Cooks Ferry BandNooaitch BandSiska BandColdwater Band 9086 Investments Ltd BC Ltd BC Ltd. Skw’akw’iyap Economic Development Corp. 100 % 9110 Investments Ltd. (Bare Trustee) DBA – Esh-kn-am Investments Joint Venture Cultural Resources Management Services Department 25 % Creative Native Designs Joint Venture Eagles Nest Log Homes Joint Venture Qwa’eet Forest Products Ltd. Partnership Donald Ursaki 50 % 60 % Eagles Nest Log Industries Ltd. 40 % Aspen Planners Ltd. Limited Partner 49.95% Aspen Planners Ltd. Limited Partner 49.95% 50 % 9110 Investments Ltd. Limited Partner 49.95% 9110 Investments Ltd. Limited Partner 49.95% Qwa’eet Operating Company Ltd. General Partner Qwa’eet Operating Company Ltd. General Partner 100 % 0.01 %

Esh-Kn-Am Investments Joint Venture Cluster Strategy-Draft Version July 2008

 Clusters are geographic concentrations of interconnected companies, specialized suppliers, service providers, and associated institutions in a particular field that are present in a nation or region.  Clusters arise because they increase the capacity, economies of scale. (Local Access to Human Capital (which includes TEK) & Non- Timber Forest Resources)  The development and upgrading of clusters is an important agenda for governments, companies, and other institutions. Cluster development initiatives are an important new direction in economic policy, building on earlier efforts in macroeconomic stabilization, privatization, market opening, and reducing the costs of doing business. What is a Cluster? Source: Institute for Strategy and Competitiveness

Reduce Poverty Create Jobs and Wealth Focus on Deficiencies and Social Needs Focus on Competitive Advantage and Investment Economic Space: Neighborhood Economic Space: Neighborhood Economic Space: Region Economic Space: Region Lead: Government Lead: Government Lead: Private Sector Lead: Private Sector Old Model New Model New Approach to Economic Development Source: Institute for Strategy and Competitiveness

Shifting Responsibilities for Economic Development Old Model Government drives economic development through policy decisions and incentives New Model Economic development is a collaborative process involving government at multiple levels, companies, teaching and research institutions, and institutions for collaboration Source: Institute for Strategy and Competitiveness

Clusters and Competitiveness Non-Timber Forest Resources Educational, Research, (e.g. UBC, Royal Roads Bands, CRMS & Trade Organizations (future state) Educational, Research, (e.g. UBC, Royal Roads Bands, CRMS & Trade Organizations (future state) Forest/ Managed Resources/ Growers Forest/ Managed Resources/ Growers Processing Facilities Processing Facilities Jars/lids/labels IT Packaging Berries Soaps Jams Salve Teas Ointments Website Specialized Publications, T.E.K. (e.g.STS) Food Cluster (e.g., Smoking/Drying/Freezing) Tourism Cluster Certified Harvesters Cluster Certified Harvesters Cluster Siska Traditions Society; Bands; Government Agencies; NGOs (i.e CFDC); NTFP IAC; Health Canada; Ministry Forest and Range Sugar/Pectin Raw Materials from Land Raw Materials from Land Transportation/ Distribution Transportation/ Distribution

CustomersCustomers CompetitorsCompetitors Related and Supporting Industries Advantages: - Proximity to sophisticated markets (Kamloops, Okanagan Region and Vancouver) -Distribution Opportunities (Brenda) -Near tourism market (highway) -Portability of products Disadvantages: -lack/limited of local customer base -Will not be geared to towards mass market (all segments of customer base). -too much product choice -product available of where largest customers are located. Advantages - FN brand recognition (leadership) -Sustainable harvesting -location Disadvantages -access to capital -access to infrastructure -lack of coordination among firms Advantages –Potential Workforce Availability (Young population) –Leader in FN NTFR –Strong Leadership –Joint-Venture Partnership –Logistical advantage –Inexpensive land cost –Access to natural resources Disadvantages –Limited infrastructure –Information infrastructure –Limited technological infrastructure –Lack of property rights to manage other access to natural resources InputInput Non-Timber Forest Resources Business Environment Advantages: - Presence of two businesses to support STS. -Presence of FN outlets: Presence of tourism Anchors; linkage to Hotel Cluster (Renaissance) Disadvantages -Low density limits ability to develop local specialized suppliers and service firms -Access to natural resources; certified pickers -Shortage of trades (potential suppliers)

