Monday, June 15, 2009

Which Businesses Will Survive The Recession? 1/28/09

While drinking a beer and doing the crossword last Friday evening, a friend and regular reader sent me a text message asking if a particular local restaurant was going out of business. I checked around and found that the business was struggling, but hanging on. I like the place so much, it got me worrying about what this recession will do to Noblesville’s small, locally owned businesses.
If we want to protect our community’s economic diversity, it makes sense to shop first at small local businesses and let the chain operations take care of themselves.
A shuttered Starbucks on Fall Creek in Indianapolis has gotten a lot of press lately. Mostly because Starbucks took an admirable gamble when they originally opened an outlet in a transitional neighborhood. I admire their try, but in general don’t weep much for the national chains protecting their deep pockets. That’s because most national chains have entire teams of marketing and legal experts devoted to putting mom and pop competitors out of business.
I root for the underdog, not the playground bully – no matter how big his smile is. It’s just my bias.
When the big chains close a store, it plays to me like military leaders shifting battleships around on a tabletop map. The people calling the shots aren’t fighting for their own family’s mortgage payment, they’re pursuing or protecting market share. It’s very different for small business owners.
A by-product of the growth that’s transformed this county in the past three decades is the handing over of our economic destiny to out of town, out of state, and in some cases out of country conglomerates. This costs us in unexpected ways.
When I was the faculty sponsor of a small town Indiana high school newspaper, the advertisers who supported us were primarily local business owners. When my students solicited ads from the national chains they were given a 1-800 number for the corporate headquarters far away. The numbers led to answering machines that seldom returned the calls. It got worse every year.
That’s just one tiny example of what local businesses do for a community. They care with sincerity.
The local business owner lives in our neighborhood, shops where we shop, worships in local churches, and sends their kids to school with our kids. Their profits buy local houses and supports businesses. They have a vested interest in seeing Noblesville thrive. On the other hand, the CEO of the out of town conglomerate probably couldn’t find Noblesville on a map if they had to.
That’s why, in this struggling economy we need to support our locally owned businesses.
The local business owner doesn’t have a national advertising campaign aimed at messaging our egos and tempting our desires. They don’t have well-honed training manuals meant to make employees in Buffalo, Ames, and Peoria act just like employees in Noblesville. They don’t have the buying power to demand lower prices from suppliers. They don’t have an entire marketing department dedicated to figuring out how to get money out of our billfolds.
All by themselves small business owners are the advertising department, the marketing department, the accountant, the janitor, the trainer and the employee. Our town will be poorer for the ones that go out of business during this economic downturn.
And they’re not just competing against national chains that have located here, they’re competing with the Internet.
Perhaps nothing does more universal damage to local economies than online shopping. When you buy online your money leaves the community.
Here’s all the things our money doesn’t do when we shop online for things that could be bought right here:
1) The profits from our purchases don’t stay in Noblesville, washing through the community as the merchant and his employees spend it and the place where they spend it has more money to spend, and on and on and on.
2) The store we might have shopped in locally won’t need as many employees, so there will be fewer local jobs.
3) The local merchants we avoided while shopping at our desks have fewer dollars to donate to local charities or to sponsor local youth sports.
4) The sales tax dollars from our purchases won’t go into state coffers, helping pay for needs right here in Indiana.
5) There will be fewer reasons for people to open new retail outlets in Noblesville because too often we spend our money elsewhere.
When the economy is booming, none of this seems very important. But it is now. Somewhere in town right now there are small business owners looking out their front windows, looking for us.

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