Small Businesses in the Inland Empire: The Importance of Buying Local

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Small Businesses in the Inland Empire: The Importance of Buying Local

By: Economic Development Agency Staff
The Importance of Buying Local

You see them everywhere: Perhaps a sign in the window of a local business, a bumper sticker on a car or even a blurb at the bottom of a receipt urging patrons to buy local. “Buy Local” is a great buzz phrase, but does it mean anything?  Emphatically: Yes. In fact, it means everything – not only to the individual businesses, but also to the community where they’re located and to the residents who live there. Consumer support of local businesses may make or break a business’s chances of survival, despite the proliferation of e-commerce and international business concerns. Some call it “community boosterism,” and while some belittle its importance, buying local truly supports the entire community.

The Mystique and Reality of Buying Local

Truth be told, people have traded far and wide for millennia. Furthermore, many of us would be ill, unhappy or no longer of this green Earth were it not for products sourced from distant locations. In the real world, “buy local” is about purchasing products and services that are sourced locally, or at least sold by a locally based merchant, whenever possible. 

The local movement has a broad range of support. The United States Small Business Administration held National Small Business Week in May 2014, with events across the U.S. to draw attention to and support entrepreneurship and business startups, plus the naming of a National Small Business Person of the Year. 

Many “buy local” campaigns center on supporting local farmers and purchasing foods produced and sourced locally. It’s a good concept for many reasons, including:

  • Locally grown food gets to the table more quickly, which means it’s fresher, tastes better, has higher overall nutrition and less chance of contamination due to over handling and processing.
  • Locally grown food helps environmental preservation by promoting diversification of heirloom seed strains and better soil health, preserving open spaces and even cutting down on the carbon footprint of transporting food long distances.
  • Buying local gives economic support to local residents and family businesses.   

The American Independent Business Alliance (AMIBA) uses a great term in connection with buying local: the multiplier effect. It describes how a local economy benefits when local residents, business owners and workers earn and then spend money locally. 

AMIBA cites three direct influences on local economies: 

  • Spending by businesses for running the business, including buying stock, paying employees and other expenses.
  • The indirect effect of a local business spending money at other local businesses.
  • Consumer spending by employees and others within the community.

Even credit giant American Express (AMEX) promotes shopping locally through its “Shop Small” campaign, which says: 

“Small businesses are the heartbeat of our communities. They’re the corner stores that create jobs. The hardware stores that help build our economy. And the mom and pop shops whose very presence makes a neighborhood, your neighborhood.”

Part of AmEx’s support of small businesses is their “Small Business Saturday” program, which started in 2010 and happens each year on the Saturday following Thanksgiving.  The day is dedicated to the support not of big box retailers (like Black Friday) or e-commerce sites (like Cyber Monday) but instead to small local businesses.

Many bloggers address the virtues of buying local, including the chance to meet artisans and craftspeople in the community. A great graphic on the Huffington Post article, “Why Buying Local is Worth Every Cent”, explains it all:

  • Local Businesses generate 70 percent more in local economic activity than national retailers (per square foot).
  • $100 spent at a local business equals $68 in local economy activity, whereas $100 spent at a big box store only adds $48 to the local economy.
  • Shopping locally benefits the environment because less fuel is used for transport and shipping, resulting in less pollution.

Buying local isn’t just about buying from locally owned businesses but actually choosing to shop in the community where you live. If you have the choice to, say, buy your child’s bike from a store in your community or spend $10 less to buy it in a nearby city, remember that the sales tax you pay on your purchase will go to the municipality to fund everything from pothole repair to recreation programs. It may be worth the extra $10 to keep that 8 percent sales tax on the purchase price in your own community.

The Rise of Indie Shopping

Not everyone refers to the practice as “buy local”; many call it “Indie Shopping.” Whatever it is called, so long as it attracts a wide range of people, the buy-local-indie-shopping movement is a good thing. The early United States economy was based on local businesses and artisans. As the country expanded, the economy changed, and sourcing commodities from far-flung suppliers became common.

All kinds of commerce have their place in our world. However, there are real advantages in supporting local economies. It’s really not all about the price tag. A lawn mower may be cheaper if purchased at a big box home improvement store, but when something goes wrong with that machine one month after the manufacturer’s warranty expires, chances are you will have better luck addressing the problem with a local merchant rather than a big box store. Knowing who rebuilds your engine makes for a stronger community.

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