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WELLINGTON COUNTY MANUFACTURING SECTOR: ROOM TO GROW

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/ Wellington County offers manufacturers:

o cost-effective, ready land o a deep, skilled labour pool o easy access to major transportation corridors o a low cost of doing business o a growing, historically strong manufacturing sector o high quality of life for employees Keep reading to learn the Wellington County story.

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Wellington County is fortunate to be located in the centre of southwestern Ontario between the Greater TorontoHamilton Area (GTHA) and Waterloo Region.

Along with its broad swaths of picturesque countryside, the County includes the historical, vibrant population centres of:

m Elora m Erin m Fergus m Rockwood m Palmerston m Hillsburgh

m Mount Forest m Harriston m Arthur m Drayton m Aberfolye

In addition, Wellington County surrounds and interacts with Guelph—a city of more than 120,000 people—and is adjacent to other economic centres such as Kitchener-Waterloo, Orangeville and the western Greater TorontoHamilton Area (GTHA), areas of manufacturing activity and innovation.

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Only 1.5 hours from the U.S. border with access to 50 million people within a one day’s drive, Wellington County is part of the broad, rapidly-expanding economic region known as the Greater Golden Horseshoe (GGH). The total population of the GGH is 8.8 million—over one-quarter of Canada’s total population. Compared to major U.S. mega-regions, the GGH would rank fifth behind (1) New York, (2) Los Angeles/Long Beach, (3) Chicago and (4) Washington/Baltimore.

Rockwood Conservation Area

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Market Overview Wellington County’s economic performance since the 2008 – 2009 downturn has been one of the strongest in southern Ontario, and is set to continue. In a survey of 300 County businesses for Wellington’s Business Retention and Expansion Project, 43% reported that they expect to expand in the following 18 months.

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Manufacturers have been able to thrive in Wellington County because of its affordable cost structure, experienced labor pool and easy access to markets. Several firms have recently undertaken notable expansions—a vote of confidence by these companies in the County and the quality of its workforce.

Manufacturing is the County’s largest sector, accounting for 17% of the jobs in Wellington County, employing more than 7,200 people.

Manufacturing’s growth rate in the County—15% over the past five years—compares favourably to a 2% decrease in the sector for Ontario overall during that period.

Many of the County’s commercially successful ventures are a result of local entrepreneurship and remain family-owned. However, foreign investment from the U.S., Japan and France also makes an important contribution. Recent and current expansions in the County by foreign-affiliated companies are a reflection of the positive experience of these existing players.

Quality Homes

Foreign manufacturing investment in Wellington County includes: m Dana Long (U.S., automotive parts) m R. R. Donnelly (U.S., business forms) m The Gund Company (U.S., electrical insulation) m Jefferson Elora (Japan, automotive parts) m TG Minto (Japan, automotive parts) m Musashi (Japan, automotive parts) m Nestlé (Swiss, beverages) m Nexans (France, electrical wire and cable) m Parker Nexgen (U.S., thermoplastic tubing) m Royal Canin (France, pet food)

Maple Leaf Foods recently invested in a new 282,000 sq ft distribution facility in Wellington County serving central and eastern Canada.

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z , Why is

Wellington County

a desirable location for manufacturers?

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Affordable, shovel-ready sites

Wellington County offers companies a variety of costeffective, employment lands conveniently located close to larger urban centres. This land is often able to meet significant water and wastewater demands.

For manufacturers, the availability of these shovel-ready Wellington County sites—at a far lower cost than in urban areas such as the Greater Toronto Hamilton Area—is an attractive opportunity. Manufacturing firms in the neighbouring urban areas, in other areas of Canada and from other countries can all find an ideal place for expansion or relocation in Wellington County.

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Available talent for manufacturing operations Labour-flow data shows that in several key manufacturing subsectors, there is a net outflow of County residents, notably in automotive parts and meat processing. Manufacturers locating in Wellington County can access this sizable number of workers who live in the County but commute to Guelph and the neighbouring Waterloo and Halton Regions—or even the GTHA.

Government-supported apprenticeship programmes ensure that manufacturing companies in Wellington County fill labour needs.

