Only until in recent times in the history of human commerce have people become internationally integrated; for most of human history, all companies were local businesses.
Advantages of being local as per Jeffrey Mohlman:
Such a model has noticeable advantages and a shortcoming, being local means you can modify your response to a consumer need much more precisely than a company which thinks about you as a region on the map. At the same time the conviction you can build up with your customers cannot be matched by non-local contenders. Each day you are a part of their lives you might even repeat the same pubs or share comparable entertaining interests. Being local also aids lessen your response time for any time critical or urgent job. Where time is a matter, nothing can go with a local business.
The main shortcomings those businesses face when compared with their non-local contenders is a matter of resources obtainable. Most non local contenders to the businesses are usually larger and have significantly more capital; both in terms of human resources and also in terms of physical plant machinery material. Being larger with a extensive area of opportunities and with much more profits it means they can pay the costs of operation over a larger number of agreements. According to Jeffrey Mohlman, local businesses also require the same ability to tap the global markets both as a source for sales but also as a basis for suppliers. Therefore, they are not able to take advantage of any cost securities from tapping the global supplier base.
Significance of local business
The significance of having a strong local business like Questar cannot be over settled, for it is these small to intermediate companies that are now providing the bulk of new service opportunities. They are also the ones paying local wages, and paying local taxes. All of which stimulates the local financial system and gives in itself more opportunities for development. If an area’s local companies go under or close down for whatever cause, the effect is seen very rapidly with the rapid growth of a post-industrial wasteland. This further pushes away other companies and thus triggering a viscous cycle to a point where the inhabitants starts to move away, thus tearing the heart out of the local neighbourhood.
Keeping it local
Many local businesses often fail to take benefit of the fact that they are local. As Jeffrey Mohlman says, being local means that you are an essential part of the local prospect and you know a lot more about the local market than any outsider could. Also, you can differ your demands for capital to take in barter where instead of cash you can put forward and except services and goods for your or others expense. Being part of the local financial system of your area can be a great gain for your company if you are eager to think outside the box, take hazards and leverage your local awareness to the benefit of your company.