We have all heard someone in town, or perhaps even ourselves, referring negatively to the price of things in our small town compared to its counterparts: the big-box stores in the nearest large city.
For the most part it is true; prices may be a little higher in the small town. The negotiation power of Wal-Mart or ALDI is superior to our local shops. While they could be buying 30 cases of tomatoes a week, our small shop only manages to sell 2 cases in the same period – the price variances are sometimes considerable.
Another factor playing a key role here is the variety of products the big-box stores put on display: several sizes and several brands of the same products, for example: tomato paste, you can find Hunts, Del Monte, Libby’s, Heinz & Contadina on the same shelf, the variety is interminable. This same pattern follows for most products. So the big-box stores have a real bulk-pricing and variety advantage over local shops. The great variety of products is indeed attractive and we all tend to marvel at the fancy displays and innovative approaches to get us to buy their products.
But the local shops can compensate and even overcome these disadvantages. Here we have three clear examples where the local shop can really win and regain customers.
-Distance convenience. Your local shops are in close proximity and allow you to quickly obtain your products, save driving time and transportation (fuel) cost.
-The personal touch. The attendant/owner may be your neighbor or attend the same church, and that connection would tend to allow for an easier exchange of ideas and for smoother business transactions. Besides, we all like to see a friendly and known face that may greet us by name as we shop. Local shop owners are passionate about what they do and they will have a vested interest in knowing how to serve you.
-Business Relationships: Building a business relationship goes beyond face and name recognition or a warm exchange of smiles as you pass each other on the street. The relationships of merchant and customer are no different. Built over time by understanding each other, their needs and challenges and finding common ground, then moving to build trust relationships where you are willing to go the extra mile for each other. These relationships are much easier to build and cultivate with a small town shop through the daily patterns of living than with a big-box business. In the big-box business you will continually find different personnel serving you and it is hard to establish a friendship. Besides the time you spend in those stores is rather short. In a small town shop you get to know the owner or the staff and that makes for a better chance to build relationships.
How do you as a customer approach all these facts? It really involves two main alternatives that can simultaneously exist and they have a lot to do with your core values or the attitude you may have towards the environment you live in, they are:
-Self-Concerned: An individual has a home economy, a top concern to conserve money and sees shopping with a purely utilitarian focus, that is, he is solely concerned about his personal economy, his pocket book and no one else’s. He is looking for the lowest price possible.
-Community minded individual. This means you see yourself as a member of a greater group, the community, and as such you feel responsible to contribute and be part of it.
Having a self-centered attitude comes natural to all of us. Our Hollywood culture of winning at any cost, taking advantage of everybody and every situation, looking out for number one and self-preservation is prevalent in our society.
Shopping local requires a higher level of maturity where life priorities are driven by a long-term view of situations, by considering the good of the group and not just self and being willing to sacrifice in the face of being ridiculed by others. We continually struggle within these two alternatives as we decide where to shop.
Civic responsibility, concern for others, a long-term approach to life and a contributing and participative attitude are some of the foundational principles in an economically thriving community.
Those foundational principles are primarily inculcated at homes and are passed through from generation to generation in the daily living activities of the families. Schooling and society at large have some influence as well.
Beside the self-centerness and the community minded consumer there are some other “reasoning or logical” factors that come to play a role in the decision making when deciding to shop either local or big-box:
On the one hand, the merchant has the obligation to continually improve his service and products and to compete. If he doesn’t, he will be unconsciously inducing the customer to default to the self-centerness state of mind and base his spending purely on price and selection. This will negatively affect the small merchant’s viability. This condition is evident when the customer perceives through his visits that the merchant does little to nothing to improve his service.
Another critical point for the merchant is to increase and manage the availability of his products: the time and patterns of when your store is open. Customers are for the most part creatures of habit. If a merchant commands a price or service leadership he may be rigid with the schedule (i.e. Apple Stores) but if not he must become flexible and tend to the customer’s shopping patterns such as late or early hours and weekends if necessary in order to capture them.
But how can the merchant improve? Here are some basic approaches that a small merchant can take to improve their likeliness to succeed:
By listening to the customers, benchmarking from others, taking some short courses to learn and apply more about technology, marketing, merchandising, customer service and strategic planning. Adjusting their operating schedules to match the customers’. Also, by working at building strong business relationships with its customers.
On the other hand, the local consumer will do a great deal of service to the community and to himself by keeping in mind the byproducts of shopping local:
-More of your money will stay in the local economy and that means more local jobs and support to other local vendors.
-Merchants can contribute more to the community in terms of charities and fund-raising.
-Local shops will grow and provide even wider selection and better pricing.
-Sales taxes are reinvested where they belong – in the community.
-Local shop owners are less likely to leave the community and are more invested in its future and creating a thriving market.
A final thought for you as the consumer and/or merchant who gets to decide where to shop in a free society within the capitalism system: shopping local is smart and local merchants must compete for our loyalty.