Sacramento, California – It’s a little tough to feel jolly this holiday season, if you’re a small-business owner. Bruised by the recession and uneasy about the post-election economy, America’s small businesses face yet another big unknown: whether consumers are feeling festive or frugal.
This weekend, they’ve got a great chance to find out: Small Business Saturday, the annual “shop local” day designed to pump up mom-and-pop businesses.
Squeezed between the Black Friday mall frenzy and Cyber Monday’s online shopping kickoff, it’s a chance for the small retailer to shine.
“In addition to holiday music wafting through the air, we’re hearing the ringing of uncertainty in Sacramento and California. … Whether it’s a bookstore, auto shop or restaurant, they’re still very uncertain about how many customers will come through the door,” said John Kabateck, California’s director of the National Federation of Independent Business.
That’s because retailers are getting mixed messages about consumer spending, coupled with uncertainty about new taxes, health care mandates and other economic realities that’s made them skittish about 2013.
” ‘Tentative’ is a good word,” said Brian Lawrence, store manager of Emigh Outdoor Living, describing what he sees as shoppers’ attitudes so far. “We’re hoping for a 10 percent increase in holiday sales over last year. But it’s challenging.”
At his El Camino Avenue outdoor furnishings store, those holiday hopes are hanging from the branches of about 25 elaborately decorated Christmas trees, part of the store’s annual changeover into a home decorating marketplace of trees, wreaths, candles and table decor.
Some projections say this Black Friday weekend will be a good one for the nation’s malls and chains, launching a November-December season where sales are expected to reach $586.1 billion, up 4.1 percent from last year.
But small-business owners like Lawrence are hoping that shoppers seeking personal service will look beyond the big-box retailers.
Retirees Jeannette and Richard Nardinelli, who stopped at Emigh’s recently to look for St. Nicholas Day ornaments for their grandchildren, don’t need convincing.
“We try to do everything local and patronize local businesses,” said Jeannette, a River Park resident. “It’s important to support the neighborhood you live in.”
This year, the average holiday shopper will spend an estimated $751 on gifts, decorations and other holiday purchases, according to the National Retail Federation. How much of that winds up in the pockets of small-business owners is hard to estimate.
The NRF doesn’t track sales specifically to small retailers, but notes that 95 percent of the nation’s retailers are independent companies with one location.
Started in 2010 during the recent recession, Small Business Saturday is a collaboration between American Express and the NFIB.
“It started from a small idea to become a growing fixture across California – and the nation – to address small businesses’ No. 1 need: more customers,” said Kabateck, NFIB’s director in Sacramento.
In California, the average NFIB member has five to seven employees and gross annual sales of $350,000 to $450,000. For many, holiday sales can represent nearly 20 percent of annual sales, according to industry estimates.
“Coming out of the election, the volume was turned up on how important small businesses are to the economy. There was a lot of dialogue and rhetoric,” said Kabateck. We hope that translates to patronizing their corner store instead of their big box.”
To entice shoppers this Saturday, many small businesses are rolling out special promotions: Sierra Hay and Feed in Lincoln is dangling 10 percent off all pet collars, leashes or harnesses. Complete Ponds, a water-garden supply store in Roseville, will knock 15 percent off an entire purchase. In midtown Sacramento, the Birkenstock store is shaving 10 percent off Naot shoes, which typically run $100 or more a pair. At Revolution Wines, a Sacramento urban winery, they’re offering a six-bottle case of chardonnay and red wines for $99, normally $159.
Beyond a one-day “shop local” reminder, some retailers are banding together in an effort to get shoppers to think a little more broadly about the impact of their shopping choices.
In Sacramento, three local business districts – downtown, midtown and Old Sacramento – are asking shoppers to “Keep Your Green on the Grid,” by taking a Facebook pledge to shift two of their holiday purchases to a small, independent retailer between now and Dec. 31.
“If a thousand people commit to spending just $25 worth of their holiday spending at a local, independent retailer, that’s $25,000 we generate in sales that stays in our local economy,” said Heather Philpott, community and events manager for the Midtown Business Association.
Some consumers have already embraced that notion. Rebecca Sturges, a Sacramento marriage and family therapist, decided several months ago that all of her holiday purchases for family and friends will be done locally.
She’s buying cycling gear at local bike shops for her husband. She’s gone to the kitchenware section of Hollywood Hardware, a neighborhood store, to look for “girlfriend gifts.” And to fill two outdoor camping gift boxes for her college-age children, she’s even scoured local Goodwill outlets.
Why? “I like the idea that the money I spend stays here in Sacramento, rather than some online retailer 2,000 miles away,” said Sturges, a Land Park resident. “It’s not all about price or saving a couple dollars online.”
The “buy local” effort by the downtown partnership in Sacramento is part of a nationwide push by the Institute for Local Self-Reliance, a Washington, D.C., policy and research group.
According to its recent survey, independent businesses in communities with an active “buy indie/buy local” campaign run by local business and civic groups saw year-over-year revenue growth in the last three years. In 2011, those sales hit 7.2 percent, compared to 2.6 percent in communities without such campaigns, it reported.
Another burst of shop-local enthusiasts are so-called “cash mobs,” groups of Facebook friends that descend – cash in hand – on a designated small business on a given day to plump up sales. The idea got started in 2011 and has caught on in dozens of cities across the country. Under unofficial “mob rules,” participants are asked to spend $20 each and meet afterward at a local bar to celebrate.
In Sacramento, a Facebook cash-mob group is still trying to get 100 “likes” in order to activate its first event. But it already has a handful of local businesses nominated for the economic honor, including Momo’s Meat Market, Time Tested Books and Danny’s Mini Donuts in Old Sac.
For devotees of the shop-local movement, it’s a way to ensure their local business community stays healthy, lively and profitable. As Sturges put it: “If we’re not their customers, who will be?”
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