Small businesses join forces to succeed

Localized online marketplaces combine neighborhood appeal and convenience
Karen Kroll
NRF Contributor
October 14, 2020

Many consumers like shopping locally: Nearly 90 percent of respondents to a recent study by Red Egg Marketing indicated they shop locally.

At the same time, more people are shopping online. Ecommerce sales exploded by nearly one-third between the first and second quarters of 2020. And when consumers shop online, about two-thirds head for the convenience of marketplaces, according to the Pitney Bowes Online Shopping Study 2019.

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That finding might seem ominous for smaller and local retailers, many of which rely mostly on shoppers from within their physical neighborhoods. However, some have begun joining forces in online neighborhood marketplaces that offer consumers convenience, with a single checkout and delivery options, and the ability to shop locally.

Joining forces

“I really care about neighborhood businesses,” says Maya Komerov, founder of Cinch Market. She also recognizes the appeal of online marketplaces’ convenience, and the power it gives behemoths like Amazon.

Cinch Market currently offers about 30,000 — and growing — items from about 50 stores in Brooklyn, N.Y., with 50 more retailers in the queue.

Once a consumer places an order, each store is alerted and fills its orders. A Cinch employee picks up the products daily and brings them to a central sorting location. From there, the items are delivered to consumers. Orders placed by 10 in the morning reach shoppers later that day;  businesses pay up to 9 percent on each sale.

“Local stores have proximity and knowledge of their communities,” Komerov says. Cinch leverages that to help businesses reach a broader market area. Already, some stores are capturing shoppers who live outside the neighborhoods from which their customers typically come. Komerov plans to launch a similar site for Manhattan retailers in October, and then expand beyond the New York area.

Cinch Market founder

Local buy-in

Member Marketplace Inc. works with chambers of commerce or economic development groups, as well as retailers, to develop local online marketplaces. The marketplaces are up in about a dozen cities, ranging from Cape Vincent, N.Y., to Ravenna, Neb. Most have between 50 and several hundred retailers.

Member Marketplace always looks for a local partner, whether a chamber of commerce or economic development organization. “We want local community buy-in,” says CEO and co-founder Cherie Edilson, adding that a successful marketplace requires the combined efforts of local businesses, local groups and the website.

To date, the company has focused on smaller metropolitan areas. Chambers of commerce and similar groups have more of an industrial focus in larger metropolitan areas, says Robert Edilson, co-founder, chief technology officer and Cherie’s husband.

Getting up and running normally takes a business up to about a month; the Edilsons provide help when needed, Cherie says. While some businesses only have online sales through the marketplace, most use the marketplace to expand their current online efforts.

The emergence of online marketplaces bodes well for both smaller retailers and consumers. “Retailers need to get together and leverage their proximity and presence in the community,” Komerov says.

An update on a few local retailers

Last spring, lockdown orders across the United States kept many physical stores shuttered for several months. NRF talked with a few that were finding new ways to connect with customers.

We decided to check in and see how several are doing now. Sales at The Bookshelf bookstore in Cincinnati, Ohio, are up, says owner Chris Weber. “More people are supporting their local bookstores. They want us to be here when things shake out.”

In addition, the store’s small size and ability to accommodate customers with disabilities helps people feel comfortable shopping. The Bookshelf still offers curbside pickup and free delivery.

The cancellation of most book fairs has impacted revenue, though Weber and her colleagues are working on a virtual fair. “[We’re] not sure how well this will be received, but we figure it is worth a try,” she says.

Some 700 miles north and west, outside Minneapolis, is The Lakes Running Co. “It’s been interesting how relatively normal things have seemed this summer,” says owner Pete Miller. “Revenue-wise, we’re tracking fairly close to last year.”

Like The Bookshelf, however, the cancellation of community events has had an impact: One event provided the store’s single largest day in 2019, Miller says.

Even so, day-to-day business remains steady. One reason is that while many sports are canceled, the high school cross-country season is moving forward, Miller says. He also credits the local community. “People love Water Street (the location of the shop) and want the businesses to do well,” he says.

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