This was the opening segment to my show on November 30, 2019:
Happy Small Business Saturday to one and all!
We are, of course, just past the midway point of what is a four-day weekend for many Americans, and with Black Friday over and Cyber Monday just around the corner, lots of people like to acknowledge the "mom and pop" shops all across America with a nod to patronizing those small businesses today.
As a small-business partner, I appreciate being seen today, even though it's not really our kind of small business that benefits much from holiday shopping.
But as is so often the case with made-up holidays or special proclamations or the like, I wonder how much of this is just lip service.
You know the kind of lip service I'm talking about -- like when people slather on the praise for "family farmers" or "first responders" and talk a great deal about how much those special vocations are appreciated, but then turn around and vote against their interests either with their ballots or their dollars.
Virtue signaling isn't just a problem among lefty hippie types.
The thing is, some businesses are small because their owners like them that way. I think of the guy behind the on-and-off "Hot Doug's" restaurant in Chicago. If you're an artisan or you do something so special that you can't franchise it or expand without losing the thing that makes you special, then you're going to stay small.
Some businesses are small because that's all the market will support (I happen to be in one of those). The modern economy is highly specialized, and specialization can push hard against growth. Even the "big" companies in my particular industry often end up breaking up or splitting apart because there's just too much centrifugal force trying to spin them apart.
Some businesses are small because it would take a lot of unreasonable risk to make them big.
Some businesses are small only because they haven't been discovered by enough customers to become big...yet.
And let's admit an unpleasant truth: Some businesses are small because they're not all that great.
But in the end, what does it matter to the public at large?
If you take a look at metro employment, we only have about 50 employers that aren't counted as "small businesses" by the usual government threshold of 500 employees.
And if you really want to get into the numbers, we have a small handful of really major employers -- according to the Greater Des Moines Partnership, Wells Fargo is our 800-lb. gorilla with 13,500 employees, then it's UnityPoint at about 8,000, Principal and Hy-Vee with about 6,500 apiece, then MercyOne and Nationwide each at about 4,500. It drops off rapidly from there.
Every community comes to its own unique mix of businesses and industries because of its own local circumstances. It doesn't look like it's in the cards for Central Iowa to be the home base for a bunch of Fortune 500 companies. But even when you are, it's no guarantee that things will stay that way forever. Remember how Boeing used to have its headquarters in Seattle, then moved to Chicago back in 2001?
Or in the other direction from us on I-80, take a look at the panic setting in across Omaha over the announcement this week that TD Ameritrade is going to be bought by Schwab.
Omaha and Des Moines have a ton in common, whether we or they want to admit it or not. They're probably going to lose a bunch of attractive jobs at what is now TD Ameritrade headquarters when they become just another satellite of the home office. The same thing happened not all that long ago when they lost ConAgra's headquarters, too. Even when you're the "world headquarters" for a big company, that doesn't mean they're staying around.
I don't want to think about what might happen if we were to lose any of those big employers. But the recent breakup of the plan to merge UnityPoint with Sanford Health out of South Dakota should probably be a reminder for our people to "stress test" their plans for what might happen if we did. It might be hard to shut down an entire system of hospitals and clinics...but it wouldn't be impossible for a lot of other major employers to find excuses to "realign" their resources around some other site.
Which brings us back to Small Business Saturday. We shouldn't care about small businesses for the purpose of virtue-signaling or resolving our guilty consciences. What we should really care about is whether we've got the right set of conditions for new business formation and home-grown expansion.
Every conscientious municipality keeps a close eye on how well it's creating an environment that cultivates new business formation and growth. You never know when one of your major employers (even the homegrown ones) may go away. That doesn't mean you have full control over anything at all, nor should anyone in government expect to have that kind of power. But they can be charged with trying to anticipate, and then paying very close attention to, the consequences of what they do (or don't).
Every firm or organization matters to people -- employees, suppliers, vendors, contractors, customers, even competitors. And whether they're big or small, there's nothing really guaranteed to any of them in the long run. What can be done -- and what probably should be done -- is not to put all the eggs in any one basket, neither with a single dominant employer or industry, nor with even a particular type of business. What really makes sense is to see that a whole lot of seeds are planted in a whole lot of pots, and then to avoid anything that would interfere with them getting enough sunlight and enough rain.
So, do go forth and shop local and spend some money on "Small Business Saturday"; that's great. If you're doing it to soothe a little guilt over how much you're going to spend on Amazon this holiday season, that's between you and your credit card. But I only ask, as one of many in the small-business boat, that we think a little beyond just one retail shopping day, and not just to the decision to sprinkle a little bit of spending on a neighborhood establishment once a year.
The moral of the story: A vibrant economy comes from lots of decisions, public and private, made over and over again. One shopping day a year is a fine way to celebrate, but the decisions we make the other 364 days a year that decide what happens to our community.