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“Mom and Pop” businesses can’t necessarily beat prices at big box stores or national chains. So some local independent businesses are experimenting with new ways to engage customers and build loyalty. We explore how business owners, ethical consumers and labor activists are harnessing the power of online communities and crowd-sourcing to support the local economy.
- Nikki Lewis Coordinator, Restaurant Opportunities Center of DC (ROC-DC)
- Neil Takemoto Founder, CoolTown Beta Communities
- Kim Weeks Owner, Boundless Yoga Studios; Marketing Chair, Think Local First DC
MR. KOJO NNAMDIFrom WAMU 88.5 at American University in Washington, welcome to "The Kojo Nnamdi Show," connecting your neighborhood with the world. It's an idea that takes the logic of a boycott or a picket line and flips it on its head. What if consumers banded together and, instead of punishing a business for doing something wrong, we leveraged our money to reward a local business for doing the right thing? Last month, a local labor rights group put on D.C.'s first carrotmob. They identified the D.C. restaurant that gives its line cooks and wait staff paid sick leave. They tapped into a network of socially conscious foodies, and they amassed a mob of people to reward that restaurant with attention and with customer receipts.
MR. KOJO NNAMDIThis hour, we're exploring carrotmobs, crowdsourcing and other strategies that bolster local businesses and community. Joining us in studio to do that is Nikki Lewis, coordinator of Restaurant Opportunities Center of DC, ROC-DC. Nikki Lewis, good to see you.
MS. NIKKI LEWISGood to see you, too. Thanks.
NNAMDIAlso with us in studio is Neil Takemoto, founder of CoolTown Beta Communities, which specializes in crowdsourcing, urban design and placemaking. Neil, thank you for joining us.
MR. NEIL TAKEMOTOThank you. It's great to be here.
NNAMDIAlso with us is Kim Weeks, owner of Boundless Yoga Studios and marketing chair of Think Local First DC. Kim, glad to have you along.
MS. KIM WEEKSThank you.
NNAMDINeil, what's placemaking?
TAKEMOTOPlacemaking is essentially building community-oriented places. I mean, that's it in a nutshell. If you want a slightly longer definition, it's building the kinds of places that the community enjoys being at, whether it's parks, plazas, main streets.
NNAMDINikki, as shoppers and restaurant-goers, most of us don't realize just how powerful we can be when we leverage our collective wallets and especially if we use our purchasing powers strategically. ROC-DC recently put on an event that takes the idea of a boycott and flips it on its head. What is a carrotmob?
LEWISSo a carrotmob is a really innovative consumer activism project that started from the San Francisco Bay Area where -- yeah, essentially, it's the opposite of the boycott. It's when you get socially conscious people to harness their buying power -- like you said earlier -- to reward businesses who are socially responsible and who are trying to do right things instead of punishing the ones who are, you know, breaking the law. So here in D.C., we use the carrotmob a little bit differently...
LEWIS...from most of the other carrotmobs that have happened around the world. A lot of other carrotmobs have been using, you know, their consumer activism, their buying power to influence or change businesses to be me more social -- or I'm sorry, not socially -- environmentally responsible. But in D.C., the spirit of the Washingtonian, we decided to use a policy issue to create awareness in the restaurant industry. And that's about the accrued Sick and Safe Leave Act of 2008, which gives paid sick leave to workers in all different sectors.
LEWISBut, unfortunately, it exempted tipped food service employees. And we felt that that was an important issue, not just for the workers but for consumers as well. And so we started an education campaign about the law and influenced people to vote online for six different restaurants that all agreed -- in theory, at least, or in practice -- that paid sick leave should be given to people that are handling food. And so we had over 400 people vote online. And the two top contenders were Teaism and Busboys & Poets, and Teaism turned out to be the winner. And we had over 100 people come and...
NNAMDITeaism on 8th Street Northeast, right? Where's Teaism? Where's Teaism?
LEWISNo. Teaism is -- has three locations. But the one...
LEWISThat's the one that we went to.
NNAMDIAnd Busboys & Poets also has several locations...
NNAMDI...around the city and in the area. The carrotmob template was originally designed as a way to reward small businesses who were doing good in their community. It's one of a handful of new ideas for strengthening local business and creating stronger ties with communities. But, Kim, I'd like to ask you a broader question, especially with Wal-Mart's plans to open up four stores in D.C. Why are small businesses important?
WEEKSWell, first of all, small business -- it's well known that small businesses create -- are the largest job creator in any community, and so -- especially in an environment where we're so concerned about the number of jobs being lost versus being gained. Local businesses work alongside consumers because we are also consumers in the community. So we are more inclined for so many reasons to hire people who are actually our neighbors to work with us and for us and shop with us, shop from us and shop alongside us. And, you know, we can talk a lot about the advantages of small business, local business versus Wal-Mart, but, really, it's just so obvious that local business benefits a community in just about every way.
