My nephew owns a bike shop in LA. He is often told my some customers that he is more expensive than online. However, the customers come back to him. Why? Because he adds value to the purchase with knowledge. He helps fit the bike to way it is going to be used and helps to personalize it.
A local quilt shop has to do the same to stay in business. They have to be a "fountain of knowledge" so that the customer feels that they are adding value. This can be done by helping to select patterns and fabrics, offering classes, offering services or connections for services that quilters want and demostrations. Helping to host local shows etc.