The power of shopping local
During a year when many local businesses struggled, some retailers reported stable or increased revenues.
John Staser of Mountain View Sports in Anchorage says that his 2020 sales turned out to be even with the year prior, and are up so far in 2021.
“Alaskans really stepped up to support local businesses,” says Staser. “I noticed a change in attitude and more customers saying they want to shop local. I attribute it to how people saw restaurants struggling and some closing; it struck home that if you don’t buy from people they go out of business.”
Local small businesses are the backbone of Alaska’s economy. A dollar spent at a local business has three times the impact on the economy compared to a dollar at a non-local business. Across the state, small businesses employ approximately 137,000 individuals and provide critical goods and services to residents and other businesses.
According to “Buy Local: The Impact of Spending at Local Businesses in Alaska”, for every dollar spent at a local business, 63 cents stays in Alaska compared to an estimated 22 cents at non-local businesses.
“It’s not only powerful, it’s doable.”
Julie Gardella, an analyst at the University of Alaska Center for Economic Development and a contributor to the report, knows full well how much it takes to be a business owner; she grew up watching her father run his small business. Gardella recently placed an order with Denali Dreams in Anchorage, and was gratified by the amount of the time the salesperson spent with her, which was followed up with a sample and a handwritten note.
“It was kind and so personal,” she said. “The whole experience brought me a lot of joy, plus the product is high-quality and costs the same as something I could buy at the grocery store. I’m definitely going to keep shopping there and recommend it to my friends.”
Despite already knowing that shopping locally is good for the economy, Gardella admitted she was surprised by how much money leaves the state when shopping at a chain store.
“The way we did the analysis showed that if each (Alaska) household switched $20 a week or $1,000 a year from a big box store or online to a locally-owned business, that would be an additional $103 million into the economy each year,” she said. “Making the change to local is not only powerful, it’s doable.”
Local businesses have more intricate financial ties to their communities than chain operations do. When they need professional services like accountants or lawyers, they tend to contract with in-state firms, keeping the spending local. Because they are relatively small and nimble, local businesses are more able to stock Alaska-made products, stimulating manufacturing.
While chain businesses may give to charity, they tend to spend the most money near their corporate headquarters in some other state. Local businesses, on the other hand, prefer to give to local nonprofits. All of these ties help to keep more money circulating in Alaska.
Gardella says she’s seen people becoming increasingly conscious about where they spend their money, and points to the Buy Alaska program as an example of how people can find more ways to support local businesses.
Formed to connect consumers to Alaska businesses to grow the state’s economy, the program includes a product directory, marketing campaigns, and recently announced a new partnership with Royal Caribbean International and Celebrity Cruises to introduce passengers to Alaskan-owned businesses in port towns that are struggling because of the pandemic.
Customer service, local expertise, and competitive pricing make the difference
When it comes to consumers choosing to shop local, Mike Hajdukovich, owner of Trax Outdoor Center in Fairbanks and Trax 2.0 in Anchorage wants to be clear that he’s not interested in “handouts.”
“Don’t just come in just because you want to buy something local, come in because I’m better than every box store and everyone online,” he said. “Nine times out of 10, the local guys are going to bust their butts to bring up the level of service because we know that when people come through our doors, that’s our chance.”
Along with customer service, Staser focuses on matching prices online.
“I challenge retailers to join me,” he said. “It’s scary at first but when you get down to it you gain a customer for life and it doesn’t cost that much to do it. We need to step up and be cost competitive.”
Staser says that when chain stores offer the same products at the same prices, they simply “can’t compete with a good local store,” and notes that Mountain View Sports customers can avail themselves of his 33 years of experience in the industry combined with a lifetime spent hunting and fishing. He considers a member of his staff to be one of the best guides in Alaska and makes sure that his customers are the beneficiaries of their knowledge.
“We can tell them where the fish are biting that day, what our personal experiences are with the gear, what fits them and what doesn’t,” he said. “And then they can walk out of the store that day with their products in hand; it’s immediate gratification.”
When it comes to locally-made products, Staser says he’ll sell everything he can get his hands on. Currently that includes products from Alpine Fit, FisheWear, and an assortment of t-shirts and jewelry. By comparison, Alaska products generally struggle to find shelf space at large chain retailers. Recently ShuzyQ moved into his store, and their added inventory of both fashionable and functional footwear has been a successful complement to outerwear and fly fishing gear.
Despite a clear belief that their stores offer the best option for their customers, both Staser and Hajdukovich keep an eye on their national competitors to stay sharp.
“REI is a good store, they have good stuff and they’re tough to beat…but I’m going to die trying,” says Hajdukovich.
Gretchen Fauske is a marketing-minded economic developer fueled by a passion for innovation and entrepreneurship. She is the associate director for the University of Alaska Center for Economic Development, Board President for the Anchorage Downtown Partnership, and a Gallup-certified CliftonStrengths coach.