Business Zen: Shop local key to community success

Russell Bell

I DON'T ordinarily read flyers placed on my windshield, but a couple of weeks ago one drew a reaction from me.

This one described large savings to be made on clothing from a pop-up retailer, but I was in no hurry to partake of these "savings".

Why? I guess I have a natural aversion to out-of-town businesses that access revenue in small centres and then channel the profits out of town.

We hear a lot politically and in the business community about buying local and supporting Whanganui businesses, but in some cases the reality appears to run counter to this.

And while, in the short term, there are savings or "conveniences" to be had, in terms of a long-term strategy it only serves to diminish the effectiveness and long-term health of the local business sector.

Some might say "Hey, competition is good" and "Yes, I don't disagree", but in the case of bargain-basement wares (which are driven by low prices), it really is just putting the foot to the accelerator of a race to the bottom, particularly for local retailers.

In the past month I have had two opportunities to make purchases while out of town but have elected to delay and purchase from a local retailer.

In one case I deferred the purchase to deal with the local branch of a national chain.

The logic being that, even if the national chain sends its profits out of town, there are full-time jobs here.

In the other case, I found what was pretty much the deal of the century on what I would describe as a primo mountain bike.

However, for a purchase such as that I would rather that a local retailer received that margin -- and I will likely be dealing with them once spring rolls around and 2017 model bike prices drop.

Which brings me back to the pop-ups. They may have given a landlord some coin, maybe they gave a couple of days' work to locals to stock the racks, and maybe there was flow-on to local restaurants and cafes.

But all of this is short term, and in the meantime local retailers who specialise in the products sold end up out of pocket. The same is true in other sectors where businesses show a local front but wheel in organisations from out of town to substitute for locals who have the experience and the skills.

The long-term consequences of this approach could be more empty stores in our main street or local businesses folding. Note that retailers in particular already have their hands full with the emergence of online competitors and the ever louder call of the Palmerston North mall. So what's the solution?

The "shop local" catch-cry needs to be louder, better co-ordinated and more sustained.

Marketing is important, but so too is a commitment to local businesses.

Balance Consulting is a Whanganui consultancy specialising in business strategy, process excellence and leadership mentoring. Contact Russell on 021 2442421 or John Taylor on 027 4995872.