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SALT LAKE CITY — Initiatives encouraging local shopping have a significant impact on spending habits of consumers in the area.
In areas with active Local First campaigns, independent businesses saw an average of 7 percent sales growth in 2013, compared to 2.3 percent growth in areas without, according to a national survey by the Institute of Local Self-Reliance and the Advocates for Independent Business.
The institute surveyed 2,606 independent, locally owned businesses. Approximately half were retailers, as well as service providers, manufacturers, farmers, banks, restaurants and wholesalers from across the nation. In total, they employed 30,049 people. Of participants, 75 percent reported that the initiative had a positive impact on their businesses. Forty-two percent said the impact was moderate or significant, while 12 percent said they didn’t know the impact.
Over the holidays, independent retailers experienced a 1.4 percent increase. Toys ’R’ Us experienced a 1.8 percent increase, according to the report.
“This national impact is reflective of what we are experiencing in Utah,” said Kristen Lavelett, interim director of Local First Utah. “More than half of the Utah-based businesses that responded to this survey reported that the efforts of Local First campaign resulted in a positive impact on their business.”
Of every dollar spent at a locally owned business, 45 cents stay in the community, Local First Utah said in 2011. Only 14 cents of every dollar spent at a national chain stays in the community. If each Utahn spent 10 percent of his or her annual spending at independently owned businesses in Utah, $1.3 billion would stay in Utah, according to the organization.
In 2011, Buy Independent/Buy Local conducted a national survey that found areas with Buy Local initiatives grew on an average of 5.6 percent in 2010, whereas areas without experienced an average 2.1 percent growth.
Small businesses still face challenges, including competition from large Internet companies — especially those that offer goods below cost or weren’t required to collect sales tax — and supplier pricing that favors big competitors, as well as costs for health insurance.
