How your spending choices impact your local economy
Understanding Economic Impact
When you spend £100, where does that money go next? The answer depends greatly on where you choose to spend it. Money spent locally circulates within your community multiple times, creating what economists call the "local multiplier effect."
Research from the New Economics Foundation and other organizations has consistently shown that money spent at local businesses generates 2-3 times more economic benefit for local economies compared to spending at non-local businesses.
Visualizing the Multiplier Effect
Watch your £100 transform into real community value. See how the same amount creates different impacts depending on where you choose to spend it - the results may surprise you!
Current Cycle: 0
£0
0%
Local Shop
80% stays in local economy
£0
0%
Amazon (UK Seller)
40% stays in national economy
£0
0%
Amazon (Foreign Seller)
25% stays in economy
The Research Behind Local Spending
Local Multiplier Effect
The local multiplier effect refers to how many times money circulates within a local economy before leaving through non-local spending. Studies have shown that:
For every £1 spent at a local business, up to £3 in additional economic value is created in the local community
Independent, locally-owned businesses recirculate 2-3 times more revenue locally compared to absentee-owned businesses or national chains
Local businesses typically spend more on local labor, services from local providers, and locally-sourced products
Community Benefits
Beyond direct economic impact, local spending provides numerous social and community benefits:
Local businesses create approximately 60% of new jobs
Areas with thriving local business districts have increased property values
Local business owners donate more than twice as much per sales dollar to local nonprofits and community causes
Diverse, unique local businesses create community character and maintain cultural distinctiveness
Environmental Benefits
Buying local also offers significant environmental advantages:
Reduced transportation distances and associated carbon emissions
Local food travels an average of 1,500 fewer miles than conventional food distribution
Small, walkable business districts reduce dependency on cars
Independent retailers often operate in town centers and existing buildings, contributing to less sprawl and habitat loss
About This Visualization
The retention rates used in this visualization are based on economic research studies of local multiplier effects. The numbers have been simplified to demonstrate the core concept:
Local Shops
Approximately 80% of money spent at locally-owned independent businesses remains in the local economy. Local business owners live locally, employ local people, use local professional services and suppliers, and are more likely to stock locally-produced goods.
Amazon with UK Sellers
Around 40% of money spent at Amazon with UK-based sellers remains in the national economy. While this creates some UK jobs, profits largely go to Amazon's global operations, with substantially less local economic benefit compared to local shops.
Amazon with Foreign Sellers
Only about 25% of money spent at Amazon with foreign sellers stays in the economy. With minimal local employment, overseas fulfillment centers, and global supply chains, most economic value leaves the country entirely.
Make Your Spending Count
Small changes in spending habits can have a significant impact on your local economy. Consider these actions:
Shift just 10% of your Amazon purchases to local businesses
For every £100 spent, try to spend £20 at locally-owned retailers
Find local alternatives for regular Amazon purchases
Check if items on Amazon are available from UK sellers rather than international ones
Recognize that sometimes a slightly higher price at a local shop creates significantly more local economic benefit