The question reminds me of a similar question I faced as a gardening enthusiast. I concentrated on growing native plants, but the question arose: how native is native? On one end, some gardeners argued only plants that our first settlers would've found growing in what is now my backyard is native. On the other end, as long as the plant could be found in the state, it is native. Most gardeners fell somewhere in between, usually narrowing the definition to a smaller geographical area such as the county or a hundred-mile radius where the garden is located. Purists, however, argued there was no such thing as a native plant since most of our native plants have the genes of non-native or hybridized cousins.
The same range of thought exists with what one defines as a locally owned and operated business. Some argue that only businesses within or very near one's town is a local business. Others argue that businesses founded in the state are a local business. Most people fall somewhere in between. Purists, however, argue there is no such thing as a locally owned and operated business as most businesses require the services or products from outside of the region in order for the owners to conduct their business.
The answer to what defines a locally owned and operated business is further complicated by other factors. Some would argue that a locally owned franchise should qualify as locally owned and operated. Others would argue that a business, whose owner has moved out of state but still maintains the business locally, is locally owned and operated.
Now here is a trick question. Is Delmarva Buildings a locally owned and operated business? They have operations in MD, VA, NJ, and even an office in OH. What about Goose Creek? Their locations are concentrated on Delmarva, but they are home to Subway, which is not locally owned and operated. Surely some investment group outside of Delmarva must own them.
In both cases, how The Original Shop Local Delmarva's defines locally owned and operated means both businesses fit the definition of locally owned and operated. Delmarva Buildings is headquartered in Wyoming, DE and Goose Creek is a subsidiary of Cato Oil, headquartered in Salisbury, MD. While personal information is private, there is enough readily available public information to reasonably believe the owners of the two different companies live on Delmarva at least part of the year.
So, yes, The Original Shop Local Delmarva considers both companies locally owned and operated.
There are probably as many definitions to "locally owned and operated" as there are people who try to answer the question, how local is local. Shop Local Delmarva considered all the ranges of thought on the subject, but discovered the definition came down to two key questions: what sort of business keeps most of its money circulating within the local community and what is the "local community"?
With those two questions in mind, Shop Local Delmarva first defined "local community" as all of Delmarva. The reasoning was based on the fact that most of Delmarva is rural in nature and one couldn't expect to find everything they would need in their local town. One may need to travel thirty miles or more to the next nearest town, but they could still support the local businesses there instead of relying on the national chains. A strong Delmarva economy is more helpful for our small towns than the national economy, alone. The thought is that studies have shown for every hundred dollars spent at Mom and Pops, sixty-eight dollars stays in the community to fund our schools and local projects compared to forty-eight dollars for a franchise or thirteen dollars for a national chain.
Ultimately, the definition of a locally owned and operated business is up to the individual to decide for themselves. Whether one only considers shopping local in his/her immediate community or a larger geographical area, the important thing is shop local, Delmarva! If everyone made a ten percent shift in their spending habits towards locally owned and operated businesses, your local economy would see huge benefits.
Cuddles' notes:
Shop Local Delmarva excludes franchises and absent‑owner businesses because both send profits and decision‑making outside the community, limiting local economic benefit and identity.
Cuddles' notes:
The Original Shop Local Delmarva defines local as the geographic area south of the C&D Canal down to the mouth of the Chesapeake at the Bay Bridge Tunnel and bounded by the Susquehanna and Chesapeake Bay on the west side and the Atlantic on the east side.

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