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Manufacturing companies in Wellington County fill labour needs with graduates of numerous Ontario colleges, including Conestoga College’s Guelph and Kitchener campuses. Conestoga is an important supplier of talent to Wellington County’s manufacturers, with an enrollment of 11,000 full-time students, 30,000 part-time students and 3,300 apprenticeship students.

johnston hall – university of guelph

Manufacturers also have ready access to highly qualified, sought-after graduates for positions in management, research and development, engineering, information technology, etc. due to the County’s proximity to numerous outstanding universities. Manufacturers can forge co-op and research relationships that make the company known to students before they graduate, also giving the company a chance to assess students’ capabilities directly.

The University of Guelph and the University of Waterloo have more than 50,000 students including 8,000 graduate students. The prestigious university is an innovation leader in a host of fields relevant to manufacturing.

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a A considerable number of other highly regarded post secondary institutions in the Greater Golden Horseshoe feed the available labor force, including: mThe University of Toronto mMcMaster University

mThe University of Waterloo mRyerson University mYork University

mWilfrid Laurier University mBrock University

mGeorgian College

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WELLINGTON COUNTY MANUFACTURING SECTOR: ROOM TO GROW

mHumber College

mConestoga College

Proximity fosters and facilitates research partnerships that support a company’s innovation agenda and research and development activities. These partnerships attract federal and provincial funding, adding to the costeffectiveness of undertaking research and development.

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Easy Access to Local and International Transportation

Manufacturing operations in Wellington County enjoy an array of transportation and shipping options that provide ready access to local, North American and global destinations— lowering supply chain costs and facilitating business travel.

The County is an hour’s drive from Toronto Pearson International Airport, Canada’s principal airport and a top North American gateway, serving more than 100,000 passengers a day on 1,200 flights to over 30 Canadian cities, 87 U.S. cities and 30 international destinations. The Region of Waterloo International Airport—which is also one of Canada’s busiest airports—is even closer than Pearson.

The County also offers quick entry to the United States market via border crossings in Buffalo Niagara and between Michigan and Ontario. Over 150 million North American consumers are within one day’s drive.

The Guelph Junction Railway provides strategically important short-line freight connections to both national railways, CN Rail and CP Rail. The County also enjoys proximity to Great Lakes shipping ports in Hamilton and Toronto and convenient year-round access by rail to ports such as Halifax and Montreal.

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Favourable Business Environment

According to KPMG Competitive Alternatives 2014 Edition, the Toronto region’s average costs of doing business across a range of sectors are lower than all 31 counterpart U.S. cities having a population of 2 million or more.

Wellington County’s location in business-friendly Ontario provides many costsaving advantages to manufacturing companies, including: Low statutory and effective corporate tax rates. m Ontario’s statutory corporate tax rates are markedly lower than U.S. states and compare very favourably with the principal overseas counterparts. The combined Federal-Ontario tax rate of 25.6% is more than 12 percentage points below the U.S. average tax rate. Measuring by average effective rates, Canadian corporate tax rates are 46.4% below the U.S. average.

Highly beneficial research and development tax incentives. m Ontario’s research and development tax incentives, combined with those offered by the federal government, can reduce the after-tax cost of every $100 spent on research and development to $37 – $61.

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Government funding programmes that support business Investing in Business m ”Investing in Business Growth and Productivity” focuses on established businesses that have the potential to be global players with innovative and unique opportunities to accelerate growth and support job creation. This initiative supports economic growth and job creation by helping businesses expand their markets and facilities, adopt new technologies and processes to improve productivity and increase business capacity to participate in global markets and integrate into global value chains.

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Wellington County’s dynamic manufacturing sector has deep roots, with notable strengths in automotive parts, plastics, food and beverage processing and animal feed.

Opportunities in those industries continue to exist for manufacturing companies.

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Industry Opportunities

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Automotive Parts

The automotive-parts manufacturers located in the County fared very well amid the downturn in the automotive sector associated with the 2008-2009 recession, and they are aggressively growing their presence in the County. Job growth in the County’s automotive-parts subsector over the past five years was 56%—reflecting multiple expansions that have occurred at the principal plants, in large part due to the County’s availability of qualified labour, low cost of doing business and affordable land.