NNAMDIHere's the economic argument. According to different studies by small business advocates, for every $100 spent in locally-owned stores, between $68 and $78 returns to that community or jurisdiction through things like payroll and taxes.
NNAMDIAt a national chain, that number is closer to $40. That stat has popped up in quite a few places. Of course, there are people who would like to challenge it. Feel free to do that. You can call us, 800-433-8850. But more importantly, do you make a point of shopping at small, independent businesses? 800-433-8850. Call us to tell us why you do that, if it's out of necessity or out of social consciousness. You can also join the conversation at our website, kojoshow.org. Send us a tweet, @kojoshow, or e-mail to email@example.com. I want to get back to the carrotmob concept for a second, Neil Takemoto. How does crowdsourcing help to organize people to do the kinds of things that a carrotmob can do?
TAKEMOTOSure. While crowdsourcing is outsourcing a task to a community or an undefined group of people via an open call -- so, right away, when I say a chain store opens, it already has an established customer base. But when a local independent opens, it doesn't. No one knows what it is. There's no reputation, so it has a disadvantage. But if you crowdsource a customer base from the beginning and let -- and you can do that by letting the advocates who believe in the concept of this restaurant-to-be get involved in planning, maybe even naming it or what events go on or the menu or hours, then they become vested so that, on opening day, you actually have maybe even a larger customer base and much more community-oriented than with the chain.
NNAMDICoffee shops and bars are more than just businesses. They are also places where we go to socialize, where we meet new people in our community. Neil, you call these kinds of businesses third places. What is a third place?
TAKEMOTOSure. A third place -- there's actually a book called "The Great Good Place," and that's where the author, Ray Oldenburg, introduces the term third place and essentially means, rather than your home or your work, it's the third place that you sort of spend a lot of time at. So a classic example is the British pub or a coffeehouse where you go late at night to spend a couple of hours reading or catching up on work.
NNAMDIWe're talking about carrotmobs and crowdsourcing with Neil Takemoto, founder of CoolTown Beta Communities, which specializes on crowdsourcing, urban design and placemaking. Kim Weeks is owner of Boundless Yoga Studios and marketing chair of Think Local First DC. Nikki Lewis is coordinator of Restaurant Opportunities Center of DC or ROC-DC. You can call us, 800-433-8850. If a community hardware store or organic market is competing, let's say, with a big-box store, they'll lose at least if it comes down to price. But does that mean that small businesses cannot compete against and beat big companies? Can they make it more than just about price? First, you, Kim, but I'd like to hear you all weigh in on this.
WEEKSI mean, yeah, the shopping experience at any local business is necessarily about the transaction, but it's also about the interaction that takes place between two people who are exchanging money for goods or services and the -- we talk at Think Local First a lot about the, you know, role of the business owner in a community, the accountability that a business owner has to her or his employees and customers because we're all closer to the same experience. We're all living on the same part of planet Earth.
WEEKSAnd the exchange, the transaction that takes place, we believe, at a larger, you know, sort of big-box store lacks some soul to us and lacks this sort of warmth that, even this time of year -- especially if we're going to talk about shopping local for the holidays -- we'd like to exchange between one another. And so, of course -- and I think I should also lead with this -- the price issue is extremely important, but we talk a lot about that also. And it's like, what are we actually competing for? Are we going to try to sell toilet paper like Wal-Mart does, as cheaply? I don't really think that's -- I think that is a very part of the conversation, but it's not the only part.
NNAMDIAgain, you can call us, 800-433-8850. Do you make a point of shopping at small independent businesses or not? 800-433-8850. Same question to you, Nikki Lewis. Can small businesses compete outside of the area of price?
LEWISExcuse me. Absolutely. Coming from the restaurant perspective, people patronize restaurants because it is an experience. It is, you know, a place where you go, where you want to feel comfortable at home when you're essentially not in your first or second place and why you want to, you know, have a good interaction with the workers in your community, have vibrant food and experience culture and forget the troubles of the day. And at smaller independent places, it's easy to create that very, very special feeling that the community can have that loyalty and attachment to versus -- you know, that you can go to a chain restaurant anywhere in the country versus, you know, your special place.
NNAMDIFrom that perspective, is it therefore more difficult to challenge a small business that you don't think has the appropriate business practices than it is to challenge a large chain?
LEWISThat's a good question. It definitely can be because it's difficult for smaller businesses to compete with large chains that have such, you know, power -- such powerful buying influence. So, yeah, it absolutely can be difficult, but that's why I think it's important to level the playing field by pushing policy that will make things fairer for small businesses.
NNAMDINeil Takemoto, you mentioned that when a major chain like a Subway or a Starbucks opens in a neighborhood, they've got built-in advantages. Everybody knows who they are and what they offer. They've got built-in customer bases and reputations. Small restaurants and coffee shops, as you pointed out, at their startup phase are really blank canvases. Can you use crowdsourcing or anything else to attract people to them on a basis other than price?
