The Importance of Local Consumption: 5 statistics that highlight the importance of shopping local

Shopping locally has always been a crucial part of supporting the economic development of any city. According to the Retail Merchants Association, for every $1 spent at a local merchant, $.45 is reinvested into the local economy. In contrast,only $.15 stay in the community for every dollar spent at a big box store. 

In a time where small businesses and local economies are struggling, the importance of shopping locally is that much more obvious. 42% of consumers believe that the way they shop will change immensely in a positive shift as a result of the COVID-19 pandemic due to the pressures of helping local businesses stay afloat. 

Because the pandemic sparked mass shut-downs, , an estimated 100,000 small businesses have closed permanently. If the stay-at-home orders are put into place again, that number will continue to grow. The passing of the CARES Act provided some cushioning for small businesses in cities across the country, but the movement to support small businesses should continue past the pandemic in order to build back small businesses and local economies. Here are some key statistics that highlight the importance of shopping local: 

  1. For every $100 you spend at a local business, $68 will stay in the community whereas only $43 will stay in the community when you spend $100 at a large commercial chain. 
  2. Small businesses donate 250% more of their revenue than larger businesses to non-profit and other community based organizations.
  3. Local businesses create the majority of economic growth, employing about 77 million Americans and improving communities. 
  4. Every $10 million of spending at a local business creates more than 50 jobs, where the same spending at Amazon creates approximately 14 jobs.
  5. 40% of small businesses are in low-income communities, therefore putting money towards these businesses will help improve community stability and the overall economy

Small businesses are crucial to the growth of small cities. As a member of your local community it is important to know just how essential these small businesses are. Having an increase of small businesses in your neighborhood who have a strong preference for hiring employees that live locally will increase job growth in your area. Bottom line- you can make a difference in the job status of your friends and neighbors simply by heading to your downtown instead of online at Amazon. 
In addition to creating a vibrant and unique community, small businesses account for an increase in job opportunities, the financial growth of a city, as well as overall economic growth for a small and growing community. Supporting the businesses in your community over large corporate chains has always been essential, but COVID-19 has created unique and unprecedented circumstances which has made it clear how important it truly is to support local businesses and local consumption.

By Lily Pillsbury

August 16th, 2020