The Valley’s struggling economy would no doubt get a boost if people spent more, but a coalition of local businesses is promoting a recovery plan that’s not so interested in how much consumers spend.
For Local First Arizona, a better economy involves where that money is spent.
The group has launched a campaign to change consumer habits by getting residents to shift 10 percent of their spending from national to local businesses. The change would keep more money in the economy and promote a better civic culture, Local First executive director Kimber Lanning said.
The initiative is based on a study in Grand Rapids, Mich., that found a 10 percent shift of that area’s 600,000 residents would result in 1,600 new jobs, $130 million more in the local economy and $50 million in local wages. The numbers are for a single year.
“The public has the ability to improve the economy and grow jobs simply on how they choose to spend their money,” Lanning said.
The first push of the Shift the Way You Shop campaign will focus on promoting awareness of businesses along the Metro light-rail line. Lanning said many people still aren’t aware of how many local businesses are tucked into shopping centers close to places they’re probably already going.
To help raise awareness, Local First launched a web site that lists businesses within a half-mile of the 20-mile Metro line. The site — http://m.shiftarizona.com — includes a mobile version so smartphone users can look up what’s around stations as they take the train.
Lanning owns two businesses in Phoenix and said Metro helps bring her customers on the weekend. She thinks passengers would spend more time around light-rail stations if they knew more about local businesses.
The newness of so much Valley development has led to more chain stores here than many large cities, she said. It’s also changed the culture.
“People love Chicago and partly because they love the local businesses, and they come here and they throw that out the window and wonder why they don’t feel so connected here,” she said.
Unlike Lanning, Peter Sterling thinks chains play the same role here as in most any other place. Sterling, president of the Mesa Chamber of Commerce, said chains have so much power to draw consumers because of their deep pockets. He used to work at an international advertising agency and said some companies spent tens of millions of dollars on research into everything from consumer habits to the color of doormats.
Local businesses have to find their own niche to survive the bigger competitors, he said. But he said groups like the chamber and Local First also have to promote how shopping locally can help the community.
“Here especially in Mesa, we more than most cities have to rely on sales tax revenue. We don’t have our primary property tax so that requires our residents to think about the impact of their spending. So the first thing they have to think is spending in Mesa is better because that’s sales tax for funding our police department, our fire department,” Sterling said.
Qiana Shaw said a large number of customers at her Pappa Maize gourmet popcorn shop want to support local businesses and ask whether she’s local or a chain new to the area. Shaw said a big part of her marketing is that the downtown Tempe shop is locally owned. Shaw said she frequently asks about ownership even if she visits another city.
“I look for things that are locally owned because I like to get the flavor of the city I am in,” Shaw said. “I am a lot more aware now that I am in my own business.”
Local First Arizona also points to research in Grand Rapids that found for every $100 spent at a local business, $73 stays in the local economy. Only $43 stays in the local economy when the same amount is spent at a non-local business.
Lanning said the prominence of national chain stores in the Valley may have reached a peak. She pointed to the $97.4 million worth of incentives Phoenix offered to CityNorth, only to see a fraction of the $1.2 billion project constructed. Political support is dwindling for incentives to developments that involve chain stores, she said, just as the public is showing more interest in local restaurants and shops.
Lanning said support for Local First is strong, citing its 16,000 social media fans and 2,000 members.
“People are often shocked to hear that Local First Arizona is the largest business coalition in North America,” she said. “They say, ‘Why?’ It’s because we needed it.”
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