Why should I shop local?


I see a lot of push towards shopping local and supporting the local economy. However, the large national brands provide the same product for cheaper and provide more jobs than your local producer. Why should I pay more for an essentially equivilant product?

In: Economics

Because what they do is that they drain money of a city and move on.

Imagine this:

You don’t buy local.

Business for local goes bad.

He packs up and probably gets hired at big one for a decent-low money.

After this happens to most locals, the big guy starts pushing up prices and keeps the wages low.

There is no other option but to buy from them.

When they see the people are running dry, they pack up and leave.

Now the economic state of the city is significantly worse compared to before.


This is my understanding anyway

The more you buy from Amazon, the richer Jeff Bezos gets, and the more Sam from Sam’s Hardware can’t afford to feed his daughter. Sam is your neighbor. Take care of Sam.

Because it supports the local economy. National brand stores send the profit back to corporate. Local store owners keep it local because they live there. Ideally it gets spent on other local businesses, building the economy and providing more revenue for public services like roads and such.

So you can virtue signal on social media that you are rich enough to pay more and how much you “care”

Firstly, it cuts down on carbon emissions. If you’re getting locally grown produce or locally made items, less pollution is created, because those items won’t need to be shipped across the country or imported. Secondly, by supporting Walmart and Amazon, you’re killing local businesses. Eventually, those businesses will no longer exist, and then the national chain will be free to raise prices because there is no competition. In the very long run, many of these national businesses will have invested enough in R&D to automate most of the low paying jobs, meaning many small towns will not only have no option but to shop at chain stores, but they will also be a wasteland for jobs.

To add to all the great replies. The city that is near where I live has a 1.something percent tax that goes for infrastructure. They paid for a stadium out of this sales tax.

Money is only useful when it changes hands. Every time somebody buys something from somebody else, *both* parties gain value they didn’t have before.

When you buy at a local store, the store owner keeps the money, and you get the thing you bought.

Then he buys produce from a local farmer, labor from local workers, rent to a local landlord, and pays back a loan from a local bank.

Then all of *those* people spend some of that money at other local establishments, all of which benefit from the increased economic activity. Some of that money will make its way back to you, both directly as increased business in the area, and indirectly in the form of better economic fortunes, better interest rates, more stores to choose from, increasing property values, etc.

On the other hand, if you buy from a national chain, the money goes to the corporate HQ, and 75% of that gets paid out as bonuses to executives and dividends to shareholders. Another big chunk goes to purchasing inventory, expanding businesses, etc. But that occurs mostly far away. Only a tiny fraction of a fraction goes to local workers in your town. Of every dollar you spend, $0.95 goes to random people (most of who are already extremely rich) rather than helping your neighborhood.

The opposite situation is an economy based on exports, or something like tourism, where lots of people from out of town come to spend their money in your local area. Just because they only stay briefly, the injection of money into the local economy helps the whole region, with more businesses and services getting built, and all of the people who built those things getting paid, and spending that money and so on.

I read your other comments, so I’ll answer here generalized.

I think you are thinking too big and about things that maybe is not really good to buy locally. A car, for example. You can’t buy a car made locally becouse it’s way too expensive to produce it in small.. A smartphone either, and so on..

But what about food? Why do we don’t buy food that is produced locally? It’s cheaper (here at least), it’s better (less chemicals) AND the money keeps running locally. Or handmade things, these aren’t cheaper, but usually it last longer AND the money keeps running locally. We prefer to buy on big markets becouse it’s easier, humans are too lazy.

The thing is, big companies don’t care about your neighborhood, who lives there maybe care, than the chance that they improve itself is bigger. And we, millenious from big cities, don’t have this sense becouse we are too megalomaniacs.

When you buy local you help a family. When you buy big you help line the overstuffed pockets of a rich CEO

Because it increases the speed money circulates at in the local economy.

Let’s say you work as a teacher in a school, buying a sack of potatoes which was sourced locally would mean supporting a local farmer, whom would be using a local mechanic for his tractor maintenance and whom would also be purchasing his supplies locally. Each of those people would be paying taxes, locally, and those taxes would support the local schools.

