Customers today are confronted with a massive array of choices about where to spend their money. From online retail giants such as Amazon to national chains like Walmart and small local businesses, there are no shortage of companies competing for your dollars. And all come with benefits should you choose to give them your custom. Amazon is undeniably convenient and it is hard to resist the price cuts during its sale-events, such as this year’s four-day long Prime Day sale.
National chains may not be quite as convenient as online retailers, but the variety they have on offer in store can be hard to say no to. And because of their ability to buy items in bulk, particularly groceries, they typically represent the cheapest place to buy the essentials that your home and family need. The same can be said of chain department stores and restaurants. But there are downsides to both large online retailers and national chains.
By their very nature, online retailers and national chains are rather faceless. Indeed, in the case of online retailers they have no presence in your community other than delivery trucks and possibly a storage warehouse. Whilst chains do at least have a certain physical presence, it is one that is replicated more or less exactly in countless other establishments across the country and thus lacks anything particular to your area. But small local businesses provide your local area with the unique flavour that, well, makes it your local area. That’s something worth spending a little more time and money to maintain.
Whilst the absence of businesses offering a unique flavour to your area may be an intangible loss, there are other negatives associated with online retailers and national chains. Customer service, for example, invariably suffers at larger businesses due to, if nothing else, the sheer volume of customers such companies have to deal with. And unlike at online retailers and national chains, everyone from the owner to the most junior employee is a member of your community.
As a result, much stronger relationships can be built between customer and company at smaller local businesses, with corresponding benefits in customer service. You can therefore have greater faith in the product you are paying for and easier recourse to restitution if it fails to meet the standard that you expect. Reputation is of the utmost importance for any company, but that is especially true of a smaller, local business.
Taking advantage of local business will also benefit the wider economy in your area. Studies have repeatedly shown that spending your dollars at businesses based in your area has real benefits for the local economy. In Maine, for example, researchers from the Institute for Local Self-Reliance found that at national chains, every $100 spent generated just $14 in secondary spending in the local area. But that number jumped to $45 in local secondary spending for every $100 spent at a local business.
Studies across the United States have produced almost identical results. This demonstrates that, on average, independent retailers can be said to return more than three times as much money per dollar of sales as their chain store counterparts, whilst spending at online retailers creates almost no local economic benefits at all. So by spending your money at local businesses, you are helping to ensure that money continues to circulate in your local area. In essence, that means that every dollar you spend in a local business helps not only that company, but all the others in your area, which plays a vital role in maintaining economic vibrancy in your locality.
So what steps can you take to support local businesses? Doing all your shopping in local businesses may well be impractical for both reasons of convenience and expense. So instead, why not set aside a certain percentage to your monthly budget to spend locally. That is a pain-free way to support businesses in your local area without having to make massive, possibly unfeasible changes, to the way you shop. It also pays to take advantage of the resources that can help you find the best local businesses for your needs.
Your first stop for this should be your local Chamber of Commerce. Chambers of Commerce play a vital role in creating a stronger local economy by providing links both between different local businesses and their customers. And with National Support Your Local Chamber of Commerce Day fast approaching (October 19th), now is the perfect time to familiarise yourself with the services they offer and find out more about the different small businesses in your local area.
Small Business Saturday (November 29th) is also not far away. Supported by American Express and always on the first Saturday after Thanksgiving, Small Business Saturday presents the perfect opportunity to do some of your Christmas Shopping at local businesses, with many offering one-day only promotions. So be sure not to overlook the many benefits of shopping locally and take advantage of the chance to invest your dollars in keeping your area diverse, vibrant and in good economic health.