1 BUY LOCAL
You probably already know about the powerful impact consumers can have by shifting their dollars to local businesses. But there’s also a massive opportunity for businesses to support each other directly. Case studies in Arizona and British Columbia have shown that buying from local, independently owned office supply companies recirculates twice as much money into the local economy as purchasing from a multinational company, because local supply companies’ purchasing and hiring choices prioritize local reinvestment. Likewise, sourcing from firms owned by people of color increases wealth and opportunity in communities that have historically been under-resourced.
ASK: What are your largest regular purchases? Could any of those goods or services be procured from a local, minority-owned, and/or values-aligned business?
Set aside everything you think about your competitors and consider the success of the craft beer movement. Craft breweries across the US are growing at an incredible pace by recognizing that their chief competition is not with each other, but with the corporate beer industry. Small breweries know that by investing in each other, training industry newcomers, selling each other’s beers, cross-promoting events, and locating near each other, they are expanding the market and growing profits and benefits for all of them together. This is a fundamentally different mindset: rather than competing for a small slice of a pie, they operate with the belief — which business results bear out — that they can work together to create a bigger pie.
ASK: How can your business share information or infrastructure with others so you all do better together? Can your voices advocate for policies or deals that benefit each of you — and all of you?
3 MOVE YOUR MONEY
Small and mid-size banks control less than a quarter of all bank assets, but they account for more than half of all small-business lending. They often have lower fees, are controlled by people who live locally, and are far less likely than big banks to use large portions of their resources for speculative investing that may create temporary shareholder profit but provide little economic or social value to your community.
ASK: Is there a local bank or credit union to which you could move your accounts? If you offer your team a retirement plan, do you offer a fund that invests in local businesses? Where are your personal investments?
4 PRIORITIZE PEOPLE
Giving people a chance and investing in their futures can go a long way toward creating an economy that works for all of us. The owner of Awaken Café in Oakland realized that judging written job applications from an English-major perspective was getting in the way of hiring good people who could provide effective customer service and has since stopped using grammar as an employment criterion. Cascade Engineering in Michigan has created an on-site social service team to help employees — many of whom were formerly incarcerated or have not been employed before — get the support they need to succeed. WinCo Foods, a supermarket chain with 98 stores in eight states, offers an Employee Stock Ownership Plan (ESOP) granting every employee, from clerk to stocker to display builder, ownership in the company. (See more on ESOPs on page 36.) The combined wealth of the 130 employees at WinCo’s Corvallis, OR, store is more than $100 million: many of their staff will eventually retire as millionaires.
ASK: How do your hiring practices shape who you recruit and employ? Can you offer jobs to people who have barriers to employment? Could you consider an ESOP or other employee ownership or profit-sharing model to increase wealth, ownership, and opportunity among your team?
5 GROW TOWARD WHAT YOUR COMMUNITY NEEDS
The Zingerman’s Community of Businesses (ZCoB) began as a deli. Over time, they wanted to expand because their team wanted new challenges. Rather than create “second-rate versions of [the] original deli under fluorescent lights in airports,” they decided to grow deep. Today, ZCoB includes a creamery, a bakery, a full-service restaurant, a coffee roaster, and more, each of which serves the original deli, meets the same level of quality, and is located near Ann Arbor, MI. Today their 12 separate businesses employ more than 500 people. (Read more about Zingerman’s in Issue 4: bit.ly/growing_deep.)
ASK: What does your community need? What does your community import and what services are missing? How could you expand not by moving to other towns, but by enriching your own community’s interdependence?
BALLE is a nonprofit organization that represents hundreds of communities and hundreds of thousands of conveners, entrepreneurs, investors, and funders who are creating new economies that work for all of us. We believe that local, independently owned businesses are the key to solving our communities’ toughest barriers to healthy, equitable economies. Learn more at bealocalist.org.
SIGNS OF ECONOMIC INEQUALITY IN THE U.S.
The share of total US income for the top 1% of income earners has gone from 8.9% in the early 1970s to over 21.2% as of 2013.
Since 1979 the income of the top 1% of earners has increased more than 187% while that of the bottom 20% has increased a mere 39%.
The 400 people who make up the Forbes 400 list have more wealth than all 16 million African-American households in the United States combined. In 2014 corporate profits were at their highest level ever as a percentage of GDP, while total compensation to employees sank to a 65-year low.