The Power of Local Purchasing

The message to buy local often appeals to our emotions, emphasizing the human connection of supporting business-owners in our neighbourhoods. This lovely segment from the town of Lincoln is a great example:

There’s another way of looking at the impact of local purchasing, and it was highlighted in a recent presentation by LOCO BC and Buy Social Canada. I dug into some of LOCO BC’s research on the subject, which tells the same story about the importance of buying local, but through numbers.

According to LOCO BC and Vancity’s research, when you buy from that business down the street whose owner you know by name, especially if you buy a product grown or produced by other people in your area—like Niagara wine or locally grown flowers in the summer—your purchase can have a significantly greater economic impact on your community.

For this study, they considered several different products purchased at independent local businesses vs. multinational chains, comparing how much of the purchase price stays within the community in the form of wages, profits, expenditures on supplies and services, and charitable donations made by the business. (They call these the 4Ps: payroll, profits, purchasing and philanthropy.) The results vary depending on the category of product, but they are compelling across the board.

With a purchase of organic blueberries, for example, they found that buying locally grown from a locally owned business resulted in 83¢ of every $1 spent recirculating locally, as opposed to only 12¢ for imported blueberries from a multinational chain, a 7 times greater economic benefit to the community.

In the case of the bike, the comparison was between a local shop and a direct-to-consumer online retailer based in Europe, which offers almost no economic benefit to the BC community. But even a brick-and-mortar multinational retailer offered only half the economic benefit of the local bike shop.

I found this study illuminating for the way it highlights the cascading effects of dollars spent at local stores. All the BC businesses featured were making their own purchasing and labour choices—sourcing local milk and Canadian grain, roasting coffee in-house and choosing local and Canadian manufacturers—that increase their economic benefit beyond what you can see when you walk into their storefronts. As the video from Lincoln says, it’s a “ripple of connection”!

You can read the whole report on the LOCO BC study here.