Importance of Small Business in local Urban Economies



According to the most recent data from the U.S. Census Bureau, small businesses with fewer than 50 employees make up approximately 95% of American business establishments and employ 40% of private sector workers. These 7.4 million small businesses also account for roughly a third of total private sector payroll. This market presence is also evident in Urban Economies specifically. According to an analysis done by the Initiative for Competitive Inner Cities (ICIC), these small businesses (which exclude the self-employed) account for 94%of all businesses across the 328 inner cities in the U.S., and over a third (37 percent) of inner city employment. A modest increase in the number of employees hired by existing small businesses (one to three employees per business) could create enough employment opportunities for a large majority of currently unemployed city residents.


Small businesses are pivotal in driving community growth. Oftentimes these small businesses are owned by local residents, and help shape the culture and reputation of cities. The visitors they attract begin to feel comfortable exploring the city after spending time there. The majority of the funding spent in these stores stays within the community, rather than going back to national or international organizations. Businesses pay a significant portion of all taxes in the United States, including income tax, property tax and employment tax. Having more businesses in the local economy can boost tax income for local governments, bringing in more money to repair roads, develop schools and improve public services. Unquestionably, small businesses are crucial for economic growth in urban areas.


With the arrival of comprehensive goods and food delivery services, many small businesses are facing more competition than ever. With smaller operations less able to adjust to the shifting economic environment, many small businesses are pushed to the brink of failure. A survey conducted at the end of the 2019 fiscal year by the New York Fed, found that even prior to the pandemic, 64% of small businesses faced financial challenges in the preceding 12 months. Among the most common were challenges paying operating expenses (43%), difficulties with credit availability (33%) and issues with making payments on debt (30%). The same survey reported that a two-month loss of revenue would cause 86% of firms to take a serious financial action, such as using the owner’s personal savings, taking out a loan, or cutting staff salaries.

Unbox your City is a direct response to the growing concerns for local business and inefficient measures to preserve their financial wellbeing. It provides the capability to ensure a healthy environment for small business stimulus and growth. The platform directly connects funds to intended recipients through a web application that can be accessed from any internet connected device. Users are given Ucoins, which can vary in buying power from full credit, to discounted, or value matching to pay transactions. To use them customers scan a QR code provided to the merchant by the app, zero point-of-sale or till integrations are needed. Ucoins can only be spent at approved merchants, who are verified through an integrated onboarding process. Merchants applauded the simplicity of participating both for the vendors and the customers. They attributed this easy integration with much of the success the Ucoin had in stimulating local business.


When the transaction occurs the system simply guides the payment from the parent fund directly to the merchant. This ensures complete efficiency of the funds to their intended targets. The innovative nature of the system allows not only for freedom in creating the user base or target list, but also quick implementation in times of economic distress or hardship leading to quick and efficient developments of localized economies.

The system was first implemented in Antwerp, Belgium with the introduction of the Antwerpen Ucoin in the context of distribution of Covid stimulus by the city government. Ucoins were distributed to city employees. Citizens were also offered the opportunity to earn Ucoins when they booked local hotel rooms. The program was incredibly successful in attracting 32,000 users and over 2000 participating merchants in a matter of months. Using CL 11.0, Antwerp city employees seamlessly locate participating merchants and spend their Ucoins using their mobile phone. Antwerpen Ucoins were also available to earn by all the city’s residents as rewards from brands and other sponsors. The small businesses reported seeing an influx of business, from old customers being incentivized to return to new customers exploring the areas for the first time.


The implementation of the system itself doesn’t even capture the full capabilities of the program. The data provided by the logging of every translation creates a clear picture of the health of the target economy. Aggregate spending habits can be mapped, therefore allowing analysis of consumer foot traffic among the different locations. For example, if a certain area with the target economy needs an increase in foot traffic, further incentives can be provided to users to increase the consumer presence within this area. Thanks to non-relational databases of CL 11.0, all this can be done following the strictest standards of GDPR compliance.


This allows for proactive responses to market developments rather than reactionary. If it is seen that certain areas or industries are seeing less business due to any variety of reasons, weather, seasonal changes, or just less consumer activity itself, immediate measures can be taken to boost these sectors. The flexibility and simple integrability of the system allow for a wide range of different applications or relationship structures. The system allows for both funds to be distributed to targeted businesses, but also for business entities to reward individuals with more purchasing power without corruption or inefficiency. Businesses can even create their own closed loop systems to provide benefits or deals to employees and customers. This includes credit to other institutions.


The closed loop network created by the Unbox your City system connects consumers and the targeted small businesses directly. This allows for more efficiency and controlled funding. Tracking the data and consumption patterns allows for localized, struggling areas within the economies to receive direct customized stimulation. The success of small businesses is crucial to a healthy American local economy. Unbox your City targets stimulus funds, guides consumer behavior, and provides consumer data that can help small businesses thrive.