Chains vs Local...What are the true economics

Not exactly an unbiased source.

The study was done by http://www.civiceconomics.com/

I just happened to find the results posted on buylocalrogue.com

I have no problem debating an issue, but it would be nice to see some facts from the opposing side.

"I just don't believe" the numerous studies stating, buying local is better, doesn't cut it for me.

A couple points:

1. I'm not suggesting that money does not flow out of the local economy for chains. I specifically said that I don't look at franchises in the same light as "big-box" stores...in this case the investment is mostly local and most of the profts are local.

2. Again what is local? Where does it stop and become not local? Aside from the fact that I like the thought of purchasing locally grown fresh food, why should it matter if the "profit" goes to Kansas, Ohio, or Florida?

3. In terms of published studies...the one quoated had a very small sample size (n=10). Would you trust a new drug if it had only been tested on 10 rats? Given the heterogeneity of busniess - how can any such study prove much of anything? Was Walmart included? Was it studied in a single industry (manufacturing, retail, service)? Was it geographically diverse? Were the study participants picked at random? We all know the old saying about stastistics. Since I'm not really trying to prove anything I'm not interested in searching the internet for "studies".

Can't you buy local because you like local stuff as opposed to some contrived economic argument....that's my point.

In the end, I judge a place by its food. Being independent doesn't help bad food and being a chain doesn't hurt good food.

There is no way to tell "true" economics because it is a matter of opinion.

Can't you buy local because you like local stuff as opposed to some contrived economic argument....that's my point.

I like that statement...it has a aura of truth about it.

I have no problem debating an issue, but it would be nice to see some facts from the opposing side.

Justin,

I don't know that there is an opposing side...There are just varying degrees of agreement when it comes to assigning value to the concept of buying local. As for "facts"...in reality what we're really discussing are "statistics" and those are tricky little buggers to pin down. We could debate the overall impact until the cows come home but I don't know that we'll get anywhere with it...So for the sake of peace in the family lets just say that (in general) a restaurant that purchases locally does more for the economy than one that doesn't and leave it at that...

I'm down with that.


I perceive the locals to have a greater impact than the chains for the various reasons I have stated and the numerous studies that support my thinking. I don't think I am imagining my perception, but it's just my perception.

I choose locals when at all possible for numerous reasons, economic impact being one of them.

As far as the concept of buying local, I'd say just buy as local as possible without sacrificing value. U.S. vs. China, KY vs FL, ect...

OK...so with a polite nod to Justin (and others) who pointed out the somewhat hard-to-pin-down importance of a restaurant buying locally produced products...let me revisit, redefine and perhaps simplify my original point of ponderization (I made that word up...pretty cool huh ?)

Lets say I'm a local guy and I own a Five Guys Burgers and Fries franchise...or maybe a Dunn Brothers Coffee Shop (or both). In both instances I've invested a bunch of money in a business that produces a product that is arguably comparable to anything produced by a local independent. No, I don't harvest my own coffee beans...but then again I haven't seen Nimbus out in the KY coffee bean fields lately either. Nor do I go out and (humanely) knock some local heifer in the head to make my burgers (Haven't seen anyone from Cousins, Home Run, etc doing it either)...So basically what I'm seeing is that (product subjectivity aside) I am doing an equal job of keeping the local economy humming.

Again...not knocking the local "independent" which as (I think it was Jeremy) said are "100% more interesting" (I'd go with 85% of 'em but that's just me)...but I'm beginning to have a hard time wrapping my arms around the concept that locally owned franchise restaurants are some kind of evil force that has descended on the community. I may not prefer their product or their service (and in most cases don't) but that is purely subjective. To use the argument that they somehow don't do as much for the economy (one of the mantras I've noticed on this forum) sounds kinda null and void.

OK...so with a polite nod to Justin (and others) who pointed out the somewhat hard-to-pin-down importance of a restaurant buying locally produced products...let me revisit, redefine and perhaps simplify my original point of ponderization (I made that word up...pretty cool huh ?)

Lets say I'm a local guy and I own a Five Guys Burgers and Fries franchise...or maybe a Dunn Brothers Coffee Shop (or both). In both instances I've invested a bunch of money in a business that produces a product that is arguably comparable to anything produced by a local independent. No, I don't harvest my own coffee beans...but then again I haven't seen Nimbus out in the KY coffee bean fields lately either. Nor do I go out and (humanely) knock some local heifer in the head to make my burgers (Haven't seen anyone from Cousins, Home Run, etc doing it either)...So basically what I'm seeing is that (product subjectivity aside) I am doing an equal job of keeping the local economy humming.

