The 3/50 ProjectI recently came across an interesting display in a local store in downtown LaGrange. The banner (see photo) said the following:

Save Your Local Economy… Three Stores at a Time

Saving the Brick and Mortars Our Nation is Built On

3. Think about which three independently owned stores you’d miss if they were gone. Stop in, say hello, and pick a little something up. That’s how they stay around.

50. If just half the employed U.S. population spent $50 each month in independently owned stores, their purchases would generate $42,629,700,000 in revenue.

68. For every $100 spent in independently owned stores, $68 returns to the community through taxes, payroll, and other expenditures. In a national chain, only $43 stays here. Spend it online and nothing comes home.

1. The number of people it takes to start the trend… you.

The premise of this campaign is to encourage people to support (i.e. spend money) in local, independent shops and restaurants. The first time I saw this, I didn’t think that much of it, but then as I was eating lunch the other day (in a locally owned restaurant) I actually read the flyer and it just didn’t sit right with me.

Don’t get me wrong, I’m all for shopping locally. I don’t like the huge chain stores or “big box” retailers any more than the next guy. But I’m also the owner of an small, independent online store and I’m friends with several entrepreneurs who have been fortunate enough to grow their businesses into regional and national businesses.

The Problem with “The 3/50 Project”

The problem with the 3/50 project and any other projects like it is simple. It’s not my (or your) responsibility to save local businesses. It’s the business owners’ responsibility. Initiatives like these put the responsibility on the individual to support businesses that often times are poorly run.

Lots of small businesses will go out of business. They are running on outdated business models, with nothing unique to set them apart from their bigger, or more nimble competition.

Local independent business owners need to find a way to differentiate themselves. Whether that’s based on service, product offering, or some other factor, they are going to have to find a way to make themselves valuable to potential customers.

Customers are never going to shop with someone just because they feel obligated to support them. It’s simply not enough to guilt someone into buying from you.

It’s Not the Internet’s Fault

Another issue I have with this program is that it seems to place a little bit of the blame on Internet companies. One of the key points is that if you shop with Internet companies all of the money leaves the local economy. While it does leave one local economy, it also enters another local economy. And it almost always stays in the United States.

As the owner of a small, independent, but online retailer, I take offense that just by being online and not traditional brick-and-mortar I’m somehow causing these small, local companies go out of business.

The truth is a lot of these local independent retailers and service providers have gotten lazy. They’re used to just doing business the way they’ve always done business, and they’re scared of changing. No amount of community involvement is going to save the business that stuck in the Stone Age.

It’s Just Postponing the Inevitable

Let’s say this initiative works. What happens in five years or 10 years after these companies have been saved from extinction by local patrons who give them money instead of cents spending money with big-box retailers and Internet companies? What happens if these companies ignore the reasons why people were not shopping with them to begin with? Are their customers expected to just buy from them for ever with no regard for price, service, selection, or any other market-driven factors?

Business owners need to take a hard look at why they are suffering, and why big-box retailers are thriving. If it’s not possible to compete on price, and there’s no way they can bring any other value, maybe it’s time to close up shop and go get a job.

How Do You Save Your Small Business?

So what do you do if you own a small, local business? Instead of spending your time and energy trying to guilt people into supporting local shops, look for ways to differentiate yourself. What makes you different? Better? What is your USP?

In some cases, you may not be able to differentiate enough. Local general stores simply couldn’t compete with the big box retailers like Walmart. It seems people just don’t care enough about service or convenience when it comes to some products (like commodities). It may be sad, but it’s just a fact of life. How many local music stores do you see around? I occasionally see a Fry’s in a mall, but they’re few and far between. The vast majority of people are buying their music online now.

Should we still be shopping at local CD stores, just to support local business? Sounds ridiculous, doesn’t it? You have to keep up with industry trends. Change and grow with your industry. Sometimes that may mean drastic changes to a business, or even the hard decision to get out of an industry.

So, take a hard look at your business and your industry. Are you ready to compete with the big guys? Can you offer something they can’t; can you do something better or faster?