Thursday, November 5, 2015

Why is it important for a community to support local entrepreneurs?

(This essay was written for a job opening. I did not get the position, but figured the essay was relevant, so decided to post it here.)

If we start with the premise that local businesses are the lifeblood of communities, then it is vitally important for communities to support local businesses. Given that local businesses are operated and created by local entrepreneurs, then supporting local entrepreneurs is even more essential.

While national and international corporations spend shareholder investments in establishing storefronts, local entrepreneurs usually invest their own savings. They are taking a gamble that they know what the community needs and that the community will in turn provide the business with the financial stability to continue providing the goods or service.

Local entrepreneurs are also more likely to provide benefits to the community such as hiring locally, sponsoring community efforts, and having the flexibility to move with the needs of the community. Most importantly, they typically keep their money local. Local money spent on goods and services provided by local entrepreneurs usually goes right back into the community. Money is not forwarded from the community to a big corporate headquarters in a faraway state or country.

Another benefit of local entrepreneurs is that they have a tendency to provide guidance or mentorship to other aspiring local entrepreneurs. One local entrepreneur’s success becomes a building block for a community of like-minded locals. If they are all supported, the many local entrepreneurs can create a movement and possibly an identity for the community. A great example of this phenomenon is the local beer movement in Tampa initiated by Cigar City Brewing. Because of community support, Cigar City Brewing was able to prosper and create opportunities for other local breweries, providing Tampa a cultural identity as a growing “beer city”. This identity in turn brings in other business and opportunities such as tourism, brewing supplies, and restaurants.

A local entrepreneur recently told me, “Give enough people what they want, and they will give you what you want”. When this “giving” relationship stays local, all parties benefit. But local entrepreneurs cannot give people what they want if they are not supported locally. Without their community, most local entrepreneurs would flounder and fail.