What is a local business (and why you should support them)

Supporting local businesses is something that everyone seems to believe is a good thing, but has anyone ever asked why supporting local businesses is a good thing? And how much good does it do? Furthermore, what determines whether a business is “local” or not?

What is a local business

It turns out determining whether a business is “local” is not so black and white.

At Pointz, when we determine whether a business is “local” we mainly look at two things:

  • Do the owner(s) (or majority of owners) live and operate in that community?

  • Do the profits stay in community?

Now, for many businesses this provides a very clear cut way to determine whether a business is local (and whether you should support them over a non-local business), but there are of course some grey arrays, specifically when considering locally owned franchises.

Why supporting local business is good

Good People Brewing Company, Birmingham, AL

Good People Brewing Company, Birmingham, AL

Although this might seem obvious to some, the main reason why supporting a local business (instead of a non-local business) is good, is because your money stays in the community (the same community where you eat, work, live, and play).

When you support local businesses, the money you spend ends up going towards roads, schools, hospitals, police, firemen, and so much more.

This doesn’t happen when you decided to support a non-local business.

How to support local businesses

Ask anyone on the street whether they support local businesses or not and more often than not they will say “yes”; but what does it mean to actually say that you support local businesses?

If you say that you support local business, you actively choose (even sometimes when it’s not easy) to eat a local restaurant (instead of going to McDonalds), to join a local gym (instead of Gold’s), to get your hair cut at a local barber or salon (instead of Sports Cuts), or to shop at a local grocer (instead of Walmart).

I’ll admit making these choices to support local business over the competition is sometimes not only less convenient, but also costs a little more money upfront. However, that little bit of extra money goes back into the community, and when combined with a joint effort and time, will not only trickle back down to you, but will also yield a huge investment in the long term.


Supporting local businesses is good. Determining whether the business is “local” is not necessarily clear cut. Everyone says they “support local businesses,” but that doesn’t mean they actually do.