Wednesday, November 14, 2012

Why Buy Local?


By Noa Kornbluh, Fall Fellow

One often hears the slogan “buy local,” but I was never really convinced that buying local made a significant impact.   Why buy local when local goods are often more expensive and less convenient than products from national chains?   Not too long ago I came across a powerful economic argument for buying local.  I was told that for every dollar spent at a national store 13% goes back into the local economy and if that same dollar was spent at a locally-owned business 43% returns to the community.  That is a 30% difference made with each dollar I spend, and that is a significant impact. 

This statistic comes from a study done by Civic Economics in Austin, Texas comparing the economic impact of local versus national book stores.  Civic Economics repeated a similar study in the San Francisco area.  The San Francisco study produced the same striking results, indicating that local businesses contribute much more to the local economy than national chains.  Economists found three aspects of local versus national businesses that create a profound difference in the impact on the local economy.  First, due to scale, local businesses have a higher ratio of jobs per market share.  National chains have corporate offices where they employ accountants and other administrators who work for the whole company.  Local businesses staff these jobs locally.  Second, local enterprises source more of their goods locally than national chains.  Due to convenience and scale, local business owners are more likely to buy from other local businesses instead of global suppliers.  Lastly, in local businesses a larger percentage of profits stay in the community.  Profits from small local businesses are spent by business owners in their neighborhoods on goods and services such as rent or going out to eat.  National and international businesses have stock holders located all over the world who share in profits.  Buying local may at times be more expensive or less convenient but it is an investment in the neighborhood we live in.  In the long run, the choices we make on a daily basis will shape the economic future of our community.

Women’s Initiative graduates work towards starting locally-owned businesses and in doing so they strengthen local economies.  Graduates open store fronts, provide jobs and invest in their communities.  When you purchase goods or services from a Women’s Initiative graduate you are not just supporting an incredible woman and entrepreneur, you are also investing in the local economy. 

To support both local businesses and Women’s Initiative graduates purchase tickets to the Love Local event happening at the Caine Shulte Contemporary Art Gallery in San Francisco on Friday November 16th.

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