The ‘local store’ message is everywhere, but deals are hard to resist during a pandemic


Are you part of the local store movement that runs across Canada?Encouragement to support neighborhood businesses comes from all walks of life as the economy struggles to emerge from the financial devastation of the COVID-19 pandemic.

Whether it’s provincial and municipal initiatives, chamber of commerce programs, high-profile incentive campaigns backed by financial giants or small signs in front of individual businesses, the message is the same: show your people. local entrepreneurs love a little more in these tough times – this is important for helping the economy recover.

Although recent polls suggest most Canadians support the idea, getting people to shop locally over the best deal and the convenience of online shopping is a difficult task during a pandemic, some experts say.

Consumers lack confidence

The pandemic has left many people out of work and feeling insecure about their finances, which could make the pursuit of the lowest prices more important than supporting local small businesses.

The Bank of Canada’s most recent survey of consumer expectations showed that virtually all metrics have deteriorated due to the impact of the pandemic, including people’s expectations for wages, expenses, conditions labor market, inflation and housing price growth.

“Everyone is trying to find a deal because they don’t know how long their money will last,” said economist Armine Yalnizyan.

And keeping prices low can be a challenge for small businesses, she said.

“They find it difficult to come up with very specific offers, especially now. “

An American Express billboard encouraging shoppers to spend locally is on display in Toronto’s Yonge-Dundas Square on August 4. (Evan Mitsui / CBC)

Yet polls conducted since the start of the pandemic suggest that small businesses across the country are enjoying growing support. One of the main findings of a Leger poll in April was that “Canadians say they buy local products more often or for the first time.”

American Express Canada said 83 percent of participants in an online survey in June agreed it was time to support the small business community, while 76 percent said they were “determined to make purchases. more local than in the past ”. The poll was not random, but a comparable random poll would have a margin of error of four percentage points, 19 times out of 20.

Who Said Not To Support Small Businesses?

But Wayne Smith, a professor at Ryerson University’s Ted Rogers School of Management who specializes in consumer behavior, says what people tell researchers may be different from how they actually behave in the real world.

“It’s kind of like asking if people like puppies,” he says. “Everyone is going to say they love puppies. But how many people are going to get a puppy? ”

Smith compares the phenomenon of local stores to consumers who commit to buying from stores that specialize in green and sustainable products.

“Some do, but it’s a relatively small proportion of the population,” he said. “Otherwise, Walmart would be bankrupt. “

People walk and shop at the Ottawa Byward Market on June 25. (Hugo Bélanger / CBC)

Buying decisions are based on “perceived value,” Smith said. Local goods or services have to be of equal or better quality than those found elsewhere if consumers are to follow through on their good intentions, he said.

Julia Gray, of Toronto, said she and her family were excited to shop locally as much as possible and support small businesses rather than large chains.

However, as an artist, she is also very values ​​conscious, she said.

“My income is always changing a bit, so as a family we have learned to be careful with our expenses. “

Julia Gray, of Toronto, shops regularly at her local green grocer. She said she would rather support small businesses than large corporate chains, and the pandemic has made her even more selective about where her money goes. (Submitted by Julia Gray)

Even so, the pandemic prompted her to make a more concerted effort to support her neighboring businesses, she said.

“Instead of ordering from Pizza Pizza or some other corporate pizzeria, let’s order from the local place where their kids go to school with our kids,” she says. “These places won’t survive if we don’t help them. “

Amazon sales booming

Gray says small businesses may also be preferable from a health perspective.

“We have people in our family who are immunocompromised,” she says. “We don’t want to go where there are large groups and you may be more exposed to the virus. Small stores don’t have that many people ”.

She avoids shopping at Amazon, she said, because it’s a way of expressing her values.

“You can vote and you can decide where to spend your money,” she said. “We think of workers – are they treated fairly? Are they protected? And in whose hands does our money end up? ”

But Lonnie Delisle, choir director in Vancouver, is an Amazon fan.

“It’s so convenient. The price is good, the selection is good, ”he said. “The ease with which you can find things and shop. Amazon is extremely user-friendly. “

Packages are sorted for shipment inside an Amazon fulfillment center in Robbinsville, NJ, in this November 2017 photo. It’s hard for small local businesses to compete with an online monster like Amazon. (Lucas Jackson / Reuters)

Delisle said he tries to shop with Canadian companies as much as possible, often checking out The Bay or Canadian Tire first.

“But when you need something, and [Amazon has] what’s available is where we’re going. ”

Amazon flourished during the pandemic, with sales up 40% from the same time last year. Revenues from international markets like Canada have also increased due to increased demand.

Large companies offer incentives to shop locally

However, even some very large businesses in Canada are trying to get the message across about the importance of small business.

Royal Bank and American Express Canada both spend a lot of money on multimedia advertising campaigns to encourage consumers to shop locally and offer financial incentives to customers who support small businesses.

RBC’s Canada United campaign offers customers additional points on their RBC Rewards card by purchasing locally.

The bank has also produced a video on the importance of small businesses and will donate five cents to a special fund every time someone watches the video, likes it or shares it on social media. Entrepreneurs can then apply to the fund for grants of up to $ 5,000 to help cover the costs associated with keeping their businesses afloat during the pandemic.

American Express Canada’s Shop Small initiative gives cardholders $ 5 in credits when they spend at least $ 10 at up to 10 different small businesses, to earn a maximum of $ 50 in free money. The company also created a small store map to direct shoppers to eligible stores.

“This is good for our economy,” said Kerri-Ann Santaguida, vice president and general manager of merchant services for American Express Canada. “It’s about the dynamism of neighborhoods across the country. “

Economist Armine Yalnizyan says household debt was a huge problem in Canada before the pandemic and she is worried about what will happen when CERB payments stop. (Christopher Katsarov / The Atkinson Foundation)

Economist Armine Yalnizyan said the strategies of American Express Canada and RBC are similar to those of the federal government, with its rent relief program and small business loans, as they recognize that businesses are the engine that will pull Canada’s economy through the crisis.

« We can’t have resilient communities without resilient small businesses, ”said Yalnizyan, who holds a Future of Jobs scholarship from the Atkinson Foundation, a Toronto-based charity focused on social and economic justice.

The point is, she says, big financial institutions like RBC and American Express Canada depend on a healthy economy.

“They are trying to keep as many businesses afloat as possible,” she said, “which will minimize the increase in permanent layoffs.”


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