Supporting Small Businesses – Holiday Special
So this is the last episode of 2020 and before I jump into the show, I just want to graciously thank every single listener out there. I know it sounds cliched, but it’s really all of you that has made this show a success.
This year we’ve smashed all expectations and as of writing this episode, we have just under 106,000 downloads since January 1st of this year.
So for our holiday special, we’re going to talk about ways to support small businesses during the holiday season and beyond.
The State of Small Businesses
It’s unfortunately not a secret that small businesses are struggling in Canada and the world at large. Just take a stroll down a major street and you’ll come across papered-up and vacant store fronts.
Statistics further let us see behind the scenes, the most recent business closure data from statistics Canada shows that from January to August of this year we have nearly 100,000 additional business closures compared to the past two years. The same data shows us that business closures peaked in April and then went back to average levels in July.
This data was only available until August and caution must be used with the data as it’s self-declared as experimental and this kind of data is often adjusted in hindsight. However, this data helps show just how drastic the impact has been.
Another recent survey that was completed by Statistics Canada from mid-September to the end of October of this year found that active small businesses are suffering from plummeting revenue that is leading many to many to consider closing shop. The survey found that 56% of overall businesses had a drop in revenue.
Of those impacted, nearly a quarter of all businesses with under five employees experienced revenue drops of 40% or more. Of these same small businesses, nearly 6% reported that they were contemplating closing shop or declaring bankruptcy.
Unfortunately, these numbers were also taken before many provinces instituted new lockdown measures.
Ways to Help Small Businesses
Thankfully there are some ways that we can really help support small and local businesses.
Before we jump into these, we also have to be honest about this situation. The economic recovery has not been equal for all and those that are still financial vulnerable may not have the ability to support small businesses.
Buying From Them
So, the most obvious way that one can support a small business is by buying goods or services directly from your local businesses instead of a big box store or that online store named after the largest river in the world.
When you shop at that local business you support all of the employees there and the profits typically support the owner and their families. On the flip side, when you buy from generic big biz, your dollars partly support their employees but the remainder gets sucked up by the corporation and will usually leave the community. In many cases these employees will also be paid minimum wage and have little to no benefits.
When you shop local, you’ll also often be able to find non-mass produced items that are often made by local producers and artisans. So the business that you’re supporting may also be supporting a network of other local businesses.
One thing to keep in mind is that smaller businesses will often not be as convenient ordering free delivery from Amazon from the comfort of your couch, but they often offer curbside pick-up or online delivery.
We also can’t forget about local restaurants. In-dining rules across Canada vary but you can help these businesses by in-dining, delivery or pick up. Also, if possible avoid using delivery apps as often they take a percentage of the sale.
Another big way to support local businesses is through gift cards. Basically, what you’re doing here is providing the business an interest free loan until the gift card is used. Many economists actually say that this is the best way that you can support a business because they have your money and do not need to immediately perform the service or deliver the good.
I’ve been hearing that some people will buy multiple gift cards at once for businesses that they support and then waiting to use them once business picks up.
Gift cards also make for a perfect holiday present and can help expose a fresh small business to people that you care about.
You can also really help out local businesses by sharing them over social media. This no cost option lets you spread the word about a business through-out your social media network. Sharing testimonies, interesting products that they may have, their sales and more can all be helpful.
Basically you become a megaphone for businesses that you support.
The final way to support local businesses is to just explore! Maybe there’s a small restaurant in your area that you’ve always been curious about or maybe there’s a small grocery store. Venturing out to these new places will help support your local businesses and you never know…maybe you’ll find your favourite future shop!
So that it for today and for the remainder of the year. Tune back in the new year when we look at what happens to your finances when you retire.
I hope that all of you and your family have a safe holiday season.
Thank you again and talk to you next year!