May 17, 2005

Small Businesses, Big Rewards

By Alison Fromme
Special to the Neighborhood Newswire

Potrero Hill resident Vince Jones thinks it’s important to support neighborhood businesses. He’d rather buy his books at Christopher’s Books on 18th Street than at a big chain.

Jones is not alone. Looking for local flavor, steady streams of customers find their caffeine fix at Farley’s Café on 18th Street, their regular chicken salad sandwich at Klein’s Deli on Connecticut Street, and books by local authors at Christopher’s Books. People on the Hill offer resounding praise to local businesses, saying that they like the unique character that these enterprises contribute to the neighborhood.

Choosing to spend money at a locally-owned business holds significance that reaches far beyond the first exchange of money for goods or services, according to multiple studies by the consulting group Civic Economics.

Money spent at locally-owned businesses continues to circulate within the community at higher rates than dollars spent at big chains, according to the Civic Economics’ studies. In one north side Chicago neighborhood, the local economic benefits of retail space occupied by locally-owned businesses is a staggering 70% greater than the impact of chain stores.

The value of the dollars spent by consumers is multiplied by the way business owners use that money. At Klein’s Deli on Connecticut Street, local bakers often supply the baked goods and local printers create menus and signs, according to owner Avery McGinn. When local businesses use local services, the economic benefit of each exchange continues to contribute to the neighborhood’s vitality.

In contrast, chain stores sell to local residents and then use that money to contract faraway firms for everything from retail inventory to legal services. Revenue is drawn away from the local economy and redistributed elsewhere.

Both locally-owned businesses and chains create jobs, according to Phil De Andrade, owner of Goat Hill Pizza and president of the Potrero Hill Merchants Association. “It gets complicated, though” he says, pointing out that neighborhoods with high unemployment, like Bayview-Hunters Point, might benefit from jobs brought in by big chains. “But are those good jobs?” he asks, pointing out that small businesses usually provide better employee benefits. Plus, small businesses create more jobs overall in the city compared with big chains.

De Andrade and McGinn agree that small businesses are more likely to be socially and environmentally responsible, by providing employee benefits, recycling, and watching their energy use. Klein’s Deli only serves fair trade coffee roasted in San Francisco, which is just one way McGinn expresses her social and environmental values.

At many large retailers, goods reach the shelves after being transported over vast distances—which engenders fossil fuel use and creates pollution. On average, food travels more than 1,000 miles before it lands on a dinner plate. To keep produce looking fresh even after such a long journey, fruits and vegetables are often chemically treated. Food produced and sold locally avoid transportation-related environmental costs and the need for chemical treatment.

To promote the importance of buying from local businesses, the Potrero Hill Merchants’ Association is considering a formal “buy local” campaign to join a more broad campaign planned by San Francisco businesses, according to Bradley Vaccaro of Allpointe Insurance Services. “This area has a strong neighborhood feel to it,” Vaccaro says, adding that it deserves to be preserved.

Potrero Hill isn’t the only neighborhood that actively fosters small businesses and a sense of community. Around the country and the world, people are banding together to preserve the unique character and economic vitality of their communities.

In Boulder, Colorado, small businesses joined together to persuade residents that supporting local enterprises also benefits their community. California’s central coast farming community joined a “Buy Fresh, Buy Local” campaign that touts the environmental benefits of buying food that doesn’t need to be artificially ripened, transported over long distances, or protected by wasteful packaging. In Ithaca, New York, community activists have even created their own local currency, IthacaHOURS, which promotes higher wages and is accepted at small businesses and the town’s credit union. In Western Australia, government policies require that supplies and services be bought from local providers.

Many Hill residents recognize the value of supporting local businesses—they want to continue to have great restaurants and shops right around the corner from their homes. And as good neighbors, many Potrero Hill businesses reinvest time and money back into the community.

The Potrero Hill Merchants Association sponsors an annual history night (this year’s is scheduled for October 22), where long-time residents share their experiences growing up on the Hill. Like several other businesses, Klein’s Deli displays the artwork of local artists, such as photographer Chris Mende’s Alemany Farmer’s Market series, and hosts receptions to celebrate their work. Farley’s Café contributes regularly to the spirit of the neighborhood with musical performances and its popular annual Halloween Pet Parade.

Trish Keady, a Christopher’s Books employee since 1997, says that neighborhood stores provide a “one-on-one” experience with residents that big chains can’t. “We know when our customers buy pregnancy books,” she says, “and we continue to watch those kids grow up over the years.” Christopher’s supports a children’s newspaper produced by 12-year-old Oona Robertson by helping to collect articles, poems, and artwork by kids and by selling the finished product. The store also holds annual book drives for charities.

Local businesses also help financially support the Potrero Hill Neighborhood House, which provides community services, including programs for youth, seniors, and people with disabilities. “You don’t see Domino’s doing that,” De Andrade says.

For more information, contact the Potrero Hill Merchants’ Association at http://www.potrerohill.biz/index.html or by calling 415-341- 8949.