Oops, this week is Small Business Week

and small businesses are significant building blocks for traditional commercial districts and local economies.  Forbes Magazine has been running a series of pieces on the topic, sponsored by Lendio, an online micro business loan provider.

-- National Small Business Week, US Small Business Administration

A couple of articles ("Small Business Week Special: Keeping Main Street Alive," "Small Business Week: Should we Instead be Promoting 'Micro' Business Week?") make the point that SBA defines small businesses in the context of very large businesses, and that there is a difference between "micro" businesses and small businesses and the failure to define micro businesses and acknowledge their importance means that a lot of business development programs by governments and other entities miss the mark.  (Stacy Mitchell of the Institute for Local Self Reliance makes the point that the Small Business Administration is set up to makeover small businesses into large ones.)

This is a good point, and an illustration of my point that there is a difference in comprehensive plan elements on economic development vs. building a local economy.

Building a local economy requires an approach more focused on the local multiplier effect of business activity within your community.  See The Multiplier Effect of Local Independent Business Ownership from the American Independent Business Alliance.

In short, people might spend a bunch of money on a hotel, but if the hotel is owned by an out-of-state company, the majority of the revenue flows to points and other businesses located elsewhere.

On the other hand, more of the money spent at a locally owned and operated business recirculates locally.  That's why the structure and ownership of businesses operating in your community matters.