“Lane 5 is open, sir,” the big box store worker helpfully steered me as I waited on line for self-checkout. The cashier at 5 looked sleepy, no doubt due to customer inactivity. I placed on the counter my two items, one of which cost $19.97.
She scanned one item and said, “That’ll be $21.44.” Knowing that didn’t make sense, I pointed out the second item she had groggily overlooked, and said, “I don’t want you to cheat yourself” or her employer.
As I exited, even though her mistake would have been in my favor if I hadn’t woken her up, it bothered me that she was so blasé about paying attention to a very simple transaction. She didn’t even say “thanks.” Good help really is hard to find, I thought, while also allowing that young people are entitled to their late nights, which they pay for the next day at work.
Ardent advocates of “Shop Small” will use that kind of shopper experience to characterize big box stores like Home Depot as not only big but bad for the local economy. That would be a gross generalization, which is part of the “Noise over Nuance” emphasis that dumbs down all kind of conversations these days, from politics to consumerism. It’s always easier and quicker to paint with a broad brush rather than painstakingly finesse the finer points.
In a separate experience, a local two-store operation whose website touts its service over “chain stores” disappointed with its lax customer service. When we called Wednesday to check if our order was in store for pickup, the employee said one item was there and the other item would be there by Monday. It wasn’t until we went to pick up both items on Saturday—five days after Monday—that we were told the second item had not yet arrived because of a vendor error. Stuff happens, but somebody at this local shop should have notified us about the delayed delivery, which would have saved us having to make two trips instead of one.
It’s encouraging to see the spread of “Shop Small” fever. “Small Business Saturday” founding partner American Express reports that more than 95 million consumers shopped at small businesses on Nov. 28, an 8 percent gain from the designated day in 2014. They spent a total of $16.2 billion, up 14 percent from last year.
Also compared to a year ago, there was a 48 percent rise in the number of so-called “neighborhood champions” who promoted the event in their communities, to 4,100, and an 11 percent jump in organizations joining the Small Business Saturday Coalition, with 425 signing on.
You can see the rest of the data in the “press releases” section of AmericanExpress.com, which released the data jointly with the National Federation of Independent Business. NFIB is a Washington, D.C., lobbying organization which has an information-packed website (NFIB.com) whose tagline is “Protecting the Future of Small Business.”
In a 1-minute video clip titled “The Biggest Trials of Being a Small Business Owner,” an NFIB survey lists the “Major Sacrifices” for owners as: never able to be away from the business (56 percent); have no time for themselves (51 percent); no vacation (43 percent); personal money tied up in the business (41 percent); don’t see family and friends as much as they want (40 percent).
The “Top Three Challenges” listed in the survey are: having to wear many hats (43 percent); riding out bad economic times (20 percent); hiring and managing staff (10 percent).
Being an independent owner/operator epitomizes the American Dream, in all its potential rewards and its formidable obstacles to overcome.
In support of our community and its inhabitants, it’s in the red-white-and-blue spirit of America to embrace the “Shop Small” mantra—up to a point, and within reason. What’s not reasonable is to make “Shop Small” synonymous with the noisy nonsense that “big=bad.”
What is especially laudatory about NFIB is that it puts forth a mature, productive sensibility about what small businesses can learn from national chains and the big box crowd. One article is titled, “What Your Small Business Can Learn from Home Depot.”
I prefer the wording “Shop Local” over “Shop Small,” because there are multiple ways that businesses of any size contribute to their communities. It’s not merely about being small. It’s about being good, about providing optimal value, about offering competitive customer service that shows the shopper you want her business more than the next seller.
The point of “Shop Local” advocacy should be to keep money circulating within the local economy. “Shop Small” messaging does a disservice when it urges locals to avoid “corporate” or “chain” stores, because spending money in those establishments certainly contributes to the local economy.
There are two sets of statistics typically used to bolster the “Shop Small” rationale. One set of data maintains “only” $43 of every $100 spent in a “national” retailer stays in the community, while $68 of every $100 spent in a “local” business stays in the community.
Another study concludes that “local retailers return a total of 52 percent of their revenue to the local economy, compared to just 14 percent for the national chain retailers. Similarly, the local restaurants recirculate an average of 79 percent of their revenue locally, compared to 30 percent for the chain eateries.”
Both of the above studies have a couple of things in common: 1) Each was conducted by mom-and-pop researcher Civic Economics. 2) The researcher based its findings in each study on highly anecdotal samples, surveying a handful of retailers in one municipality.
On its website, the American Independent Business Alliance admirably points out how these studies often are misinterpreted by “Shop Small” advocates who take them out of context and overlook the nuances in favor of making noise.
It’s hard, though, to accept those figures as statistically significant considering the survey was of 15 independent stores versus four national chains, and seven independent restaurants versus four national chains—all in one place, Salt Lake City. To extrapolate that tiny sample as indicative of a national pattern is unsupportable.
Since the volume of transactions is much greater in a chain store, the absolute number of dollars being “recirculated” or “multiplied” in the community will mathematically be greater from a chain store than from a small local business.
The health of local economies doesn’t hinge only on percentages; there also are absolute dollars to count. If the “multiplier” effect of what a small business rolls back into the community is said to be three to five times that of a national chain, what is the “multiplier” effect of a national chain’s scale of sales transactions?
At the end of the selling day, if $43 (of $100 spent) back to the community is multiplied by 100 transactions at a national chain ($4,300), and the $68 (of $100 spent) back to the community is multiplied by 50 transactions at an independent ($3400), do the math: which is contributing more to the community? Not to mention that odds are the ratio of transactions between the two is greater than 2:1.
There are more nuances to consider amidst the noise.
A fast-food chain, like a Panera or a McDonald’s, can be a franchise owned by someone from the locality.
Even national chains not locally owned create jobs by employing locals, who pump at least some of their disposable income back into the local economy.
“Shop Local” in truth means spending money within your community as often as practical, regardless of who owns the business or where the business owner lives.
The absolute bottom line is that shoppers should and will patronize those businesses that best satisfy their needs with satisfactory inventory, fair-market prices, convenience, and considerate, professional customer service.
Media and marketing specialist Bruce Apar, also known as Bruce the Blog, is Chief Content Officer of Pinpoint Marketing & Design, a Google Partner agency. He also owns APAR All-Media, a Hudson Valley marketing agency that works with The Winery at St. George, Yorktown Feast of San Gennaro, Jefferson Valley Mall, Yorktown Stage, Axial Theatre, Armonk Players and others. Follow him on Hudson Valley WXYZ on Facebook, Twitter and YouTube. Reach him at email@example.com or 914-275-6887.
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