What are Locally Owned Businesses?

Introduction

Locally owned businesses are small establishments that sell goods or provide services to a specific area. They are generally owned and operated by a small group of people or, more often, by families. In most cases, business owners are located in the same area and focus on serving regional customers.

Types Of Locally Owned Businesses

We can categorize local businesses in various ways, depending on factors such as company size, business type, sector, and marketing modes, among others. Here, we have divided locally owned business firms into two main types, depending on their physical presence and customer relations.

Service Area Business (SAB)

In a service area business, service providers visit customers' locations to provide their services. There is no need for customers to see the company's physical location. You can easily find locally owned businesses online that offer services to customers in their area.

Examples: Common examples include plumbers, electricians, and locksmiths.

Brick-and-Mortar Business

Unlike service area businesses, a brick-and-mortar business has a precise location. Customers must visit the location to purchase goods or receive services. Many local family-owned businesses operate on the brick-and-mortar business model, having a physical location to serve their customers.

Examples: Common examples include restaurants, medical clinics, and retail stores.

 

 

How Local Businesses Operate?

A local business operates within a specific geographic area. The services or goods they provide are specifically tailored to the unique needs and preferences of the area. The performance of a company is often influenced by the norms and cultures of the local area. Moreover, they may experience a sudden peak or decline based on seasonal or culturally specific events in that area.

Small regional businesses are typically marketed through referrals and word of mouth. They have a strong connection with the community members. They are often able to build trust relations with the target audience. Below are some points specific to the operations of local businesses.

• They focus on the needs and preferences of the people in a specific geographic area, often limited to a town or a city.
• Their services are tailored to each customer. It helps them build strong relationships with the customers.
• They primarily utilize regional resources, including materials and personnel, for their services.
• They focus on customer satisfaction as their top priority.
• They offer more flexible solutions tailored to budget plans or specific customer needs.
• They gather more trust and community involvement compared to larger companies.

Due to their customer-specific solutions, most people prefer locally owned businesses near me over large national or international brands.

Marketing Local Business

It is often thought that local businesses are still stuck to traditional, customer-based marketing methods. This is not always true. With time, the latest marketing methods are also being used for small regional setups. Most owners are more inclined towards local SEO techniques, which are considered the most effective for local businesses. What is local SEO? It is about optimizing the business profile for better visibility in search engines, targeting the local area.

Furthermore, many small shops and stores have their official local business listings on various social media platforms and marketing channels. Many of them are even trying the latest methods, such as paid ads and LEO SEO, to increase their online visibility.

Reasons to Support Locally Owned Businesses

It is always recommended to support local small businesses not only by shopping from them or hiring them for services, but also by helping them with marketing their business and making them a bigger brand. Supporting the businesses of our family, friends, or community members not only provides an easy source of income for them but also has many economic impacts. Local brands, whether majority-owned or local minority-owned businesses,​ strive to bring comfort to local members through their products, services, or solutions. When they receive an encouraging response from customers, it fosters an atmosphere of warmth, friendliness, and helpfulness in the community.

 

 

Benefits of Supporting Locally Owned Businesses

There are numerous benefits to supporting small, locally specified companies. It has a direct impact on the community's economic conditions and the quality of life of its residents. Below are some of the benefits of local businesses.

• Communities that support their local shops and stores have a substantial economic advantage over others.
• It helps build stable and happy communities by linking members with strong social relationships and contributing to the collective solution of problems.
• It helps recycle a large amount of revenue within the same community, which contributes to the well-being of every member.
• It creates more jobs and employment opportunities in the community.
• Local stores and shops are typically within walking distance or at least not too far from community members. It helps offer more eco-friendly solutions by less automobile use, habitat loss, and pollution.
• Small businesses pay significantly less in terms of infrastructure, utility bills, and other commercial expenses. It affects the costs and rates of goods, leading to lower and more customer-friendly prices.
• It helps community members access more specialized and area-specific solutions to their concerns.
• Local firms tend to support the non-profit charity organizations within the area. Statistics show that charity organizations receive 250% more donations from local setups compared to large companies.

In the context of the benefits mentioned above, it is clear that supporting small setups in the area contributes significantly to the community's prosperity.

Examples of Locally Owned Businesses

There are numerous examples of locally oriented and operated small businesses in our communities. From the café in the street to the hardware stores in a small town, all are operated locally. Below is a list of locally owned businesses most often found in our communities​;

• Restaurants
• Medical clinics
• Salons and beauty parlors
• Retail stores
• Cleaning services
• Electric stores
• Plumbing services
• Tree trimming services
• Towing services
• Cloth shops
• And much more!

Conclusion

Many types of locally owned and operated businesses focus on meeting customer needs, resolving problems, or providing them with a better lifestyle. It is always better to choose and support local businesses to get personalized and affordable solutions. Moreover, supporting local businesses has a positive impact on the community's prosperity and economic well-being.

FAQs

1. What’s the difference between a local and a franchise business?

A local business is independently owned and operated by local families or community members, while a franchise business is part of a larger brand or company, following corporate rules even if locally run.

2. Are all small businesses locally owned?

No, not all small businesses are owned locally. Some are remote-owned companies or franchises, even if they operate on a smaller rank or scale.

3. Can a franchise be considered locally owned?

Yes, a franchise can be locally owned if the owner lives in the area and actively manages the business, despite following national brand guidelines.