Aiming for local impact
The Devonshire Group is made up of charities and businesses in the UK and Ireland, including Chatsworth in Derbyshire, the Bolton Abbey Estate in North Yorkshire, the Lismore Estate in County Waterford, and the Compton Estate in Sussex.
The businesses include heritage attractions, shops, restaurants, and luxury accommodation. The estates include tenanted businesses and residential property, a property development business, sustainable forestry and farming businesses, and a farm shop.
Three of the Group’s ten strategic goals launched in 2019, were about making a difference to local economies:
- Help create 1,000 homes and 1,000 jobs in the local area
- Double the benefit to local economies
- Buy at least 50% of supplies and services locally
Finding a way to measure impact
To help measure and ensure it met these goals, the Devonshire Group needed to conduct an innovative economic impact assessment, and looked to our University for support.
Together, we created a Knowledge Transfer Partnership (KTP) and recruited an economics graduate, James Pickering, to work full-time on this two-year project, which ran from March 2020 to February 2022. Funding for this initiative came from Chatsworth, the Economic and Social Research Council, and Innovate UK.
Rather than being a one-off exercise, the aim was to develop a methodology and set of tools that the Devonshire Group could then use itself every year. There is no standard methodology to estimate the full economic impact of an organisation, so the team tried several approaches before deciding upon one that would work best for the Group.
Their chosen methodology considered five different impact streams:
- Direct impact: impact of their own operations
- Supplies: their spend with suppliers and suppliers' own supply chains
- Payroll: employees – expenditure on consumer goods and services
- Visitors: visitors – spillover impacts on other sectors in the economy
- Tenants: businesses – economic activity of tenants
Together, these impact streams made up the total economic impact of the organisation on the local and UK economy over three financial years: 2019/20, 2020/21 and 2021/22. The economic impact was measured in Gross Value Added (GVA) and full-time equivalent (FTE) jobs.
Key findings
National impact
The Economic Impact Assessment found that the Devonshire Group is a large employer that adds considerable value to the local and national economy. It found that:
- Total group GVA in 2021/22 was £223.7 million and 3,338 FTE jobs
- Since 2019/20, this was an increase in GVA of £27.1 million, but 41 fewer jobs.
Local impact
The group’s impact on the local economies (the areas within a 30-mile radius of the properties) was also estimated. The team found that:
- the GVA generated by Chatsworth in 2021/22 was £97.6 million — up £8.5 million from 2019/20
- Chatsworth supported 1,863 FTE jobs in 2021/22 — up 127 from 2019/20
- 44.3% of the Group’s spending was with local suppliers in 21/22. This is close to their goal of spending ‘at least 50%’ by 2029.
Impact on SMEs
We would expect that much of this economic impact supports small-to-medium-sized enterprises (SMEs), because many of the Group’s suppliers and tenant businesses are SMEs, and also because the impact of visitor spending will reach SMEs — mainly in the accommodation, hospitality and tourism sectors.
Extra analysis conducted by the team supports this assumption. They found that:
- In 2021/22, the Devonshire Group leased out commercial properties to over 100 SMEs, which supported 500 FTE jobs.
- Of the Group’s top 100 suppliers over the past three years, 72 of these were SMEs. The Group spent £29 million with these firms.
Effects of the pandemic
The report also covered the pandemic years 2020 and 2021. Data showed that the Group’s economic impact fell substantially in 2020/21, when many of its businesses had to close for a large part of the year. However, as we can see from the 2021/22 figures, the Group has rebounded strongly.
A successful partnership
This KTP has benefitted all parties and the wider community. The Devonshire Group has an accurate measure of its economic impact over the last three years, and now has a set of user-friendly tools and processes in-house to continue measuring its activities and informing its strategy. This is clearly of benefit to the local economies, because they are the focus of its strategy.
Andrew Lavery, Chief Financial Officer for the Devonshire Group said:
"The three-way partnership with the Devonshire Group, University of Derby and Innovate UK enabled us to design and implement a methodology to measure the wider impacts of our activities in a way that was rigorous, adopted best practice and that was repeatable from year to year.”
The graduate, James Pickering, says he has learnt a lot from the experience and has been able to use the work to inform a PhD he is now undertaking with the University of Derby. “The experience has been better than I expected,” he said. “I got a lot of benefits from working between the two organisations and effectively having the support of both. My career options are also a lot broader than before.”
Mel Powell, Senior Lecturer in Economics and Finance and Academic Supervisor for this KTP said:
"The successful completion of the Chatsworth KTP has enriched our experience of running knowledge transfer projects within Derby Business School and expanded and developed our existing strategic partnership with Chatsworth.
It has generated a range of benefits for the University including new research output and evidence of the impact of our knowledge transfer on regional business. It has enhanced our academic knowledge and expertise, created cutting-edge innovation for use in teaching, and will create further research through the KTP Associate who is now registered with us for a PhD."
In addition, the tourism and heritage sector will benefit from the project, when the methodology is published. It represents a new approach to conducting economic impact assessments for these types of organisations.
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