SMALL BUSINESS SATURDAY. (WHO'S HELPING WHO?)

January 2015

   Did you have November 29 circled on your calendar last year? I hope so; you wouldn't want to have missed Small Business Saturday [SBS] - the one day last year that American Express encouraged you to spend your money with small businesses. It was again conveniently located just after Black Friday (November 28, when all of the big businesses offered you amazing deals on all their merchandise) and Cyber Monday (December 1 last year, when all the on-line businesses offered you amazing deals on all their products). Actually, of course, Black "Friday" covered - depending on the store - anywhere from three to seven days. Did you have any money left after Black Friday that you were not saving for Cyber Monday - or for the extended Black "Friday" - that you spent on SBS?

  American Express began promoting SBS in 2010 and, according to them, it has grown in popularity each year. In 2013 the President of the United States and 41 State governors championed it, and in 2014 the United States Small Business Administration encouraged business owners to take advantage of it, offering specific advice on what to do to increase sales.

   American Express reported that millions of people shopped at small businesses in 2013, generating $5.7 million in sales for independent merchants. That was up from their estimate of $5.5 million in 2012. The reports just in for 2014 sound even better - amazing, in fact: according to the National Federation of Independent Business (the group that now runs the surveys), 88 million consumers "shopped small" on SBS 2014, spending $14.3 billion (yes, billion not million), or about $162 spent by the average buyer. They don't make any attempt to compare their "new" estimates of billions to the "old" estimates of millions. However, they do admit that, while total business was up 2.1 per cent when  2014 is compared (using their "new math") to 2013, purchases by the "average person" were actually down 11.5 per cent.

   I find it hard to believe that American Express is really a champion for independent business. I worry, too, about the National Federation of Independent Business (NFIB) being the Keeper of the Score on what's really happening with SBS. After all, they were one of the principal complainants in the recent Supreme Court case against "Obamacare" (the Affordable Care Act), which about half of the country's small businesses seem to approve of. Also, much of their operating money is said to come  from sources much more favorable to large corporate interests than to independent businesses. I don't know enough to state a lot of "facts" here, but the type and volume of information compiled about NFIB seems pretty compelling. Do a quick web search, and judge for yourself.

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My fears about sponsorship and monitoring aside, it's still hard to get a handle of what the figures really mean. They sound pretty good, but... For instance, press releases from American Express say that reported sales were generated by shoppers who "had heard about" SBS, seemingly implying that it was money that would not have come to small businesses in the absence of the SBS publicity. But how many of those shoppers who "had heard about" SBS would have shopped at a small business, regardless of the promotion? How many were new shoppers? How many of those who did shop small on SBS came back some of the other 364 days, in lieu of their regular trips to Walmart and Target? It's all pretty nebulous. I know these kinds of statistics are hard numbers to come up with, but let's presume that a few folks did have a little money left over from Black Friday that they weren't saving for Cyber Monday (or the rest of Black "Friday"). Truth be told, "a little money" is almost certainly exactly the right description. According to the American Express website, a survey after the "gala" in 2012 estimated that the median amount spent by a shopper in a small business on Small Business Saturday was $75.00. The "new math" figure for 2014 was $162.00.  Using either figure, I'm amazed; it's hard to believe you can go in any store nowadays, and spend as little as that.

   One blogger from a year ago or so labeled the idea of Small Business Saturday "silly." I think a more apt term would be "obscene." Oh, I know that SBS probably does generate a little extra business for local enterprises. I suspect that some beneficial impact of the SBS publicity extends beyond the one designated day. It can't hurt to have advertisements that say "shop small." But, seriously, what message is being sent here? Is it that small businesses should be the backbone of American enterprise? Isn't it more likely that the message is that it's nice to give small shops a well-publicized "pat on the head," just as long as people remember that "mom and pop" are just a sideshow alongside the Big Tent of the Nation's economy?

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   It isn't easy to "shop small" in America nowadays. Many small towns have no choice except Walmart for hardware, clothing, books, stationery and office supplies, medical prescriptions, and even groceries. A lot of this is the result of intent on the part of Walmart and (to a much lesser extent) other large chains, underselling local businesses until the locals couldn't survive; some of it is just the public reacting to the convenience of one-stop shopping, or the claims of the big stores that their prices are "much cheaper." In any event, "small business" in many communities now consists of mini-marts where you can buy beer, soft drinks, and snacks; stores selling seasonal tourist items; and "handcraft" boutiques, run more for love than profit. Few of these independent businesses offer their operators a real living.

