The Local Multiplier Effect

“In Greater Peoria, shopping local is not an event. It is a daily practice to grow stronger communities.” That’s the message of the Greater Peoria Economic Development Council’s Shop Local 365 campaign. As the initiative continues to gain traction in the community, the EDC has rolled out an online calculator quantifying this message. It shows the impact of each dollar of spending on your community—whether you shop at a locally owned business, a national chain or online. It’s a powerful tool to understand the impact of your purchasing decisions.

When you shop locally, your dollars are recirculated in the community, a process known as the multiplier effect. The multiplier effect is comprised of three parts:

  1. Direct impact: spending by a business in the local economy (operating costs, salaries, utilities, etc.)
  2. Indirect impact: recirculation of business spending at other local businesses.
  3. Induced impact: local employees and business owners spending their income in the local economy.

Shopping locally is an act of reinvestment in your community. It helps fund vital government services and local programs, including schools, fire and police protection. Money spent at local businesses means less shipping, less waste and less pollution. It’s also an opportunity to make connections, get to know your community better, and discover something new.

Visit to try out the interactive calculator and learn how your spending habits can affect your community. iBi