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Automotive parts has emerged as the most prevalent type of manufacturing operation in Wellington County, which is geographically well-positioned in terms of supply chains for Honda, Toyota, Ford and Chrysler automobile manufacturing facilities in nearby Brampton. The automotive-parts labour force in the County and Guelph combined is more than 10,000 people.

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The Canadian automotive-parts sector as a whole—comprised of approximately 400 firms with close to 1,000 establishments—is singularly concentrated in Ontario, especially in the south central and southwestern parts of the province.

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/ / With a concentration of automotive-parts manufacturers, Wellington County is particularly well-suited to plastics manufacturers that serve the automotive sector, which accounts for about 14% of the plastic industry’s output.

Similarly, the County’s significant agricultural industry makes it a strategic location for plastics manufacturers that serve that sector.

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plastics

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The plastics industry is relatively capital-intensive and synthetic resin represents the most significant input, with resin costs typically accounting for 30%-50% of the final value of the product.

Plastics firms located in Wellington County benefit from being able to access the Polymer Distribution Inc. (PDI) bulk handling facility for resins on the Guelph Junction Railway—a facility that allows for mixing, as well as efficient rail-to-truck transfers.

Another plus for plastic manufacturers in the County is the research and development at the University of Guelph’s Bioproducts Discovery and Development Centre, which is on the leading edge of the development of biocomposites as substitutes for petroleum-based plastics.

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Food & Beverage Processing

Wellington County’s availability of large plots of shovel-ready land with sufficient water/wastewater capacity makes it an attractive location for expansion or relocation of beef, poultry, pork and sheep production, which are already well-established in the County.

The County is also well-positioned for food and beverage processing because the region is home to the largest concentration of expertise and infrastructure dedicated to food research and development in Canada and among the most notable in the Americas.

In addition to the University of Guelph’s numerous facilities and research programmes devoted to agribusiness, the university provides more life-science expertise per capita than any other post-secondary institution in North America.

Also notable is Conestoga College’s Institute of Food Processing Technology, which focuses on developing a skilled workforce tailored to the needs of the food and beverage manufacturing sector.

In the beverage industry, the County offers an attractive opportunity to craft brewers and distillers. The popularity of craft breweries continues to grow, with the number of licensed breweries in Canada rising 50% in the past five years. Wellington County is an appealing location for these breweries because of the quality of locally grown barley and its proximity to the University of Guelph, which has played a prominent role in the development of high-quality malting barley for over a century. In addition, an important craft brewing industry supplier, Gilbertson and Page (Canada) Inc., is based in Fergus.

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Animal Feed

Wellington County occupies a strong relative position in animal food manufacturing among Ontario jurisdictions. Due to the County’s strong agricultural base and its cost-effectiveness for manufacturing operations, it is an ideal location for animal feed production, including pet food.

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High quality of life with rural charm and urban amenities Wellington County residents enjoy: m a small-town atmosphere m culturally rich communities m urban amenities within the County m an affordable cost of living m plentiful natural amenities and recreational opportunities m bountiful local farmers’ markets m unique heritage architecture

This attractive lifestyle helps companies in all industries, including manufacturing, attract top talent and retain employees.

A unique characteristic of the County that many people find immensely appealing is that it’s “horse country”. Wellington County consistently ranks as the Ontario municipal jurisdiction that is home to the most horses, and the County’s equine industry is large and diverse, comprised of a broad range of sporting, recreational and breeding interests. People who love horses find Wellington County to be a location that can’t be beat, and even those who aren’t horse aficionados enjoy the excitement and diverse group of successful people the industry brings to the County.

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Meanwhile, major urban centres are as close as Guelph or Waterloo, and people who live in the County readily enjoy the cultural landscape of the entire Greater Golden Horseshoe, which includes world-class universities, museums, parks, restaurants, shops and venues for professional sports, art, theatre, opera, dance, and film.

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Rockwood Conservat ion Area

Economic Development County Of Wellington 74 Woolwich St, Guelph, Ontario, Canada N1H 3T9 T 519.837.2600 x 2614 F 519.837.1909 E ecdev@wellington.ca Visit us online wellington.ca/business