To Beat Recession, Indies Launch Buy-Local Push

Small business owners are banding together to encourage consumers to shop nearby independents. Would such a campaign help your business?

By John Tozzi

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The buy-local movement isn't new. For the past decade, independent businesses have banded together to urge local consumers to spend more of their dollars closer to home. Proponents say doing so helps build vibrant local economies by keeping money circulating in the area rather than elsewhere, while detractors say the economic benefits are negligible. Now, amid the sinking national economy, some small-business owners are saying buy-local efforts have helped insulate them from the worst of the downturn.

That's the case for Chuck Robinson, owner of Village Books in Bellingham, Wash., who helped launch the city's buy-local effort in 2003. While sales have dropped 4% since Jan. 1 at his 40-employee, $3.5 million bookshop and adjacent card store, he says that's less severe than other booksellers he's talked to in places that don't have buy-local efforts. According to a national survey by the nonprofit Institute for Local Self-Reliance in Minneapolis, independent retailers in cities with buy-local campaigns saw holiday sales fall 3.2% from the prior year, while those in cities with no such movements recorded a 5.6% drop. Nationwide, retail sales fell 9.8% in December 2008 vs. the prior year, according to the Commerce Dept.

KEYS TO SUCCESS

Most successful buy-local campaigns grow out of independent business networks that share three main elements, says Jeff Milchen, who in 1998 co-founded the first such group in Boulder, Colo. First, they educate consumers about the value of independent businesses in the community. Second, they jointly promote shopping at those businesses through advertising, coupon books, shop-local weeks, and other efforts. And third, they give independent owners a unified voice in government and media.

At least 130 such groups have been founded since 1998, with the number roughly doubling since 2005, according to Stacy Mitchell, a senior researcher at the ILSR and author of Big-Box Swindle. Mitchell says about 25,000 small firms now belong to a business alliance promoting local shopping. The trend has been bolstered by growing consumer interest in buying locally grown food and reducing carbon emissions associated with shipping goods long distances.

Two main organizations support buy local campaigns: the American Independent Business Alliance and the Business Alliance for Local Living Economies. The first steps for new buy-local groups involve recruiting members, designing logos and marketing kits, and educating the public, says Mitchell. Often they will launch with a buy-local day or week to attract local press coverage. (For more on how to set one up, resources are available from AMIBA, BALLE, and the ISLR.)

WHY BUY LOCAL?

The economic argument behind buy-local campaigns goes like this: Spending at local businesses, rather than at chain stores or online, helps local economies because those firms are more likely to buy from local suppliers and hire local service providers for needs such as accounting.