By Sarah Mecham
There are only 52 more shopping days until Christmas.
These days represent the biggest consumer retail spending of the year. The National Retail Federation expects November and December sales to rise 3.7% to $630.5 billion dollars. The average consumer is expected to spend more than $800 dollars on holiday shopping this season.
Consumers have many choices when spending their shopping dollars: shopping online, national chains or at local shops. According to American Independent Business Alliance shopping at locally owned and operated businesses, local communities benefit in three ways: economically, socially, and environmentally.
Local First Utah released a report from Civic Economics of a statewide study in 2014 which showed locally owned retailers in Salt Lake City, Ogden, and Wayne County return 55.3 percent of their revenue back to the local economy. In comparison, national chain retailers only return 13.6 percent back to local economies. That means every dollar spent at a local business returns more than four times more to the local economy than a dollar spent at a national chain retailer.
Sonnie Swindle, local business owner of Bloomingsales, said the number one benefit to buying and shopping locally is keeping tax dollars in the local community. The more thriving small businesses created in our community, the larger the tax base it has to use for public services.
“I hire local people to support my business. I pay local contractors, printers, marketing and technology professionals, accountants, and caterers,” Swindle said. “This helps contribute to the livelihood of many careers in the community.”
This “local multiplier effect,” according to the American Independent Business Alliance, recirculates money into the local economy and is a key tool to creating more local jobs.
Cait Boyer, a Salt Lake Resident, shops local for her food. She loves the Downtown Alliance Farmer’s Market held Saturdays during the summer months at Pioneer Park and purchases her produce from local farms. Her passion for supporting local agriculture is motivated economically.
“Government subsidizes large corporate farms, and the little ma and pop farms are completely on their own,” Boyer said. “These farmers work so hard to run their business with little to no help and they rely 100% on local consumers to support them.”
Boyer also recognizes the social impact of shopping local.
“I particularly love shopping at the farmer’s markets where I get the chance to meet the farmers or growers,” She said. “I love to hear their stories and what their job entails. It makes the process of buying and cooking food more meaningful, when I know where my money is going and who directly will be benefited.”
Melissa Reed, while shopping at Katie Waltman Jewelry, said she only shops local.
“I love walking into a store where they know my name and talk to me about my purchases,” Reed Said. “There is a real community feeling that I cannot get at the mall.”
Many small businesses make their shopping experiences social. For example many local boutiques are hosting holiday open houses offering entertainment, refreshments, and a party-like atmosphere that brings people together to shop.
In 2010, American Express created a social campaign to encourage their cardholders to shop at small businesses on Thanksgiving weekend. For the past five years, “Shop Small Saturday,” held on the Saturday after Thanksgiving has grown to more than 88 million participants in 2014. Last year consumers spent more than $14.3 billion at local business. This social movement gets consumers involved in shopping local.
Shopping local is good for the environment too. It reduces the carbon footprint on our planet by diminishing the distance of transporting goods into our community.
“Most food at the grocery store has traveled over 2,000 miles,” said Adrienne Tuerpe, Director of Utah’s Eat Local Week.
It takes a significantly less amount of gas to bring apples from a Payson farm to a grocery store than importing apples from Mexico.
From a community standpoint shopping local makes sense. But is it economically beneficial to the consumer? In other words, will the consumer get the best prices by shopping local or by shopping chain stores? According to Stacy Mitchell with the Institute for Local Self-Reliance, big retailers are known as “category killers.” These businesses do not need to compete with other business because they tend to be the only store in town.
“Typically, a chain store will enter a new market sporting deep discounts. Many chains employ loss leaders to attract customers. Wal-Mart has been known to sell gallons of milk for 25 cents or to price entire departments below its own acquisition costs. This sets up a battle that local merchants cannot win. If they don’t match the chain’s prices, they risk losing customers. If they do match the chain’s prices, they will lose money on every sale. While a chain can afford to operate a new outlet at a loss indefinitely, it’s only a matter of time before the local business will be forced to close,” said Mitchell in her speech.
With local competition eliminated the chain stores then raise their prices. In Elizabeth Humstone and Thomas Muller’s study, “Impact of Wal-Mart on Northwestern Vermont” Wal-Mart prices varied 25 percent. The study showed that prices rise in markets where national retailers face little competition. Local businesses keep prices at competitive levels for both national chains and local shops.
Boyer added, “Shopping seasonally when it comes to produce is often times more affordable because you aren’t paying a middle man or for the expense of shipping foods half way across the world.”
In the same report from Civic Economics released by Local First Utah, shifting just 10 percent of purchases from national chains to locally owned shops and restaurants would keep $1.3 billion in the Utah economy.
Consumers who want to shop local can look for produce with “Utah’s Own” labels or participate in Shop Small Saturday on Nov. 28, 2015. For a list of local retailers, restaurants, services visit http://localfirst.org/buy-local/find-a-business.
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