Last week, the City of Phoenix unanimously voted to approve a contract with Wist Office Products, a locally-owned office supply company based in Tempe, Arizona. This new partnership is great news for Arizona as it will keep dollars circulating in the local regional economy and create jobs.
In a statement, Phoenix Councilman Bill Gates applauded the new contract with Wist Office Products. "This contract will save the city $320,000 per year and will keep more taxpayer dollars in Arizona, supporting the local economy," said Councilman Gates. "Congratulations to Wist on the contract award and to the city for finding additional savings that can be used for essential city services like police, fire, parks and libraries.”
In an email, Ian Wist, owner of Wist Office Products, mentioned that because of the contract with the City of Phoenix, Wist has created two new positions at their company. These are high quality jobs that are fully benefited as well. It goes to show that when cities work to keep procurement dollars in the local economy, they are directly responsible for creating jobs.
Local First Arizona applauds any efforts of local governments to keep their dollars in the local economy! Studies have shown that when awarding government agency procurement contracts, local suppliers and businesses generate dramatically greater local economic activity than their chain competitors.
The 2007 study by Civic Economics Procurement Matters: The Economic Impact of Local Suppliers analyzed the economic impact of a procurement contract made with an Arizona-based independent office supplier (Wist Office Products), a chain office supplier with a local presence (Office Max), and a chain office supplier with no local presence (Staples):
“For example, assume a single government entity in the State of Arizona purchases $5 million worth of widgets each year. If that contract were made through Office Max Contract, only $580,000 would remain in the state of Arizona at the end of the year. If the same contract were made through Wist or a similarly situated local supplier, an additional $1 million would find its way to the people of Arizona. Finally, by contrast, were that contract made through Staples, only nominal amounts would remain in state... In the case at hand, using the most locally invested of the national chain suppliers, one with a sizable physical presence in the Phoenix area, the local firm generates nearly three times the economic impact.”
The City of Phoenix has been quick to understand the benefits of keeping procurement dollars in the local economy. In 2012, the City of Phoenix adopted a Buy Local policy where for goods and services costing less than $50,000, Phoenix must first offer the contract or job to a company based in Maricopa County or Arizona before offering the work to an out-of-state company. This new policy resulted redirecting millions of taxpayer dollars back into the local economy, creating jobs and supporting vibrant local communities.
The benefits are clear: when cities and states direct their procurement dollars to local businesses, local economies thrive. Read more about the benefits of supporting local businesses.