Size Isn’t What Makes A Business Good or Bad

America has an unfortunate tendency to impute merit into sizes: big business is innately predatory and harmful, while small businesses are inherently a boon to the community. From some perspectives, this is understandable: when the big box hardware chain sweeps into town and shutters the corner store that’s stood there since grandma and grandpa’s day, unfolding events can seem like an injustice. Local craftsmen lose their livelihoods and the entire community is a little less enriched.

But for every charge that can be laid at the feet of big business, a benefit can also be named. Big business provides jobs for community members; it often leads to infrastructure reinvestment. The greater resources big businesses can draw on mean consumers are often presented with greater choices at lower prices.

Small businesses can provide poor service, just as can big business. The truth is: when it comes to the quality of business, size doesn’t matter. The individual business and the practices of its owners generate value. Consumers form their own judgments regarding which businesses are worthy of patronization based on their own set of values. Economic transactions are underlain by overlapping value-judgments: a producer pursues a certain set of values in they way they create and promote a product and individual consumers seek out those goods and services that reflect whatever they deem meritorious.

This distinction brings the greatest prosperity to the community because it is a system rooted in satisfaction. By encouraging all individuals engaged in economic transactions, regardless of whether they are on the buying or selling end, to seek that which they value, they serve a twinned purpose: they advance those things they think are of merit in the world and simultaneously pursue ends guaranteed to enhance their individual satisfaction. A community that follows such a pattern of behavior cannot help but be enriched, not in the least because such a system does not require regulation imposed from above. There is no force, no coercion, just competing ideas naturally buoyed through the community by the free and independent actors of various actions.

But this can only occur when big business is not pitted against small business. Economic systems are, in reality, a complex and intermeshed series of interactions. One can profit at the expense of another, or one can profit with the aid of another.

Enter Amazon’s newly announced Storefronts platform to illustrate the point that small and big business should not be painted as a dichotomous battle of one against the other. Storefronts, conceptually, will work to shine a spotlight on particular vendors already selling their goods through Amazon. Small, independent businesses that customers rate highly will be featured by Amazon through personalized ad campaigns, featuring elements such as videos that highlight the stories behind particular retailers and showcase their creative process.

In effect, this is small business being bolstered by big business. And, yes, there’s an obvious element of self-benefit to Amazon: Storefronts will not link to websites that independent business may own, but will promote sales through their platform. The company is using the talent of others to benefit itself. But by doing so, it increases not only its own profits, but those of the small businesses chosen to participate in the program as well. Amazon’s desire to buoy its own bottom line buoys those with whom it partners. This is not a parasitic relationship, but one of mutual self-benefit to the parties involved.

And that includes consumers. Amazon will highlight approximately 20,000 of the American-based small businesses from the pool of approximately 300,000 that currently use the retail giant’s platform. The 20,000 will be chosen using metrics that help connect customers to products they’re most likely to desire and rate highly. In other words, businesses will be rewarding for catering to existing customer bases. Again, everyone’s interests are served, including consumers. Value is matched to value: business that offers what is desired are promoted, while buyers with specific needs are connected to businesses most likely to meet them.

The downside of small business is its limited range: it is simply not possible for a local store to serve an entire nation, at least not without sacrificing many of the qualities for which independent stores are prized. The personal interaction and hand-made goods are sacrificed for the ability to serve a greater public. Big business solves this problem but comes with its own: mass production allows more people to possess desired goods, but artisanry can be sacrificed. There are no perfect systems, in part because theses are merely a vehicle to help individuals achieve ends and judgments and values differ from person to person.

Imputing morality into a system is therefore a mistaken practice, destined to lead to a dystopic view of the state of the community. Big business is not inherently good or bad. And neither is small business. When each serves its customer base in a way that is conducive towards both, each is good. But “good” is defined in reference to a particular set of users, who import their judgments of the term.

That’s why tools such as Amazon’s Storefront program are beneficial. A platform is not a business, but it does facilitate the value-for-value exchange between parties that leads to good business. Nothing that is in aid of this end should be demonized, regardless of what size it happens to take.


Originally published at The Politics of Discretion.