Small Business Importance

1964 Words 8 Pages
Small businesses are vital to the success of the economy. Each year brings more national chains displacing locally-owned businesses throughout the country. We see big business chains replace unique establishments all the time. Over 90 percent of businesses are considered small businesses. Not only do they provide success for the future, but also because they meet local needs (i.e. hairdresser, financial consultant, plumber). Small businesses benefit both the economy and consumers because they revitalize economically depressed areas by creating many new jobs in the local area, are more reliable, provides support to your local community, has a great amount of importance in the country 's exports and employees can benefit more. A small business …show more content…
Local businesses are owned by people who live in this community, who are less likely to leave, and are more invested in the community’s future. Therefore, will do most things in the interest and for the good of the people living in the community. Small, local businesses support the area through their everyday needs. Small businesses open accounts at local banks, hire local CPAs and attorneys and when they need supplies they can go down the street to other local businesses to get them quickly. Running a small local business provides automatic advantages in the daily operations. Many small businesses use local infrastructure to attract customers and gain the local communities trust. Locally owned businesses are also much more likely to reinvest profits into the local economy which strengthens the entire community. In a company-owned store, the profits are exported to corporate headquarters which is most likely not near your town or state. These factors lead local independent businesses create a multiplier effect in the local economy. The multiplier effect is “an effect in economics in which an increase in spending produces an increase in national income and consumption greater than the initial amount spent.” (Multiplier Effect) Small businesses also require less space and infrastructure than large chain stores, making more efficient use of public services and it takes less construction and time to build the infrastructure (Flatt). Small businesses also support the local economy by donating to charities and nonprofit organizations. Even though you see the large corporations on the news everyday giving away large amounts of donations to nonprofit organizations, it is proven that nonprofit organizations receive on average 250% more support from smaller business owners than they do from large businesses, just

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