The Impact of Small Business Failures on Local Communities
Small business face higher failure rates compared to larger corporations due to limited financial resources and difficulties accessing capital. However, the impact of small business closures extends beyond the owners themselves.
Local communities are significantly affected by the loss of these companies. This article explores the repercussions when a large number of small businesses fail in a community.
Local jobs play a crucial role for individuals who cannot travel long distances, such as teenagers without transportation or parents who want to minimize childcare costs.
When numerous businesses close in a town, local job opportunities become scarce. This can force many people out of the workforce, especially those with commuting constraints.
Small businesses contribute to the value of neighborhoods. When a significant number of companies shut down, neighborhoods may become less desirable, leading to lower property values.
While homeowners may not be immediately concerned about their home’s value, it can impact their ability to access home equity through loans or lines of credit.
Local companies generate tax revenue, which supports public services. With the closure of many small companies , the town’s tax revenue decreases, resulting in a reduction of public services.
Neglected parks and the disappearance of various programs can adversely affect both property values and residents’ quality of life.
Supporting Small Business Benefits the Community
Supporting local small business is vital to mitigate the negative consequences mentioned above. By patronizing small companies , you contribute to their survival. Rather than opting for large chain stores, consider purchasing goods or services from local establishments.
Although it may involve spending a bit more money, the long-term benefits to your community can be significant.
For example, instead of going to Starbucks, visit a local café and enjoy their specialty coffee, even if it costs slightly more. Instead of exclusively buying books from online retailers, support your local bookseller, even if their prices are slightly higher. These choices help sustain small businesses and contribute to the economic health of your community.
If financial constraints prevent you from spending extra at local businesses, you can still support them by writing positive reviews and recommending them to friends and neighbors. Word-of-mouth advertising is a valuable contribution to small businesses’ success.
The closure of small business affects not only the owners but also the entire community. The loss of local jobs, declining property values, and decreased public services can have a negative impact on residents’ lives and the overall desirability of a neighborhood.
By actively supporting small businesses through patronage or positive recommendations, individuals can help mitigate these repercussions and contribute to the resilience and prosperity of their community.