   The situation in the Big City isn't much different. Here in Gresham, Oregon - covering 25 square miles, with a population of 110,000 - our only hardware store is Home Depot. We don't have any bookstores selling new releases, anymore (although you can pick up the Top 10 bestseller paperbacks at the supermarket). I think Office Depot may be the only stationery-office supply store within the city limits. In the entire Portland, Oregon - Vancouver, Washington metropolitan area (population 2.25 million, covering 7000 square miles), there may be two dozen "independent" hardware stores, and far fewer bookstores where you have access to a reasonable selection of recently-published volumes. I doubt it is much different in other cities. Although some types of small business do seem to be experiencing some resurgence from their lowest points (see examples in the Hometown Advantage Bulletin -

http://ilsr.org/about-the-institute-for-local-self-reliance/  ), I see little hope for a real renaissance.

*   *   *

  The War Against Independent Business (if we can have wars on drugs, terror, and even Christmas, surely we can label this one similarly) has been going on for a long time. Between Big Boxes and The Internet, much of this "war" has already been lost. Still, there are battles that can be won. Therefore, it always surprises me when I see people who label themselves "progressives," or "liberals," or "Democrats" openly touting  Walmart, or telling us to buy our books from Amazon. Are they really not aware, or have they already ceded the victory to Big Business?

   I don't know if anything can be done for the many small communities that have no choice anymore but to shop Walmart. No individual enterprise can compete in these environments. In the past, I've suggested local businesses join together to form co-ops that could stock more merchandise and maybe bring down their costs. That's tough work, and it's doubtful that "success" would be much more than a moral victory. There are, however, many actions that can be taken (or not taken) that can lend support to a general, healthy maintenance of independent business in the United States.

  (But, before I list some of my suggestions, I need to acknowledge that there are a lot of people in this country who now rely on Walmart and some of the other big chains. They don't have the time or the transportation to get elsewhere, or their finances are such that even the hope of a savings is important to them. We need to help them find viable alternatives.)

 So, here are some suggestions:

1. If you have ANY other alternatives, don't shop at Walmart, Target, Home Depot, Office Depot, and the other Biggest Boxes. You probably won't hurt their profits - after all, they make more money than almost anyone else in the world - but at least you won't encourage them. Many of us don't need to save the few pennies that might (actually or theoretically) be possible at those stores; if we do, we can buy one less carton of soda or one less bag of chips, and probably make up the difference.

 2. If you do need something that can only be obtained from a Big Box, buy just that; don't do all your shopping there, just because it's convenient. Any of us who are solvent enough not to have to worry about every penny we spend should be aware of how much more our Big Box purchases hurt independent businesses than they benefit us. (See my essay "Buying Local," linked above.)

 3. If you must shop a Big Box, think about which one; they aren't all equal. Walmart is constantly in the news for alleged unfair labor practices - low pay to employees, unpredictable work schedules for workers, few benefits... Costco has clearly taken business away from smaller stores, but they seem to treat their employees fairly, with good pay and benefits, and a generally desirable work environment.

 4. Don't shop online if you have any local choices. "Convenience" can't be a legitimate excuse for a Progressive. If you do shop online, be selective. Amazon has a long history of what I and many others consider unfair competition with small businesses. There are other book and merchandise sites that work mainly with small suppliers. The money you spend may not stay local, but at least much of it will go to support small enterprise, somewhere.

 5. If you sell merchandise, don't automatically tell your potential customers to buy from Amazon. Give some thought to who can best benefit from your business, not just to what seems most beneficial to you.

 6. Don't ever offer your products exclusively to a Big Box, and don't buy products that are offered only at one store. That gives another advantage to the big store over the little one, and entices the customer to come to a store to buy one thing, then to stay for the convenience of one-stop shopping.

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   I don't know that any of my suggestions will do any good in the long run. For a long time, economic trends have favored bigger business over smaller enterprise. It's a sad fact that more and more money is leaving local economies, and being concentrated in a few Big Business bank accounts. It's a sad fact that Small Business has become little more than a collection of boutiques, offering nice but not essential goods that sell fairly well in "up" periods, but not when things get tight. It's a sad fact that, more often than not, if you're lucky enough to have any job, it's likely to be working for "the Man," not for yourself.

  And it's a sad fact that, in the history of dragons vs. dragon slayers, the dragons definitely have the advantage, and the winning record to prove it. But dragon slayers keep stepping up, and usually not for personal gain (well, okay, sometimes it is to win a fair maiden), but because the community needs the dragon slain.

   Occasionally, the dragon is vanquished.


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