SMALL BUSINESS SATURDAY

Yesterday marked the 2nd annual Small Business Saturday®, an event snugly nestled between Black Friday and Cyber Monday, and as the people who started this event say, during one of the busiest shopping weekends of the year. Of course it is a bit ironic that the folks behind this whole thing are in fact American Express, who happen to be nearly a $54 billion company.

By any measure, that's no small potatoes.

But neither is the impact that supporting small business has on local economies, and on something I often talk about in my blogs, and in the opinions I write at HubPages; competition. To my mind competition is really at the heart of the entire concept of the free markets. I have argued for some time now that in many ways, when we leave out the little shop on the corner in our regular shopping, we narrow the field. We break the opportunity for any real competition. Our choices become fewer, and what we have left is to choose from a shorter list of people in the marketplace. At the end of the day that means that they, the bigger businesses get to dictate the status quo. They get to dictate the prices in the market, and frankly the wages and benefits that worker's receive in the marketplace. It becomes more of a circumstance of "take it or leave it."

Yeah, that's still the free markets working. But is this the kind of free markets we really want? Is this really how we want our choices to be offered to us? In these narrow and limited ways?

What those big box stores, and huge conglomerations of eateries and banks, and other types of businesses are really saying to us is, "Where else are you going to shop?" For that matter, where else are you going to work?

If there is no pressure on the bigger businesses to pay higher wages, or to offer better choices on the shelves, they'll just do whatever brings them the most profit—heedless of the overall cost to each and every one of us. Keep in mind that right now when the choices are so limited, these businesses are only competing with each other on likewise limited terms. Terms that they ultimately decide because for most of us, the real competitors in the marketplace are not even considered.

Sure, it does mean that we get cheaper products. But is cheaper really better when we have to give up so much to enjoy it? If lower wages and less benefits are ultimately the result of this narrowed competition, is that truly to any of our benefit? Where has customer service gone? How about quality? Even to a large extent, where has business integrity gone? And again, what has happened to wages?

I'm not saying we give up entirely on the bigger businesses. But I do think that we should be more inclined to shop local whenever we can, and small whenever we can. Just a little bit of market share passed along to a small business operator goes a very long long way. And we're not just limited to shopping local stores by the way. It could be as simple as choosing a jar of salsa made by a small startup in lieu of a jar made by Frito-Lay.

Most of the time spending money small and local means that more than likely a much higher percentage of that money is going to stay right in the community where it gets spent in. Small, local businesses have a habit of also supporting small, local businesses, and so many of the products you'll find on their shelves will be from small, local businesses who employ people in the community, and do other commerce within the community and surrounding areas. The operators themselves often live in the communities as well, and so more of their profits wind up staying local as well as they also shop local.

I've suggested in the past that we spend about 25% locally. That's honestly a number I sort of picked out of the air. Actually devoting 25% of our spending locally, or on smaller businesses overall is a tough deal to do. But if we do spend more often locally, the impact that it will have on our economy going forward will be enormous. The money simply goes farther. The choices will become more. And the opportunity to more easily shop small and local will become more likely.

What I'm saying is that while I applaud the efforts of American Express for starting this, because really what they are doing is creating an awareness for the importance of small business to all business, we ought to be doing this far more often than just one day a year. If we do that, eventually we'll be doing it anyway without even thinking about it because improved competition will keep more players in the marketplace. We'll be spending locally naturally rather than having to do it now, contemplatively.