Online Shopping Can Hurt the Local Community

online shopping This article is contributed by Amanda Carlson. As the Internet develops, so does the related commercial aspect of life. Online shopping is a way that allows people to find and purchase exactly what they are looking for instead of settling for what is available locally. Although this provides a great deal of competition for shopping and a decreased cost in price, it could be doing more damage to our community than we may be realizing. Who hasn’t purchased something from the Internet at least once? That number is slowly increasing as more and more techniques for shopping security allow consumers to spend money online without fear of being scammed. However, have you ever thought about the ramifications of what this very convenient form of shopping is doing to the local consumer scene? 1. Sales Tax – In most states in the U.S., there is no sales tax on items purchased from buyers in another state. Most local laws demand that online sellers tax local residents of their state with the county sales tax rate, but purchases from other states are tax-free. With this decline of sales tax revenue generated by local sales, is it fair for us to blame local governments from having to increase tax rates to make up the difference? Who pays the bill for 9-1-1 services and government sponsored food programs? 2. Lay-offs – Did you know that by 2016 consumers in the United States will spend more than $320 billion on online purchases? According to a study completed by Forrester Research Inc., eCommerce will account for 9% of all sales. If people are spending more money online, then they have less to spend locally. For retail businesses, that could be quite damaging. As there is less money coming in to the store, there is less money to pay employees. A prime example of this can be seen by taking a look at Blockbuster. This once successful video rental location was slowly dismantled as services such as Netflix, Redbox, and others decimated the business. In 2010, the Consumerist.com website reported that Blockbuster was filing for bankruptcy. As you can see from the chart, there is no doubt as to why. blockbuster decline to bankruptcy 3. Local Support – Layoffs from lack of income are only the beginning. Many businesses  are affected in a major way by losses created by online sales. It starts by letting people go, and then it escalates to the inability to pay utilities and finally they can no longer afford the rent. This is why businesses have been launching efforts through the “Buy Local” campaign. According to the Institute for Local Self-Reliance, there is nearly a 4.5% difference in revenue changes between businesses that sponsor a “Buy Local” campaign over those who don’t. buy local effect on revenue Shopping online isn’t an evil process. It is a way that people can get what they want in a timely manner. Although there are many that delight in the instant gratification of having an item right now, there are a great number of people who are patient enough to wait for something that is exactly what they are looking for. Instead of being fearful, local businesses should expand business to online services in order to stay in competition and keep the doors open. They should embrace “Buy Local” strategies and develop innovative ways to keep the interest of local consumers. Online competition doesn’t have to destroy the bricks-and-mortar store. Author Bio: Amanda Carlson, a blogger as well as a former newborn care nurse contributed this post. To stay connected to her previous career and share the knowledge she gained, she began writing for www.newborncare.com. You can reach her at amanda.newborncare @ gmail.com. Photo credit: online shopping image courtesy of sevenfloorsdown via photopin cc
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