Beyond Small Business Saturday: Sustaining Support | Bankrate

In many ways, small businesses are the lifeblood of America, accounting for a majority of the businesses you see around you. Supporting those small businesses is already a priority for many people. According to the Bankrate Small Business Saturday Survey, more than three out of five (61 percent) holiday shoppers said they were more likely to shop small for Small Business Saturday this year.

While shopping during the holidays certainly helps, small businesses need customer support beyond the seasonal excitement. That way, they can bring in steady income all year long. Let’s look at just how popular shopping small has become and why you should shop small throughout the year.

Insights on shopping small business

The rise of shopping small businesses

Shopping small businesses has been on the up and up over the past few holiday seasons as shoppers ring in the holidays with their shopping carts in tow. According to a recent Bankrate Small Business Saturday Survey, 72 percent of holiday shoppers plan to shop with a small business during the holiday season. That number is up from 65 percent in 2022.

From a consumer spending standpoint, customers really dove into supporting small businesses during the COVID-19 pandemic. Shoppers spent $23.3 billion by shopping small in 2021, increasing by 18.8 percent compared to 2019, based on data from American Express.

One way that small businesses have been getting the word out is through social media. According to the CMO Survey, businesses allot 13.8 percent of their budgets toward marketing. And 88 percent of businesses prioritize social media in their marketing strategies. Small businesses can use social media to raise awareness about their brand, encouraging shoppers to shop small in-store or even online.

Why support small businesses?

Small businesses add luster to our world through their different shapes, sizes and industries. Small businesses touch every corner of our lives, from whimsical bakeries and enriched coffee shops to hard-working construction and landscape companies.

Here’s why you should shop small and support small businesses every day.

Give back to your community

Shopping small keeps money in your local community, rather than funneling that money to big box stores that already have large budgets and support. According to American Express, every dollar spent at a local business keeps $0.68 in the local community. Further, every dollar spent adds an additional $0.48 from increased local activity, such as encouraging others to purchase local goods and services.

When you shop small, not only does your money go toward local employees and business owners, but the businesses pay sales tax to the city and county where it’s located. You’re essentially supporting local businesses and your city, town or neighborhood.

Yet another reason to give up your money at a local small business store is that they’re known for supporting charities. According to SCORE, a business mentorship program, 75 percent of small business owners give to local charities.

And when they give, they don’t hold back. Small businesses are known to give 250 percent more money to local nonprofits and community causes than large businesses. For example, Sarah Ingram built giving back into her business plan for Grassroots Yoga and has since been able to give $300,000 to a nonprofit.

Support local economy and job creation

Shopping small businesses is vital to keeping a thriving business landscape. That’s because the American economy is comprised mainly of small businesses, accounting for 99.9 percent of all businesses, according to the U.S. Chamber of Commerce.

Small business owners are eager to start their new business ventures. The U.S. Chamber of Commerce also found that in 2022, there were 5.1 million applications for new businesses.

But the legacy of small businesses doesn’t stop there. These small but mighty enterprises have created 12.9 million net new jobs over the past 25 years, according to the U.S. Small Business Administration. In fact, small businesses created two out of every three jobs added to the economy in that timeframe. In short, when you support small businesses, you influence job creation in America.

Offer better customer service

Small businesses tend to have a better understanding of what their customers desire. They keep their ear to the ground, so to speak, and deliver the experience that customers want. Fifty-four percent of holiday shoppers feel that small businesses have better customer service than large businesses, according to the Bankrate Small Business Saturday Survey.

When you walk into a local business, you have a better chance of seeing the same smiling faces as before. You may get to speak with knowledgeable staff who understand the ins and outs of the products on the shelves.

For example, my husband and I used to go to a local guitar store in Florida where all the customer service staff knew how to play. They could also point to which guitars would get you the best sound or explain how to get the best sound from your guitar. I’ve also been to a rare bookstore in Georgia, where the clerks personally pulled the books down for me and told me about the history behind them.

Provide unique products and services

When you go to a local shop, you’re likely to run across unique items that you can buy that you wouldn’t find anywhere else. Sometimes, the items are hand-selected or handcrafted by the owners. With some businesses, the owner can customize or personalize items for you if their products are made to order.

The Bankrate Small Business Saturday Survey found that 56 percent of holiday shoppers shop small businesses to find unique products and services.

For example, if you shop with Kainos Leather, you can choose from a selection of Bibles made from 50 different types of leather. Or you can go to small businesses like Put a Plant On It that prioritize knowledgeable customer service about the plants they keep in the shop.

Shopping small throughout the year

Small businesses certainly get a boost in sales through the holiday season. But it’s important for customers to be supportive and think of local businesses for their shopping throughout the year, as sustaining business can help increase small businesses’ resiliency during uncertain times or economic struggles.

You could get fruits and vegetables at the local farmers market or buy paintings for your home from local artists. If an appliance breaks, you could hire a local contractor to fix it. If you think local with different home and living needs throughout the year, you’ll be helping these small businesses keep the lights on.

Shoppers are already trending toward choosing small businesses over their large counterparts. Major retailers, like Walmart, Target and Amazon, offered sales in October this year, but Bankrate’s Small Business Saturday Survey found that 46 percent of holiday shoppers didn’t shop these sales.

To make shopping small more convenient and help you shop small businesses more, you could see if businesses have an online store. According to the National Retail Federation, online e-commerce was expected to increase by 10 percent to 12 percent this year, totaling over $1.4 trillion. Specifically, customers like shopping through multiple channels, often buying online and going in-store for some purchases.

How large businesses support small businesses

Small businesses and large businesses aren’t always in competition — in many cases, they can help each other succeed. Small businesses can often act as suppliers, and large businesses can distribute products from them. This model is vital for the economy’s success since it needs both business sizes to thrive.

Here’s how large businesses can support their smaller counterparts:

• Source food or ingredients from local farmers
• Sell small businesses’ products in the store
• Promote small businesses to their social media or email followings
• Partner with a small business unique to the community

Frequently asked questions

• How can you support small businesses?

  The biggest way you can support small businesses is by purchasing from them. Think about using local business products and services, including everyday items and food you use and construction or home improvement projects you have. When you have a good experience, you can also take the time to leave a genuine, positive review. This helps build the company’s reputation when other potential customers are researching that company.

• How do you start a small business?

  To start a small business, you first need a product, service or business idea that you think is marketable. You can confirm whether you have a market for it through market research, including interviews with potential customers. Then, you need to assess how much funding you need and find a source for financing, whether that’s a small business loan, crowdfunding or personal savings. You also want to write a business plan to outline the strategies you’ll use to reach your goals.

• Why are small businesses important?

  Small businesses are important because they drive the American economy, create millions of jobs, and foster a sense of community. Many shoppers enjoy shopping local because they can get high-quality products from knowledgeable staff that help them understand the best parts of the product or service.

• When is Small Business Saturday?

  Small Business Saturday falls on the Saturday after Thanksgiving each year. In 2023, the holiday shopping event is on November 25. Small Business Saturday 2024 is November 30.