Saturday, January 31, 2009

Buying Local has a Big Impact

By Tom Campbell, from the Durham Herald-Sun, 27 Jan 2009

Bob Ashley, in his recent column, "Buy local? Sure, but not always," said that "while I applaud and respect many of the motivations of the "buy-local" movement, I worry that, like many good ideas, it can be carried to the extreme."

While I understand the point that Ashley was making, I have to say that from the perspective of an owner of one of the dwindling number of locally owned, independent businesses in the area, it's hard to see, in practical terms, how "buying local" could actually be carried too far.

Gone are the days when folks around here had lots of locally owned choices for things like hardware stores, food stores, shoe stores, clothing stores, print shops, business supply stores, pharmacies, etc. Trying to survive in the Durham area today by just buying local would be a very tough go indeed.

But the motto of the shop local movement isn't "Shop Local Only."

It's "Shop Local First." And what it really means is "Think Local First" -- take a moment before you buy something and ask yourself if there's a local source of whatever it is you are looking for.

Thinking local first also means giving some thought to the benefits that flow from shopping local. Independent businesses make for a more vibrant and varied local culture. A greater sense of community. And they help keep a lot more of our money at work here in our hometown.

Why? Because a lot more of the money you spend at a locally owned business stays (and re-circulates) in our local community. Take my business for example. All of our employees live here. Our back office is in the back of the store, not in New York or Shanghai. We buy almost all of our supplies locally. Most of the taxes we pay stay in Durham and North Carolina. We bank locally. And we don't send dividend checks or inflated CEO salaries off to another state, or another country.

A recent study in Grand Rapids, Mich., found that a modest change in consumer behavior -- a mere 10 percent shift in market share to independent businesses from chain stores -- would result in 1,600 new jobs, $53 million in wages, and a $137 million economic impact to that area. If this 10 percent shift were to happen in Durham, (a smaller city than Grand Rapids), the impact would be something like 800 jobs, $20 million in annual wages, and $60 million a year in increased economic activity.

There's no escaping the fact that we live in a global economy. And for a lot of reasons the global end of things has been running rampant lately, driving local business to the brink. Some of this has to do with efficiencies, but a lot of it also has to do with access to capital, exchange rates, and things like the financial backing needed to sign a lease at most shopping malls.

But we also live in a very specific (and I think very remarkable) place. And supporting a little local balance to the global giants can only be a good thing for this place we call home -- and, really, for the global economy as well.

Wednesday, January 21, 2009

Got Wisdom?

From the final pages of Henry Alford's new book, How to Live: A Search for Wisdom from Old People...

Five traits that Alford concludes are associated with wisdom are reciprocity (do unto others..), doubt (not being overly sure of yourself), nonattachment (from Buddhism), discretion (knowing when to say nothing), and acting for the social good.

Monday, January 5, 2009

Bargain Hunting for Books, and Being Confused About It

The New York Times over the holidays published a marvelously muddled piece about the book business titled “Bargain Hunting for Books, and Feeling Sheepish About It.”

The point of the article was that the sale of used books over the web was the death knell for bookstores and for book publishers. As proof of this idea, the author, David Streitfeld, recounted his experience buying a used copy of a book called “Room for Doubt” through the web site There he purchased the book for twenty five cents (the book sells new in paperback for $13.95) from a woman in California.

Streitfeld makes much of the availability of used books on the web for next to nothing. He even recounts finding copies of “Room for Doubt” being offered for as little as one cent! Books for a penny! Books for a quarter! It sounds almost too good to be true.

And of course it is. And maybe Streitfeld knew this was the case when he told us the title of the book he ordered.

The rub here is that Streitfeld gives exact figures for the new price of the book and the two astonishingly low used prices he finds on the web. But he glosses over how much he actually paid for the book, saying he “bought a copy for 25 cents from someone who called herself Heather Blue plus a few bucks for shipping.”

“Plus a few bucks for shipping” indeed. If Streitfeld really paid so little to get this book, why doesn’t he tell us what the bill really came to? Probably because if he did, he would be feeling sheepish about his whole article.

The standard internet charge for shipping a book these days is $3.99. This is for postal service book rate shipping; arrival in 5 to 14 business days. Some places charge $4.50 or $5.00 for this standard shipping. So Streitfeld almost certainly paid a minimum of $4.24 for his book, and he had to wait 5 to 14 business days for his purchase to arrive.

Paying $4.24 for this book is a decent bargain, but it certainly doesn’t rise to the level of the industry-changing phenomenon that Mr. Streitfeld claims. And talk about twisted economies--Streitfeld likely paid 16 times more in shipping charges than the supposed value of the item he purchased. To put this in perspective, let’s apply this ratio to the purchase of something that you might actually need to have delivered to your home. I’ve got a great deal for Streitfeld on a new refrigerator--$500, plus a few bucks—say $8,000--for delivery!

The seller’s side of this transaction is stranger yet. When contacted by Streitfeld, Heather Blue said she sold the book “because she had too many books and wanted to raise money to buy more.” But how can selling a book for 25 cents, when it will cost her at least $4.00 to get a similar book, be a smart move? Of course, she probably made an actual profit of about $1.25, since the post office charges $2.23, book rate, to ship most books. (And she would also have paid something for packing and shipping materials).

But going through all the work of posting a book on the web, accepting an offer, packing and shipping this book for a net of $1.25? It’s hard to see how this is a good use of anyone’s time or energy.

Why didn’t she gather this book together with others she wanted to sell and bring them to a local bookstore? At The Regulator she could have received $2.00 in store credit for her copy of “Room for Doubt,” and more (than selling on the web) for her other books as well. In just one short trip, she could have gotten a bunch of credit that she could spend in our store on used books, new books, remainders, cards, gift items, magazines, etc. Compare this to the effort of selling, packing and shipping her books one book at a time to folks like Mr. Streitfeld, with each transaction netting a smaller profit on each item.

What’s going on here? My guess is that both the buyer and seller in this transaction have fallen prey to the thrall of the internet. Many folks these days operate under the assumption—usually unspoken and almost always unexamined—that if you can do it on the net, most especially if you can do it peer to peer on the net, that’s the best way to do everything and anything. As this case shows, this is not always so, particularly when there’s a reasonably close-by local alternative.

There’s one more thing David Streitfeld should really feel sheepish about. That’s the carbon footprint/global warming impact of his method of buying books. Even without a carbon tax—which we should all hope gets put in place soon—the huge imbalance between the price of his book and the cost of shipping should have tipped him off that something wasn’t quite right with this way of buying things. Shipping a single book, with all its packaging, hundreds or thousands of miles is a global warming nightmare. Buying (and selling) locally is a greener way to go.

When we finally do get a carbon tax, some ways of doing business may no longer be viable. Selling small items one at a time over the net could well be one of these. Sell your amazon stock now?

Read Streitfeld’s original article at this link