TAKEMOTOYeah, definitely. There's a project in Lansing, Mich., called the REO Eats Project. And they have an empty former diner that they want to transform into a restaurant. And they've given the community a three-month window to help them name it, design it, come up with the menu, come up with the style and look. And it's created this sort of a -- almost mini frenzy of a community that's supporting this, that they already know, on opening day, they're going to have a huge crowd and customer base. And as the -- and to answer the question about like how can a local independent compete with a -- like a Starbucks? Just take my neighborhood, Adams Morgan, for instance.
TAKEMOTOThere's a -- you have Tryst right in the same neighborhood as Starbucks. Tryst came first. Starbucks came second. And everyone thought, great, when Starbucks is going to open, it's going to really hurt Tryst's business. And to sort of counter that with a simple test is, whenever I have a visitor in town and they ask me that same question, we walk over to Starbucks, and I ask them to count the number of people in there. And they say, okay, got it. Then we walk over to Tryst and ask them to count the number of people in there, and they start laughing because they can't. There's too many people.
NNAMDIEnough said. Here is Laura in McLean, Va. Laura, you're on the air. Go ahead please.
LAURAHi, Kojo. I just wanted to say -- well, thanks. Your show is awesome. I listen every day.
LAURAAnd I (word?) -- I mean, there really is this differential in terms of customer service. And there's a local business in McLean that we shop at all the time because -- and the prices are definitely higher, but we know that when we walk in there, literally there's someone standing at the door waiting to show me exactly what I need. And you know what? I'll pay for that nine times out of ten if I can because it's just I'm just so happy to have this business, you know, locally. So I think that's the differential.
NNAMDIIntimacy and relationships. Thank you very much for your call, Laura. If you have already called, stay on the line. We're going to take a short break. When we come back, we'll continue our conversation about carrotmobs and small, local businesses and their usefulness. 800-433-8850. I'm Kojo Nnamdi.
NNAMDIIt's food Wednesdays, and we're talking restaurants in a way. What we're really talking about are new ideas, from crowdsourcing to carrotmobs, to encourage small restaurants and small businesses in general or to encourage patronage of small restaurants and small businesses in general that happen to be doing a good job. And joining us in studio to discuss that is Kim Weeks, owner of Business -- Boundless Yoga Studios and marketing chair of Think Local First DC. Nikki Lewis is coordinator of Restaurant Opportunities Center of DC or ROC-DC.
NNAMDIAnd Neil Takemoto is founder of CoolTown Beta Communities, which specializes in crowdsourcing, urban design and placemaking. If you have already called, stay on the line. If the lines are busy, go to our website, kojoshow.org. Join the conversation there. Kim, in D.C., there's a big debate going on right now about Wal-Mart. Depending on where you stand, it's either one of the most innovative companies in America that brings jobs and low prices to communities, or it's the incarnation of everything evil. Can it be both?
WEEKSOf course, it's always both.
NNAMDIWell, how do you think the arrival of a big-box store like Wal-Mart will affect local small businesses?
WEEKSWell, I mean, Wal-Mart is well-known for its scorched-earth policy with regard to other businesses other than itself. And in itself, it is an advocate of the free market with a capital F and M. And so, you know, because, I think, we have been forced as a result of the recession, all of us -- but many great thinkers before that, with regard to business -- were advocating even before that, that there is a subtler relationship that exists between large multinational corporations. I mean, Wal-Mart's bigger than many countries, you know, with the amount of money it makes.
WEEKSAnd, you know, those entities versus local businesses, and I think that any of us who have had -- spent any time in strip malls in the past five years recognize not just that places like that which represent these huge businesses are not sustainable as an economy. They are closing all over the country. And many of them -- many of the funders for those places have gone bankrupt. And so I think that the -- without a doubt, Ward 8 needs a Wal-Mart. I think, and we believe because...
NNAMDIThat's one of the suggested locations in the District of Columbia's...
NNAMDI…Ward 8. So you would say Ward 8 needs it. It can provide jobs. It can provide lower prices 'cause people don't have access to very -- a great deal of retail over there. On the other hand, would you approve the location in Ward 4 at Georgia and Missouri Avenues Northwest?
WEEKSYou know, I struggle with that because I live half a mile from there in Petworth and, you know, can see huge advantages that that would bring to that area for many of the shoppers who live in that part of Ward 4, in that part of Northwest. But at the same time, the amount of traffic that that's going to bring to my neighborhood via cars, and what it will take away, I think, from what is a very fragile Georgia Avenue with a lot of local businesses there, is maybe not worth it. And so what Think Local First believes -- and what I believe as the owner of Boundless Yoga -- is that businesses like mine should be at the table with Wal-Mart.
WEEKSIf we have made so many concessions as local businesses -- over time we pay very high taxes. We have really low margins relative to a place like Wal-Mart. Wal-Mart should make some sacrifices also. Maybe 20 percent of their sourcing could come from mid-Atlantic companies, so that they would eat into .05 of their profits. I mean, such a tiny percentage point for this region alone just so that mid-Atlantic sources of wrenches or Pampers or whatever, you know, could make some money.
