boost the impact of efforts like “Small Business Saturday” by more than 200%.
Boston, MA (PRWEB) November 30, 2013
The day after Black Friday has been dubbed "Small Business Saturday", a day where consumers are encouraged to “Shop Small” and support Main Street. Last year, according to a survey by Amex, "Small Business Saturday" brought in $5.4B . This is great news. However, a startup has recently raised the question asking, "How much of that $5.4B is actually staying on Main Street?".
That seems a valid question. Consumers are making a big effort to support the local economy without any real indication of how effective their efforts are.
To fix this, Anthony Comito, an accountant and founder of the Economic Information Exchange Company, created the Economic Impact Rating: a system offering consumers a tangible way to understand where their money is going.
The rating, on a 5-star scale, shows the amount of a product’s price-tag being captured in a specific area’s economy. America, Regional, State-wide, and select city ratings are available. The “Economic Impact Rating Certification Mark” displays a product’s rating. The mark is placed on packaging, signage, and advertising, giving consumers third-party verification of how local a product is, and a quick and easy way to identify such products.
What’s wrong with typical “Local” and “Made in America” claims? The Federal Trade Commission, the body charged with policing such claims, does not actively verify "Local" or "American Made" claims. They merely prosecute perpetrators AFTER a complaint has been filed. Not only are claims unverified, but the FTC’s definition is vague. According to US Small Business Administration, the Federal Trade Commission states “products advertised as American-made must be ‘all or virtually all’ made in the U.S”. The laws outlining these distinctions are over 40 pages long. None of which really tells the consumer where the money leaving their hand is going.
Lets look at a hypothetical "local" product from a "local" manufacturer. This product costs $20. The question is, how much of that $20 is really staying on Main Street?
If the manufacturer uses raw materials from a foreign source, then some portion of the $20 will be sent to a foreign supplier, to pay foreign employees, to be wages spent in a foreign economy.
If the machinery used to create the product is foreign, then some portion of the $20 is put aside to pay for that machinery--- again being sent off to a foreign company, to a foreign economy.
If the packaging supplies are from a foreign source, more of that $20 dollars is leaving main street and being sent to foreign economies.
There are a lot of places where money can leak out of the economy and reduce the impacts of efforts like “Small Business Saturday”. The more complex a product is, the higher the chance of "economic leakage”.
If only 20% of a product is really staying on Main Street, that means of $5.4B our economy is only capturing $1B. A great accomplishment-- but what if we could have kept that other $4B? The Economic Information Exchange Company claims it's line of "Economic Impact Ratings" can solve this problem and boost the impact of efforts like “Small Business Saturday” by more than 200%.
“There are lot of places where money can leak out of our economy if you do not look close enough,” states Comito. “The goal of efforts like Small Business Saturday is to keep money in the economy and to create jobs. So why not take a hard look at how efficient a job you’re doing?”
The Economic Impact Rating is currently enrolling products for analysis nationwide. They have recently launched their crowdfund campaign on indieGoGo.com to raise startup funding. For further information please check their Facebook at Economic Impact Rating or contact Anthony Comito directly at Anthony@EiEcompany.com.