Again...not knocking the local "independent" which as (I think it was Jeremy) said are "100% more interesting" (I'd go with 85% of 'em but that's just me)...but I'm beginning to have a hard time wrapping my arms around the concept that locally owned franchise restaurants are some kind of evil force that has descended on the community. I may not prefer their product or their service (and in most cases don't) but that is purely subjective. To use the argument that they somehow don't do as much for the economy (one of the mantras I've noticed on this forum) sounds kinda null and void.

Your keeping the economy humming, just not as loud as a 100% local, independent, place. No royalty fees, or buying contracts for the 100% true locals.

As far as the concept of buying local, I'd say just buy as local as possible without sacrificing value. U.S. vs. China, KY vs FL, ect...

I agree with that, but that just comes down to always buying the best value. Which, with maybe some minor exceptions [I mean, really, how often is it a tie?], means ignoring local v not entirely.

Which, with maybe some minor exceptions [I mean, really, how often is it a tie?], means ignoring local v not entirely.

Rob, I don't know if there is a typo or I'm just not following.

http://www.buylocalrogue.org/index.php?option=com_content&view=category&layout=blog&id=51&Itemid=86

A study with some actual figures.

The study analyzed ten locally owned restaurants, retail stores, and service providers and compared them with ten national chains competing in the same categories. The study found that spending $100 at one of the neighborhood's independent businesses created $68 in additional local economic activity, while spending $100 at a chain produced only $43 worth of local impact.

I buy those numbers. Now, how much per $100 spent do locally owned chains bring to town from outside stores?

Do Yum and Papa Johns and etc make up for that $25 lost?

And is it really lost? Do I even care if my money goes to NYC or The Highlands? [Answer: probably a little, but not that much]

Which, with maybe some minor exceptions [I mean, really, how often is it a tie?], means ignoring local v not entirely.

Rob, I don't know if there is a typo or I'm just not following.

You said:
"I'd say just buy as local as possible without sacrificing value"

I took that literally. If product A has a value of 11 utils (standard bogus measure of utility) and Product B has a value of 10 utils, you wont sacrifice 1 util of value because B is Louisville made and A comes from China.

In the rare case that A==B, then you would break the tie by buying the Louisville product.

And I agreed with that chain of logic completely. Maybe that isnt what you meant though.

I don't know if it matters for me to worry about whether local or. chain keeps more money in the community when the city government sends all that money to Cordish.

Which, with maybe some minor exceptions [I mean, really, how often is it a tie?], means ignoring local v not entirely.

I didn't understand what you were typing, the bold part.

You said:
"I'd say just buy as local as possible without sacrificing value"

I took that literally. If product A has a value of 11 utils (standard bogus measure of utility) and Product B has a value of 10 utils, you wont sacrifice 1 util of value because B is Louisville made and A comes from China.

In the rare case that A==B, then you would break the tie by buying the Louisville product.

And I agreed with that chain of logic completely. Maybe that isnt what you meant though.

How do we decide on value. Does a CA avacodo have more value (to you or me) than a Mexican one if they are both $1 and of equal quality? Maybe, maybe not. Value of a specific item is harder for me to pin down than local.

Value in the local vs chain restaurant debate is a no-brainer for me.

I only buy produce from Earth. I absolutely refuse to support the Martian economy. I'm very flexible on some points of disagreement but I'm afraid I cannot bend on this one.

Seriously, it's easy to see why customers may perfer local restaurants over franchises since they have much to gain from it with very little risk. I'm more interested in hearing why a business owner decided to invest in a franchise or decided to open their own business. I think there are risks/benefits to both that may not be obvious to those not in the business. I think I can guess at some of the risks and rewards of each but I don't really know the answer since I haven't done it myself.

Also, employees, where would you prefer to work? I would think that there's a better chance of financial security working for/owning a franchise, but maybe not. Does the state of the economy make a difference in your choices?

I don't have a dog in this fight, but I would really like to see the details and methodology on the study cited above. What are the credentials of the firm/individual doing the study and who underwrote the cost of the "research"? There is a ton of "bad science" going on in all fields including economic development. I'm not saying this study is "bad science" or not, as not enough information has been provided.
Surely there have been academic studies done which have undergone peer review. I just can't seem to find one.
Cheers,
Bill