IS LOCAL BUSINESS ALWAYS BETTER? The obvious answer is probably not - but there is more to it than that. Some services can be provided virtually from other parts of the country or even from other countries. Large account firms have taken to utilizing their Indian affiliates to provide such services as completing income tax returns. But where is the benefit? The benefit is not to the consumer - they will use local charge out rates to bill their clients so lets say $350 - 600 an hour. But they will pay the staff (in India) who completed the work - a pittance by comparison - local rates so perhaps $10 per hour. There are tailored clothing services that are starting to trend in Canada - how it works is that a sales guy come to your office and measures you and your colleagues up for shirts, suits, ties and so forth - the orders are sent back to Asian countries where the products are made and shipped through the local agent. Good quality clothing and at competitive prices. In the case of the accountancy firm it is a blatant money grab - profit (as they say) is not a four letter word - but is clearly not hard earned profit. The impact on the consumer market is minimal since large accountancy firms often steer away from smaller clients preferring the larger corporate entities. How about the tailored clothing service? There is good and bad news - good news for the Asian based manufacturer, good news for the consumer and good news for the supplier. Cheaper manufacturing, one middleman in the supply chain and the consumer gets a better deal passed on down. The downside is that the garment industry in Canada has all but disappeared. Jobs have gone! Harvey Woods is a fine example - a company started in 1906 in Woodstock, ON, and when the doors were closed due to a bankruptcy in 1990 about 600 locals lost their jobs. That is 600 more people with families to feed looking for work! Cheaper socks but less money in the local economy. So you negotiate a mortgage through an aggressive Ottawa firm - it is easy, they make it that way. You get independent legal advice (ILA) from a local lawyer they suggested you speak to. The documents are either faxed or downloaded. Your questions, the stuff that you can think of, are answered by phone or text. The staff are always friendly - what could be wrong with that? Nothing, necessarily. But you may have found that a local broker wold have spent a bit more time with you - perhaps even advising you against the mortgage. In some cases that is precisely why people have gone to virtual brokers to get their financing - the local guy refused to put the money out. Why? Because it was too risky for each of his clients, the lender and the borrower. And because the next time hes in the grocery store he may see you again. The same holds true in our industry - you need to see a trustee come on down to the office - you dont need to take a train to Toronto or book an appointment weeks out because the Trustee only comes to town on every second Thursday. Think global, act local!
Posted on: Tue, 24 Jun 2014 10:36:57 +0000
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