What is a small business?
A small business is, by definition, a company with much smaller revenue than a major corporation. These companies typically employ less than 1,500 individuals and earn only a few million dollars or less every year.
Small businesses are privately owned for-profit companies in the US. These companies make considerable contributions to our economy by paying taxes, using products made in the US, and hiring US employees.
These businesses can be sole proprietorships, partnerships, or corporations. However, what defines a small business depends largely on industry standards. For example, a company with 1,000 employees that makes over $40 million in revenue may be considered a small business based on its number of employees rather than its revenue.
Small businesses focus on everything from digital to traditional small business marketing, depending on their target audiences. For example, they may use website builders to attract customers or flyers to increase foot traffic.
Of course, these businesses aren't just local; they can operate anywhere and serve any target market. For example, anyone can start an online business, which will still support their local communities, especially if they grow enough to hire small business workers.
Why should you support a small business?
Small businesses are crucial to our everyday lives, even if we don't realize it.
Without these businesses, we wouldn't have several options for the products and services we purchase. Instead, everything would be the same, with the same prices and fewer options. But why should you support small businesses?
They focus on customer experience
Small businesses typically have more involved owners who focus on the customer experience above all else. Since customers, sales, and reviews are crucial to the success of their business, local business owners will spend more time trying to find ways to improve the customer experience and offer a more personal touch.
In addition, unlike large corporations, small business owners typically hire individuals with more specialized knowledge of the products and services they offer and know everything there is to know about their own business, including how to serve customers. Employees can take the time to get to know regular customers to improve the experience.
Stimulate the local economy
Local businesses stimulate the local economy by paying taxes in the states and cities they operate in. When you shop locally or from a business, whether online shopping or walking through shops in your town square, you'll help these businesses grow, further stimulating the economy where you live.
Depending on where you live, you may pay sales tax on items you purchase, and this tax goes directly to supporting your city and state governments and their initiatives. Small businesses can receive tax breaks that reduce their liability, but they're more common for large corporations. Therefore, local businesses may pay more in taxes, contributing more to the local economy than big box retailers even though they have lower revenues.
When you buy products and services from companies in your city or state, you can support your local economy because your money stays in the community to support its development, even creating new jobs.
If you're like many people, you care about the environment. Unfortunately, when most people shop, they don't consider how transportation affects a product's carbon footprint. The longer a product travels to reach you, the more pollution it causes.
Small and local businesses typically have more sustainable business practices and a shorter product journey, the time it takes for products to be manufactured and put in the hands of consumers. This shortened journey reduces how much time products spend in transportation. In addition, many small businesses manufacture, produce, or purchase goods locally, reducing their carbon footprint and yours.
Of course, this isn't true for every small business, so you should research their sustainability practices. For example, just because you shop at the local grocery store doesn't mean that the products there haven't traveled long distances or overseas to make it there. Still, in many cases, small businesses manufacture and produce products close to home, reducing their environmental impacts.
Supporting small and local businesses enables job creation. While you might think big businesses supply the most jobs, that's not necessarily true. Even though those companies hire more employees than your local small business, there are more small businesses than large corporations, which is why small businesses are responsible for hiring much of the private workforce.
Consider how many small businesses operate in your area. These businesses range from advertising and marketing agencies to manufacturing plants, restaurants, shops, and more. They increase economic growth by hiring employees in their areas, and the more you purchase products and services from them, the more they can grow.
But, of course, small businesses can't always hire new employees if they're not performing well. Therefore, customers must make conscious efforts to support small businesses to enable job growth in various sectors and industries.
Small business owners pay taxes that go to local community initiatives. These businesses support local communities by paying local and state taxes and providing local jobs.
However, they're also more engaged in local charities and nonprofits than large big box chain stores in various locations. Local businesses can benefit from strong community ties, but communities also benefit from local businesses that are more willing to support them than big box retailers.
How to support small businesses
Supporting small and local businesses has many benefits, including supporting local economies and communities while enabling job growth in your area.
Supporting your local small businesses may seem challenging if you love shopping online or from particular chains and retailers. Luckily, there are several ways to support small businesses, even if you don't purchase products and services directly. A few ways to support small businesses include:
Buy gift cards
Buying gift cards is a great way to spread awareness about a small business. Even if a local store isn't open yet or has closed for some reason or another, you can purchase gift cards to use later, supporting small and local businesses even when they can't sell you products and services yet.
Gift cards also allow you to introduce your friends and family to new small businesses in the area. Believe it or not, everyone loves gift cards because they're essentially free money. However, when you give someone a gift card to a small business, they're forced to shop with that business, giving them more awareness about a particular shop's product offerings.
Using social media is another way to support local businesses and boost their brand awareness, even if you don't spend any money. Competition is fierce for small businesses, so promoting your favorite local businesses online is a great way to get them the attention they deserve while reducing their advertising spending to help them connect with more potential customers.
When sharing the brand on social media, you can tag them in posts with recent purchases you've made or post reviews on their website and share them on your own channels.
Many local and small businesses have websites that allow you to purchase their products without going to a physical location. Shopping online can help you support small businesses even when they're not nearby. When you shop online, you'll pay state sales tax, and small businesses will pay business taxes that contribute to communities. The more money local governments have, the more initiatives they can implement to help the community.
Leave positive reviews
Another way to support small businesses is to leave a positive review on a company's social media, Google My Business (Google Business) Profile, and other directories and review sites. All it takes is a few moments of your time.
Remember, small businesses rely on customer reviews because potential customers read them before deciding whether to shop with a business. Therefore, positive reviews can help businesses in your area attract more valuable customers.
Buy gifts for your friends and family
Word of mouth is crucial for all businesses, especially small businesses that might not have a large budget to compete with large businesses and big box retailers.
Buying gifts for your friends and family is a great way to spread brand awareness through word of mouth because it allows you to show others the type of products they can expect when they shop with a particular business.
Supporting small businesses is crucial to a healthy economy, job growth, and community satisfaction. When you support small and local businesses, you can contribute to the health and happiness of your neighbors, friends, and family. Whether you're shopping online or in stores, small businesses need your support.
Mailchimp supports small businesses with its all-in-one automation software that offers tools to help small businesses effectively market products and services to their customers. Ready to spread the word about your business? Try Mailchimp today.