I like to support local and am willing to pay a little more to do so. But that has limitations. I will not support a bad business, regardless of price, or one where I'm not treated fairly--whether it's an LHBS or any other type. The LHBS that closed near me was one of the very good ones and I miss it a lot. OTOH, I have been to a few others where either their ingredients were not very fresh, or they had poor selection, or the employees were just plain dicks. Or all three. Sometimes, a business is its own worst enemy.
Maybe some closed due mainly to online competition. But that's how many businesses are evolving and the pandemic probably sped up that change as more people ordered stuff from home.
But in many cases an LHBS just drove off its customers, and blaming online is an easy excuse. I've certainly heard plenty of bad LHBS stories on HBT over the years.
In any case, it's such a niche business that it's not economically viable by itself. The ones in small markets that still make it usually have some other business to backstop it, e.g., liquor store, grocery, hardware store.
It's sad to see the good ones close up, but some of the bad ones needed to go. Business is a Darwinian process.