THE SMALL BUSINESS PERSPECTIVE

What is it that makes communities prosper? Small business. Small is beautiful. Once people get their own private businesses up and running, they pass on benefits (jobs and incomeIncome: money one earns by working or by capitalizing from other people's work.) to other community members. As a result, communities don't depend so heavily on government transfer payments or the success of a big corporationCorporation: the most common form of business organization. It pursues set objectives and is empowered with legal rights usually only reserved for individuals, such as to sue and be sued, own property, hire employees, or loan and borrow money..

Small is seldom seen as beautiful in the mining industry. Finding a big, rich lode is the dream of the prospector, the mining geologist, the juniorJunior Company: a mining company that has no mining operations. It must rely almost entirely on the capital markets to finance its exploration activities. exploration companiesExploration Company: a company whose principal activity is that of exploration., and mine developers and their investors. Moreover, with dozens or hundreds of employees and machines to feed, house, maintain, and transport, mines have big needs to meet.

To meet these needs, the mining industry prefers to hire a few big businesses with plenty of equipment, staff, and experience. For example, contracts for haulage of mining products are often awarded to large trucking companies. One- or two-person businesses find it difficult to compete for such large, complex contracts.

Sometimes communities negotiate agreements that break down big contracts to a size and scale appropriate to Aboriginal businesses. Alternatively, communities negotiate terms that allow them to pair up their businesses (“Joint VentureJoint Venture: commonly, a business to which two or more parties contribute the essential land, capital, and services, in return for a share in its ownership and control. (Note: the Joint Venture is very strictly defined under Canadian law.)”) with larger, more experienced companies.

The problem with the Small Business Perspective is its assumption that any small business will thrive so long as its owner is energetic and clever. Actually, small business are like fish. They swim in a friendly, supportive environment of customers, suppliers, credit, and investmentInvestment: the purchase of a financial product or other item of value with an expectation of favourable future returns. Generally, “investment” means the deliberate use of money in order to make more money. capitalCapital: cash, property, equipment, services, and contracts or leases.. Without such necessities, they go belly up.

Aboriginal communities have to keep that in mind, if they think a few entrepreneurs are all that’s required to capture real benefits from a mine. Local entrepreneurs can’t go it alone. If a mining company refuses to unbundle contracts or to encourage Aboriginal joint venturesJoint Venture: commonly, a business to which two or more parties contribute the essential land, capital, and services, in return for a share in its ownership and control. (Note: the Joint Venture is very strictly defined under Canadian law.), those entrepreneurs won’t even get in the door.