During a recent chat with green-business expert Jennifer Kaplan, I got a look at the competitive edge businesses gain when they buy local. Kaplan is the author of the new book Greening Your Small Business and founder of the consultancy Greenhance in Washington, D.C.
Kaplan points out that small businesses can buy closer to home to cut their shipping miles and reduce their carbon footprint. You can find local suppliers or manufacturers, which means fewer miles and less pollution.
Often it’s hard to find a vendor that sells what you want right in your town. But buying local is all relative. If you’re buying from China and can buy from Mexico instead, that’s going to save a lot of truck fuel. If you’re on the West Coast buying from East Coast manufacturers, finding a replacement in the Midwest should be an improvement. As a bonus, along with being greener, shorter shipping should reduce your transportation bills, too.
Labor laws are stronger in closer countries and within the United States, so workers may enjoy better pay, working conditions, and work hours. If your company has social-justice values as part of its mission, your move to localize buying may allow you to strengthen your message that you care about worker conditions.
Buying local also opens the door to saving on inventory management costs, while doing a better job of satisfying customers. With shipping time cut down, you may be able to carry less inventory and wait longer to reorder while still keeping shelves stocked. This frees up cash for other uses in your business instead of tying it up in inventory. Your order turnaround time should be better too, allowing you to respond faster to customer requests.
“There’s also more flexibility for customization,” Kaplan told me. “Local vendors are more likely to work with you to give you exactly what you need.”
One final strength of buying local: It can give you a serious edge if there’s a catastrophe. If there’s an earthquake, tornado, riot, or other problem, shipping from far-off places tends to get back to normal slower than short-haul trucking. So while your competitors wait, and wait, for deliveries, you’ll be back in action serving customers, and maybe attracting some of their customers, too.