Clusters and Competitiveness Value-Added Wood Educational, Research, (e.g. BC Wood, Bands, FPInnovations & Trade Organizations (Mike to Add) Educational, Research, (e.g. BC Wood, Bands, FPInnovations & Trade Organizations (Mike to Add) Limited Skilled Labour Limited Skilled Labour Processing Facilities Processing Facilities Handtools IT Packaging Plastic/Metals/Birdseeds Bird Feeder/Houses Suet Feeders Packaging Bat House Cedar Planks (potential) E-commerce Secondary Products (Potential) Secondary Products (Potential) Forestry Cluster Tourism Cluster Non-Timber Forest Cluster Non-Timber Forest Cluster Government Agencies; NGOs (i.e CFDC); Packaging Industry; Bands Powertools Raw Materials From suppliers Raw Materials From suppliers

CustomersCustomers CompetitorsCompetitors Related and Supporting Industries Advantages: - Proximity to sophisticated national/international markets -Distribution Opportunities (Brenda) -Near tourism market (highway) Disadvantages: -lack/limited of local customer base -Will not be geared to towards mass market (will only focus on customers w/houses). -too much product choice -Will not be geared towards economical customers. Advantages - FN brand recognition (leadership) -Chain of certification -sophisticated product/aesthetic/creative Disadvantages -limited access to capital -high logistical/storage costs Advantages: –Potential Workforce Availability (Young population) –Strong Leadership –Joint-Venture Partnership –Logistical advantage (Highways, rail) –Inexpensive land cost –Access to raw materials –Access to facilities (production) Disadvantages: –Limited infrastructure –Information infrastructure –Limited equipment/tools –High cost of inputs –Distance to market InputInput Value-Added Wood Business Environment Advantages: - Presence of existing business to support CND. -Presence of tourism Anchors; Disadvantages -Low density limits ability to develop local specialized suppliers and service firms -Limited transportation suppliers -No retail / distribution partners

Clusters and Competitiveness Cultural Resources Management Services Educational Institutions & Trade Organizations (IT, Cultural Modeling, Archeological) Educational Institutions & Trade Organizations (IT, Cultural Modeling, Archeological) Database (to make Informed Decisions) Database (to make Informed Decisions) Project Team Project Team IT (Hardware & Software) IT (Hardware & Software) Proposals/Marketing Potential impact analysis Potential impact analysis Economic Development Reports Maps Training (incubator) Co-management/ Co-stewardship Co-management/ Co-stewardship Impact & Accommodation Agreement Website Land development Cluster Land development Cluster Natural Resource Cluster Natural Resource Cluster First Nation Consultation Cluster First Nation Consultation Cluster Investors (Four bands); Bands; Federal and Provincial government; municipal government; Industry standard Human Capital Office infrastructure Data (e.g Advisor information) Associated Businesses Cluster Associated Businesses Cluster

CustomersCustomers CompetitorsCompetitors Related and Supporting Industries Advantages: - Good relationships with customers -Linked with other bands (good referrals) -Excellent customer satisfaction (e.g BC Hydro) -Can engage any indigenous group nationally and internationally. Disadvantages: -unwilling customers due to legislative requirements. - time limited contracts -Political changes Advantages - FN brand recognition -Access to one-of-kind technology -Network of associations; Bands -Partnerships with Gov’ts -Strong project team Disadvantages -access to capital -access to infrastructure -political interference -new entrant (i.e strategic plan) Advantages –Potential Workforce Availability (Young population) –Leader in CRMS –Strong Leadership –Joint-Venture Partnership –Extensive experience/ strong technical knowledge –Synergies of input –Access to data (pending) –Trust Disadvantages –Limited infrastructure –Lack of sustainable funding –Lack of consistency in referrals –Staff turnover –Capacity to meet increased demand InputInput Cultural Resources Management Services Business Environment Advantages: -Access to web-based land management /referral tool (CoNect). Disadvantages -Lack of substitute for critical supplier.

Clusters and Competitiveness Information Technology Educational Institutions, Trade Organizations Educational Institutions, Trade Organizations Skilled Labour/ Training facility Skilled Labour/ Training facility Esh-Kn-Am Software/Hardware Servers Network Administration tools Telecom Consulting Services/Training Hosting Capacity building Customer Services Infrastructure installation Infrastructure installation Marketing CRMS Cluster CRMS Cluster Government Agencies; IT Industry; NGOs; Bands Trainers Curriculum Database administrators Curriculum

