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Think Big Shop Small sign
Savvy shoppers already have their retail battle plans in place. Once Thanksgiving obligations have been satisfied, the heartiest among them will find a queue to stand in outside of their favorite big-box store to capture what they believe are incredible deals. Black Friday—and, increasingly, Black Thursday Night—has become the traditional gateway to holiday spending.
Falling on Nov. 25 this year, Black Friday is a windfall for large national merchants. Electronics and appliance giant Best Buy anticipates 2022 revenues of $51.8 billion, a 9.52% increase from 2021 revenues of $47.3 billion. Discounter Walmart is planning on 2022 revenues of $587.8 billion, a 3.83% increase over 2021 revenues of $559.2 billion. No wonder company heir Rob Walton was able to spend $4.65 billion to buy NFL team the Denver Broncos earlier this year.
Online buyers who want to eschew the queue are looking ahead to Nov. 28—Cyber Monday—to capture deals electronically. That’s good news for Amazon, which anticipates 2022 revenues of $485.9 billion, a 9.61% increase over 2021 revenues of $461.8 billion. Company growth has enabled Amazon to hire 400,000 delivery drivers worldwide to pilot its own fleet of vehicles, including 70 aircraft.
Sandwiched between these shopping holidays is Nov. 26, Small Business Saturday, devoted to encouraging shoppers to support the local economy by spending their shopping dollars with small local merchants who, in turn, recirculate their profits in the community. In a very real sense, this is the most significant shopping holiday of all.
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“We’re big believers in people buying locally,” say Tim Sheehy, president of the Metropolitan Milwaukee Association of Commerce. “Small businesses by their nature are customer-friendly, innovative and scrappy, and Milwaukee is well-served by the small to mid-size businesses we have.”
The Milwaukee metro area has more than its share of small manufacturing firms, Sheehy says, noting that only San Jose, California’s “Silicon Valley” has more manufacturers. Even though such firms won’t be patronized on Small Business Saturday, they provide the area’s small business strata with significant economic strength.
And Milwaukee’s small business tend to patronize each other, which Sheehy describes as “washing each other’s socks.” The best small businesses, he says, can sell outside the local market. “That brings in more socks to the washing machine,” he adds.
It’s in the Numbers
Some U.S. federal government programs define small businesses as having 500 or fewer employees. Using that parameter, small business employment in the area comprised of Milwaukee, Ozaukee, Washington and Waukesha counties is home to 28,652 small businesses that support 373,114 employees with a total payroll of $17.4 billion, according to U.S. Census Bureau data. According to Sheehy, MMAC uses a parameter of 100 or fewer employees, which changes the figures to 27,545 small businesses with 246,143 employees supported by a payroll of $10.9 billion.
The financial impact, in aggregate, certainly doesn’t measure up to Walmart’s performance, but it does illustrate how significant small businesses are, especially when you realize that the flow of funds largely stays local, Sheehy explains.
“Small businesses foster a symbiotic relationship,” he says. “The more you spend locally, the more products and services can be provided to the community. It makes a tighter supply chain and a healthier local economy.”
Small business owner Guy Rehorst agrees. As founder and CEO of Great Lakes Distillery & Tasting Room, Rehorst occupies the unique position of manufacturer, wholesaler, retailer and hospitality industry member for the unique line of spirits he produces and distributes from his Walker’s Point facility. Rehorst oversees 12 full-time-equivalent employees (FTEs), making Great Lakes a very small business.
Both the pandemic and a volatile economy have taken their toll on the distiller, who has managed to weather the storm thanks to the popularity of the 30 or so brands he produces, many of which have attracted their own following.
“We compare our products to ones from large companies, but in our case 90% of dollars spent stay in the local market,” Rehorst says. “We’re sourcing ingredients locally. It begins at the farm level and includes the local trucker who brings the goods to the distillery. Financially, the local aspect is way more important than people think.”
It’s About Community Building
Social issues affect all small businesses, but they can have a greater negative impact on minority-owned businesses, according to Marjorie Rucker, executive director for The Business Council, which helps Black- and Brown-owned businesses learn to access supply chains and work with larger companies. Rucker also chairs the Ethnic & Diverse Business Coalition, a consortium that includes 14 different chambers of commerce and business coalitions throughout the state. The two groups collectively represent 1,800 small businesses with 8,000 employees statewide, she says.
“The challenges minority-owned businesses face are similar to most small businesses and that’s reaching potential customers,” Rucker explains. “But money from purchases only circulates for six hours within the Black community before leaving. In other communities, money circulates much longer than that and has a greater positive financial impact.”
In some cases, the lack of funds circulation has to do with entrepreneur limitations, including lack of knowledge and/or capital, such as not owning their own buildings, she says. That can distinctly affect the welfare and growth of the neighborhood in which the businesses reside.
“Small businesses are economic cornerstones of their community, and drivers of how those communities look, feel and operate,” Rucker explains. “Determination, grit and consistency are what these businesses need to survive, and our goal is to help them through the challenges they face, whatever those may be.”
The neighborhood aspect is critical to small businesses throughout the Milwaukee metro area and their impact should not be underestimated says Eric Ness, Wisconsin district director for the U.S. Small Business Administration.
“Milwaukee, along with some of its suburbs, is a very neighborhood-focused city,” Ness explains. “Each area has its own character, so people can visit another neighborhood and have a completely different experience of shopping, dining, and entertainment than they might have closer to home.”
Those same businesses are operated by neighbors that, in turn, patronize other small businesses, which recirculate the money locally for the good of the community. Many small businesses disappeared during the pandemic, which further emphasizes the need to support them not only on November 26, but every day of the year, Ness says.
The Business Council’s Rucker agrees: “Small Business Saturday is really important. If you’re shopping on Black Friday, look at your list and save at least 50% of your purchases for Small Business Saturday.”
This content was originally published here.
