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Omar Odeh L. Gilliland English Comp. 102 13 November 2013 Baton Rouge Needs a Buy Local Movement Baton Rouge needs help. This once great city is now plagued with empty store fronts, derelict buildings, and poor roads. What can be done? The city requires a lot of work to be the grand, shining metropolis that it could be. However, there are a number of smaller steps the city can take to help itself on its path to glory. Actively courting small business owners is a great first step. Baton Rouge seems solely focused on courting large retail corporations. If Baton Rouge were to make it a point to embrace local, independent businesses, it could potentially see a large growth in the local economy. Whats the difference? Corporations are large businesses with locations all over the country or even the world. The revenue generated by these businesses doesnt get put back into the individual cities in which the individual stores operate. Independent businesses are locally owned and operated by members of the community. Every ounce of revenue generated from the business turns right back around and supports that business, its community, and its city. Opponents of the Buy Local movement are quick to claim that corporations have a larger positive impact on a city than independent businesses. Although there are many positives to having corporations in Baton Rouge, independent businesses have more to directly offer this city. To understand the Buy Local movement, one must first understand the differences between independent and corporate businesses, as well as the differences between local and nonlocal businesses. An independent business is a business that is traditionally owned by a limited

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number of people and operates typically on a small scale (for example: a specific region, a specific product, or a specific need). Sole proprietorships are the most common form of business, [constituting] approximately three-fourths of all businesses in the United States (Ferrell, Hirt, and Ferrell 84). Corporations a large businesses owned by a group of people (stockholders or shareholders) who have varying degrees of claim to the business. Local goes beyond simply operating in a specific area. In order for a business to be truly local, it must be fully owned and operated in a limited area, addressing the needs of that region. The proprietors must live in or near the area in which they operate. Michael H. Shuman, author of Going Local, puts it very eloquently: "Going local does not mean walling off the outside world. It means nurturing locally owned businesses which use local resources sustainably, employ local workers at decent wages and serve primarily local consumers. It means becoming more self-sufficient and less dependent on imports. Control moves from the boardrooms of distant corporations and back into the community where it belongs." (Shuman 153) Corporations tend to operate in numerous cities across the nation or the world. Corporations have a home office, operating in one specific location. As such, many corporations are considered local to the city in which their home office is located (this is why many corporate home offices have signs with sayings like Owned locally Operated nationally). Independent, local businesses have a much more direct effect on the cities and towns in which they operate. Both corporate and locally owned businesses provide income to employees that turn around and spend it in their cities. However, the bulk of revenue and profits generated by corporations is sent to the home office, and then distributed amongst their businesses in many cities and possibly countries. Independent businesses profits are put right back into the business,

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into the community; the money stays in the city. This increases direct tax revenue to the city, which can be put back into the city in the form of new roads, better school funding, more businesses, and larger investments in the city. In his book Rebel Bookseller: Why Indie Businesses Represent Everything You Want to Fight ForFrom Free Speech to Buying Local To Building Communities, Andrew Laties addresses this: Todays buy-local movement cites analyses like The Andersonville Study of Retail Economics to prove that when customers spend in locally owned stores, much of the money recirculates in the community, bolstering quality of life. In contrast, most money spend in chains leaves home towns. After decades of infatuation with big-box chain stores, community leaders have finally learned that durable economic revitalization hinges on the launch of new businesses owned by local residents. (Laties 29) Laties is attempting to explain the importance that should be placed on independent businesses in communities. The effect on the local economy produced by an independent business is larger than a corporate-owned business. Proponents of corporations point out that corporations pay taxes in the cities in which they operate, and that is entirely true. Proponents of the Buy Local movement argue that independent businesses pay taxes, pay employee wages, and also actively invest in the community in which they operate. For example, studies have shown that roughly $68 from every $100 spent in an independent business stayed in the community. On the other hand, only about $43 from every $100 spent in a corporate business makes it back into that community (The Andersonville Study of Retail Economics 1). While this may not seem like a huge difference on this small scale, extrapolate that over the millions of dollars generally spent in a city of Baton

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Rouges size. At this point, its easier to see just how much of a difference independent businesses can make. The largest difference is the sense of community: local businesses have a vested interest in their community. Without it, they will fail. Corporations dont require this level of commitment to a specific city. If their business fails in one town, they have the money to move it elsewhere (or, more likely, they already have operations elsewhere). Shoppers in Baton Rouge (and indeed shoppers anywhere) tend to weigh their options when it comes to where they spend their money. It is true that often large corporate stores can offer more competitive prices and a larger selection of products. This would certainly sway shoppers away from the local businesses that may be required to charge more (to cover their costs) or carry fewer items (limited space availability). The corporate advantage in these situations is disappearing. Many independent stores have found themselves able to compete more directly with prices. And, with the prevalence of the internet, many independent stores are also able to direct ship items they do not carry in their stores directly to customers (the store still gets the revenue, the customer gets the item, but the physical space in the store is not required). Independent businesses also rely very heavily on customer interaction; they know that they have to treat every customer as their best customer in order to keep them. Corporate stores do not rely so much on customer service (to their detriment in many circumstances), hoping that their price and selection will give them the advantage. What does this mean for Baton Rouge? Baton Rouge has a large problem with entire areas of town becoming derelict. Take, for example, the majority of Florida Boulevard. One drive down any section of Florida Boulevard is met with many desolate, formerly functioning business fronts. This is not only a waste of local resources (land, buildings), it is an eyesore to

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the people that must drive past it on a daily basis. If Baton Rouge were to truly embrace local businesses, allowing for tax cuts and government assistance where needed, these stores could be filled within a year. The Institute for Local Self Reliance had this to say on the economic effects of local businesses: Independent businesses located in communities that have an active "buy local" campaign operated by a local business organization, such as an Independent Business Alliance or a Local First group, experienced markedly stronger revenue growth compared to those in areas without such an initiative. (2012 Independent Business Survey 3) This growth in revenue of the buy local movement is a fact. The effects of the buy local movement on the city that institutes it is also profound. As illustrated earlier, the amount of revenue remaining in a city from an independent business averages roughly 25% higher than the revenue from a corporation. Adding more corporations in these areas would see a proportionately smaller increase in city revenue, surely. Independent businesses would generate more tax revenue directly into Baton Rouge, since they fully operate here. Baton Rouge is slowly on a path to becoming a great city. They are laying the groundwork. But Baton Rouge is still years away from truly achieving the greatness to which it aspires. If Baton Rouge were to more openly embrace its local businesses, through tax cuts, through government assistance, or even simply through putting a focus on the Buy Local movement, the city could achieve that greatness much quicker. Corporations have a lot to offer Baton Rouge; independent businesses can offer much more.

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Works Cited Civic Economics, the Andersonville Development Corporation, and Andersonville Chamber of Commerce. The Andersonville Study of Retail Economics. 2004. PDF file. Ferrell, O.C., Geoffrey A. Hirt, and Linda Ferrell. Introduction to Business: Busn 110. Baton Rouge: McGraw-Hill Education, 2013. Print. Institute for Local Self-Reliance. 2012 Independent Business Survey. 2012. PDF file. Laties, Andew. Rebel Bookseller - Why Indie Businesses Represent Everything You Want to Fight ForFrom Free Speech to Buying Local to Building Communities. 2nd ed. New York: Seven Stories Press, 2011. Print. Shuman, Michael H. Going Local: Creating Self-Reliant Communities in a Global Age. New York: Routledge, 1998. Print.