Small Business Saturday is a relatively new tradition among American shoppers gearing up for Christmas. Small Business Saturday is a shopping “holiday” that falls between Black Friday and Cyber Monday, and encourages shoppers to visit locally-owned brick-and-mortar businesses. This new tradition was started in 2010 by American Express in an attempt to boost the economy.
The recession hit small businesses especially hard, with growth dropping about 12 percent between 2007 and 2010. Small businesses have been touted as comprising about half of the private non-farm gross domestic product, and providing around two out of three new jobs. Small business are a big talking point on political campaigns, with both parties pledging to provide aid and benefits to these mom and pop outfits to stimulate the economy. While loans and grants and tax breaks are a great help to these small entities, what really spurs their growth is consumer dollars.
Some big box stores like JCPenney and Macy’s have $1 billion to spend on marketing campaigns to draw in shoppers with holiday money to spend. They use some of those big bucks to draw in pop stars and other celebrities who have a large following to capture the hot under 30 market. Small local business just don’t have that kind of buying power. They usually employ a very small number of people, and have no way of competing. With tighter profit margins, they often can’t offer the rock bottom door buster prices that a lot of larger retailers use to draw in shoppers. Therefore, collaborative campaigns like AmEx’s Small Business Saturday are a huge benefit to them, to the tune of about $5.5 billion two years ago.
There are many benefits to shopping local. Small businesses often provide excellent, personalized customer service. Local business owners are often very involved in the community — either by donating to local charities, or coaching and/or sponsoring local athletic teams and events. USA Today reports that in Chicago, two thirds of customer dollars spent in locally owned business stayed in the community. Big box stores sent almost that same percentage outside of the city.
As more Americans seem to prefer shopping from the comforts of their home, American Express teamed up with Etsy, an online marketplace where individuals can buy and sell unique and often handmade goods from around the world, allowing people to still support small businesses without leaving home. Advances in online marketing and electronic inventory have made it much easier for individuals and small businesses to harness the power of the internet to aid them in selling and shipping their distinctive goods. So while Small Business Saturday is mostly geared towards getting people into local brick-and-mortar stores to check out the wares, it’s still helping those that have the ability to sell online, and may be providing a much-needed boost to local economies. So do your part, and shop local on this Small Business Saturday.