5 Takeaways from the 2016 Independent Business Survey

5 Takeaways from the 2016 Independent Business Survey

By Alex Gladu, Independent We Stand

For the ninth year in a row, the Institute for Local Self-Reliance (ILSR) and the Advocates for Independent Business (AIB) have released their annual Independent Business Survey, which includes data gathered from more than three thousand small and independently owned businesses across the country. Together, these businesses reported steady revenue growth, an increase in employment and confidence in the buy local movement. Despite the many challenges that small businesses face, including public policy issues and competition from larger retailers, the independent business marketplace remains healthy, thanks in large part to the buy local movement and the groups working to spread it.

Small Businesses Finished Strong in 2015

Throughout the year, small business revenue growth remained steady. Among the independent businesses surveyed, 67 percent reported that their revenue increased from 2014 to 2015, the same rate that reported growth the previous year. Steady growth is always reassuring, but perhaps the most notable part of last year’s growth was the holiday season. Independent retailers, according to the survey, saw revenue 3.1 times that of the 2014 holiday season. Comparatively, overall holiday retail sales grew by just 1.6 percent in 2015, according to the U.S. Department of Commerce.

Job Creation Remains a Priority

In 2015, independent businesses reported a 6 percent increase in employment. Among the roughly three thousand businesses surveyed, there were more than two thousand jobs added over the course of the year. This growth came at a time when many expected rising health care costs and increased health care demands on small business employers to stagnate job creation.

Buy Local Groups Make All the Difference

In communities throughout the country, buy local groups unite independent businesses, provide them the resources they need to stand out from big boxes and spread awareness of the benefits of buying local. Each year that ILSR and AIB have published a survey — for nine years in a row, now — the research has proven that these buy local groups have a measurable, positive impact on their communities. In 2015, independent businesses located in communities served by a buy local group reported revenue growth of 7.4 percent. Independent businesses located elsewhere also saw revenue growth, but less of it – just 4.2 percent, on average. In other words, it’s clear, for the ninth year in a row, that working together to spread the buy local message matters.

Business Owners Believe in the Buy Local Movement

Not only do independent business owners report growth in connection with buy local groups, but they also see the buy local movement working for themselves. Nearly half of business owners surveyed see public awareness of the need to buy local growing in their communities. That’s good news: Buy local groups often need buy-in from the independent businesses in their communities in order to flourish and successfully implement their awareness programs.

Internet Retailers Remain a Top Challenge

As always, independent businesses face several unique threats in the marketplace. Not surprisingly, competition from large online retailers remains the threat that business owners are most concerned about. According to the survey, 70 percent of independent business owners rank competition from online retailers as their top challenge. Fortunately, there’s a silver lining. Ongoing advocacy efforts from members of the buy local movement are working to close an important tax loophole that prevents states from requiring online retailers to collect sales tax.

Ultimately, the 2016 Independent Business Survey should reassure business owners, consumers and the buy local groups that connect them. Last year brought steady growth and new jobs. Although challenges remain, the effectiveness of the buy local movement will continue to mitigate the negative impacts that these challenges have on small businesses.

To download the full report, click here.

Independent We Stand is dedicated to helping independent businesses across the country engage their communities and encouraging customers to buy local. If you’re a business owner, get buy local resources, tips and news by registering for a business membership. Your business will also be included in our ‘locals only’ search engine and mobile app. If you’re a consumer, take the pledge to buy local to join the movement.

 

 

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