SF Chronicle to Readers: 'It's time to shop local'

Following the publication of an economic and market share analysis of the city of San Francisco that showed both a thriving local book market and the important economic value of locally owned businesses, the San Francisco Chronicle editorial page has weighed in with its opinion: "The message is clear: It's time to shop local."

For the "San Francisco Retail Diversity Study," Dan Houston and Matt Cunningham of Civic Economics estimated the market share of independent businesses in a number of retail categories, calculated the economic impact of those independent businesses, and forecast enhanced impacts associated with redirected consumer spending. While previous economic studies have gauged independents' local economic impact, this new study analyzed locally owned merchants' total market share in the San Francisco area and determined what the effect would be if there were an increase in consumer spending in locally owned businesses.

Commenting on the San Francisco Chronicle editorial, Hut Landon, executive director of the Northern California Independent Booksellers Association, noted, "For the city's daily newspaper to acknowledge the findings of the study as credible and to reach the conclusion that 'It's time to shop local' is a big deal."

Among its highlights, the report noted that the sales of books purchased annually from locally owned bookstores in San Francisco totaled $167 million, and that approximately one-third of that revenue (about $54 million) was returned to the local economy. In contrast, the sales of books purchased from San Francisco chains totaled $42 million and that only 19 percent of that revenue ($8 million) was returned to the local economy. The picture becomes even starker when Internet sales of books are added to the chain numbers. The sales figure rises to $117 million, but the return to the local economy remains unchanged at $8 million, lowering the percentage of revenue returned to the local economy to only seven percent.

In addition, the study found that redirecting 10 percent of book purchases to the local market would result in an increased economic input of approximately $3.8 million, 25 additional jobs, $1.3 million in new income for workers, and almost $325,000 in additional retail activity.

Further, the study also noted that a 10 percent increase of the total independent market share across the studied categories "would yield nearly $200 million in economic activity and nearly 1,300 new jobs; [however,] it must be remembered that the reverse is also true: shifting a further 10 percent of sales to chain merchants would deprive the community of that same $200 million and put those 1,300 employees out of work."

The study, which creates a model that can be used to conduct similar studies in other markets, was commissioned by the San Francisco Locally Owned Merchants Alliance (SFLOMA) and conducted by Civic Economics. It is based on sales data from 2005.

The full Chronicle editorial is available here.