FACE OFF: Buy Local VS Buy Global

09/03/2016

Faceoff: Buy Local VS Buy Global

Faceoff: Buy Local VS Buy Global

The “buy local” movement has been around in some form since international trade and globalization began. In Canada, a “Buy Canadian” movement began as early as 1914, when the First World War economy saw imported products as a threat for the first time.

In the U.S., the “Buy American Act” of 1933 required the U.S. government to prioritize American-made products in its procurement purchases.

In the past few decades, the call to support local businesses by patronizing locally sourced and sold products over those that are imported and sold at corporate chains has gained momentum.

While there seem to be many benefits to supporting the neighbourhood “mom n’ pop”, not least of which is a warm feeling of doing “the right thing”, is it really best to buy local?

Buy Local VS Buy Global

1. Buying local helps the local economy

Buy Local: In the Time Magazine article “Buying Local – How it Boosts the Economy”, evidence is presented on how keeping your purchases local will benefit that same economy:

“The New Economics Foundation, an independent economic think tank based in London, compared what happens when people buy produce at a supermarket vs. a local farmer’s market or community supported agriculture (CSA) program and found that twice the money stayed in the community when folks bought locally.”

“That means those purchases are twice as efficient in terms of keeping the local economy alive,” says author and NEF researcher David Boyle.”

Buy Global: The Wikipedia page for local purchasing presents an alternative argument, shedding a different light on the possible effects that prioritizing local products can have on the region’s economy:

“The argument that “buying local” is good for the economy is questioned by many economic theorists. They argue that transportation costs actually account for a fraction of overall production prices, and that choosing less efficient local products over more efficient nonlocal products is an economic deadweight loss.”

“Moreover, the community as a whole does not actually save money because consumers have to spend so much more on the more expensive local products. Karen Selick argues that the buying local trend is just a watered-down version of protectionism, and would not benefit communities as proponents envisage.”

In an article recently published on TradeReady.ca, Michelle Hustler, CITP|FIBP reminds us that buying global helps local businesses too:

“Let us be cognizant that importing products actually supports local services such as shipping, transportation and distribution.

2. Buying local helps build thriving communities

This is a multifaceted argument for supporting local businesses, which ranges from economic protection, to culture, to health and jobs. But there are two sides to this argument as well.

More money goes to non-profits

Buy Local: According to Sustainable Connections Org:

“Non-profit organizations receive 250% more from small business owners than they do from large businesses.”

Buy Global: According to a National Retail Federation study:

“Imports improve American families’ standard of living. They help families make ends meet by ensuring a wide selection of budget-friendly goods, like electronics we use to communicate and many clothes and shoes we wear, and improve the year-round supply of such staples as fresh fruits and vegetables.”

Import/export jobs in Canada and the U.S total in the millions.

Maintains economic diversity

Buy Local: The Institute for Local Self Reliance says:

“A multitude of small businesses, each selecting products based, not on a national sales plan, but on their own interests and the needs of their local customers, guarantees a much broader range of product choices.”

Buy Global: Limiting purchasing to locally available products means less access to globally sourced items that are either unavailable in the local region or inefficient, and at times detrimentally resource-intensive, to produce and source locally.

Better jobs

Buy Local: Amy Robinson,  Founder and Co-Executive Directorof LOCO BC, an organization designed to promote local business, says:

“Much of this value created [by buy local programs] is in fostering good local jobs—the higher-paid management, sales and marketing positions that a local company creates right in its community.”

Buy Global: In his article “The Top Ten Reasons NOT to Buy Local”, Zachary Barowitz says:

“There is no reason to believe a local boss is any better than a corporate one, and due to the threat of class-action lawsuits, corporations have some incentive to behave. What’s more, national chains can more easily offer a better benefits package. Who has better salary/wages and benefits: Borders or Books Etc., Whole Foods or Paul’s Food Center, Starbucks or Coffee by Design?”

Better service

Buy Local: According to an article by Nicole Leinbach-Reyhle on Forbes.com:

“Small local businesses have a more hands-on role within the company, therefore building a stronger sense of care for the job they do. Additionally, smaller companies are more flexible in their customer support – with a willingness to bend rules if necessary (such as alter a return policy) or deliver VIP treatment when least expected (such as home delivery for a customer during a rain storm).”

Buy Global: Big global chains face a fair amount of regular criticism over their customer service performance. But there are a few things at play here: Big companies are more often in the public eye, meaning you hear of a higher proportion of bad experiences than small businesses, which can distort appearances.

