Arizona: Home to World’s Largest Local Business Coalition

Crafting an independent and lasting economic story

With approximately 45,000 independent companies, Arizona is a thriving and vibrant environment for locally-owned business.

But not everyone is aware of the vital role that local companies play in shaping a resilient community, and the economic and cultural benefits they provide to the state.

One organization, Local First Arizona (LFA), is committed to advancing that bottom-line narrative. According to Kimber Lanning, executive director of LFA, the mission of the nonprofit she founded in 2003 is to support, promote and advocate for a strong local business community, and raise public awareness about how it enriches communities and contributes to a sustainable economy for Arizona.

When Lanning launched LFA, she was a one-woman, grassroots crusade knocking on doors and meeting tremendous resistance rather than open-arms support for her ideas on local endeavors. Today, LFA is the largest local business coalition in North America with 2,600 members, 13 full-time employees and several volunteer Ambassadors to Local First Arizona (ALFAs). And it has had a major influence in cultivating a collaborative, diverse and proud local mindset in the state.

Lanning, however, believes there’s much more to do and say about how the importance of developing a prosperous local economy in Arizona.

“We need to get better at telling our story,” she explains. “We’re not paying attention to ourselves.”

Driving a Localist Culture

While quaint coffee shops, artisan restaurants and trendy boutiques started by enterprising individuals tend to be the darlings of the localist scene, the reality, according to Lanning, is that local business describes a range of small, medium and large-sized companies that are privately held in Arizona. They include manufacturing, construction, agricultural, business services, retail and restaurants—and many with deep economic and cultural ties to the state.

Lanning passionately supports an Arizona-based business model because she knows of what speaks. She’s not only an economic specialist, she’s an entrepreneur. At age 19, she established Stinkweeds, a successful independent used and new music store in Phoenix that’s been operating for 28 years. In 1999, Lanning opened Modified Arts, a contemporary art gallery and music venue in downtown Phoenix, which also is home base for LFA.

She believes that a strong local economy not only strengthens Arizona’s sustainability, it also leads to a less homogeneous community.

“Entrepreneurism is a great opportunity to preserve the health and culture of the community,  as well as earn a living,” says Lanning of the positive chain reaction that results from starting a local business venture. “When independent businesses take their profits and source products and services from other local establishments, they generate more tax revenue needed for the community to thrive and create jobs.”

Plus, local businesses are more likely to hire local employees like accountants, graphic designers, web developers, printers and lawyers, creating a secondary job market, she notes.

Building Hometown Pride

LFA isn’t in the business of demonizing large corporations and national retail chains that operate in Arizona, according to Lanning. Rather, its No. 1 priority is to educate consumers about the impact of shopping locally and the significant return on investment the transaction provides to the state.

“Studies have shown that for every $100 spent in a locally-owned business, roughly $45 remains right here in Arizona. When $100 is spent in a national chain store here, only $13 is reinvested,” she says. “That loss gets passed on the public as differed billing. It’s an artificial sense of savings.”

A localist mentality encourages new job creation and revenues that stay put, but it instills a sense of hometown pride of place, as well, according to Lanning. In Arizona, that’s an ongoing challenge given the state has the third largest number of transplants in the country.

“Research conducted by the Knight Foundation revealed that connection to place is the single most important indicator of places with prosperity,” she says. “It’s about promoting economic development that gives back in way that non-local business doesn’t in the community. As an organization, we help people understand their rightful place in driving that type of an economy.”

Creating Connections

One local company that has seen a tremendous boost in revenues and brand exposure due to its LFA affiliation is Chandler-based State Forty Eight. Partners Michael Spangenberg, Stephen Polando and Nicholas Polando joined LFA shortly after launching the casual street wear line in 2013 that celebrates the 20-somethings’ passion for Arizona on T-shirts and other fashion accessories.

“The biggest benefit of belonging to LFA is it has driven business to our company. Several of our wholesale accounts found us through LFA and recommendations from other members,” says Spangenberg.

Plus, its involvement with LFA has created an economic domino effect in the community since the three-man enterprise has stuck deals with other small businesses based in Arizona, according to Spangenberg.

“LFA does the leg work. It’s a one-stop shop for promoting the local movement. The calendar of events, the connections and the low membership fee make it a no-brainer,” he says. “As members, we’re exposed to so many companies to collaborate with and who have first-hand experience in the local market. We sell our products wholesale to local small businesses in bulk and they, in turn, are able to generate a profit. It’s a win-win.”

Spreading the Message

To help spread the local message and inspire a better quality of life throughout Arizona, LFA holds signature events, campaigns and special promotions such as Buy Local Month and Shift Arizona, which encourages citizens, business owners, government agencies and nonprofits to shift 10 percent of their spending from national to local businesses.

“In a city with 600,000 people, a 10 percent shift in spending from national to local businesses results in $130 million circulating in the community, 1,000 jobs and $50 million in new local wages in one year,” says Lanning.

LFAs efforts to connect businesses to each other and the marketplace aren’t confined to urban boundary lines. LFA’s nonprofit sister organization, the Local First Arizona Foundation (LFAF), merged with the Arizona Rural Development Council in 2013  and, as part of that partnership, developed technology workshops for local businesses in rural areas to help strengthen regional tourism and marketing strategies to attract visitors to their communities. In addition, LFAF organizes the annual Rural Policy Forum that connects rural economic development professionals, nonprofits, community leaders, business owners and other rural stakeholders who are interested in sustaining rural communities.

Promoting a Local Effort

The localist community is actually a large network of like-minded individuals working toward establishing a new economy approach in the United States. In 2015, LFA will take the national stage for inspiring that change when it hosts the Balle (Business Alliance for Local Living Economies) Conference in Phoenix. The annual event is a forum for visionary local economy experts, entrepreneurs, funders and policy makers around the country to identify and connect pioneering leaders, spread solutions and attract investment toward local economies.

“This is not a trendy pastime,” says Lanning of the momentum sweeping the nation to go local. “Localism is an idea whose time has come.”

By Sally J. Clasen

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