Two purchases. The same amount spent. Two very different economic impacts.
Did you know that 66 cents of every dollar spent at a small independent retailer in Canada stays within the provincial economy, compared to just 11 cents when shopping at a multinational retail chain?
It's a striking difference, and one that reveals something important about the way our everyday purchasing decisions shape the economy around us.
We often hear about the importance of shopping local. But beyond supporting small businesses or feeling good about buying from a Canadian company, what does it actually mean for our economy?
Where does our money go after we make a purchase? Who benefits from it? And why does shopping locally make such a difference?
Let's take a closer look at the economics behind our everyday choices.
1. The Numbers Behind Shopping Local: 66¢ vs. 11¢
According to a 2023 study by the Canadian Federation of Independent Business (CFIB), where we choose to shop has a significant influence on how much money circulates within our provincial economies.
For every $100 spent in Canada:
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$66 stays within the provincial economy when shopping at a small independent retailer.
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$11 stays within the provincial economy when shopping at a multinational retailer with physical stores.
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$8 stays within the provincial economy when shopping with a large online retail giant.
That means small independent retailers recirculate approximately six times more money within the provincial economy than multinational retailers with physical locations.
These figures represent Canadian averages and measure the direct economic contributions of different retail business models.
But why such a significant difference?
The answer lies in what happens to the money after a purchase is made.
Independent businesses often rely on local employees, service providers and suppliers. The money they spend on these activities helps support other businesses and workers within their province.
Large multinational retailers, on the other hand, generally have different organizational structures and supply chains, with a greater portion of their spending directed outside the provincial economy.
The result? Two identical purchases can generate very different local economic contributions.
Source: Canadian Federation of Independent Business, Small Business, Big Impact, 2023.
2. One Purchase. A Ripple Effect.
When we purchase from a local business, the economic impact doesn't necessarily end at the checkout.
A single transaction can help support an entire network of people, businesses and services.
Think about everything involved in operating a business.
There are employees to pay, accountants managing finances, designers developing products, manufacturers bringing ideas to life, photographers creating visual content and transportation companies moving goods.
When these services are sourced locally, the money spent by one business becomes revenue for another.
That revenue can then support additional wages, business expenses and future investments.
Economists refer to this circulation of money as an important part of local economic activity.
Shopping local isn't simply about supporting one business. It's about contributing to the economic network behind it.
And while not every local business purchases all its services locally, the connections between independent businesses can help strengthen regional economic activity.
3. Locally Owned vs. Locally Made: What's the Difference?
One of the most important distinctions in conscious consumption is understanding the difference between supporting a locally owned business and purchasing a locally manufactured product.
Although these concepts are often used interchangeably, they don't necessarily mean the same thing.
Locally Owned
A locally owned business is operated or owned by people within a particular region or province.
It may employ local workers, use local service providers and contribute to the economy, even if the products it sells are manufactured elsewhere.
Locally Made
A locally manufactured product involves production activities taking place within the region.
Depending on the product, this may include manufacturing, assembly, specialized labour and quality control.
Local manufacturing can help sustain skilled employment, preserve production expertise and support businesses involved in the manufacturing process.
Both locally owned businesses and locally made products can contribute to our economy, but they do so in different ways.
Understanding that distinction allows consumers to make more informed decisions about the economic activities they want to support.
How Can You Identify Products Made in Quebec?
To make product origins easier to understand, the organization Les Produits du Québec has established three distinct certification marks.
Product of Québec (Produit du Québec)
At least 85% of the direct production costs must be incurred in Quebec, and the product's final substantial transformation must take place within the province.
Manufactured in Québec (Fabriqué au Québec)
The product's final substantial transformation must take place in Quebec.
Designed in Québec (Conçu au Québec)
The workforce responsible for design and development must be located entirely in Quebec.
These certifications provide consumers with clearer information about where products are designed, manufactured and produced.
They also highlight an important reality: a Canadian brand does not automatically mean a Canadian-made product.
Source: Les Produits du Québec, Verification Process.
4. Preserving Local Craftsmanship and Expertise
There is another important dimension to local manufacturing that extends beyond immediate economic contributions: the preservation of skills and expertise.
From textiles and furniture to specialized manufacturing and design, Quebec has developed valuable production knowledge across numerous industries.
Behind these industries are skilled workers whose expertise is built through years of training, experience and hands-on practice.
When production takes place locally, it creates opportunities to maintain these specialized skills and pass them on to future generations.
Local manufacturing also supports relationships between businesses, workshops and industry professionals.
However, maintaining production activities requires more than technical expertise. It also requires sufficient demand to make these operations economically sustainable.
By choosing locally manufactured products when possible, consumers can contribute to sustaining the industries and craftsmanship that exist within their communities.
It's not only about where something is made today, but also about helping preserve the ability to make it here tomorrow.
5. Shopping Local Doesn't Mean Buying Everything Locally
Supporting local businesses doesn't mean every purchase needs to be made close to home.
And it certainly doesn't mean buying more simply because something is produced locally.
The reality is that not every product is available or manufactured in Quebec. Price, accessibility, quality and individual needs will always influence purchasing decisions.
Conscious consumption is about understanding those choices rather than striving for perfection.
Sometimes, it means choosing a locally manufactured product.
Other times, it means discovering an independent business, researching where a product comes from or investing in an item that will last for years.
It can also mean buying less.
Because thoughtful consumption isn't necessarily about how much we buy. It's about how intentionally we choose.
Small decisions, repeated over time, can help shape our consumption habits and influence the businesses and industries we support.
6. The Economy We Support Is the Economy We Help Shape
The relationship between consumers and the economy is more direct than we sometimes realize.
Our purchasing decisions influence which businesses generate revenue, which services are in demand and which industries have opportunities to grow.
Supporting local businesses can help maintain employment, encourage entrepreneurship and contribute to the economic vitality of our communities.
Supporting local manufacturing can also help sustain production expertise and create opportunities for skilled workers.
None of these impacts depends on a single purchase.
They are the result of countless individual decisions made by consumers every day.
And while no shopping choice alone can transform an economy, understanding where our money goes allows us to participate more consciously in the economic landscape around us.
A Small Choice Can Have a Meaningful Impact
Shopping local is about more than geography.
It's about understanding the people, skills, services and businesses behind the products we purchase.
It's about recognizing that our money continues to have an economic impact long after a transaction is completed.
And perhaps most importantly, it's about remembering that we have choices.
We don't need to buy everything locally to make a difference. We simply need to be more aware of what our purchases support.
Because every dollar tells a story about the economy we choose to participate in.
And every thoughtful choice is an opportunity to make that story a little more meaningful.
Have less. Be more.
Sources & Further Reading
Canadian Federation of Independent Business (CFIB)
Small Business, Big Impact: Small Retailers' Local Contributions, October 2023.
https://www.cfib-fcei.ca/en/research-economic-analysis/small-retailers-local-contributions
Les Produits du Québec
Verification Process: Product of Québec, Manufactured in Québec and Designed in Québec.
https://lesproduitsduquebec.com/en/verification-process