CustomersCustomers CompetitorsCompetitors Related and Supporting Industries Advantages: -First Nations: presents strong market -Untapped market -FN community more prone to contract with FN service provider. -FN communities more attracted to customized solutions, Disadvantages: -lack/limited of local customer base -Will not be geared to towards mass market (all segments of customer base). -too much product choice -IT budgets for FN Bands maybe limited Advantages - FN brand recognition -Holistic approach to FN. -Limited competition -Unique service; value-added solutions; bundled services -Cost of service Disadvantages -access to capital -access to infrastructure -lack of staff -new entrant Advantages –Potential Workforce Availability (Young population) –Vision for the cluster –Joint-Venture Partnership –Access to network of industry professionals. –Blueprint IT strategy; can be replicated for any nation/band. Disadvantages –Limited infrastructure –Information infrastructure –Limited technological infrastructure –Limited skilled professionals –No training facility InputInput Information Technology Business Environment Advantages: -Relationship with unique supplier (I.e CoNect). -Associated with IT suppliers (i.e Microsoft) Disadvantages -need to develop more established relationships with Suppliers.

Clusters and Competitiveness Bio-Fuels Production Educational, Research, (e.g. UBC, Royal Roads) Bands, Trade Organizations Educational, Research, (e.g. UBC, Royal Roads) Bands, Trade Organizations Forest/Agriculture Resources Forest/Agriculture Resources Processing Facilities Processing Facilities Human Capital IT Research Market Research Ethanol Wood Pellets Logs Heat/Energy/Electricity Website Forestry Cluster Forestry Cluster Petroleum Cluster Petroleum Cluster Energy Cluster Energy Cluster Bands; Government Agencies; NGOs (i.e CFDC); NTFP; Ministry Forest and Range;Ministry of Agriculture and Lands; Agriculture Canada; Ministry of EMPR; Machinery/Chipper Raw Materials from Land Raw Materials from Land Transportation/ Distribution Transportation/ Distribution

CustomersCustomers CompetitorsCompetitors Related and Supporting Industries Advantages: - Proximity to markets (Kamloops, Okanagan Region and Vancouver) -Established markets; market demand for product -Distribution Opportunities (Brenda) -Near tourism market (highway) -Portability of products Disadvantages: -lack/limited of local customer Base -will not be geared to towards mass market (all segments of customer base). -access to adequate biomass to meet customer demand Advantages - FN brand recognition -Already completed feasibility study -Sustainable harvesting -Location Disadvantages -access to capital -access to infrastructure -distance between raw material and processing facility Advantages –Potential Workforce Availability (Young population) –Strong Leadership –Joint-Venture Partnership –Logistical advantage –Inexpensive land cost –Potential access to biomass Disadvantages –Limited infrastructure –High cost to produce –Limited technological infrastructure –Lack of machinery –Limited trained workforce InputInput Bio-Fuels Production Business Environment Advantages: -Potential partnership with other bands/industries to increase supply of biomass Disadvantages -Low density limits ability to develop local specialized suppliers and service firms -Access to natural resources; -Shortage of trained workers

Influences on Competitiveness Multiple Geographic Levels Broad Economic Areas Groups of Neighboring Nations Regions Nations Rural Communities Source: Institute for Strategy and Competitiveness

Generic Project Timeline Form a leadership committee consisting of reputable private and public sector leaders Build relationships within the business, academic and communities to act as project advisors Organize Project Leadership (Ongoing) Prioritize and Identify Target Clusters (Stage 1) Develop Cluster Action Plans (Stage 2) Identify and secure cluster team leadership Select business environment issues Form cluster action and business environment teams Develop action plans and success measures Launch and Implement Action Plans (Stage 3) Establish an organization structure to drive implementation Disseminate strategy report and wide-spread communications Measure and communicate progress Identify new opportunities Conduct in-depth cluster analysis and demographic profile Analyze current and past research reports and projects Prioritize and select target clusters Continuous Process

Proposed Project Workflow 1. Select Cluster 2. Form Action Team 2. Form Action Team 3. Identify Opportunities 3. Identify Opportunities 4. Create Action Plan 4. Create Action Plan 5. Implement  Select clusters based on various criteria decided by the Leadership Committee  Identify strong cluster chairs who are leaders in the cluster  Build a diverse private sector led team  Ensure team size is manageable  Identify and prioritize actions to strengthen cluster, improve business environment and increase productivity  Develop a short and long term action plan to implement the team’s recommendations  Establish success measures  Identify and assign resources to implement the action plan  Executive Committee monitors and communicates the team’s progress

Competitive Advantages of the Esh-Kn-Am Strategic location  Located near regional transportation and infrastructure nodes Near Regional Markets  In close proximity to near by urban centres such as Kelowna and Kamploops. Underutilized Workforce  Large pool of available workers Linkage to industrial/ regional clusters Support of growth clusters such as tourism, transportation and alternative energy