Size Matters?

Tell me if you've heard this one before.

When you buy from a small business, you are not helping a CEO buy a third vacation home. You are helping a little girl get dance lessons, a little boy get his team jersey, a mom put food on the table, a dad pay a mortgage, or a student pay for college.

The message is meant to be, "Mom-and-Pop Businesses Good," "Corporate America Bad."

It's an emotional ploy, a suggestion that small, presumably struggling single-location storefronts are morally superior to Evil Corp.

They might be. Or, they might not be. Just as some multinational conglomerate might subject laborer to what we'd deem brutal conditions in some third-world mud pit, the local mom-and-pop might be selling counterfeit or black-market products, might be run by a child abuser, or might support political radicalism with which you disagree.

Such a notion rarely crosses most of our minds, but the presumption that a corporation is far more soulless than the friendly corner bodega owner is widespread.

Thing is, the corporate storefront isn't just funding a CEO's lavish excesses. Costco's CEO made about $10M last year. Since the company's revenue was $227B, you'd have to ring up over $200 in purchases to put a penny in his pocket. CEO salary, a much-maligned metric, is an irrelevance in reality. Big companies put money in the pockets of thousands, perhaps hundreds of thousands, of direct employees. They also put money in the pocket of untold numbers of employees, of all the other businesses, large and small, that they interact with, whether it be supply chain, professional services, support services, financial, legal, accounting, janitorial, maintenance, industrial, or the like.

Everyone who works at Costco is trying to put food on the table. Everyone who works for one of Costco's suppliers, or distributors, or service contractors is trying to put food on the table.

The meme is nonsensical.

Take it a step further, now. Some mom-and-pops are content operating their single storefronts, but others would love to be successful enough to expand. To open more locations, to employ more people, to delegate responsibilities so they can focus on building a bigger business and a better brand. Their success (in a free market) is predicated on offering something better than their competitors. Better value, better product, better service... something to make people say "I'll shop here rather than elsewhere." That's how big companies became big.

Where in the growth sequence from mom-and-pop to big corporation does the owner stop deserving consumers' "mom-and-pop is better" support? Two locations? Five? Ten? Fifty? Should your loyalty fade with success and popularity?

There's an old gag where people pretend to stop liking a band they "discovered" when the band was first starting out if the band becomes too popular. If the unwashed masses "find" your hidden gem five or ten years after you did, after they stopped loading their own gear in and out of a beat up van and paid roadies to do it for them, after they upgraded to deluxe tour buses or private jets, does the band deserve to lose your loyalty? If you ate at the first Wendy's, in Columbus Ohio in 1969, and enjoyed it, should you reject Wendy's now simply because it has over 7000 locations?

Sure, if the product isn't as good as it was, or if someone offers a better product, you as a consumer should not feel some past-tense loyalty to a now-inferior offering. But, size should not matter. If you consider Chic-Fil-A's sandwich to be the best of its kind, it shouldn't matter whether there are three locations or three thousand.

Some ascribe virtue to the struggling small operator. Ir remember when Fair Trade coffee first entered my awareness. Being a budding cynic even then (it began 1988, I probably first heard of it in the early 90s), I wondered what the unspoken gag was. The label "informed" consumers that more of the money they were spending on their coffee purchase found its way to the growers. While it may very well have worked and work as advertised, I later read that Fair Trade punished success, that getting too big would "size out" a producer from the certification and program. Fair Trade was already a market distortion, born of a season where there was a supply glut, and in time it turned out to be a flawed and in some ways counterproductive program, but the relevance is in the coerced virtue of the struggle.

We can choose to patronize a mom-and-pop over a chain, for whatever reason we wish. The local bookstore might stock offerings that the big chain, whose inventory is driven by "analytics," might not. On the other hand, Amazon introduced us to the concept of the "long tail business model," where size facilitates the offering of far greater choice. Amazon can stock a whole lot more titles than any mom-and-pop. Consumers are offered many more selections than their local book store could possibly stock, and writers have a much better chance of selling at least a few copies of their creations. Size, far from being an objective measure of "good vs evil," is just a datum. We should base our consuming choices on maximizing our value and fulfilling our values, not on some false notion that we are putting money in better pockets by buying local.

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A snarky footnote. The little girl dances. The little boy plays team sports. The mother prepares family meals. The father earns the mortgage money. Nowadays, these are considered “traditional gender roles,” and as you well know, anything “traditional” is an affront to the “gender theorists” who purport all such stereotypes are entirely culturally imposed and therefore oppressive.

Meanwhile, those same people, without any irony, define “man” and “woman” by some sort of internalized self awareness. This poses (but does not beg) the question, “what is that internalized self awareness?” Going by the pressures put on teens who may not conform to those traditional gender roles” to transition, aren’t they telling us that “man” and “woman” are, in their eyes, labels for those traditional gender roles they denounce?