Small Shops Win Big: Americans Turning To Local Businesses For Nearly Half Of Holiday Gifts

A new survey suggests the holiday season belongs to Main Street, not the mega-retailers. Americans say they now buy almost half of their seasonal gifts from small businesses, underscoring the enduring pull of local shops and the relationships behind them.

In a survey of 2,000 U.S. adults, respondents reported that 44% of their holiday purchases come from small businesses, and one in three shoppers said that more than half of their gifts are bought locally. During the holidays, twice as many people prefer small businesses over big-box stores (34% vs. 17%), a trend especially strong among Gen X and millennials.

Conducted by Talker Research in partnership with SurePayroll by Paychex ahead of Small Business Saturday, the findings reveal a deep sense of community connection tied to local stores. Seventy-two percent said the holidays “wouldnt happen” without their favorite neighborhood spots, and 84% believe small businesses are essential to the fabric of their community.

That attachment is personal as much as practical. Two-thirds of respondents (64%) describe themselves as regulars at small businesses and estimate theyve been loyal customers for about eight years. Theyre on a first-name basis with an average of six local business owners, and one in seven say theyve befriended at least 10.

Their commitment extends well beyond convenience. Sixty-four percent would willingly travel farther to shop at a small business rather than visit a nearby chain. Nearly a third are willing to drive 10 miles or more to get the quality (60%) and personal connection (48%) they say only small businesses provide.

For many, local stores are embedded in holiday routines. Shoppers said their plans would be disrupted if small grocers (46%) or retail shops (43%) in their neighborhoods closed. A festive season, they said, depends on access to small bakeries (48%), specialty grocers (46%) and local coffee shops (41%). Beyond food, respondents rely on small businesses for services (36%), gifts (34%) and clothing (32%).

“Its inspiring to see that Americans do nearly half their holiday shopping at small businesses,” said Ylang Nguyen, director of digital market strategy and product management. “It speaks volumes about the impact small businesses have in their communities when shoppers say the holidays wouldnt be the same without their favorite local establishments. Were proud to help small business owners ease their administrative load behind the scenes so they can focus on serving their customers.”

That support extends to tipping behavior as well. Two-thirds of Americans who tip say theyre more generous during the holiday season (67%), particularly Gen Z (74%) and millennials (71%). On average, tips rise from 29% to 35% during the holidays, motivated by the spirit of giving (62%) and empathy for workers navigating the seasonal rush (57%). The most generous days: Christmas Eve (69%), Christmas Day (64%) and Thanksgiving (57%).

“Small Business Saturday is more than a shopping event — its a reminder of the vital role local businesses play in our communities,” Nguyen said. “When consumers choose to shop small, theyre helping sustain the entrepreneurial spirit that drives Main Street year-round.”