Supporting Independent Locally Owned Small Businesses is Worth Every Cent.

Adam Grupp
Oct 3, 2017
3 min read

Skyline Shot of the City of Dover, NH in the early Fall.

As a business owner, I find myself shopping around for the best prices on products and services I need to operate my independently owned business, things like utilities, equipment, marketing material, payroll and even coffee for the office. Shopping around for the best prices often leads me to the chain stores which may or may not be local but usually not locally owned, places like Staples or VistaPrint which I found and used online for business cards (MG Print and Promotions, Fusion Capital will be back to use your services!)

As of recently, I've been changing the direction of my business by focusing on marketing to the local businesses that may find my services (equipment financing & small business loans) useful, . During this change in direction, I read a lot about the importance and benefits of supporting locally owned businesses. One of several interesting articles I read came from the American Independent Business Alliance , (AMIBA) a non-profit that helps communities become more self supporting & resilient through fostering a culture that values and supports independent business and local entrepreneurs. The article was titled, "The Multiplier Effect of Local Independent Businesses", it supported research showing that independent locally-owned businesses recirculate a far greater percentage of revenue locally compared to absentee-owned businesses (franchises and chain stores).

After reading the article, I had a better understanding of how supporting local independent business owners can have such a profound affect on not only the success of the local economy but also the success of my independently owned business. In a nutshell, the Multiplier Effect (Local Premium) consists of 3 elements - the direct, indirect and induced impacts.

Direct Impact is spending done by a business in the local economy to operate the business, including inventory, utilities, equipment, pay to employees and banking.
This is where I can do more with my business to have a greater impact on the success of the local economy.
Indirect impact happens as dollars the local businesses spend at other local area businesses re-circulate.
This is where spending a little extra on products and services from local independent businesses will come full-circle and have a greater impact on money spent in your establishment.
Induced impact refers to the additional consumer spending that happens as employees, business owners and others spend their income in the local economy.
A higher percentage of the dollar spent at local independent businesses stays local where the franchise dollar is spread through owners, directors and taxes not local to your area which means less money re-circulates in the local economy.

The statistics on buying from independent local business versus chain stores are staggering. Check out the infographic below showing how much of every dollar spent re-circulates into the local economy depending on where it's spent.

Statistics on the Impact of Your Business Buying from Local Independent Biz

Based on all the articles I've read and the statistics backing it up, I've come to the conclusion that the long term success of my independent locally owned business is far better than that of immediate savings found at chain stores that never buy or even step foot into my establishment. Savings today don't always add up to success tomorrow. My advice (and I'm going to take my own advice as well), keep your business local, support local and watch your local business and local economy flourish as you keep the wealth local!

Fusion Capital Corporation is an independent, locally owned business serving Dover, NH and the NH Seacoast, offering small businesses working capital and equipment financing and working with local equipment dealers in offering our service to their customers. Feel free to check out our website at www.gofusioncapital.com. We're always doing our best at buying from locally owned businesses. We hope you do the same. If you feel your services or products would be of use to us, please email us at questions@gofusioncapital.com or you can leave a comment below.

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Reference of Articles and Websites Used and Helpful Links that I found while researching: