The holiday season, between now and Jan. 1, is a critical time for retailers; many stores realize 75% of their annual sales during this time.
As this busy shopping season gets underway, let’s look at the economic impact our purchasing decisions and the flow of money have on our community.
Imagine spending $100 on local goods and services. These locally owned businesses generally use local services such as accountants, advertising, legal services and supplies and will in turn re-spend the money locally. Picture this cycle continuing several times before the money is finally spent on imports – goods or services from outside the region. The original $100 could recirculate seven times and really act like $700 by increasing revenues and income opportunities for local producers.
Now, imagine that same $100 being spent immediately online or with businesses headquartered in other regions. These transactions would add very little or no value to the local economy. In this instance, $100 would really act like $100, not the $700 in the local purchase example above.
This is the multiplier effect — essentially the ripple effect that occurs by the re-spending of income. Research suggests that as much as 70% more money stays in a community when consumers choose a locally owned business over a non-local alternative. Buying locally keeps the money moving around to keep the economy alive.
In addition to the economic incentive to think local and shop local first, there are numerous other reasons to support local businesses.
-- Local businesses — where we shop, where we eat, where we have fun — all make our community unique.
-- Communities with a distinct character are more likely to attract entrepreneurs and a skilled work force than homogeneous communities.
-- Local business owners live in this community and are invested in the community’s future.
-- If gaps in products or services are identified by consumers, new businesses can be started to fill in these gaps – creating jobs and adding to the economic base of the community.
Grand Island is a regional retail trade center with an exceptional array of products and services. Locally owned businesses are an important part of that mix. The next time you have a choice of buying locally or on-line, remember that buying locally helps the Grand Island economy which in turn, ensures that each of us have the products, services, attractions, and an overall quality of life that we want and expect.
Cindy Johnson is the president of the Grand Island Area Chamber of Commerce. Contact her at (308) 382-9210 or email@example.com