Get out and shop local is the message this holiday season: last Saturday was Small Business Saturday, when residents were encouraged to patronize their local businesses, while Mayor Martin Walsh continues the call with a twitter campaign and other promotions.
But small businesses face steep challenges to staying afloat, according to several executive directors of Main Streets districts. Nevertheless, they added, small businesses offer unique returns to the local community.
Speaking ahead of Small Business Saturday, Joyce Stanley, executive director of Dudley Square Main Streets, said she anticipated the day would draw needed attention to new businesses and a second look at revitalized older ones.
Recent construction and related traffic congestion in Dudley Square discouraged some customers from the area, Stanley said. Older businesses located there also struggle to make youth aware of their offerings, as many young people shop online, she added. Saturday, however, promised an influx of visitors and a chance for older stores to get discovered. A local hat store sported a new window display and web presence in time for the occasion.
Challenges to local
Small business owners face a variety of struggles.
Smaller store sizes mean that owners are not able to buy goods in bulk and reduce costs, and these businesses often have higher insurance costs, according to Ed Gaskin, executive director of Grove Hall Main Streets. This, he said, often means higher prices for customers.
It also can be hard to maintain a steady cash flow, Stanley said. Patronage levels can vary, creating difficulty for a business that needs to maintain merchandise when income dips or seems hard to predict.
Each location also has its own set of draws and hurdles.
In Dudley Square, challenges include lack of parking for employees and customers and the high cost of space, Stanley said. In many cases, proprietors will locate their stores in the same building, with one renting and subletting to the others.
Most enterprises in Grove Hall are beauty salons, convenience stores, bodegas and fast food or take-out restaurants, according to Gaskin. With few businesses selling merchandise, it is more difficult to launch promotions for shopping local and holiday gift shopping.
And even when a business is able to keep running, it may not stick around.
“It’s unusual now for businesses to last to the second generation,” Stanley said. The reason: often there is no one to take over if the original owner retires.
This limited business life span restricts how large and established it can become.
But when small local businesses survive, they bring a variety of benefits.
Job creation
Statewide and nationally, many people re employed in small businesses.
“Small businesses created two out of three net new private sector jobs in America,” said Anne Hunt, deputy district director of the U.S. Small Business Administration. Nearly half of Massachusetts’ private workforce was employed by small businesses in 2012, according to the SBA.
In the past 22 years, Stanley said she has seen 300 new businesses established in Dudley Square. Those that have survived the difficult first year have created 320 lasting jobs in the community.
Other districts report similarly strong small business presence. Most of the business in Hyde and Jackson Squares are local moms and pops, said Gerald Robbins, executive director of Hyde Jackson Square Main Street.
“Small businesses are the backbone of our local economy here in Hyde and Jackson Squares,” said Robbins.
Currency in the community
Small businesses that serve local customers and employ local residents keep the money circulating within the community.
“Out of every dollar spent in a local business district, 58 cents will be returned to that community, fueling our local economies and contributing to more vibrant neighborhoods,” Mayor Martin Walsh said.
The goal of keeping dollars circulating in the community is an important one, and still has not been fully realized, Gaskin said.
He pointed to a 2014 study that found a dollar spent in a black community goes on to be spent outside the community within six hours, as compared to a dollar spent in Asian communities, which circulates six times before leaving, or Jewish ones, where it circulates ten times.
“The idea of buying local for the holiday season is a good one in theory,” Gaskin said. “It is consistent with self-empowerment, and leaders in the black community have promoted supporting black businesses not just during the holiday season, but all year long.”
Community building
Supporters of small businesses said they help make the fabric of the community. They are more likely to sponsor local little league teams and be the restaurants that reflect local culture, said Norm Eng, Economic Development Specialist and Public Information Officer of the SBA.
“[Small businesses] provide services unique to a community, such as a restaurant that may remind you of home,” said Eng.
Local stores also raise a district’s visibility, with the storeowners often playing a role in keeping communities safe, Robbins said.
“Retailers have a special place, bringing people to their stores, keeping our streets vibrant and alive, and helping us maintain a healthy neighborhood,” he said. “They are our eyes in the community, looking after our children, providing products to residents, and reporting any problems.”
More to come
Several Main Streets are building on momentum generated by Small Business Saturday and going further.
Dudley Streets is planning a children’s book signing, a scavenger hunt and a night where men are encouraged to come out and shop for their significant others, Stanley said. On Thurdays in December, special deals will be offered at Hyde and Jackson Squares business under a Jueves in the Hood promotion. Gaskin said Grove Hall also is looking for long-term strategies to support existing businesses in the area and recruit a more diverse mix of outlets.
The city also has plans in the pipeline. Mayor Walsh issued a challenge for residents to patronize local Main Streets district stores five times during the holiday season and tweet the experience with the hashtag #5onMain. During this time, the city also is facilitating small acoustic performances at Main Street businesses by waiving entertainment license and performance fee requirements. Another sweetener: one-time use of two free hours of parking for visitors and residents. Drivers can use the ParkBoston app and code 617617 at a metered space between Nov. 27 – Jan. 2.
