Keep Your Money in the Community

Originally published in October 2021.

When dollars are spent locally, they can be re-spent locally

Did you know that locally-owned businesses circulate three times more money back into the local economy than chain stores do?

A Shopping List – I was recently thinking about an event we held while at Piedmont Peace Project, where we organized low-income folks in rural North Carolina. As people registered for the day, they received an envelope with play money and a list of things to buy during the breaks and lunch time.

We made pretend businesses: a locally-owned pharmacy (with our own local pharmacist running it), a local sandwich shop, local hardware and farm equipment store, as well as a Walmart, McDonald’s and a Home Depot. Our intern, Joyce Mandel, actually got or made “real” looking signs for each business, including one with the McDonald’s golden arches. People had a great time spending their pretend money!

We collected their “receipts” after lunch and reported back on how they spent their money and how much of it went back into the community. Because there was not enough play money to buy all of the items at a local business, folks mostly had bought from the major chains where goods were cheaper. Many people used the local sandwich shop because the food was better, but very few went to the local pharmacy or hardware store because it was too expensive. Also, some didn’t have enough time, and found it faster to get most of their shopping at two stops: Walmart and McDonald’s!

Where Do Your Dollars Go?
Our pharmacist told the group that Walmart could sell medicines cheaper than he could, and had already put some local pharmacies and other local shops out of business. Yet, within two years, they were charging as much or more than the local pharmacy. Those of us who used the pharmacy talked about how the pharmacist had helped us get coverage for our medicines that big chains didn’t. Others testified about how when they didn’t have money, our local pharmacist would give them their medicine and let them pay it back later. The pharmacist also informed us when our medicines were not compatible with each other, and provided lots of services that we didn’t find at the chains. When shopping at local businesses you’re seen as an individual not a consumer statistic.

After hearing these stories, and understanding from an economist who spoke to us about how the local economy invested in the community, people had a break to try to rethink how they wanted to spend their money. An amazing thing happened. People got very creative about how to spend their money. A group of farmers decided to share the tools on the hardware list. But the best part was they decided to form a tool co-op after the event. They even shared a tractor, a mower and other machinery.

Investing in the Future – Local business owners invest in their community and have a vested interest in its future. Locally owned businesses contribute more to local charities and fund-raisers than do their national counterparts. Spending money with local retailers helps keep the local community alive. The places where we eat, shop, and have fun all have the potential to make a community feel like home. Many cities have a “buy local” card you purchase annually that gives you discounts at participating businesses.

I recently decided I needed to change to a local pharmacy and practice what I preach! I was thrilled to find a local pharmacist who sat down with me, introduced me to staff and took all my information. Later, as I waited in my car to pick up my first prescription, a person came out and asked how they could help me. My medicine was ready to go when I drove up to the window.

Why Buy Local? This question is best answered by Michael H. Shuman, author of Going Local. “Going local does not mean walling off the outside world. It means nurturing locally owned businesses which use local resources sustainably, employ local workers at decent wages and serve primarily local consumers. It means becoming more self-sufficient and less dependent on imports. Control moves from the boardrooms of distant corporations and back into the community where it belongs.”