By DANIEL STURM

Seeds for a new garden may well have been planted last week at City Pulse’s first "Going Local" luncheon. Held at Tripper’s restaurant in Frandor on Jan. 23, the luncheon attracted a diverse mix of 50 participants--ranging in background from local retailers and restaurant owners, to designers, planners, and organic growers—but sharing in common a sincere interest in the theme posed by City Pulse publisher Berl Schwarz: "How can locally owned businesses survive and thrive in an era of globalization?"

In 2002, there were 60,000 residents working in the tri-county area service sector. That’s a remarkable increase from the 30,000 jobs in this sector during 1983. At the same time the manufacturing sector has been shrinking. It employs 11,000 fewer people (down 31 percent) than 20 years ago. The same trend is visible in the mid-Michigan transportation equipment sector. Today it employs 11,800 people, which is 14,000 less than in 1983 (54 percent drop). According to the America’s Labor Market Information System, 13,949 of the tri-county’s 17,984 businesses have fewer than 10 employees--meaning an overwhelming 78 percent are considered to be small business. Michigan’s Office of Labor Market Information shows the largest sector for job growth in Lansing to be within the service sector, a sector including thousands of small business owners.

Mark Clevey, luncheon panelist and vice president of the Small Business Association of Michigan, said that although the economic impact of small businesses in the region is growing, politicians in Washington and Lansing have shown little interest and have made no money available: "The bottom line is that small businesses don’t make campaign contributions and that they fragment the political power they have by arguing. The only time everybody cares about them is during elections."

Luncheon participants agreed that this should not be the last time they discussed sustainability and the needs of local businesses. They discussed the need to create a "sustainable network" in the Lansing/East Lansing area. Such a network would allow local business owners to support each other through local, environmentally sound buying practices, and avoid sending profits out of the area, or investing in projects and corporate practices not supporting the needs of the community. An essential part of strengthening the local economy is recognizing that locally owned businesses are here to stay because of their roots in the communities. Global companies go where tax incentives and cheaper labor take them.

Jeff Johnson, owner of Bake’N’Cakes, 3003 E. Kalamazoo St., Lansing, which co-hosted the panel, said that larger companies were able to jump ship when they got into economic trouble. "I can’t pick-up my roots and dump my bakery out in Okemos. I bought my building and we’re kind of locked into this place." Johnson said many bakeries have started to sell pre-packaged cookies in plastic containers, but he personally doesn’t like using disposable items. He will continue to package his bake goods in wax paper. But Johnson said that made it difficult to compete against people who walk into large chain stores and grab plastic containers from the shelves. "Education is not only needed within businesses themselves, but also for the consumer who’s making choices day-to-day."

How can one compete against large chains? Clevey said small businesses such as Bake’N’Cakes are in a way already part of a larger chain. "We just haven’t figured out how to market that chain." Clevey suggested creating a logo as part of a "going local" marketing campaign that could be found on the front door of every locally owned businesses. The campaign should explain why it was more exciting to buy locally.

The need to "buy local" has often been the mantra of politicians wishing to gain the support of regional businesses. Yet a good slogan can sometimes unfortunately be just that. Thursday’s GoLocal panel spoke of having different experiences. Paul Emery, manager of the Capital Area Green Party and owner of Oakgrove Computers in Lansing, reported that the information technology giant EDS, headquartered in Texas, now does the job he used to perform for the Michigan Department of Transportation. "They’re flying people in from other states to do this work for a month -- whereas I could give a better service because I’m here all the time," said Emery. He said there was no reason for local and state governments not to give preference to a locally owned computer service, as they’d done in the past. City Pulse owner Schwartz compared Emery’s example with City Hall’s decision to purchase its coffee from a Massachusetts-based company rather than taking locally owned Paramount Coffee’s bid, for a savings of roughly $1,500 per year (just 3 cents per package). "We see these kinds of things happen at the county and at the city level, though Paramount Coffee paid income taxes in Lansing, and supported about 100 jobs right in downtown Lansing," he said.

Terry Link, director of Michigan State University’s Office of Campus Sustainability, suggested that the state give a 10 percent discount to Michigan firms who are bidding for state purchases through executive order, in order to make sure that the money stays closer to home. Clevey added that there used to be such a system, called "buy Michigan," which the Engler administration ended.

Link suggested introducing sustainable business awards in order to promote the right business practices, and also advertising for small businesses. He gave the example of a restaurant that recently received a sustainable business award in Philadelphia, for paying living wages, using organic produce from local farmers, generating wind-powered electricity, donating 20 percent of its profits to charities, and not allowing the restaurant owner to make more money than five times as much as the lowest paid employee. "If I knew about all this when I walked into a shop, why would I shop somewhere else?"

Mike Skory, owner of six cellular telephone and car audio stores, said it’s all a matter of perception. "National chains aren’t cheaper, although people think they are." He said the perception, not the reality, causes school districts and other government entities to use them. Skory said the perception to always get the deeper deal has now trickled down to the consumer, who now prefers going to "disposable quasi-villages of garbage," as he called malls and chain stores, instead of shopping at the nearby grocery. "But I’ve probably done it a thousand times myself, so I’m guilty too," he said.

