Jane Dalton, director of Boost & Co members Groundswell Innovation considers how ‘shopping locally’ can help the Lancashire economy grow.
How much do you think our house prices increase if we have independent shops on our High Street?
As much as 17% if you believe American Express. That’s 17% more than the price boost created by having big name chain stores and restaurants sited locally. People are willing to pay an even bigger premium for access to something a bit different in their local area. And yet here we are, merrily buying from Amazon instead of putting in the effort to keep value alive on our high street. Because it is easier. And because they have a seemingly endless supply of products to choose from.
Our commercial system is set up to support big business and put small operators out in the cold. For the most part, we spend in line with that system, despite the fact that this probably means working to reduce our own personal asset holdings.
Buying local currency helps people demonstrate commitment to their own community.
I’ve been fascinated by the power of local spending to self-seed prosperity since meeting the team behind Lambeth’s home-made currency. The Brixton Pound is burgeoning. It feeds the identity and aspirations of local residents and is building energy and pride in the area. The idea is simple. Commit an amount of money each month that you will ‘only’ spend with local suppliers. The notes are cool, the process is fairly straightforward and local businesses can rest easier, knowing there is a commitment to maintain a thriving high street.
If you’ve taken a trip to the Lakes lately, you’ll have seen something similar in action. The LD£ even comes with it’s own passport so people can ‘collect’ venues to support. Not necessarily bringing in new spending but certainly making it fun to spend as widely as possible. And that is fantastic, as far as it goes. But schemes like these can be resource intensive to set up and run well, and the focus remains consumer spending. Imagine if we could activate the spending power of a mass of local businesses.
Build local prosperity by building businesses that operate and trade locally.
Businesses have a crucial part to play as a multiplier and distributor of money flows in to the local economy because they are employers, but also links in a local supply chain.
Two Lancaster companies, both members of ESTA – Lancaster’s Ethical Small Traders Association: www.lancasteresta.org are demonstrating the effects of business spending on local prosperity. The results make for very interesting reading.
Mike Hallam of www.smallgreenconsultancy.co.uk and Mark Keating of www.shadow.cat have developed a spending tracker programme called Local Loop that shows individual business owners the impact their company’s spending has on Lancaster’s economy.
This nifty app aggregates anonymised data across the city to create a model showing the multiplier effect caused by strong local trade. Findings demonstrate very clearly that the more independent businesses we have, the more engines there are, working to fire up prosperity in our area.
With consumer spending, £1 spent with a small or medium-sized business means about 63p stays in the local economy, compared to 40p with a larger business.
Business spending levels are far higher per transaction, so the chain reaction of wider local spending is magnified as well as multiplied.
Take for example, Atkinsons Coffee Roasters who run The Hall and The Music Room in Lancaster. Lancaster residents buy coffee or enjoy a latte instead of heading to Costa, now owned by Coca Cola.
This enables Atkinsons to employ local residents, buy local supplies, even support local musicians. In turn their suppliers, such as Stephensons Dairy, employ local residents and buy from local suppliers such as Shadowcat.
Local Loop is bringing to light the real financial power of strong independent businesses.
As company owners interested in the prosperity of our region, we have the opportunity to take an active part, without doing anything to change our current behaviour. All we need to do is become conscious of our current spending patterns. Sounds like a pretty easy way to boost local house prices.
Sign up to track your company’s spending on Local Loop, by emailing Mike Hallam: email@example.com