So part of the money would be going back in to your pockets because you’re a teacher. And then you could spend it on a carpenter to help fix your house and the cycle would continue.

What this would mean would be an increased amount of jobs in your area, which would reduce the poverty rate and crime rate and boost public services.

If on the other hand you purchased a sack of potatoes produced in another state, you would be sending the money over to that state so it could be circulated there and create jobs there.

**Short version:** Shopping local keeps more money in the local economy, which is ultimately good for your experience of your area (and everyone else’s experience of it, too). Local businesses are also more responsive to community needs (demand), and tend to foster a better local culture.

**Long economics:** National and International chain businesses tend to take money from your community and move it elsewhere (to regional HQ, into paychecks for upper management, or to a different country). This makes sense, though; since they get everything except the local employees from national/international supply chains, what reason do they have to spend money locally? They don’t have any reason to, so they don’t. They always chose the option that’s the least expensive for the company, and that is to invest in nothing more than the wages for local employees. (**Example:** Walmart pays a Chinese company for a ton of hammers. They then pay a national executive who lives on the other side of the country from your town to make sure the hammers arrive at a Walmart distribution center. They pay *another* executive who lives in the biggest city near you to make sure those hammers get to your local store. When the hammers are sold at your local store, you pay the price that Walmart paid for each hammer, plus a tiny part of the salaries of those executives. None of that money is returned to your local community.)

Businesses that franchise (like Chick-fil-a) are a kind of middle ground because the owner is local and more of the money stays local, but the owner still sends some percent of profit or a flat sum back to corporate, away from the community.

Local businesses keep most of the money in community. When you spend money at a local business, the owner, who lives in your area, uses the money from his business to do things like buy a house, pay for services, send his kids to (local) schools, and buy the supplies for his store from local farms/producers. This increases the total wealth of the community, and creates more opportunities for new small business, employment, and development. This also generally leads to more tax money for local government, which can benefit schools, infrastructure, and public services.

**Long benefits:** Shopping local helps keep local shops in business. Having a good selection of local businesses can provide other, not-money-related benefits to the community.

Local businesses can often respond better to what people want. If you come in every week and ask for a certain item, your local store might start selling that item. A national brand won’t. Good local businesses are also more aware of community needs, and can act much more efficiently to serve those needs. They have to be, since they make all their money by serving local people. Think of the stereotypical local hardware store that lets the local farmers buy on credit until they make money at harvest time. A national brand won’t change to fit the community, and often just doesn’t care. This mean you’ll often get better service from local businesses, and have greater “say,” or more ability to effect business practices.

Because of this greater say, and because nobody likes to mess up the place they live, local businesses can be significantly more environmentally friendly than national brands. They also don’t have the ability to cause environmental catastrophes the way big brands do, just as a matter of scale.

Local businesses can also maintain and benefit local culture. A town that has the same set of chain restaurants and businesses as the towns around it becomes stagnant and boring. Variety is important, and differences can help build or define communities. Local businesses will also do things like work with local schools or sports teams to build community support for different groups. Local businesses are more likely than national businesses to host local events like school fundraisers or senior nights. All of these things connect the community and build culture, which offers more activity variety, more recreational options, and a greater sense of belonging for local residents. Basically, for most people, living in a town with a healthy culture and community is more pleasant and more fun than not.

I think at least part of it stems from a modern lack of connection some people feel that elicits nostalgia for a (somewhat imagined) idyllic past when much more of what we consumed had to be produced locally — and what couldn’t be produced locally was at least sold by a small, local retailer so that everything you used had a face to it.

There’s an environmental aspect to it. All else equal, an item that travels a shorter distance will leave behind a smaller footprint.

And finally, an economic aspect: Not shopping locally will mean your town will stop producing some goods and focus more on others. However, if that focused on good rapidly falls out of fashion or starts being made w/automation, the town may feel a setback it may never recover from. Staying unfocused and diverse makes this less likely, and shopping locally helps that