Small Business Saturday this year arrives on November 30. Founded in 2010 by American Express to promote local retailers, Celebrating Small Business Saturday has become a tradition in the post-Thanksgiving, pre-holiday season. The big-box retailers may get slammed on Friday; Saturday is a day when people can buy presents, stock up treats, and get ready for whatever of the many holidays they celebrate through to the first week of January.
The purpose is to encourage people to shop at local retailers. Local retailers, of course, are often sourcing from other small businesses. American Express and the National Federation of Independent Businesses have worked together to research the economic impact of small businesses. When analyzing cost of goods sold and revenue, they found that $0.67 of every dollar spent at small businesses stays in the local community. Of this, $0.44 goes to wages and profits for local employees and owners, while $0.23 goes to other local businesses. Because these people also spend in the community, each dollar spent at a local business generates a total of $1.50 in local economy.
Local retailers often support small businesses in other communities. They can’t get unique inventory by going to the same suppliers that the major retailers do. Yes, local retailers often have higher prices than national chains, but analyzing cost of goods sold shows that it’s because of the unique inventory. Small retail store owners have to look for different things, and they do, supporting entrepreneurs and artisans all over the country while they are at it.
Smart cost analysis is great for business and customers
And, even many online retailers are small businesses. One example is our customer Tobi.com, an online fashion retailer (they’re having a huge Thanksgiving sale right now, of course!). Their super cute and trendy clothes are designed AND manufactured in the US.
CEO Kenneth Chan has found a great way to use Bento to stay on top of the company’s larger and international competitors. “Expenses are crazy in fast fashion, so I need to know what is going on all the time,” he says.
Tobi’s buyers assign all materials costs for each design to a unique Bento card. This makes analyzing cost of goods sold and gross margin really easy; they compare the card spend to sales data to find the profitability of each particular item. The company uses this information to see which styles resonate with customers, helping them plan manufacturing and guide designers on what customers want to buy next.
“We used credit cards before Bento,” Chan says. “They didn’t give me visibility, expense management, or transparency. They only gave me a reward,” and he says that the miles did not have anywhere near the value of the information. “Now I can see each charge in real time, and I can have direct control of the money that each of my buyers spends with vendors.”
We love that our tools help community local, American manufacturers, and community nonprofits stay in business. This Saturday, our staff will be shopping at local bookstores, coffee roasters, and clothing boutiques, and we hope you will be, too.