How to Boost the Economy by Buying Local

Buy Local
Buying close to home may be more than a feel-good, we delve into how sourcing locally can grow the local economy. A number of researchers and organisations are taking a closer look at how money flows, and what they’re finding shows the insightful economic impact of keeping your dough in town—and how the fate of many communities around the UK and the world progressively depend on it.

At the most basic level, when you buy local more money stays in the community. The New Economics Foundation, an independent economic think-tank based in London, compared what happens when people buy produce at a supermarket vs. a local farmer’s market or community supported agriculture (CSA) program and found that twice the money stayed in the community when people bought locally. “That means those purchases are twice as efficient in terms of keeping the local economy alive,” says author and NEF researcher David Boyle.

Undeniably, many local economies are suffering not because too little cash comes in, but as a result of what happens to that money. “Money is like blood. It needs to keep moving around to keep the economy going,” he says, noting that when money is spent elsewhere—at big supermarkets, non-locally owned utilities and other services such as on-line retailers—”it flows out, like a wound.” By shopping at the corner shop instead of a giant supermarket, consumers keep their communities from becoming what the NEF calls “ghost towns” (areas devoid of neighbourhood shops and services) or “clone towns”, where Main Street now looks like every other High Street with the same fast-food and retail chains.

The point is not that communities should abruptly seek to be self-sufficient in all ways, but rather, says Boyle, “to shift the balance. Can you produce more locally? Of course you can if the raw materials are there, and the raw materials are often human beings.”

And what about the higher cost of local goods and services? After all, most superstores got to be so big because their prices are low. Susan Witt says that the difference falls away once you consider the increase in local employment as well as the relationships that grow when people buy from people they know. (Plus, one could argue, lower transportation, and therefore conservational, costs, and you know what you’re getting—which as we’ve recently seen with alleged contamination in toys and other products from Chinese manufacturers, can be a concern.)

There’s also the matter of local/regional flexibility. Says Witt: “While now we’re largely a service-providing nation, we’re still just a generation away from being a nation of producers. The question is: what economic framework will help us reclaim those skills and that potential.” Say, for example, the exchange rates change or the price of oil rises so that foreign-made goods are no longer cheap to import. We could find ourselves particularly stuck because domestic manufacturing is no longer set up to make all these products. While no community functions in isolation, supporting local trade helps “recreate the diversity of small businesses that are flexible and can adjust” to changing needs and market conditions, says Witt.

Another argument for buying locally is that it enhances the “velocity” of money, or circulation speed, in the area. The idea is that if currency circulates more rapidly, the money passes through more hands—and more people have had the value of the money and what it has purchased for them. “If you’re buying local and not at a chain or branch store, chances are that store is not making a huge profit,” says David Morris, Vice President of the Institute for Local Self-Reliance, a non-profit economic research and development organisation. “That means more goes into input costs—supplies and upkeep, printing, advertising, paying employees—which puts that money right back in the community.”

As the nation continues to limp through the recession, many towns and cities are hurting but we can change that by sourcing locally – Support your local businesses and in turn they will support your community.

Airphone Telecom Solutions strongly believe in investing in the local community with office equipment, resources and services sourced directly from Peterborough and the surrounding areas.

If you aspire to support Peterborough’s economy by procuring your business’ telephony and broadband requirements from Airphone Telecom Solutions, call a dedicated local team member on 01733 34 00 34!

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