What is it? Local officials and economic development entities often work with a region’s largest employers. However, small to mid-sized businesses comprise a larger share of the economic base in many localities and their size is not always indicative of their importance and impact in the local community. Community-based retention and expansion efforts that include a focus on small to mid-sized establishments are on the rise. Retaining and expanding existing businesses is a critical part of regional economic development. Programs consist of strengthening relationships, conducting research, and identifying strategies. In many cases, simple conversations between local leaders and business owners serve to open new communication links and can help businesses feel more comfortable in the community. Retention and expansion initiatives identify potential barriers to growth as well as opportunities to better support existing community enterprises.
How has it been used? Littleton, Colorado officials are known for founding the “economic gardening” approach to development. The city decided to shift its economic development efforts away from industry attraction and towards developing its economy from within. This has meant an increased focus on retaining and assisting “second stage” companies. These were businesses identified based on their potential for growth. The approach took years of work to establish and refine, by offering businesses networking opportunities, data tools, learning experiences, and other tactics to help them take the next step in their business lifecycle. The system hasd had dramatic success in doubling the local job base, while hundreds of other communities around the country have adopted their own “economic gardening” approach. (Source: Littleton, Colorado)