As we approach the holiday season, full of gatherings centered around food and family, supporting local shops and artists is an especially powerful way to have a positive impact. It may just be the perfect solution that saves our watershed and the world! The raw economics behind this holiday mantra have substantial and almost immediately noticeable impacts on our economies, which is even more motivation to support your local food hub, farmer, grocer, artist, brewer, baker, and all other kinds of close-to-home businesses and makers. And if you want your dollar to go the extra mile this season, consider using cash in your local communities. It helps keep the money in our pockets; another cool way to go green this holiday season.
The Economics of Supporting Local
You’ve probably heard the call to “shop local” before. But the reasons why are pretty astonishing. According to the American Independent Business Alliance, the “local multiplier effect” occurs when you spend your dollars at a locally owned and independent business instead of a chain store or online giant. Your dollars recirculate through your local economy TWICE to FOUR times more than money spent at a non-local company. As your dollars move through your community, the money generates more local wealth, charitable contributions, and jobs.
To see if this held true in Alaska, the University of Alaska Center for Economic Development, in partnership with BuyAlaska under the Alaska Small Business Development Center, conducted a study to quantify the impacts of buying from local businesses compared to national businesses, primarily chain retailers and restaurants, in Alaska. Here’s what they found:
Three times more value is retained in Alaska when consumers shop at local businesses than when they spend at non-local big box stores and chain restaurants. For every dollar spent at local businesses, 63 cents stays in Alaska. Only an estimated 22 cents stay in Alaska for every dollar spent at non-local businesses.
An estimated additional $103 million would stay and circulate through the Alaska economy if every Alaska household spent $1,000 at local businesses instead of nonlocally owned businesses. Local, independently owned businesses retain more profits, source more goods and services from other local businesses, and do more community-based charitable giving. Non-local businesses are more likely to source goods and services from their own national supply chains, and profits are largely returned to corporate headquarters out of state.
If every Alaskan household shifted $1,000 of spending from non-local to local businesses, it would support an estimated 5,850 additional jobs statewide. Greater local capture of dollars enables more economic activity.
Inletkeeper believes strongly in the power of local, independently owned businesses, farms, and entities because of the underlying economics. By retaining more wealth in communities, local businesses are the foundation of strong, healthy economies, allowing people to have sustainable livelihoods. Without stable local economies, boom and bust industries can wreak havoc on local communities. The local people and landscapes are left bearing generations of scars. At the same time, profits are sucked away by multinational corporations and shareholders who, by design, care mainly about the bottom line.
Incubating Entrepreneurial Success
The interconnectedness of economic, community, and watershed health is one of the core concepts behind our approach at Inletkeeper’s Community Action Studio. The shared space is a nexus for local people, organizations, and businesses who value clean water and healthy watersheds. Though only 1,500 sq ft, the Studio hosts a co-working space, meeting space, art gallery, commercial kitchen, and business incubation space. Multiple food-related entrepreneurs have utilized Inletkeeper’s Community Action Studio to grow their businesses. Established in 2019, the Studio has proven to be an excellent stepping stone for home-based or mobile businesses to transition to a brick-and-mortar establishment.
We are incredibly proud to have been part of the evolution and success of one of those businesses, The Goods + Sustainable Grocery and Where It’s At! mindful food & drink, which operate under the Mindful Living Collective, “an LLC built to nourish our community, mind, body, and spirit.” The Goods expanded from a small corner of the Studio to provide zero-waste products, local dishes, groceries, and much more. As it has grown, The Goods continues to invest its spending power in “ethically produced products and services while connecting Alaskan farmers, artists, makers and entrepreneurs to a broader customer base.” The owners state, “We believe this will create a more resilient local economic ecosystem.”
The power of aggregators is immense. Farmers markets, Inletkeeper’s online Alaska Food Hub, and other co-op style grocery stores curate many locally grown and made goods to sell to customers in one location. In this way, it is essential in bolstering the local economy because it provides year-round sales for one family-owned business and many families’ businesses and products.
So, no matter how big or small your family budget is, you can use the power of your spending to support local in many ways: eat local, shop local, donate local. So be a LOCAL hero – support local businesses, farms, and organizations. It just makes (dollars and) cents!
This holiday season, we ask you to support Inletkeeper’s mission to protect the Cook Inlet watershed and the life it sustains. Your donation will help incubate more independently owned businesses, lower pollution from imported goods, and increase food security in our watershed.
Thank you for reading. We are able to do this work because of member support from concerned friends like you. Please donate today to protect Cook Inlet for our future generations.