NNAMDIAnybody else want to comment on that before I go to the telephones? Because there are a lot of callers who are waiting. So let's start with Lisa in Westminster, Md. Lisa, you're on the air. Go ahead, please.
LISAHey. Hi, Kojo. Happy Holidays. I love you.
NNAMDIThank you. Love back to you.
LISAThank you. I'm calling kind of with questions and comments. My comment is I work as a job developer/job coach for students between the ages of 18 and 21 who have disabilities. And I've only been doing this job for about two-and-a-half years, but what have learned is I expected the big-box stores -- Wal-Mart, Target, Dick's, places like that -- to welcome my students as model employees. And what I have found is that it's the mom and pop places who are willing to take my kids under their wing, train them, help them to develop job skills and social kills.
LISASo I'm asking your audience to maybe patronize stores for that other reason, not just jobs that they bring to a community, but the jobs that they don't bring or the people that they are not willing to hire. And my comment is -- or my question is, how can I use the carrotmob? I live in a small community, Westminster. And how can I use the carrotmob to kind of, I guess, favor the businesses to hire these students? How can I organize something like that?
NNAMDIFirst, you, Nikki Lewis.
LEWISWell, very carefully. I think that first, all -- using social media, one, to get your purpose across and to get people interested in -- about the issue of workforce development for young people. And the smaller local businesses could reach out to small local businesses and tell them why you want to praise them and reward them with business because they do these, you know, special training and give opportunities to the people that you're working with. And, actually, the carrotmob founders in San Francisco are very helpful with giving you a tutorial and step-by-step in how to organize a carrotmob.
LEWISSo then, I think, you just get, you know, several friendly businesses to agree with your ideas and concepts. And then have people vote online or possibly another way. But have your concerned consumers voting online and then win. Whoever wins, then you guys mob them and get media and people out there to make a, you know, big buzz about it.
TAKEMOTOYes. Well, Lisa, I would also -- I agree with everything Nikki just said. And Think Local First, you should contact Tricia Clauson who runs Think Local First. And Kim Weeks here is actually on the board. I would contact her. We're working on a program where, ideally, we're going to have a carrotmob at least once a week, even daily, almost like an inverse Groupon -- as Kim rephrased it -- where every day there's a mob to go support a local independent restaurant based on, does the community really want this to happen? And let's find a good reason why we want to support them.
NNAMDIWe got an e-mail from Miguel in Columbia Heights who says, "I recently joined the website, Groupon. It's a site that sends out online coupons for local businesses. It seems like a great template for letting consumers know about great local businesses."
NNAMDIWhat do your guests think? What do they think? They love it. Here is Kim.
WEEKSI totally agree. Groupon, you know, has -- is a recession. It's a business model born of the recession. These guys with so little overhead -- I don't know how they got a handle on the hundreds of thousands of e-mails that they've got, but they've got them. And they send seatbelt e-mails out to people everyday with these just 50 percent or greater discounts that, you know, a lot of -- frankly, local business owners I know complain about and say, you know, basically, you know, it helped our revenue short-term. But then we weren't able to service, you know, the requests as they came in.
WEEKSSo I think it -- I want to say caution to business owners. It -- you should really look at your model, make sure that it's not going to be a money loser for you and that you ultimately are going to make money off of the customers-- the new customers you get in -- but from such a thing, from this volume-based purchasing. But what, you know, local businesses compete with or -- have struggled competing with most is that volume-based business, which is why our margins are definite -- necessarily lower and our prices -- in some cases but not all -- higher.
WEEKSSo what Groupon is allowing for everybody is to not just know about the services in the area, but it's really -- we've seen -- it's driven people from all over town to Boundless who wouldn't otherwise have come. And before it, we were just -- not just, but just a neighborhood studio, where people would walk in the morning after they got out of bed to go to yoga or whatever. So...
NNAMDIOn to Eric in Beltsville, Md. Hi, Eric.
ERICHey, how are you?
ERICI have a -- hello, can you hear me?
ERICOkay, good. I've got a quick comment. I'm a small business owner. I've got a used guitar store, and I want to just explain what happened when Guitar Center came in, which is a larger box store. Basically, I saw a lot of my fellow independent music stores immediately go under. I know that in Baltimore, there was one place basically right on top of another shop, and that went down. So, I mean, I feel that when the large box stores are going to come in, anytime they come in, they immediately take out a lot of businesses. The idea that I had -- I'm assuming when a Wal-Mart comes in, there are some concessions made -- excuse me -- in order to attract them to an area.
ERICPerhaps, it could also be an area designated where there are some subsidized spaces -- you know, maybe subsidized by the city or maybe even Wal-Mart has to kick in a little bit -- to subsidize the rent for some smaller businesses. Because between box stores and the Internet, it's getting very, very difficult for, you know, a small business to maintain profitability and operate, I mean. So, I guess, I'll just take my (unintelligible)...
