Supporting small businesses has a great effect on the community also. Research shows this is due to a boomerang effect. Someone spends money on a local business, and that money is then put back in the community. It goes back into the community via salaries and donations. Despite this great effect on the community, it still seems that people choose large businesses over small, local ones. The reason of this has was not discussed however.
- In Australia, a quarter of every single dollar spent goes to small businesses
- Although more Australians are choosing large business, the overall outlook for small business is positive
- Just about $38 billion is put back into communities through local spending, going to worthy causes
“Money spent with small businesses finds its way back to communities through salaries to residents (27 cents) and payments to local suppliers (12 cents).”