Businesses have been working hard this year trying to figure out how to reinvent the way they do business during periods of pandemic with the new norms of social distancing and restricted travel.
Small businesses, especially local brick-and-mortar stores, have been hit the hardest with the new challenges to adapt. We don’t tend to have the capital reserves to weather these economic storms as much as the bigger national or multinational corporations. We don’t have a large and diverse investment in online and mobile infrastructure for sales, marketing and support options for customers.
90%. This figure varies slightly depending on what counts as a small business. But it is a significant generalization of both the percentage of small businesses and the percentage small businesses contribute to economic growth.
One point is crystal clear: the strength of our economy depends on the strength of our small businesses.
So what can small businesses do to adapt to new economic and social realities?
While one of the obvious solutions is to utilize more online tools for your marketing, sales, and customer support, I want to focus here on a solution which is not so obvious and has seemed to get overlooked by the media lately. I will post a separate article about the available online tools and methods soon. So be sure to subscribe to get notified of new posts as they get published.
In the past 20 years, as large online businesses have seemed to dominate every market, and global import has challenged local manufacturing, there has also been a push back to shop local, buy local, and live local for a lot of good reasons. There have been many studies and reports demonstrating how going local is best for the economy, culture, families, and people in that community, as well as the foundation for future economic and social stability and growth.
In this article, I will survey just some of the top reasons supporting local businesses is good for our community is Surrey, and one of the main ways we can strengthen and revitalize our local community through difficult times like these.
As people’s livelihoods continue to be in jeopardy, the stakes have never been higher!
The good news is that the majority of small businesses are also local businesses as well. So as a consumer, by choosing to support a small business instead of purchasing from a larger company online, you are also helping to support the community in which that business is local, and vice versa.
It means supporting businesses which:
The top 2 reasons given to buy from local businesses are economic and social. There are other really good ones as well. I will summarize them by the popularity of reasons generally given by studies. Keep in mind that they all tend to overlap and work together to vitalize communities and the people within them. So I don’t want to number them as in any rank of importance.
Money spent at a local business can recirculate through the community over four times as much as money spent at non-local businesses, and even more than money spent through non-local online purchases. This community based multiplier effect is an essential to understanding how buying local is the fundamental basis of a strong, innovative and growing economy.
Here’s an overly simplified idealistic illustration of how it works. Mary spends $100 at her local grocer within walking distance instead of the big box store 30 minutes drive away.
|Local Grocer||Non-Local Box Store|
|A||$50 to local farmers||$0 to local farmers|
|B||$25 to local employees||$12.50 to local employees if within community|
|C||$10 to building lease from local property owner||$0 to building lease from local property owner|
|D||$10 to local taxes supporting public works||$20 may go to local taxes (ignoring taxation loop-holes)|
|E||$5 to the local grocer owner to put back into her business improvements||$2.50 goes back into the branch to improve their store|
So far, we see an example of another common reason stated to shop local: the majority of money spent at local businesses stays within the community. In the illustration above, all $100 dollars spent at Mary’s local grocer stays within the local community. In contrast, of the $100 spent at the big box store, only $35 stays within the community.
For all the money which stays within the local community, that’s not the end of its life-cycle for that community. It multiplies.
Already, we see that the second cycle of money Mary spends at her local grocer can double the total amount spent within the community. And if that money is spent locally as well, it will continue to add a multiplier to the amount which stays within the community, improving the economic prosperity of the community, small businesses, and individuals within it, supporting the public infrastructures and social services which provide the fundamental stability of that community, especially through difficult economic times like these.
Several studies have been carried out across various communities in the US. Loco BC commissioned Civic Economics to produce a study of consumer spending with local businesses. Here are just a few of the highlights from that 2019 report on local businesses in BC (cf. https://www.locobc.ca/blogs/loco-bc-2019-study-on-the-the-economic-impact-of-local-business), as well as some similar results from US studies.
Multiple studies of small businesses all produce the same data: small local businesses are the primary source for job creation and satisfaction.
While the economy is certainly on the forefront of every small business owner’s mind right now, the social impact of shopping locally has its own “multiplier effect” for the non-business aspects of its communities. Arts and cultural activities flourish. Non-profit support programs thrive. Community programs for families and children grow. These not-for-profit activities create more happy communities and people, and a stronger social network from which to weather economic crises.
Local small businesses communities are cleaner greener communities, and those living in them get more exercise, eat better, and are generally more happy and healthy.
Small businesses are more dependent on their clients to survive, so they tend to give more personal attention to each individual client. So you get more benefits.
The Big Spend was a Canadian campaign to encourage spending locally on July 25th as a national strategy “to help the nation’s post COVID-19 rebuilding process.”
The potential economic stimulus injected into communities by the ordinary consumer through small businesses, and through small businesses supporting one another, is one of the biggest contributions we can make to transforming the economy from failed “trickle down” models to a community by community based “trickle up” model, while also building a more stable community and family based “social net” for future economic crises.
With the diversity of small businesses and local producers in Surrey, most of us have almost no need to shop elsewhere. And because of that, if we concentrate on supporting our local small businesses in Surrey, we could create one of the most thriving local economies in British Columbia, and perhaps all of Canada.
Let’s continue to support one another to stimulate and grow our local economy in Surrey while improving our social impact on our communities, families and children!
Allegra in Surrey has been locally owned since it started in 1996. We live in and employ mostly local Surrey residents who live and shop in Surrey. We prioritize the sourcing of our products by location, first in Surrey if possible, then BC, and then Canada more broadly if Surrey and BC sources are not available. All of our paper is 30-100% recycled, and all unused paper is recycled. We continually support not-for-profit community organizations in Surrey with discounts, services, and donation programs. Our primary service area includes Surrey, Delta, and White Rock.
8620 Glenlyon Parkway
Burnaby, BC V5J 0B6
Phone: +1 604-590-4405
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