NNAMDIWell, Kim, you can talk a little bit about this. There's a lot of empty spaces at the DC USA Development...
WEEKSThere are so many. Yeah.
NNAMDI…where small businesses apparently haven't been able to get into.
WEEKSRight. And the reason that small businesses can't get in to DC USA is because it's too expensive. The rent there -- what I would suggest is, for example, we know we could look at the historic rents and commercial rents in Columbia Heights, for example, where it was before the announcement of Target and DC USA and then look at the increase over that period of time, and that amount should be subsidized for local business owners, for example, for, like, five years or something or three years to allow them to get to a level of profitability where they could justify a higher rent.
WEEKSBut, you know, we talk all the time in business about lowering the barrier to entry. And what happens is that these big-box stores have increased the barrier to entry for local business and knocked off all of the "weaker ones," the ones who were struggling with their bills anyway, but maybe could have continued through a rockier economic time, you know.
NNAMDIEric, thank you very much for your call. You might want to listen to our next caller 'cause I think he wants to talk about the music business and music stores also. He is James on Capitol Hill. James, you're on the air. Go ahead, please.
JAMESYeah, I'm thrilled that Eric did call in because I love his store, and I love another store over in Falls Church, Va. -- another guitar store in the area. And I kind of wanted to tell a positive side of that tale, which is, if I can at all avoid it, I will avoid at all cost walking into a guitar center versus those smaller local stores for a couple reasons. It's partially the sort of -- the theory of locally-owned is better, but, really, it's the experience. I mean, Guitar Center, you know, they can slash their prices, and they can stock every guitar and accessory and amplifier under the sun.
JAMESBut half of that stuff is nonsense and junk, and all it means is it doesn't have to be expensive to be good. But, you know, it's -- there's just too much stuff and they have most of what you don't want. When you walk into one of the local ones, you get owners because they can't stock everything who have thought it through and stocked the stuff that they know is good and that their customers are going to like. And so you filter out a lot of the noise. On top of that, you get stores where they're kept, sort of, you know, cleaner and in better shape than most of the Guitar Centers usually are because you have -- you have the owners and workers that care about the store.
JAMESWhereas you, you know, in some of these other places, you definitely get -- you know, it's a chain that's hired some people to work at a chain. There just isn't sort of a care for the store there. And then you also just get the expertise. The expertise of these local stores is typically better than I -- in my experience, than at a chain one. And so you can walk in, sort of knowing you're going to see the stuff you want to see. You're going to get advice on that you can trust and believe in, and you build a sort of long-term relationship with these people. It just makes it a much, you know, overall better experience.
NNAMDIIt's really about the local music store being attuned, if you'll pardon the pun, to the customers' needs more than the larger big-box store. Neil, you wanted to say?
TAKEMOTOExactly. I would say that one way to look at it is, think of these big-boxes and these, say, that music chain, think of them as competing with Amazon rather than the local business, and the local business competing more with, say, watching TV, for instance. You want the local business to offer classes, build a community among his customer base, have them get them to know each other so that they form a little community of customers, and then they say, hey, let's have a class. Or I know someone who would want to host them but doesn't have a place. Let's have it at the music store.
TAKEMOTOLet's have an event where we teach people how to buy instruments. So those are the things that the community can sort of build almost like a music club organically that -- so that now, you're competing with, well, should I watch TV tonight or go and have a music class versus do I, you know, buy this at the big-box or do I buy it at Amazon? Let them have that price war. But let the locals' independence fight for your social time.
NNAMDIJames, thank you very much for your call. Yeah, in case you were just joining us, we're talking about new ideas for small business, from crowdsourcing to carrotmobs. Here is Jeremy in Washington, D.C. Jeremy, you're on the air. Go ahead, please. Hi, Jeremy, are you there?
JEREMYI'm here, Kojo. How are you today?
NNAMDII'm well. Go right ahead.
JEREMYGood. So I launched -- one of the things that I've observed about opportunities for small business here in the District and in other urban centers, you know, vis-à-vis big-box stores and large competitors, is to fill a niche that they're unable to fill. And so, for example, we've launched a company here in D.C. called Compost Cab, which is in the business of making urban composting easy. And what do we do? We collect from residences, from offices, from restaurants. We collect their food waste.
JEREMYAnd then instead of bringing it to a big landfill-like facility, we bring it to a not-for-profit urban farm in the community that does economic and social benefits for the community as opposed to just the environmental benefit of the composting. And so for us it's not just about waste reduction, it's about food production. That's not something that waste management's going to do. That's not something that one of these big waste haulers is going to do. But we can do it. And so, I think, that's a model that can apply to retail and across the board.
NNAMDIWould anybody care to comment on that? Here is Kim.
