"Shop Local" Isn't Enough: How Communities Can Truly Support Microbusinesses

In my local community, there have been a lot of small business closures. They were not all new businesses that didn't quite take off or those you wondered how they stayed open at all. Many were popular, established businesses.

Why did they close? 

While a few, especially restaurants, told the local newspaper they couldn't get and keep enough employees to run properly, most businesses just aren't making the amount of sales they need to keep the doors open.

As customers are spending less because their cost of living is rising, small business owners are facing higher costs for supplies, inventory, employees, and utilities. To stay afloat, many are forced to eat the difference or raise prices. If they do raise prices, sales drop further. The math isn't mathing anymore.

The Struggle Is Real

Our area of the country is not alone. Small businesses are suffering everywhere. Main Street America surveyed over 1500 Main Street businesses across the country (approximately half of those surveyed are considered microbusinesses) and gathered data that matches what so many of us are seeing:

Nearly half of the Main Street small businesses surveyed across the country saw profits drop in just the past three months

• 65% say they don’t earn enough from their business to cover basic household expenses

• 72% of small business owners cite rising costs as their top concern

• 68% worry about customers spending less

And maybe most concerning of all...Business owner confidence in their future success also declined from last year. (This means something coming from a normally positive, will-figure-it-out group of people.)

This isn’t just about shops and storefronts — it’s about the stability of local families, the vitality of our downtowns, and the economic resilience of our towns. When microbusinesses struggle, the entire community feels it.

Why “Shop Local” Campaigns Aren’t Enough

So, what are communities doing about the challenges small businesses are facing? The well-intentioned call to “Shop Local” is everywhere. But slogans alone aren’t enough when families - and businesses - are stretching every dollar. If we want to help these businesses survive, we need to go deeper than marketing campaigns.

A family facing higher grocery and utility bills won’t suddenly buy a $60 locally made product instead of a $40 chain-store version just because a flyer told them to. In fact, a recent test by Afina showed that when given the choice between a U.S.-made shower head at $239 and an identical $129 version made overseas, every single customer chose the cheaper option — a clear reminder that in today’s economy, price often outweighs loyalty to “shop local.”

Communities must move from encouragement to enablement.

What Communities Can Do 

We cannot control the cost of supplies. We cannot control how much families have in their wallets. But here’s what we can do:

1. Help Businesses With Cash Flow

• Support microgrant or microloan programs to bridge gaps traditional banks won’t cover

• Offer workshops on cash flow forecasting, pricing, and inventory management

• Connect owners with accounting or bookkeeping resources that prevent cash leaks

2. Guide Smarter Product & Service Choices

• Provide training to help owners identify products customers need and can afford now

• Help businesses analyze sales data to focus on their most profitable offerings

3. Encourage Strategic Pivots

• Help business owners conduct customer development research to discover what products or services the market truly needs that already align with the business’s strengths

• Explore adding or adjusting offerings to meet emerging community needs (for example, practical goods, budget-friendly options, or services that save customers time or money)

4. Elevate the Customer Experience

• Even in tight economies, people will pay a little more for a business that makes them feel valued. Communities can train and mentor business owners to:

  • Add personal touches (thank-you notes, loyalty perks, birthday discounts)

  • Provide exceptional, personal service that big-box stores can’t replicate

The Call to Action

And as the Afina shower head story proves, even when customers say they want to buy American or shop local, price often wins. Goodwill alone isn’t enough to keep our local businesses alive.

We need to offer our local small and microbusinesses more than an event, slogan, or cheerleaders. We need to be proactive and give them the tools they need to meet the challenges we are all facing in this economy. Communities that step up now will be the ones whose local businesses survive and grow, even in hard times.

✦ At SmartStart Business Development, we work with communities to build thriving microbusiness ecosystems through training, resources, and connection. If your community wants to strengthen its economy by supporting microbusinesses, let’s start a conversation.