rejected them on those grounds. They are among hundreds of U.S. communities to reject new chain retailers in recent years. Their scrutiny consistently shows that most income of new chains comes directly from established businesses. For example, an extensive study of new Wal-Marts by Iowa State U. professor Ken Stone found 84% of sales simply shifted dollars away from existing local (including chain) merchants.

Economic Value of Independent Businesses

It's time to consider the real costs to a community that loses its local business base. Independent local businesses employ a wide array of supporting services. They hire architects, designers, cabinet shops, sign makers and contractors for construction. Opportunities grow for local accountants, insurance brokers, computer consultants, attorneys, advertising agencies and others to help run it. Local retailers and distributors also carry a higher percentage of locally-made goods than the chains, creating more jobs for local producers. In contrast, a new chain store typically puts in place a clone of other units, eliminates the need for local planning, and uses a minimum of local goods and services. In a company-owned store, the profits are promptly exported to corporate headquarters. These factors lead to dollars spent at local independent merchants creating a multiplier effect in the local economy up to five times that of a chain outlet.

People across the country decry losing the sense of community in their towns and cities. And each year brings more national chains displacing locally-owned businesses throughout the country. Most consider this trend a symptom of our loss of community orientation, but could it be a cause as well? Also, what are the impacts of this trend on our economic well-being? It seems obvious that we do business where we perceive we receive the best value for our time and money. Perceptions, however, are not always accurate when we see and hear the omnipresent ads of corporate chains everyday, but are collectively underinformed about the values independent businesses provide us, both individually and collectively. With better information, we might more often choose to patronize local businesses because it benefits our communities, and ourselves. The disappearance of local businesses leaves a social and economic void that is palpable and real - even when it is unmeasured. The quality of life of a community changes in ways that macroeconomics is slow to measure or ignores completely. The giant chains often win a town's consent to build new stores with promises of growth and tax revenues. But when communities such as St Albans, Vermont & New Paltz, New York

performed thorough analyses, they concluded proposed new "big box" retailers would create economic costs exceeding benefits, (loss of existing jobs and increased infrastructure demands being the top two) and

The Benefits of Doing The Benefits of Doing

"Local officials often fall for the seductions and political appeal of luring new national chains...but fail to consider the greater losses that occur when the local business base is undermined."

Maintaining Community Character

and tax revenues, but fail to consider the greater losses that occur when the local business base is undermined. For example, the chains may boast of creating up to 300 new jobs for a new big box store, but they displace more than one job for each (mostly part-time and lower-wage) job created. Ensuring Choice and Diversity Retailers sift through competing goods and services to find those that appeal to their customers. Even though a single local shop may have a smaller selection than a big chain outlet, a multiplicity of independent retailers creates great diversity. For example, when 3,000 or so independent book and music shops serve their local customers' tastes and each owners preferences, the cumulative effect is demand for a wide variety of ideas and music. This makes accessible controversial books or music from new artists with the expectation that there will be a market somewhere within a variety of stores. As fewer giant corporations dominate both production and sales, our options - determined by a powerful few - will be greatly reduced. Our freedom of choice is imperiled when a few buyers from national chains choose what reaches consumers. This may be only moderately disturbing for most goods, but truly frightening when you consider the impact on our choice of news sources, books, music and other modes of expression.

American Independent Business Alliance