WEEKSI think to be clear, the waste management company would totally do it if there was immediate profit in it, you know. I mean, and so what I think that that subtler -- I think the really important point that Jeremy makes is that there -- is that entrepreneurialism is what drives local business in so many ways, filling a need that has not, you know, previously been filled. Or, you know, as we talk sometimes at Think Local First, like, just looking at the world in a certain way that it doesn't exist at that time, but the sort of even larger point I want to make from the two music callers -- especially the second one -- and exactly what Neil is saying, is that we're trying, I think, to talk about active consumerism versus passive consumerism.
WEEKSWhat -- we really, I think, need to sit down and ask ourselves, what is Wal-Mart selling that we really do need and want? And they are necessarily profiting by turning your brain off as you walk into that store, grabbing, you know, the sort of stuff that's really discounted at the ends of the aisles. And everything is organized in that store to keep you in there longer and to ensure that you buy more stuff that you may or may not need.
NNAMDIHere's a provocative e-mail we got from Tony in Vienna, Va. And, Jeremy, thank you for your call. Tony writes, "If I go to the local hardware store, I hope to find some supplies made locally. But I'm not going to pay twice as much for the same part made in China that I can get at Home Depot for less. I'll buy local if they buy local."
NNAMDII guess that's a point that everybody appreciates. I want us to get back to the restaurant issue for a second, Nikki Lewis, because restaurants don't -- even the most successful ones tend to be huge moneymakers. Profit margins can be fairly thin, and the tastes of consumers can change quickly. That's one reason why some restaurant owners are reluctant to guarantee things like paid sick leave and other benefits to their workers because they say they can't afford it. What do you say to that?
LEWISWell, I say, actually, on the contrary because the restaurant industry, even in this recession, is one of the most thriving sectors of the economy. I believe the National Restaurant Association reports on their website that they made over $515 billion in profits last year, and the industry has over 13 million workers and projected to add another million next year. It's growing. It's thriving. These are big businesses and small businesses, so I say that they can afford it.
NNAMDIThe Restaurant Opportunities Center has conducted surveys of sick leave policies of restaurants in different cities, and you found some pretty disturbing things.
LEWISYeah, well, in the Washington D.C. area, we conducted over 500 surveys and 60 interviews of workers and restaurant employers alike 'cause we wanted to know everyone's perspective of what was going on. What we found is that the restaurant industry is, one, segregated by sector, and that meaning the quick serve versus casual versus fine dining. We found that a lot of workers, you know, experience discrimination in hiring practices. We also found that restaurant workers lack benefits. Almost 90 percent of restaurant workers nationwide don't have access to healthcare or paid sick days. It's just really shocking to us when it's, you know, people that are cooking your food and, you know, dealing -- it's a consumer health issue.
NNAMDIGot to take a short break, but before we do, one quick question, Neil. A few years back, it's my understanding you tried to create a restaurant concept using principles of crowdsourcing. This is an idea that continues to intrigue some restaurateurs. How would it or how does it work?
TAKEMOTOWell, I mentioned the one that they're doing in Lansing, Mich. We started with this project called Elements where the group -- crowd named it. It started off with 14 people saying, what kind of restaurant would you want or do you think is missing in D.C.? And that 14 people grew to a vision of vegetarian, organic, local farm-oriented and is a community of 500-plus people. Now, the challenge is, is that who can execute that vision that this community -- so you have the customer base.
TAKEMOTOBut, here, you don't quite have the restaurant. So you -- the lesson learned here is you need a restaurateur who's got the capital and the know-how to open a restaurant along with a customer base that they're willing to listen to. And then when you got those two together, that's when, I think, you're going to see a lot of raw support of local, independent businesses popping up.
NNAMDIWe're going to take that break now. If you have already called, stay on the line. We'll do our best to get to your call, but the lines are busy. So, if you'd still like to communicate with us, go to our website kojoshow.org and ask a question or make a comment there. I'm Kojo Nnamdi.
NNAMDIWe're discussing all kinds of ideas for small businesses, from crowdsourcing to carrotmobs. We're talking with Nikki Lewis, coordinator of Restaurant Opportunity Center of D.C. or ROC-DC, Neil Takemoto is founder of Cool Town Beta Communities that specializes in crowdsourcing, urban design and placemaking, and Kim Weeks is owner of Boundless Yoga Studios and marketing chair for Think Local First D.C. We have a crowd of people waiting for us on the telephones, so we're going to outsource this conversation to them starting with Nigel in Jefferson County, W. Va. Nigel, you're on the air. Go ahead, please.
NIGELGood morning and thank you. And thank you for continuing to support to buy local. It's such an important part of keeping the local farmers working. I'm on the Ag Task Force for Jefferson County. We have restaurants in Shepherdstown that do nothing but buy local. And I've just have the wonderful privilege to being able to go across the river over the Potomac into Sharpsburg, Md. and buy fresh bread from a Mennonite bakery. And then I drove on into Antietam and walked straight into a farmer and walked right off the farm. I think these things are just very important.
