Two-thirds of small business revenue stays in the community

TULARE COUNTY – Consumers and small businesses in communities across the country are preparing to celebrate Small Business Saturday, taking place this year on Nov. 24. Because an average two-thirds of every dollar ($0.67) spent at small businesses in the U.S. stays in the local community, consumers’ local impact during the important holiday shopping season could be significant. Further, every dollar spent at small businesses creates an additional 50 cents in local business activity as a result of employee spending and businesses purchasing local goods and services, according to the Small Business Economic Impact Study from American Express.

American Express created Small Business Saturday in 2010 as a way to help small businesses get more customers, and the celebration has since become an annual shopping tradition on the Saturday following Thanksgiving.

“What began nine years ago as an effort to support local stores during the holiday shopping season has become the Shop Small movement, bringing together millions of shoppers, small businesses of all kinds, civic leaders and organizations in thousands of towns and cities across the country,” said Elizabeth Rutledge, chief marketing officer at American Express. “Shopping small has a significant and positive effect on local communities, and we hope Small Business Saturday will help to amplify that effect during the crucial holiday shopping season. When we spend local, small businesses thrive. And when small businesses thrive, we all thrive.”

The Small Business Economic Impact Study, a county-level economic analysis on shopping small commissioned by American Express, provides a closer look at the economic benefits of shopping locally and the impact of small business on communities. The study found that if small businesses in the U.S., defined as businesses employing fewer than 100 employees, were a country, they would have a GDP of $4.8 trillion, equivalent to the GDP of Japan, the third largest economy in the world.

The study also demonstrated the extent to which small businesses support jobs locally. In addition to small businesses directly employing members of the community, spending by those small businesses and their employees in the area also supports local jobs. In fact, for every ten jobs at a small business, another seven are supported in the local community.
Now in its ninth year, 97% of consumers who plan to Shop Small on the day said Small Business Saturday has had a positive impact on their community, according to the 2018 Small Business Saturday Consumer Insights Survey, another study released today by the National Federation of Independent Businesses (NFIB) and American Express, based on a separate survey of consumers.

The survey found that nine in ten (91%) consumers believe it is more important than ever to support small businesses this holiday season, and 83% plan to do at least some portion of their holiday shopping at a small, independently owned retailer or restaurant – either in person or online. On par with previous years’ celebrations, nearly six in ten (58%) U.S. consumers reported being aware of Small Business Saturday, and among those, 80% plan to go out and Shop Small at independently-owned retailers or restaurants on the day.

Additional results of the survey:

A majority of consumers (94%) value the contributions small businesses make in their community;

As consumer shopping habits shift further online, nearly two-thirds (65%) are likely to seek out small, independently-owned retailers when shopping online, including 59% who plan to Shop Small online this Small Business Saturday; even 40% of consumers say they will shop with a small retailer online this Cyber Monday;

Among consumers who plan to shop on Small Business Saturday:

Nearly all (96%) said Small Business Saturday inspires them to go to small, independently-owned retailers or restaurants that they have not been to before, or would not have otherwise tried;

Plans to shop include visiting independently-owned bakeries (40%); clothing, accessory and shoe stores (40%); restaurants, bars and pubs (37%); bookstores (32%); and gift, novelty and souvenir stores (30%).

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