“Buy Local” is an Economic Stimulus

An easy way to help the economy?  Buy local.  What started as an independent business initiative in Boulder in 1998 has now grown to 140 cities nationwide, and it doesn’t show signs of stopping.  If anything, “Buy Local” is continuing to gain new ground.

For the fourth year in a row, a national Independent Business Survey taken over an 8-day period in January found that “independent businesses in places with a ‘buy local’ initiative,’ which comprised about half of the respondents, reported an average gain in revenue of 5.6%, compared to 2.1% for those elsewhere.”  The survey looked at 2,768 businesses in all 50 states, including retailers, service providers, restaurants and others.

“This survey offers proof that, with sustained efforts, communities can indeed raise local consciousness and build a culture of support for local entrepreneurs,” said American Independent Business Alliance director Jennifer Rockne.  “Remarkably, most of the campaigns operated by Independent Business Alliances are funded by businesses paying $20 or less per month in dues.  They’re getting quite a return on their investment.”

According to the survey, 55% of the initiative’s participating businesses said that the campaign increased customer loyalty, 47% said “Buy Local” brought new customers, more than two-thirds of them have seen increased local media coverage, and 51% noticed more awareness and support from local government officials.  The initiative has also fostered more business involvement in communities, with 49% of the respondents saying that “Buy Local” led to more more collaboration, purchasing and mutual support between local businesses.

The survey also found a greater awareness and more intentional seeking out of independent businesses, with almost two-thirds of the respondents reporting that public attention towards the benefits of buying locally increased in the last year and 83% stating that their local and independent statuses are important to some or most of their customers.

“Small, local businesses generate the majority of new jobs in the US,” said Michelle Long, Executive Director of the Business Alliance for Local Living Economies.  “Buy Local First campaigns help bring these businesses and residents together to build community health and wealth.”  This is because local businesses tend to have larger payrolls because they employ their own people, as opposed to chains, which are usually centralized in headquarters.  Local business are also more likely to buy locally themselves, which in turn recirculates the money spent with them into the community.

The initiative’s biggest impact is in how it builds a community’s health and economy through what is known as “The Local Multiplier Effect,” which looks at the frequency that money circulates at the local level before it gets spent on an import from somewhere else.  Every million dollars reinvested by independent businesses at a local level becomes the equivalent of a million dollars coming into that community from somewhere else.  

Basically, money spent at local business stays closer to home.  If you increase local spending from 50% to 80%, you more than double the economic return.  “For every $1 spent at a local business, 45 cents is reinvested locally,” wrote Yes Magazine.  “For every $1 spent at a corporate chain, only 15 cents is reinvested locally.”  The culture of buying locally creates a ripple effect that in turn builds upon and sustains community economies.

“More and more shoppers are voting in favor of independent retailers with their spending, proving that they recognize that bigger is not always better – and making clear that they value a strong, unique, and vibrant community,” said American Booksellers Association CEO Oren Teicher.  “The potential for locally owned businesses committed to working together could not be greater.”

A brand is more than just a brand, and it shows when consumers see nationwide that “Buy Local” is more than just a catchphrase or even a movement.  It’s a lifestyle, even a culture, that values its economic contribution just as much as it does its product and revenue.


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Photo courtesy of Peter Blanchard via Flickr


Mit W.
Mit Wes6 years ago

I work at an extremely large global company myself. The particular location that i work at actually sells very little to the local community. However, they employ about 300 people from the local and surrounding communities. They also buy supplies from some local industrial shops. Our goods and services are sold nationally and globally. I.e. we take little money out of the community but inject quite a bit through our payroll and purchases. If our customers suddenly insisted on buying just locally, our local community would certainly suffer.

Ann P.
A P6 years ago

I don't buy very much. But, that's an example of how keeping wages low decreases the market for business local or otherwise.

I buy from 2nd hand shops and by that means support women's shelters, disabled american vets, etc. I'm afraid I'm NOT a morning person so I rarely make it to farmers markets. And while I like to support local businesses, even there it is good to choose wisely.

Robert O.
Past Member 6 years ago

Kimberly seems very angry, and there seem to be more and more Kimberlys every day. I pray it doesn't come down to her solution, but i also realize that if it does, i will likely be standing beside the Kimberlys in the fight for economic and social justice.

Sound Mind
Ronald E6 years ago

Who really gives a rats as* about the "global" economy when it comes to supporting your friends and neighbors? Yes, by all means - if you have the option, buy local! Never knew any one dumb enough to pass up fresh produce off their neighbors farmland in favor of imported two-six week old produce at the local supermarket chain store! Heads up - some produce stands or trucks selling off the tail gate actually have no true "local" goods to sell. Beware.

Gloria W.
Gloria W.6 years ago

Buy organic and local!!

Valarie S.
Valarie Snell6 years ago

Great article!

Anne H.
Anne H6 years ago

We have evolved into a world economy, this is not a bad thing. We need to learn to compete in this global economy w/our products & our selves. We are not better simply because we are the USA. We need the high wages to support our lifestyles. The cost of living is less elsewhere and so are wages so we set up factories, often with perks connected to the trade agreements. Our competition has been sending their children to our Universities for years & we gladly take their tuition. We are then upset when they return home to help their own nation compete with us.

Buying only American will not solve our problems. The USA needs those trade agreements to work both ways. There can be a balance of big retailers & small business. There is a need for both.

We need to be more aware of not letting our cities & local businesses die. If you run off to the suburbs instead of forcing politicians to do their jobs then your city will die and eventually so will your suburb.

Yvette T.
Past Member 6 years ago

Everything is expensive, so, whenever I can, I go through with purchasing organic and local. Today's high prices soon will seem low! Plus, the more purchases made, the more likely the ability to reduce the final cost will become for the seller!

Ernie Miller
william Miller6 years ago

I think this is a good idea. I see lots of complaint about what people precive is being sold as cheep crap. stop in shop and let the owners know you will buy if they sell quility American and local products. and then return and spend. Buisnesses sell what their customers want. Locally we are in the process of pushing local and down town buisenesses I will bring this to them.

Tracey O.
Tracey O6 years ago

Since when on here is it fine to speak on shooting people? See that crap don't fly in my world. Your state is screwed so are many more. You vote? Buy local was what I came to speak on. Of course if you have a farmers market & that kind of thing consider yourself lucky. Made in America is the biggest problem though. We used to make stuff here & yet the GOP was ready to let the American car industry go down too? All my life my family has only bought americanGM,Chevy, Buick ,Olds. I own an Oldsmobile myself see. Everything else in your house was not more than likely. Even this notebook I use.I looked at a list of Koch Bro stuff & stopped buying Angel Soft. Buy American anytime you can & do not buy from Koch. They are running this country now it seems.