I don’t think their concern is necessarily where the products themselves are made, but just where they are sold from.

Big box retailers have been known to crush local businesses because they offer convenience and have more financial resources to throw around. But they don’t have investment in their local communities outside of the wealth they can extract from them, so they can be detrimental influences within the communities where they operate. They cause local businesses to close and offer only the bare minimum to employ local workers.

Local businesses can still carry mass-produced goods, but money spent there largely stays in the community. Rather than the profits going to enrich some C-level execs at a corporate office located who knows where, it helps the local business owner who is more likely to either reinvest in the quality of their business or put the money to some other purpose within the community.

Those are typically the reasons people are thinking of when suggesting that folks buy local. But having local business more easily able to stock locally made goods is also a bonus, which would not be done at a larger retailer.