NNAMDIThis is a very good example, Kim Weeks, of what you call active versus passive consumerism. Nigel is, clearly, a very active consumer.
NNAMDI...thank you for your activity.
NNAMDIThank you for your call and for being an active consumer.
NIGELWell, my pleasure because it's so important. And I really thank you for continuing to support it because you've done a marvelous job on it.
NNAMDIThank you very much for your call. We move on to Jen in Washington. Jen, you're on the air. Go ahead, please.
JENHi, Kojo. I tried to resist calling, but I couldn't help it when (unintelligible) just wrote off Ward 8, saying, oh, they need a Wal-Mart. I'm sorry. If we're going to make a change in this whole consumerist mentality model that we have -- which is what you're talking about, essentially -- why not look at Ward 8 as the opportunity to put an urban green space...
JEN...where people learn to farm, to grow their food, to do their own repairs, to help one another fix their houses, to produce the items that they need within their own community? And, of course, it's giving them…
NNAMDIHere's the -- Jen, allow me to rant -- interrupt.
JEN... (unintelligible) do nothing but sell them cheap Chinese crap...
NNAMDIJen, allow me to...
JEN...which we don't need.
NNAMDIJen, allow me to interrupt. How do you incentivize that? The real fact of the matter is that small businesses have not been going into Ward 8. They have not been opening up. How do you intend or how would you suggest making that happen?
JENI -- well, I will tell you that I'm not entirely anti-conversation because you did -- Kim and someone else mentioned incentivizing the rent by subsidizing the rent. Give the people a place to grow their good. Give them a place to market the food. Bring in the people to teach them the skills that they need in order to do their own electrical repair, do their own -- we have to start re-centering our entire mentality on the local economy.
NNAMDII think a lot of people would agree with you, Jen. But besides Ward 8, there are people in Prince George's County who would be saying to you, look, we've been sitting out here with our money for a long time, asking people to come over here and open up anything at all...
NNAMDI…and we've been having a hard time attracting them. And in Prince George's County, one has to mention the word race because it's a predominantly black but very affluent county. But how it's -- the question is not whether it needs to be done. It's, how do you get it done?
JENWell, look, we're spending millions and millions of dollars to bring these types of local technologies all over the world. Why don't we have U.S. aid at home? I mean, charity begins in the home.
LEWISI totally agree with that, yes. I totally agree.
LEWISI have to say, we spend so much time. And it's so important, you know, what we do with our nation's wealth, building up, you know, war-torn communities and, you know, communities where women are totally uneducated, for example, because we know that's such a key component to a society's health. But at the same time, you know, here we are, you know, talking about how Wal-Mart is going to be a -- excuse me -- a huge advantage to Ward 8 for the very reason that local business has, for a variety of very systemic reasons, not been able to benefit that community.
LEWISAnd it is totally important to know -- even though I believe that this is probably a statistic influenced by the Wal-Mart press people -- you know, 70-something percent of D.C. residents say they want a Wal-Mart. And so, you know, business is there -- Wal-Mart to the mom and pop store -- to serve the community's needs and wants. And I think what we're talking about is a really equal conversation, I think, between local business and Wal-Mart so that, recognizing what we have on our hands, we have a practical solution, but we also have an ideal vision.
NNAMDIThe negotiations that will precede Wal-Mart's entry into the market in Washington, D.C. are going to be fascinating to watch and to cover. Jen, thank you very much for your call. We got this posting from Peter on our website, who says, "I choose to support local businesses. I know they can't beat the national chains on price, but they can surpass them in one primary area: service. If they fail here, they will fail. Service respects the customer and exceeds the customer's expectations. Examples can be to help customers get what they need, ordering alternative products and when they need it at hours different than the national chains." Thank you very much for that e-mail. We go back to the telephones with Chris in Washington, D.C. Chris, your turn.
CHRISOh, it's nice to talk to you from Northeast, where they're talking about setting these Wal-Marts. Yeah, what do your guests have to say to the argument that small businesses don't create the volume of jobs that would be needed to employ, as Van Jones says, pooky (sp?) on the corner? We've had a discussion of this in this latest federal tax bill, with giving tax breaks to millionaires. The Republicans are making the argument that all these people are small business class, people who will create jobs. But what do you say to that argument that a big-box place is going to create more jobs?
NNAMDIWell, first, in terms of Van Jones talking about pooky on the corner, you should know that -- our audience should know that Van Jones is talking about that in terms of using clean energy as the driving force to create jobs in our communities as opposed to putting big-box stores in those communities...
CHRISThat is true.
NNAMDI...to create jobs. But I don't know if anybody else wants -- here is Neil.
TAKEMOTOYeah, actually, I think sometimes there's a really simple reason for, like, why things happen. Why -- you know, why is there such a focus on Wal-Mart? Because it's -- if you're in economic development, and that's basically the most powerful agency in the city...
