Thank heaven for Amazon. Before the rise of the retailing giant, I was always racing to the store for duct tape or office supplies. Now, I’m a pretty devoted online shopper. When a brown box shows up on my front porch, I’m grateful. For a small fee, Amazon saves me hours of wandering the vast fluorescent-lit aisles of Home Depot or Staples.
Still, it’s hard for me to feel good about Amazon’s newfound support of small business. The retail giant recently launched a merchandising program that will highlight its small-and mid-sized business sellers this holiday season. Amazon seems to want to cash in on the goodwill generated by the hugely successful Small Business Saturday.
Small Business Saturday is a shopping event created eight years ago by American Express as a counterpart to Black Friday and Cyber Monday. In contrast, Small Business Saturday – always two days after Thanksgiving – is meant to encourage folks to patronize small and local brick-and-mortar retailers. The event helps some shops ring up enough cash to stay in business.
Still, I must confess: Small Business Saturday makes me a little cranky.
Long before the launch of Small Business Saturday, there’s been tension between small business and American Express. That’s because AmEx charges higher fees than Visa, Mastercard and all those rewards cards are subsidized by your local Mom and Pop shops. Many small retailers operate with extremely thin profit margins, and credit-card fees can make the difference between barely surviving and thriving.
And while I love the convenience of Amazon, it’s hard to ignore the fact that millions of small and mid-sized businesses have been crushed by the retail giant. This holiday season, Amazon says it intends to highlight its small business partners. My guess is that for every shop it promotes, Amazon is helping to kill off five others.
Consider this little-known strategy: small businesses must wait for over three months to get their money from sales generated through Amazon. Yep, Amazon has over $3.7 billion in accounts payable. How many small shops die waiting for that check? This equates to what is essentially a massive interest free loan that further fuels Amazon's growth.
In my view, every day should be a small business day. Consider shopping first at the local businesses that support your children’s sports teams, your neighborhood events and fundraisers that are important to you. Your Turkey Trot was undoubtedly paid for in part by some small shop in your hometown.
So stop by those local shops and say hello. While you’re there, browse the inventory. Invite your friends, too. You might just enjoy it more than shopping online by the cold blue light of your computer screen.