Many organizations have long recognized the importance of small businesses and their contributions to the economy. IMA’s Small Business Financial and Regulatory Affairs Committee (SBFRC), for example, advocates for small businesses and financial reporting matters. You can help too by turning to local small businesses for goods and services.
November 29 is a day when you can make a big impact. Yep, it’s Small Business Saturday, a day that promotes shopping at small businesses in local communities and offers a chance for individuals to make a big impact on both the local and global economies in many ways.
Boost Employment Rates
Small Business Saturday was established by American Express in 2010 and was nationally recognized in 2011 because small businesses help lower the unemployment rate—the most important factor to a growing economy.
The Small Business Administration says that 60% to 80% of new jobs in the United States are created by small businesses, and small businesses account for 99.7% of employers. On a smaller scale, they hire locals, which decreases the community’s unemployment rate.
Engage Your Community
Small businesses help support many aspects of individual neighborhoods, including occupying buildings that would otherwise be abandoned and that would foster crime.
In addition, small businesses cater to their customers who might need specialized products. The customer service provided to this niche market builds stronger customer relationships.
You are also more likely to become a frequent shopper at stores that understand your needs and want to help you, unlike some of the chain stores. And the money you spend there goes back to the community. (For example, the business can make a donation to the town, the sales tax goes to local police or municipalities, and they can sponsor town sports teams or events.)
Grow the Economy
Small businesses are essentially the backbone of the economy. A survey of independently owned retailers by Civil Economics reveals that 52% of small business revenues are recirculated into the economy, whereas chain stores recirculate only 13.6%.
If you’re drawn more to the boutique rather than the big-box store down the street, the products you’re buying are probably Gross Domestic Product (GDP)—domestically grown or made products that aren’t imports. This greatly benefits the national economy.
By supporting your neighborhood “mom and pop” shops, you contribute to the growth of the economy. What can small businesses do to keep you motivated throughout the year to shop small?
Written by Linda Devonish-Mills, CMA, CPA