Challenges of a declining local market

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Your Finances with Stephen Maltby

Many long-term residents of Amherst have difficulty grasping the rapid changes that both demographics and technology have made on local merchants. With the Traditionalist Generation (1922-1945) now ages 68 to 91 starting to pass away or be past their prime spending years we in the local market see a declining retail and service environment. Many have a hard time to see the forest through all the trees but the reality is the world has and will change.

Consider Amherst with a population of 9,700 and 33 per cent of the population now 55 plus we see rapidly changing trends and needs. A shrinking younger population with a median average income of $20,000 (provincially $29,500) is a real threat to any sales increases for local merchants. A higher then average low income level (19 per cent Amherst versus provincially 12 per cent) means less disposable income and more reliance on social assistance.

Growth of our population of any real substance is a pipe dream, not a practical prediction. Amherst was able to grow in the 40s as it was a place of employment. Much of our existence today came from families who moved there, many Acadian families who had large families and who became major contributors to our community. Communities in the past grew and survived because of employment and opportunities. Without these we will survive but will become retirement communities that will eventually decrease in size and prosperity.

Retail stores will always follow prosperity. Politicians, businesspersons and community leaders need to realize that education and job creation go hand in hand. The great opportunities that our young people in the west will not go away. Communities need to look at ways to create jobs that provide a living at  a reasonable level. Many of the ways of survival have now changed. Gone are the mill and forestry jobs, the dairy and beef farms and some long term manufacturers. Many of our generations of entrepreneurs have cashed in and countless Provincial governments have taken significant provincial jobs away.

So what is the answer? Not a clear solution but rebuilding our communities is not much like being a Maple Leaf fan, The Stanley Cup is a few unpredictable years down the road. We need to centre our focus on building businesses that provide products that can be exported and at reasonable prices. We need to continue to provide employment training and increase our Community Education programs. The challenge in doing so is the tax dollars are stretched and committed to areas particularly health care. We will need to think outside the traditional box going forward.

For retailers, what does this mean? It means being very good at what you do and offering specialized services. Generation Y (1981-2004) will become the next generation of spenders. They are very technology savvy and would rather text and order online then drive to a mall. They are less loyal and worldlier then any previous generation. They are also so fortunate to be at a point in history, much like the 50s, where interest rates are historically low.

These are challenges we all need to consider as we evaluate where our traditional businesses are going. Over $895 billion in assets will transfer to the next generations over the next 10 years. As a businessperson one has to decide where the opportunities may be in servicing and selling to the vast richer generations ahead. 

Many years ago one of my University professors told me businesses would have to recreate and reinvent themselves every 10 years. My gifted professor was only partially right, as we need to continually evaluate how we operate our businesses on a continuous basis. 

Faith in our People, Pride in Our Products. We better start talking the talk and walking the walk.


Stephen Maltby is an Investment Adviser and Chartered Accountant with CIBC Wood Gundy. He has been in the financial services industry for more then 30 years and has held various accounting, investment and management positions with several accounting and investment firms over the years.He is in addition to his Advisor role a First Vice-President and Executive Director Atlantic Canada, CIBC Wood Gundy.


Organizations: CIBC Wood Gundy

Geographic location: Amherst, Maple Leaf

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Recent comments

  • Steve
    February 09, 2014 - 08:06

    This is an interesting article. I think one of the fundamental problems with Amherst is the local government that we the citizens have elected. They appear to be a collection of individuals who are self serving as evident with their unanimous decision to give themselves a 40%-80% salary increase a couple of years ago. The mayor and the councillors all make well over $20,000. This money would be well worth it if these individuals had the interest and/or ability to assist the local economy. I do not think they do and as a result they seem to spend most of their time debating on whether or not to tear down or renovate old buildings. They are stuck in the past and do not see the future. Fortunately there are a lot of talented and dedicated citizens in Amherst and we can only hope that some of them will step up to run for the next municipal election. More importantly though we as citizens need to make sure we vote and chose people who can guide the town forward positively.

  • Doug P
    February 07, 2014 - 14:00

    Education and job creation are too important and critical to allow the government to be involved in. With out educated business minded people the system collapses. Our schools are turning out good government workers not entrepreneurs. Prosperity leaves any place that is home to the highest tax levels in the country and high taxes is tantamount with high systemic corruption. It really isn't that difficult to understand at all. A dollar confiscated by a bureaucrat is one that can't be used to reward an entrepreneurial leader. Einstein's definition of insanity is doing the same thing over and over but expecting different results. As long as the belief that the government can save us from every ill, an almost universal religious belief, we will get poorer and poorer with less economic opportunity as a consequence. The problem is and will always be too much government at all levels chocking out the peoples economic power for its own self centered greed . The solution must very well be to rid ourselves of it's representatives meddling when ever and where ever we can. Not sing its praises to save us from what it does to us.