As the discussion progressed, people admitted that they hadn’t reflected enough on the importance of buying locally. "Education plays a big role to raise awareness," said panelist Patrick Hudson, director of Urban Options, an East Lansing nonprofit environmental organization. He argued that the so-called economic multiplier was a key reason small businesses could be competitive and sustainable at the same time: Every expenditure cascades into a larger number of transactions, which could end up greatly enriching the community. Quoting Michael H. Shuman’s book "Going Local," he said: "Once the multiplier leaves the community, the benefits of subsequent transactions are lost. A community in which money flows out quickly and never returns slowly bleeds to death." Hudson pointed out that the backbone of success was buying food and energy on a local scale. Here, local investments greatly increased the likelihood of the economic multiplier staying at home.

Sarah Davis/City Pulse

Panelists at the GoLocal luncheon hosted by City Pulse at Tripper’s were, from left, Julie Sawaya, general manager of Woody’s Oasis Bar and Grill in East Lansing; Pat Hudson, executive director of Urban Options; City Pulse owner Berl Schwartz; and Mark Clevey, vice president of the Small Business Association of Michigan.

Julie Sawaya, the third panelist and general manager of Woody’s Oasis Bar and Grill in East Lansing, said she was interested in giving something back to the community. She spoke about her current project, in which she is working on a grant that would enable East Lansing businesses to build a recycling program. Now, business owners had to take care of recycling by themselves. "My staff came to me and told me how many bottles they were forced to throw out," Sawaya said. With the help of this grant, Sawaya would like to eventually make recycling even a profitable choice.

Okemos resident M.C. Rothhorn emphasized the importance of marketing sustainable concepts, "so we can actually make customers aware that they can buy good stuff locally." With this intention, Rothhorn, a social worker, recently joined a project to map out food sources, organized by the Greater Lansing Food Bank. "We’re choosing a geographic area and then seeking out local residents, and getting their interest piqued about the idea. Then we hope to slowly and steadily expand from a pilot project, to a larger undertaking--ideally mapping Lansing's ‘most needing’ neighborhoods," Rothhorn said. The project aims to improve the quality of life in close-knit neighborhoods.

There were other projects underway, such as the one started by East Lansing resident Patricia Wood. Last summer, Wood contacted activists from the Business Alliance for Local Living Economies, a network operating in 18 cities in the United States, to gain support for "a living economy that works in harmony with natural systems, supports both biological and cultural diversity, and fosters fulfilling and enjoyable community life for all peoples." Wood said there was a need for more networking in the area.

Many participants were excited by Clevey’s idea to publish a business directory that specifically focused on the needs of locally owned businesses. "It would be very helpful to have a directory in which you can find information on who exactly offers organic food for restaurants," Sawaya said. She said that, as a vegetarian, she would often buy organic produce. She wished to feed her customers organic food as well, but thought that doing so would be more difficult. Sawaya asked: "Am I going to be fined by the Ingham County Health Department, because I’m not buying from official dealers? Also, many times I’m road blocked, because a case of tomatoes from an organic farm may be $20 more than the one of the local produce company."

Phil Throop, who runs the Wildflower Organic Farm in Bath, was able to help. He said buying organic produce wasn’t problematic at all. "A case of tomatoes won’t be $20 more, and the quality is better. I know there are no regulatory barriers, because I serve restaurants myself. That’s a very simple, economical model."

Sawaya said she found this discussion really "awesome," because she didn’t usually have access to such important information. "Until today I was told that I had to buy from a certain type of supplier. I simply didn’t know, and also didn’t have the time to check myself." Other luncheon participants agreed, and pointed out that there’d been a lack of communication in the past, and that all small businesses have a lot to gain from creating a network community.

Clevey added that if a business directory were created, the people listed should be committed to buying from each other. Hugh McNichol, a planner for the Michigan Department of Transportation, added that a sustainable business guide could also explore existing gaps in the community, and give would-be entrepreneurs the opportunity to fill in these niches. Nichols suggested including educational information on how small businesses can get the capital they need to get started, a problem that is frequently a lot more difficult than it is for large companies.

In former times, Skory said, the location of a business used to be a secret for success, but with the way area development progresses, the right location now seems to change almost weekly. Urban sprawl was especially problematic, he said. "Each time a big shopping center wants to come in, the township governments just fall over themselves to build roads and sewers." Hudson said that Gov. Jennifer Granholm supports "smart growth" and has appointed former Gov. William G. Milliken and former Attorney General Frank Kelly to develop a legislative strategy for fighting urban sprawl.. "She has said that it’s going to be a concentrated effort of analyzing the cost of incentives for that development, versus the long-term cost of loss to the community." Clevey said every Chamber of Commerce in Michigan seems lined up against the new governor on smart growth. He suggested that members call up their chambers or industry associations and "put pressure on them, because they’re using your dues to undercut you on this issue."

M.C. Rothhorn said he felt inspired to see that Lansing is moving in a sustainable direction, one that reminded him of San Francisco, where he’d lived until recently. "San Francisco is going through the same issues we’re dealing with here and they also have a free weekly paper, called the Bay Guardian, which is also organizing the return to local businesses."

Publisher Schwartz said he wants City Pulse to be the venue for getting the word out. Schwartz referred to the paper’s own struggle against the largest newspaper chain in the country, Gannett, which owns 94 daily newspapers including USA Today and the Lansing State Journal and 22 television stations. When it started NOISE to compete against City Pulse, Schwartz said, it reached into its "deep pockets to start a publication overnight, put up billboards all over town, and buy television commercials."

"I think we can help educate consumers about the long-term importance of supporting local businesses," he said.