Sunday, March 2, 2008

Our fight for Local Living Economies and Entrepreneurship

"Wrong Wrong Wrong Wrong Wrong!" were the words firing around my brain today as I sat in committee with a person whom I have come to admire in the social enterprise and double-bottom line investing world.

Her assertion was that local-living economies, where local products are encouraged and supported, make no sense and are in fact counter-productive to sustainability. If I were to paraphrase, she said that "to make a product in a less efficient manner, with less defined quality, for a higher price, and to sell it locally just to say that we are supporting local entrepreneurs and businesses is not a good trade off. It benefits smaller suburban communities, but it orphans urban settings which is where more people live anyway, so it doesn't work."

"Wrong Wrong Wrong Wrong Wrong!" I say again.

Her reasoning is sound except for one big catch...and it is a BIG ONE - The Customer!

Running our economy of retail products like some Stalinist centrally planned system appears to make sense from the 50,000 ft view...that is, it makes sense until no one buys those well-intentioned products and instead they all form a black market in more customer-centric goods. The theory goes as such: if you make things in big factories at the greatest efficiency and quality possible, and then ship them to the people that want them, that would seem to work; but those very efforts to make and build such a factory at a distant location, ipso facto, loose critical touch with the customer. This eventuality takes place because the construct is sadly missing the crucial fact that people who shop DO have a preference for true individuality and character whether they live in a city or in the country.

Call it a fact of human nature or otherwise, this proclivity toward real goods from real people has been around since the gold rush, and it is part of our DNA. Without the ability to infuse a product with local feel and design and to respond to local needs the whole spirit of the entrepreneur is in peril of being lost. And without entrepreneurs, the agents of change in the free world are stifled from making meaningful change.

Therefore, I submit: no matter how much less efficient it may seem, ask the customers what they like better and show them the choices. You will see that they prefer Whole Foods to Albertsons every time. It is NOT a coincidence.

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