Local Value Generation: Independent Businesses vs. Global Chains

The benefit to local economies is often more pronounced amongst small businesses. In a U.S. study, Civic Economics reported that local retailers return 52% of their revenue into the local economy, while national chain retailers contribute only 14%. Similarly, local restaurants circulate an average of 79% of their revenue within the community, in contrast to 30% for the chain restaurants.

This largely reflects the business model of many small and independent businesses that rely more on local labor and services, ensuring a larger portion of their profits stays within the local economy. This supports other small enterprises and sustains local jobs, while national chains tend to centralize profits and operations, limiting their local economic contribution.