The 2009 holiday season was a tough one for retail businesses. In November, their sales increased just 1.8 percent over low 2008 numbers—failing to keep pace with inflation. December was worse, with sales actually falling three tenths of a percent from 2008.
But in more than a hundred communities across North America, independent community-based businesses had a more positive story to tell. A nationwide survey of more than 1,800 independent businesses by the Institute for Local Self-Reliance (ILSR) found them outperforming chain competitors. Most notably, the survey found independent retailers in communities with active "Buy Independent” or “Buy Local" campaigns reported an increase in holiday sales three times stronger (up three percent) than those in cities without such campaigns (up one percent).
Given the current inflation rate of 2.7 percent, the benefit of such campaigns could mean the difference between success and failure for many store owners. "Amid the worst downturn in more than 60 years, independent businesses are succeeding by emphasizing their community roots and local ownership,” says Stacy Mitchell, who executed the survey.
Jennifer Rockne directs the American Independent Business Alliance (AMIBA), a nonprofit organization supporting 70 "Independent Business Alliances" across North America. She concurs with Mitchell, saying “When executed well, these campaigns are making a huge difference for local businesses and their communities."
The increased interest in buying local isn’t lost on store owners. In a recent survey of its members, the Portland Independent Business and Community Alliance in Maine found 84 percent of its member businesses reported its "Buy Indie / Buy Local" campaign and related activities had positively impacted their business—that number has increased with each year.
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The ILSR survey respondents hail from communities of widely varying size, geography and political leanings, but share an important quality. Like Portland, they gain support from AMIBA or the Business Alliance for Local Living Economies (BALLE) and engage in year-round, long-term community education that goes beyond mere consumer choices to focus on local independent business.
Mitchell and Rockne view many “buy local” campaigns started by government entities or chambers of commerce with some skepticism. “Many are launched without long-term commitment and are motivated by desire to boost city sales tax revenues, not concern for local entrepreneurs or community character,” warns Mitchell, who detailed the escalating problem of “local washing” last year. The term describes campaigns by some cities, chambers of commerce, and corporate chains to define a “local” business as merely a nearby location without regard to the crucial distinction between local and corporate ownership.
Rockne questions whether such campaigns can yield measurable impact and notes a key framing issue. “While we ask people to shift more of their spending to local independents, consumer choices alone cannot halt many of our destructive environmental, social and business trends," he says. "We need to exercise our power as citizens as well."
Why? Countless chains benefit from tax loopholes, subsidies, federal handouts and other preferential treatment that undermines fair competition and handicaps community-based businesses. Both ILSR and AMIBA help citizens to reverse such destructive government action and advance myriad pro-local measures, from local purchasing and contracting preferences to policies that promote neighborhood-scale building and prevent big box sprawl.
How can you respond to the Supreme Court's ruling in Citizens United?
AMIBA is walking the talk of democratic action as one of four organizations to launch Free Speech for People, a coalition gathering support for a constitutional amendment to overrule Citizens United v FEC. The recent Supreme Court ruling granted corporations the power to spend unlimited company funds in efforts to elect or defeat judicial and political candidates. While recognizing the primary threat to our Constitution, indie business advocates also worry because, even prior to this ruling, corporate chains had little trouble translating their wealth into political favors such as those noted above.
AMIBA’s presence in the coalition has helped curtail previously routine media references to the Roberts Court as “pro-business” and has created some surprisingly honest reporting in major business news outlets. “High Court Wallops Small Business” was the title of a recent Kiplinger’s brief on the case.
While Rockne embraces this role, she focuses on the core mission of helping people to effectively execute local campaigns. She expects to see 100 Independent Business Alliances by year’s end.
Mitchell believes the recession creates added opportunity. “Recycling capital locally by spending and investing more with local independents is powerful economic stimulus for communities," she notes. “As the evidence builds that Buy Independent and Buy Local campaigns can actually shift consciousness and purchasing choices, we’re seeing interest and results grow even more rapidly.”
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