When a Starbucks (SBUX) opened across the street from our offices in downtown Missoula, Mont., a few years ago, a lot of people in this liberal college town were not too pleased. The national behemoth would squeeze the local coffee shops, critics said, and contribute to the homogenization of Missoula.

In addition to supporting local cultural, social, and athletic events, local shops add a degree of color and flavor to areas that no Starbucks ever can—unless you like the contrived, calculated flavor that every other Starbucks in the country has, wrote one commenter on NewWest.Net.

Additionally, profits from local coffee shops tends to stay close to home, allowing for further local investment in the community. Starbucks profits get shipped off in giant suitcases to the company HQ three states away. Further, local shops are also more likely to hire local contractors, keeping even more money close to the source.

As an independent local businessman whose largest competitor is a multibillion-dollar national chain, I've always been more than sympathetic to this argument. As a company, and as individuals, we're all about supporting locally owned businesses and the eclectic downtown commercial culture that goes with them.

But last week, we learned the Starbucks would be closing—it couldn't compete with the excellent alternatives. And I don't see that as a good thing.

For starters, the idea that Starbucks would drive out independents was obviously incorrect. Break Espresso, barely 100 feet down the street, is busier than ever, thanks to a great physical space, good coffee, and free Wi-Fi. Starbucks has always said that its arrival actually increases business for all coffee purveyors in the area—and at the very least it didn't hurt the neighbors here in Missoula.

Plus Starbucks' prime space will probably stay empty for a while, given the economy. The employees will lose their jobs, which, while they don't pay well, come with benefits. And that's more than you could say about a lot of work in this low-wage town. More people looking for work and more empty storefronts on Higgins Avenue aren't great for anyone in the community.

It's usually smart business to support like-minded independent companies. Personally, I hardly ever set foot in the Starbucks, even though I think its coffee is just fine. I much prefer the Trailhead for sporting goods (rather than Sports Authority), Go Fetch for pet supplies (rather than Petsmart (PETM)), Fact & Fiction for books (rather than Barnes & Noble (BKS)), and First Security for banking (rather than Wells Fargo (WFC)). Not coincidentally, these locals all advertise on NewWest.Net.

But the more personal nature of these relationships can also cut the other way. A local electronics chain that we wooed as a client for years recently pulled a small ad campaign because a satirical blog post on NewWest.Net offended the religious sensibilities of the owner. I doubt that Best Buy (BBY) would have acted in that fashion.

Some national chains are starting to make an effort to source products locally, especially food. While it may be true at some level that profits are exported to headquarters, good branch managers are often active in their community and support the local businesses. In the case of franchises, they are, in fact, locally owned businesses.

I agree that a town dominated by chains is less interesting and rich than one with a vibrant independent business community. But here, at least, it seems the two can co-exist. And it's dangerous to assume that what's bad for the chains is good for the mom-and-pops. In this economy, a store closure is nothing to cheer about.

Coffee