(We will update this 2015 commentary template for the holiday season in October of 2017)
For years now, it seems corporate chains and online giants have garnered an ever-greater share of our holiday spending. Not only has more of our retail economy consolidated into fewer hands, but many communities have struggled as local stores are displaced, along with many other local entrepreneurs whose clientele consists largely of other local businesses.
But some evidence suggests healthy winds of change in the winter air. In a survey (pdf) of more than 3000 independent business owners published earlier this year by the Institute for Local Self-Reliance, respondents reported revenue growth of 8.1% on average. The survey also showed a powerful correlation between sustained “buy independent/buy local” campaigns and the success of local businesses. Independent businesses in communities with grassroots business alliances consistently promoting the benefits of buying locally reported an average revenue increase of 9.3%, compared to 4.9% growth among independents in communities without such alliances.
Even some business sectors written off as unable to compete in the age of online retailing have shown resilience. Independent booksellers, for example, not only stabilized, they’re growing in number again. And despite the media’s willingness to tout Amazon’s “Cyber Monday” as a thing, online sales — though growing — comprise just 7% of retail sales as of the first quarter of 2015. Apparently most people still prefer doing business with other humans, rather than their keyboards.
Combined with the recent rise of nationwide campaigns like Small Business Saturday (which seemed to grow substantially this year) and Shift Your Shopping, awareness about the many benefits of choosing local and independent is accelerating.
While some of those benefits appear altruistic, the Localization Movement is gaining momentum largely because citizens are recognizing our long-term self interest involves building more self-reliant and vibrant communities from within. And those who choose to shift more of their shopping locally often report pleasant surprises from their choice.
Equally important, more people are recognizing a big distinction between cheapness and value. Admittedly, the big box stores and online giants usually can win a battle based on cheapness alone (though perceived differences in price far exceed reality). But that cheap table or coffee maker quickly ceases to be a “bargain” when it breaks down prematurely.
As craftsmanship has devolved from an everyday value to rarity, we’ve learned low prices at the expense of reliability and durability are no bargain at all.
None of this means we need to swear off ever shopping online or at a chain store visit, but we should look for ways to integrate widely-held values into our purchasing decisions. If even one of four people shift at least one more shopping trip to independent community-based businesses this season, it would create dramatic, positive changes in our local economies and induce many new jobs nationwide.
This is partly because your local businesses help employ many more people than you’ll see on the sales floor. They’re more likely to bank and source locally, while employing local outside providers like accountants, graphic designers, sign-makers, webmasters, suppliers and many other high-skilled positions. When sales shift from locals to chains, some of these local jobs also disappear.
Since a new chain store or restaurant typically is a clone of other units, it eliminates the need for most local planning and typically uses a minimum of local goods and services. That’s simply good, efficient business for them, but not so for the host community.
Similarly, local non-profit organizations depend largely on the contributions of local businesses who, in turn, depend on our patronage. If we value local business support for our kids’ sports teams or our favorite charities, we must recognize they literally can’t do it without us.
Those factors, added to local owners re-spending much of their profit within the community, equal a big economic impact. On average, more than three times as much of each dollar spent at local independent store recirculates in your local economy compared to a dollar spent at chain-owned businesses. With restaurants, independents re-spend about twice as much locally as chains do. Capitalizing on this local multiplier effect is key to creating jobs and wealth in your own community.
The long-term relationships fostered by local business also cement commitment to civic institutions like schools, churches, and fraternal leagues that aid not just economic prosperity, but community cohesion and trust.
So do yourself — and your community — a favor this year by shifting a bit more spending to your local merchants, service providers, artisans and others. Along with helping your neighbors and community, you may just find “going local” turns holiday shopping into a far more relaxing and enjoyable experience: one that rewards both you and your community.
Jeff Milchen co-directs the American Independent Business Alliance (AMIBA) and authored “Building Buy Local Campaigns that Shift Culture and Spending,” which is recently revised and available free upon request (pdf) in both English and Spanish.
Top Reasons to Buy Local, Eat Local, Go Local (with sources and graphics for each).