Shopping locally is all the rage for "socially conscious" shoppers this year, but economics has to play a role, too. For example, there is a local independent toy store here that I just love. They have stuff there you can't find anyplace else. The shop keepers sprinkle pixie dust on the children and blow bubbles (they're not weirdos, just a lot of fun). There isn't a licensed cartoon or movie character in sight. Stuff is built to last. And unfortunately, the prices will break your bank account, too.
See the poll to the right about Christmas gifting? I would love to get the girls this princess dollhouse/castle from Melissa & Doug. Amazon.com is selling it for $57 with free shipping and no tax. The sweet, independent toy store is selling it for $125 plus tax. I would consider it for $57 (as a gift to both girls). I can't and won't consider it for $125. I've looked for used ones on eBay and Craig's List, but they must be awfully popular -- only new ones are available, and Amazon's price was the best by far.
Online retailers seem to have the edge over "brick and mortar" much of the time. But I have found independent online stores with great prices, too, and I try to patronize them as much as I can. They're local to someone, I guess. So what do you do? Shop local or go for best price no matter what? Oh and by the way, I found it at my local We Be Toys (TRU) for $99...so they're not always the best price, either.