Understanding the Challenge Faced by Small Businesses: 6 Reasons Why People Don’t Shop Local.
- Price: Small businesses may struggle to offer the same low prices as big retailers due to higher operating costs.
- Convenience: The convenience of online shopping and delivery services make it hard for small businesses to compete.
- Selection: Large retailers have a wider selection of products, which can be a significant factor for consumers.
- Awareness: Small businesses often struggle with getting their name out there and attracting customers.
- Marketing: Effective marketing strategies can help small businesses stand out from the crowd and increase their exposure and visibility.
- Brand loyalty: Some consumers may have strong brand loyalty to specific national brands or retailers, making it challenging for small businesses to build customer loyalty
In today’s fast-paced world, shopping has become more convenient than ever before. With just a few clicks, you can have almost anything you desire delivered to your doorstep. Unfortunately, as we increasingly rely on large retailers and online shopping, small businesses struggle to stay afloat. The pandemic accelerated this trend and radically changed our expectations when it comes to consumer purchasing. Today we’ll explore the six main reasons why people don’t shop local and the corresponding challenges local businesses face as a result.
Convenience: The rise of e-commerce has made it easier than ever to shop from the comfort of your own home. Shopping apps and mobile shopping have also made it possible to buy things on-the-go. Additionally, delivery services and same-day delivery options have made it even more convenient for consumers. All of these factors make it hard for small businesses to compete with the convenience of larger retailers (source: BigCommerce).
Price: Price is often a deciding factor for many consumers when it comes to shopping. Small businesses may not be able to offer the same low prices as big retailers due to higher operating costs. Large retailers are often able to take advantage of economies of scale, which means that they can produce or acquire products at a lower cost than small businesses. This allows them to offer products at lower prices, which can be attractive to price-conscious consumers. Many consumers are on a budget and are constantly on the lookout for discounts, coupons, and sales. Some large retailers even offer price matching policies, which can make it difficult for local businesses to compete on price alone.
Selection: Large retailers typically have a much wider selection of products than small, local businesses. It’s not uncommon for a large supermarket or superstore to carry tens of thousands of products. For example, Walmart, one of the largest retailers in the world, stocks over 100,000 products in its stores, while some large supermarkets can have up to 60,000 products on their shelves. They can afford to stock a larger inventory and carry a wider range of product lines. This can be a significant factor for consumers who are looking for specific items or want more options to choose from (source: National Retail Federation).
Awareness: Small businesses often struggle with getting their name out there and attracting customers. Many consumers may not even be aware of the local businesses in their area or may not know what they offer. Large retailers have the resources to invest in advertising and marketing, which can make it difficult for smaller, local businesses to compete. However, social media, search engines, and online presence can be effective tools for small businesses to increase their exposure and visibility (source: Alignable).
Marketing: As mentioned above, large retailers have the resources to invest in advertising and marketing, which can make it difficult for small businesses to compete. However, effective marketing strategies can help small businesses stand out from the crowd. This includes branding, promotions, sales, outreach, targeting, and messaging. Both digital marketing and traditional marketing can be effective for small businesses, depending on their target audience and goals.
Brand loyalty: Finally, brand loyalty is another challenge that small businesses face. Some consumers may have strong brand loyalty to specific national brands or retailers, which can make it difficult for them to switch to shopping locally. However, small businesses can build trust, reliability, and a positive reputation by offering quality products, consistency, and building familiarity and affinity with their customers.
These are the six main barriers to shopping local and they create several challenges for small businesses face when it comes to competing with larger retailers and online shopping. It’s important for consumers to consider these factors and make an effort to support their local businesses whenever possible.