Also, big chains like Hertz, American Express, Westjet, Marriott, Apple and Amazon are taking full advantage of social media and big data to build stronger connections and better experiences with their customers. In an era where customers have a louder voice than ever, it’s no wonder.

3. Buying local is better for the environment

Buy Local: David Suzuki focuses on the benefits of buying locally produced food on davidsuzuki.org:

“Currently, the average meal travels 1200 km from the farm to plate. Food that is grown closer to home will therefore have fewer transportation emissions associated with it, and also be fresher and support local farmers. And as the distance food travels decreases, so does the need for processing and refrigeration to reduce spoilage.”

Buy Global: In his New York Times article “Don’t Buy Local!”, Richard Coniff argues that:

“The ‘local’ label says little or nothing about a product’s actual environmental friendliness. A resident of Sacramento, for instance, can take comfort in buying ‘local’ rice, but it’s likely to be rice grown in a heavily irrigated desert, at huge environmental cost. In the overall carbon footprint of a product, the cost of transport turns out to be surprisingly trivial.”

4. Buying local is the ethical choice

Buy Local: Buying local is a form of ethical consumerism.

When you shell out a little extra to support your neighbour’s business, reduce your environmental impact, purchase fair trade products that don’t profit from unsafe or unfair working conditions, and promote diversity and the community, you are making a moral purchasing decision that you can be proud of and benefit from.

Buy Global: Todd Hirsh of The Globe and Mail asks readers to:

“Do to others what you would have them do to you. When the U.S. introduced “Buy America” policies in the midst of the last recession as a way of boosting its own domestic economy, Canadians were angry. Not only does it fly in the face of free-trade deals, it just doesn’t seem very neighbourly. And when cities and countries care only about keeping their dollars within their own economies, the benefits of global trade start to shrivel.

5. Buying local encourages innovation

Buy Local: According to Susan Witt, Executive Director of the E.F. Schumacher Society:

“‘Buy local’ campaigns serve another function: alerting a community about gaps in the local market. For instance, if consumers keep turning to on-line or big-box stores for a particular product—say, socks—this signals an opportunity for someone local to make and sell socks.”

This is the way product innovations get made, says Witt. “The local producer adds creative elements that make either the product or materials used more appropriate to the place.” For example, an area where sheep are raised might make lambs wool socks and other goods.

Buy Global: Competition breeds innovation. The drive to outperform our competitors leads us to develop better, more efficient, feature rich products that consumers demand.

As Michelle Hustler pointed out in her “3 Reasons you shouldn’t buy local” article:

“The premise was that high duty rates would push Barbadians to buy locally manufactured products and give companies in these areas a chance to grow unperturbed by competition. This didn’t happen. Instead, these sectors, in the absence of the helpful push of competition, became less and less internationally competitive, while the tastes and needs of consumers kept up with global trends.”

6. Buying local means better quality

Buy Local: A plethora of “buy local” proponents champion the quality of locally sourced and lovingly produced goods over imports and items made on assembly lines in mass quantities.

Particularly poignant are arguments from buy local produce initiatives who highlight advantages such as a much shorter farm to table journey, ensuring freshness and quality.

Buy Global: Wikipedia on Local Purchasing:

“The term ‘Buy Local’ has become subject to varying interpretations. While leading advocates of local independent business such as the American Independent Business Alliance say the term should apply only to locally owned independent businesses, some campaigns run by governments and Chambers of Commerce consider “local” to be merely a geographic consideration. Additionally, many corporations have manipulated the term in ways critics call ‘local-washing’.”

Trish Tully, CITP|FIBP adds:

Almost every locally made good produced or service offered would not exist without imported inputs.”

We’ll let the parting shots go to Todd Hirsh from his Globe and Mail article “Buy Local: nice idea but does it make sense?”

“The main problem with “buy local” movements or policies is that they require us to discriminate between businesses based on ill-defined criteria. That can lead to poor choices and a misallocation of resources in ways that can be economically damaging. Purchasing from a vendor deemed to be local may end up costing more, and there’s no certainty those dollars will remain in the local economy anyway.”

Do you make an effort to support local small businesses by “buying local?” Or do you prefer to shop based on other criteria such as price, availability, and quality no matter where the products are made or sold?

Disclaimer: The opinions expressed in this article are those of the individuals cited therein, and do not necessarily reflect those of the Forum for International Trade Training.

About the author

Pamela Hyatt

Author: Pamela Hyatt

I am a Content Marketing Specialist for the Forum for International Trade Training (FITT). You can find some of my work on TradeReady.ca. My background is in copywriting, journalism and social media. My passion lies in connecting people to the stories that are most important to them.

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