The new California privacy law will hurt Sacramento small businesses

Sacramento Business Journal - Feb 28, 2019

By Jim Relles, owner of Relles Florist in Sacramento

As an entrepreneur and longtime small business owner in the Sacramento community, I consider my path to be very fortunate— and perhaps inevitable. It’s safe to say carnations, roses and baby’s breath have adorned our family tree for generations, with my father founding Relles Florist in 1946 and my brother and myself taking over the family business in 1972. That’s 73 years of arranging and delivering flowers to the greater Capital community.

But as I learn more about the recently passed California Consumer Privacy Act (CCPA), I am concerned that my business could be harmed. I’m in favor of safeguarding people’s personal information, but I rely on the internet to find customers and market my business. The florist business is highly competitive, and family-owned businesses face stiff competition from other retail operations.

As they consider changes to the CCPA, I hope Gov. Newsom and the Legislature will consider how the act will impact smaller businesses that have a limited budget for advertising and a need to use that budget wisely to reach people in our area or outside of where we are located through internet sales, digital marketing and social media.

To understand why the act will hurt me, consider a consumer who’s searching online for a dozen roses for a loved one, or a delicate corsage for a wedding or prom date. The search engine that individual is using provides my advertisement to that individual and if I am fortunate, the consumer visits my store to purchase that floral arrangement.

We have a small website; we keep records of calls; we text customers; we have a “leads” database; we buy digital ads. We do not “collect” data. But under the provisions of the CCPA, we would be considered to be collecting “personal information,” even when it is not linked to an individual.

Even as a small business, my company would suffer from CCPA because it would diminish the value and effectiveness of the online marketing tools I’m using now. And if I hit a certain threshold for sales or customer interactions, then I have a whole set of daunting legal compliance obligations. In response, our company would be required to collect more information about consumers than we need and provide it to the consumer upon request. Relles Florist is not a big tech company. The compliance costs of such an effort, in terms of person-hours and data capture, would be hard to bear.

If my online marketing capabilities are eroded, my potential customers may not see my ads or be directed to my store. Relles Florist is not a large company that can afford television or newspaper advertisements. It’s a high-tech version of the same old story: small businesses will be at a competitive disadvantage in competing with larger players.

The internet has been a great equalizer for small businesses, allowing us to use inexpensive digital advertising, and consumers to shop wisely and access the best prices. But larger, corporate-owned retail chains will always have an advantage in their ability to use other means of advertising and marketing to attract market share. If we cannot depend on digital ads, our efforts to attract new customers will become less nimble, less effective and more expensive.

The CCPA goes into effect in 2020. The California Legislature must act to fix the significant problems and keep the internet available for small business. If they don’t, the California Consumer Privacy Act will betray its good intentions and make it more difficult for people who need that special flower arrangement, decorative plant or precious keepsake to find my store.

Jim Relles, owner of Relles Florist in Sacramento, is an active member of the Sacramento Metropolitan Chamber of Commerce.