TAKEMOTO...it's so much easier to say, let's just make one meeting. Meet with Wal-Mart. Bring them in rather than having to build relationships with 100 potential entrepreneurs and development. That's too much brain damage for me. I don't have the skill set to do that. I never really learned that in college. There's not even an entrepreneurial course to manage entrepreneurs. So let's just bring a whole bunch of jobs in one time, one fell swoop with Wal-Mart. Butt I'm saying, it's the easy way out, but it's not what people need.
TAKEMOTOIt's not what people want. And so reinvent the economic development that focus on entrepreneurs. And there's actually a movement in Littleton, Colo. called economic gardening, which is actually reinventing economic development that focuses on small businesses and teach people how to do this. That's what's missing in government.
NNAMDIAnd, Chris, while Wal-Mart may be able to create a large number of jobs in one specific jurisdiction, like the Southeast, according to the Bureau of Labor Statistics, the overwhelming number of American jobs are still created by small businesses. Chris, thank you very much for your call. Nikki, I wanted to get back to restaurants for a second because ROC is also advocating around the issue of wage theft, when restaurant owners -- and they're paying their workers less than they are due. Talk about that.
LEWISWell, from our studies, from our survey -- which, by the way, we'll be releasing all of the reports on Feb. 14 because that's the highest grossing day for restaurant workers. So remember that when you're dining out on the 14th, to treat your restaurant employees well. But from our study, we learned that wage theft is pretty common, actually, within the industry. And it comes in a number of ways, whether it's not -- directly not paying people, whether it's withholding wages or -- in a recent little mini-campaign that we had -- you know, not paying people for the last month that they worked there or not giving people their overtime that's due. It comes in a lot of different ways, and we're learning that restaurant workers experience that more frequently than you would think.
NNAMDIIndeed. We got a tweet from NPRisforLovers that says, "Your guests should mention unions in a comparative conversation about benefits, wages and working conditions for restaurant employees."
LEWISWell, yes. Well, ROC is not a union. We're a worker center. We do educate workers about the benefits of having a union and that's -- you know, typically unions give a working class people more job security, benefits, living wages. And there are those types of jobs in the restaurant industry. So we would like to, you know, promote that. Yes, absolutely.
NNAMDIOn to Hassan in Alexandria, Va. Hi, Hassan.
NNAMDIHi, Hassan. You're on the air. Go ahead, please.
HASSANYeah, thank you. Yes. Fifteen years ago, I opened an upscale store in Alexandria, Va. And the residents were shocked to see my store upscale, and they told me, are you crazy? This town is for secondhand stores. So, anyway, I thought to educate the consumer that it's about the quality, not about secondhand. But it's really difficult to condemn people to buy quality stuff. I don't know why.
NNAMDISo were you...
HASSANCan anybody comment?
WEEKSSure. Yeah, it's a great question.
NNAMDISure. Here's Kim.
WEEKSI mean, the consumer -- I mean, capitalism brings, you know, goods -- more goods and services to more people faster. And when you actually have to think about something and think about, is this good for me? Is this not good for me? Can I see this as a long-term benefit to my life? Those are, like, harder questions to ask yourself than -- I hate to keep using the example because I don't want to give Wal-Mart any more branding than they already give themselves -- but you walk into Wal-Mart, and you just can grab something off the shelf and suddenly you got this immediate benefit, this immediate thing that you can use, even though it probably is going to break down in the car on the way home.
LEWISAnd also, I think, it's important to note that often time people just simply cannot afford quality today...
LEWIS...and that's because, you know, with a lot of the outsourcing and the big, you know, chains and stuff they, oftentimes, don't pay a living wage.
NNAMDIBefore we go, allow me to read this e-mail we got from Caleb. "My wife and I own a small wine bar and wine store on 14th Street in Logan Circle. When we opened the wine store, many people thought it would be hard for us to compete against the bigger likes of Whole Foods down the street, cheaper prices, more volume. But we..." -- Whole Foods, cheaper prices?
NNAMDI"But we have been able..."
LEWISHold the check.
NNAMDI"...to compete and thrive because we're small, personable and unique. We're small enough that we can adjust our inventories that meet local interest and don't have to depend upon a regional buyer that has to create a brand across stores. We can offer a more personal interaction with guests and customers. And we can offer unique experience to each guest and provide items they can't find in other places and, more often, for a better price. As to the restaurant question about healthcare and sick leave, we offer both to our employees. And we supported the paid sick days law here in D.C. We can afford it because we create a more dedicated and connected staff." I'm afraid that's all of it that I can read because we're out of time. Nikki Lewis, thank you for joining us.
NNAMDINikki Lewis is coordinator of Restaurant Opportunities Center of D.C., ROC-DC. Neil Takemoto, thank you for joining us.
TAKEMOTOThank you very much.
NNAMDINeil is founder of CoolTown Beta Communities. Kim Weeks, thank you for joining us. Kim is owner of Boundless Yoga Studios and marketing chair of Think First -- Think Local First DC. I'm Kojo Nnamdi.
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