Christmas shopping at J. Skylark, a locally owned toy store in Canal Park, is a longtime tradition for Paige Salyards of Duluth.
"I try to always shop locally," she explained. "I just see the value of supporting our local economy."
Donna and Lauren Sletten, also of Duluth, do likewise. "We just love those one-of-a-kind gifts," she said.
Consumers locally and throughout the nation are becoming more aware of the "buy local" movement, believing it will boost individual businesses, the local economy and the quality of life where they live. A recent report by a new state think tank, Minnesota 2020, highlighted the value of buying local this holiday season.
Local buying advocates point out that mail order and Internet sales send money elsewhere and that even big box stores and chains divert most of their money to corporations, although they do pay local salaries and rent or property taxes that put money into the economy.
But whether spending locally really makes a big difference is an open question, two local economists said recently. While no one is saying shoppers shouldn't favor their favorite local merchants, the economic issue really hasn't been well studied.
Part of the reason it's difficult to tell whether buying local benefits the local economy, said Jim Skurla, acting director of the University of Minnesota Duluth's Bureau of Business and Economic Research, is "it's so difficult to tell what's local and what's not."
Even if an item is sold by local merchants, it's probably made elsewhere, he pointed out. Sometimes -- but not always -- local prices are higher than large retailers.
What you're buying locally really is service, Skurla said. "That's what the local people are adding to it, is the knowledge and the time," he said.
There's also the question of what is local. Big box retailers Target and Best Buy, for example, are Minnesota-based corporations. They pay taxes in the state, contribute to community causes and employ people at their headquarters who wouldn't be in Minnesota if the companies were based elsewhere.
And, taking the argument to the extreme, what would happen to the shipping companies if everyone bought local, asked Tony Barrett, economics professor at the College of St. Scholastica. If northern Minnesotans stopped shopping in Minneapolis, workers might be laid off and then they'd be unable to afford to come to Duluth as tourists, he added.
The world of commerce is too interconnected for the buy local argument to be simple, he said.
10 percent boost
But ask local merchants what would happen if everyone spent 10 percent more of their holiday shopping money locally and the point of view is entirely different.
"Oh my gosh, it would be huge," said Cindy Nelson, who owns J. Skylark, 394 S. Lake Ave. She said she might be able to give raises to her eight part-time employees and increase her inventory.
A 10 percent boost in revenue would be "tremendously significant, considering that the cost of doing anything in our world ... has gone up," said Doug Melander, co-owner of Mainstream Fashions for Men at 206 W. Superior St.
Angela Orman, owner of Angela's Bella Flora, 138 W. First St., said she might be able to give more to community causes, increase employee pay and benefits, have more money to spend locally and add to inventory. "If people can really focus on buying local, there are so many benefits to the community," she said.
Catering to locals
"When you spend money at local-owned businesses, more money stays in the local economy," said John Bennett, University of Minnesota Extension community economics educator for Northeastern Minnesota. He works with merchants to help them compete with big box stores such as Wal-Mart.
But even a business owned elsewhere can have more effect on the local economy than buying by mail order or online, said Bryan Brown, general manager of the Younkers department store in Duluth's Miller Hill Mall.
He points out that his store, owned by Bon-Ton Stores of Milwaukee, tries to cater to local tastes by carrying more warm clothing than most Younkers stores, for example. And it offers good jobs to local people, with about 50 of its 200 employees being full-time, which he said is an unusually high number for a retailer.
Brown, who is a fan of local buying, said the philosophy works better with food than it does with other products because it can be both produced and sold locally. Most clothing and many other goods these days are made in China, he said.
"Without a doubt, if more Northeastern Minnesota/Duluth residents made their purchases locally instead of in the [Twin] Cities or online or by mail order ... there'd be a huge win for our economy and the environment," Brown said. Even local chain store competitors such as Chico's and Talbots help boost sales at his and other stores, because shoppers no longer have to get the stores' merchandise elsewhere and stay in Duluth to shop. When they go to one store, they often go to another.
Bennett cited a study done by Civic Economics, a private consulting firm, in 2004. It studied retail sales in the Andersonville neighborhood of Chicago and concluded that for every $100 spent with a local firm, $68 remains in the local economy -- whereas spent with a chain company, $43 stays local.
"Changes in consumer spending habits can generate substantial local economic impact," the study said.
The Minnesota 2020 report agrees, saying: "If Minnesota families spent 25 percent of their holiday shopping budget on Minnesota-made goods, the small business ripple effect would feel more like a tidal wave."
Barrett of St. Scholastica is skeptical of that kind of statement, but does think it's important for consumers do what is comfortable for them. Those who favor buying from local merchants, or purchasing locally produced goods, are acting on their values -- and that's a good thing, he said.
"It's totally a personal choice. But it's not going to change the world," he said.