The Declaration of Independents

Just when economic bullying by big corporations threatened the whole idea of independent small business, company builders nationwide did the last thing anyone expected -- they turned to one another for help.

A new "spirit of independents" is spreading across the nation. And the battle lines have been drawn. Consider that the United States just concluded one of the longest-running consolidation plays ever ($2.8 trillion in mergers and acquisitions in 1999 and 2000 alone). The big got a lot bigger.

In response, independent companies are forming and joining alliances, cooperatives, networks, and coalitions in record numbers. By coming together in groups of 10, 30, or 300, small companies are gaining the benefits of bigness. And it's happening everywhere. From baseball teams to carpet retailers to network-services entrepreneurs, small players are uniting for a common good. The movement has even marched into other countries.

Some groups get started after feeling deserted by their city councils and chambers of commerce. Others go where trade associations fear to tread. Whatever the origins, the new independents movement amounts to a potent underground economy -- groups of companies that buy and sell for one another.

How big is this hidden economy? A partial accounting reveals hundreds of alliances involving thousands of companies. Just 18 of the more prominent small-business alliances have 9,402 members with total sales of about $29 billion. Members of the groups pool their political clout, their purchasing dollars, and their business know-how. They launch national marketing campaigns. They share office space, technology, even employees. The new movement is an antidote to the culture of consolidation. The message is, there's another way to gain economies of scale. Who needs a "parent" when you've got friends?

"Underneath it all, there's a flavor of independence that's absolute," says David Leppert, CEO of Cooperative Solutions, an organization set up to support cooperatives. Leppert has helped start half a dozen small-business co-ops in businesses ranging from bike shops to drywall dealers. Leppert went so far as to draw up a "Declaration of Independents," a portion of which appears in the introduction to this story. If this is war, the battle plan is twofold: defend local ownership positions and attack the enemy with the fortifications of an army. The result is nothing short of revolutionary.

The Revenge of Mom and Pop
The new independents movement is alive and kicking in small towns and in the neighborhoods of big cities, where storefronts are joining the battle. Local retail alliances are rooted in community groups with names like MADSET. (That's short for the Milford Alliance to Defeat Sprawl at Exit Ten, an effort by residents in the small community of Milford, Pa., to stop a Home Depot from going up.) The story of mom-and-pop revenge began publicly when citizens joined hands with local business owners. And now owners are helping other owners.

Meet Lorraine Miller, a leader of the new independents movement. She is a respected businesswoman in Salt Lake City, the longtime owner of a thriving $3.5-million gardening center called Cactus & Tropicals. She doesn't seem like the type to take up arms. A few years ago she was just minding her own business. She dutifully served three years on the Salt Lake City Chamber of Commerce. But the chamber experience turned Miller into a rebel with a cause. "I told them, 'You are not addressing the needs of small business,'" she recounts. "Local small businesses were under the radar."

Not anymore. Not since Miller jumped into action. In March 1999, she joined three other retailers to form the Salt Lake Vest Pocket Business Coalition. Now 150 companies strong, the coalition helped to defeat a proposed "sprawl mall" and elect a pro-small-business mayor. "Our number one focus," Miller explains, "is to create a level playing field between local ownership and the national chains that get all kinds of tax incentives." That means that whenever one of the coalition's members has a run-in with city hall, the others raise hell. But more than that, the members actively promote one another's businesses, do joint advertising, and cosponsor community marketing events. They also mentor one another. Says Miller, "We want to change the world...one storefront at a time."

"There's been a growing number of communities saying no to big-box stores, but beyond that more communities are doing things proactively," says Jeff Milchen, cofounder of the Boulder Independent Business Alliance, in Boulder, Colo. "What's exciting about this is it's fighting for values we believe in rather than just fighting against the Wal-Marts." BIBA, as Milchen's group is known, started in 1998, which makes it the oldest known alliance promoting local independent businesses across the spectrum. The BIBA Guide lists 150 retail, wholesale, and service businesses.

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