Buy Local & Be All That You Can Be

Buying Local And The Circulating Dollar

Source: Blue Oregon

By John Amundsen of Portland, Oregon who describes himself as "a native Oregonian who wants to improve it's livability, economy, and communities."

Buy local. We all want to do it, but do we really know why? It's good for our local economy. Well, that's right. If we can buy at a national chain at what we think is a lower price, isn't that better for our personal or our company's economy? Well, that's wrong. What happens to a dollar spent locally versus at a national chain or formula restaurant?

Tim Mitchell in Northwest Earth Institute's Choices for Sustainable Living states, 'A dollar spent at a locally owned store is usually spent 6 to 15 times before it leaves the community. From $1, you create $5 to $14 in value within that community.' That's good news! He also states, 'Spend $1 at a national chain store, and 80% leaves town immediately.' That's bad news. Let's recap. Dollars circulating locally -- good. Dollars leaving community -- bad. Next question.

Is that enough for everyone to start buying local? Apparently not. What about that personal and professional economy being more important than the community? Why does the federal government require that government agencies only buy from the lowest bidder, which is very often outside of the local economy or a national chain? These are good questions.

Let's take that personal economy question first. The purchaser says, 'I save money by purchasing at the lower price!' That's an obvious statement, but is the national chain always cheaper? Sometimes, it is just the opposite. Many times local suppliers and retailers are part of co-op groups and buying groups that collectively have the buying power of the national chains.

GOPD is a market research and technology company specializing in the office products industry. GOPD has been monitoring chain store pricing practices since 1999 and is the un-disputed leader in the field. A study on the national chains of office suppliers and independent office suppliers concluded this:

'Our research has shown, time and time again, that most local independent office supply companies are substantially lower in overall cost to the consumer.'

'The pricing gap between the independent and the chains is so wide, and the consumer perceptions are so engrained that the chains have the lowest prices, that some independents have chosen to match the chain store prices using our services.'

Yes, you read that right. Some independent suppliers raised their prices by matching the national chains. National chains have successfully changed the perception of the consumer that they are the lowest price through advertising and price juggling. Clearly, local is better here.

to read more of this article check out Blue Oregon HERE.