by Roger House, Federation of Small Business chairman, Kent and Medway region

Extensive FSB research shows 58% more of the money spent by local authorities with small firms is re-spent in the local economy compared to that spent with large businesses in the same area.

The FSB and the Centre for Local Economic Strategies surveyed local authorities across the UK and found in the last year they spent £8.7bn buying goods and services in their local area.

The findings highlight how doing business locally is better value for money, as small local firms generated £746m more for the local economy than large local businesses – even though £500m less was spent with them. The research shows for every £1 spent with a small or medium-sized business (SME) 63p was re-spent in the local area compared to 40p in every £1 spent with a larger business.

The report, Local Procurement – Making the Most of Small Businesses, One Year On, is the second on the power of local authorities and how they use local businesses in their areas for goods and services.

Kent County Council leader Paul Carter, pictured right, has often stated KCC spends huge chunks of its money with local business. Rather that than start up businesses of its own but partnership with the small local enterprises would be better.

Another Kent leader, Cllr Peter Fleming from my patch Sevenoaks, who is also chairman of the LGA Improvement and Innovation Board, speaks strongly on the subject. He says: “Councils have a vital role to play in driving growth and at the heart of this they are ensuring they themselves are open for business, in particular working with SMEs and local suppliers.”

Business Secretary Vince Cable says of the FSB research: “This report shows what I have known for a long time – more of our small and medium sized companies must get a fair share of public contracts.”

I end with a snippet on cybercrime. It would appear criminals can now rent DDoS (distributed denial-of-service) attacks for under £31.50 an hour from a growing online marketplace. Until recently the only people who we had to worry about were the skilled hackers but no longer. You can it seems buy all the tools you need online and cybercrime is no longer the preserve of the “tech savvy”. One more thing for we business owners to take on board, but one we really must face.