If You Love a Local Business, Pay in Cash!
Posted by Neil Brody Miller on March 21, 2010
The deeper I delve into the cultural politics of the buy local and slow food movements, the more I appreciate how transformative a real commitment to these movements will be. A number of developments this past week have driven my thinking on this topic. First, I filed the DBA for my new business, TheVillageSquared.com (more about this at a later date), which is still several months away from being launched but which personally and professionally marks an important turning point. In all likelihood it signals the end of my academic career as a college professor, or at least an end to the expectation of finding a full-time teaching position, and a return to an earlier status as a business owner and entrepreneur. My ambivalence about this realization, however, is offset by the hope that it will also mean stability and independence – financial and existential – after eight years as an itinerant educator, and a firmer foundation for my commitment to remain in Central New York and put down permanent roots in the region.
I’ve also been reading and thinking about a number of related issues. I started reading Michael H. Shuman’s book The Small-Mart Revolution: How Local Businesses are Beating the Global Competition which, despite indulging occasionally in utopianism and relying too heavily on best- and worst-case scenarios, is an important book for understanding the challenges, and the politics and philosophical underpinnings, of community-based economics. I’ve also been thinking about joining a CSA, which for a middle-aged bachelor long habituated to eating out rather than cooking at home, is not as simple a decision as it may sound. Will I really make and keep a commitment to consume all the fresh food delivered weekly? Will I be paying for produce I won’t eat, or worse yet, throwing away food I failed to consume? Will the moral good of supporting local farming be offset by the moral harm of wasting food?
Finally, I got a letter this week from my bank, HSBC, “the world’s local bank,” informing me that, beginning in April, there will be a monthly charge for my checking account, which until now had been free. I’ve already been thinking about which bank to open the business account for The Village Squared, and have been leaning towards a community bank or local credit union. The letter from HSBC, however, combined with the ideas in Shuman’s book and my thinking about community-based economics, demands that I rethink my personal banking as well.
All these issues came together this morning over breakfast at the Red & White Cafe in DeRuyter. As I reached to pay the bill, I grabbed automatically for my plastic debit card, which over the past few years has virtually replaced my use of cash. In fact, I often go for weeks nowadays without a dollar in my pocket. I stopped, however, and thought a bit about the socioeconomics of my actions. Beyond the questionable ethics of banking with HSBC, a multinational corporation who uses the money in my account for god only knows what purposes, and in god only knows what countries, paying for my meal with the debit card also meant that Mastercard was going to take somewhere around 3 percent of the total bill, or around 30 cents, in fees and charges, which would come out of Chris’s, the owner of the Red & White Cafe, pocket and profits.
A short conversation with Chris brought home the economics of this issue. We quickly calculated that she serves about 500 customers a week, which at roughly $10.00 per customer works out to $5,000 a week. Which means that Chis pays around $150.00 a week in credit card fees, or somewhere around $8,000 a year in lost income and profit. That may not be enough to make-or-break her business, but it is certainly enough to prevent her from purchasing a major new appliance, or making a commitment to source locally grown products, or taking a much-needed vacation. So in terms of its effect on the local economy, the use of a debit card to pay for my breakfast could, like the flapping of a butterfly’s wings in Brazil, metaphorically set off a tornado in Texas.
All this may seem like a lot of deep thinking for a Sunday morning breakfast, but supporting a community-based economy, I am begining to realize, is not simply a matter of purchasing locally grown farm products. At the very least, today’s meal got me thinking about the supposed convenience of carrying plastic, which, like the convenience of purchasing produce at the local supermarket without any thought of where it came from and how it got there, comes with significant hidden costs. Which is why I say that supporting the local economy will be transformative and require me to change entrenched habits. If you love a local business, pay in cash!
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6 Responses to “If You Love a Local Business, Pay in Cash!”Leave a comment, and if you'd like your own picture to show up next to your comments, go get a gravatar!
WOW! Tremedously good point! I will Tweet this blog!
As I was reading your blog, I kept thinking “That’s me; that’s how I am.” (especially the part about rarely even carrying cash). I am passionate about supporting local businesses and I will most certainly take this advise!
Shannon, Thank you!.
Great point! As a small business owner I should know that and do that but hadn’t thought about it. I’ll try and remember that in the future.
I, too, got the HSBC notice ($3/month fee…for um, nothing). When you did the math, 3% really adds up. I’ll think twice next time I’m at a local business and think about paying with plastic! $8,000 is a lot…
Hurrah, Neil! You’re figuring it all out. As far as that “excess” produce, rather than toss it you have some other options available that will deepen your commitment to your “buy local” credo or broaden your connection to the community you’re building. Try preserving, canning or freezing that extra food. The winter will not seem so long when you tease your palate with the flavors of summer. Or, give it to a local food pantry. Those less fortunate than you will appreciate something fresh they wouldn’t otherwise be able to afford.
Hi Debby. I’ve been thinking exactly along those lines, and have started reading up on pickling and canning. Pickles are in my Slavic, peasant blood, so it would be fun as well as tasty to learn how to preserve foods using this traditional method. Donating fresh produce to local food pantries is something I’ve also been thinking about. I’ve spoken with Jennifer Baskerville-Burrows and a few other community activists/local entrepreneurs about starting up a non-profit company that would allow individuals to purchase whole or part of a CSA share (i.e., we’d bundle smaller donations to purchase whole shares), which would be donated to local food pantries. So far the idea has been well received.