Think about how you really shop. You're done with work. There's something you need, and you don't want to spend too much time searching. So navigating into one of the major streams of traffic on your way home, you settle into a barrage of signs promising consumer goods until you see something suggestive. As the electric lights begin to illuminate the sea of parking spaces, you make your way towards the ocean-liner store at the center. Inside, among the ascending racks of merchandise and torrents of shopping carts, you find what you need, a few more things that you forgot you needed and something that might not be necessary but seemed like a good idea. It's not wasteful, this shopping trip; everything only costs a few dollars. Back in your car, with one of the last items on your day's agenda complete, you relax back into the flow of automobiles, barely noticing the vacant storefronts and unlit signs of the smaller shops that litter your way back home. These are the businesses that lie where they've fallen while competing with the store you just visited: the dust of America's consumer trend.
Ambrose Bierce, in his ever-useful Devil's Dictionary, defines a corporation as "an ingenious device for obtaining individual profit without individual responsibility." In other words, when stores like Wal-Mart, Home Depot and Target launch themselves, money starts being tapped from local pockets for use elsewhere. The profit of a store in Spokane may be directed toward building another one in Albany, the profits of which may end up nurturing the investment strategies of a group of company executives who really live outside of the concept of community. The few trees planted along the drive of the Spokane store are some of the limited civic effects this community sees.
Of course there are the much more visible drawbacks, too. Large chain stores draw more traffic than clusters of smaller businesses. And while larger stores may provide a large number of jobs, very few of those positions pay better wages when the business does well. A small business, on the other hand, doesn't tend to turn its location into a knot of traffic and is positioned to share the wealth with its employees when times are good. And of course there's the simple fact that single-stop destinations remove the adventure from shopping. Finding a small, out-of-the-way store is replaced with knowing which direction to turn your cart when navigating the superstore's isles. Shoppers are encouraged to select that perfect, personal coffee mug in the same place that they purchase their paper towels.
Unfortunately, price, convenience and visibility all contrive to make the mega-stores a growing force in American communities, and according to most analysts, that situation is unlikely to change. The one thing that local businesses cannot do, says Don Taylor, is rely on nostalgia and sympathy to attract customers. "Most of the customers today go where they feel they're going to get the most for themselves," he says. "That may be in terms of selection, in terms of price, in terms of service."
Taylor is the author of Up Against the Wal-Marts: How Your Business Can Prosper in the Shadow of the Retail Giants, one of the first books to look critically at the increasing development of chain stores in communities across America. He's also a business analyst for CNN and PBS. Taylor, on the faculty at Texas A & amp;M University, is an affable man who speaks with an easygoing Texas accent. His tone grows indignant, however, as he describes some of the attitudes that smaller businesses have. "The reason a business exists is to benefit the customer," he says flatly. "And when we look at why a specific store is where it's at, it's not there because there's always been a store there. It's not there because your grandfather started the business 71 years ago. It's there to serve the customer."
The first step in serving those customers, Taylor says, is gaining an intimate knowledge of the competitors that are going to try to serve the same customers. It stands to reason: a bigger store will fail as rapidly -- perhaps even faster -- than a small store if it isn't working.
"I have had in the past some retailers tell me proudly that Wal-Mart had been in their town for 10 years and they had never once set foot in the store," Taylor says, pausing for effect. "I think that's stupid. You've got a competitor who's going after the same customer base that you are, and you don't know what they're doing? You've never been in the store? I think that's ludicrous.
"The small retailer really has to know the competition and then find the areas where they can compete successfully. That doesn't mean that they have to change their whole operation. But it does mean that they're going to have to look hard at their operation and find the things that aren't going to work with a higher level of competition."
Local Advantages -- One advantage that smaller, locally based businesses have when it comes to serving customers is the fact that an owner in the community has a better chance of understanding the people who live and shop in that area. When Susan Carmody decided to open her elegant clothing store Jigsaw in downtown Spokane, she spent a considerable amount of time determining what her prospective customers would want.
"Initially I offered more basic things, thinking that I'd have more conservative customers," she says. "But I sell more forward merchandise in this location than I did at the end of my 11th year in very liberal Olympia. So that tells me that there are a lot of hip, savvy, well-traveled people who want contemporary style. And in every location I've had a store, there has always been a median size that's the strongest-selling size. You learn things like that."
The results for Jigsaw have been sales that have met or exceeded Carmody's projections for each month that Jigsaw has been open.
"We're talking about really knowing who the target customer is," Taylor says of this technique, "being able to describe them demographically and psychologically and geographically. Running a better business means shifting the focus back to the customer. If you've got a working customer -- a customer who's working a typical 8-to-5 job -- but you're only open 8-to-5:30, then you limit their ability to get to you a lot. You might shift your hours, open a little earlier, stay open until 7:00, and really be able to reap the benefit of that customer who is working."
Jigsaw has another advantage that Taylor says smaller businesses should consider: it's located near several bigger clothing shops. Placing an upscale clothing store right between the Bon and Nordstrom may seem counterintuitive, but specialists say that if a small business opens near a larger business that sells similar things, the foot traffic looking for those items and services will increase.
The same technique -- locating a store near larger competitors -- worked for Whiz Kids, an educational toy store. Owner Reying Huslid, who has owned the business for 16 years, says her move to NorthTown Mall several years ago into a store next door to a national toy retailer, has served her well.
"It's very good," she explains, "because we compliment each other. We're looking for the same customer. But they emphasize the mass market, and we emphasize the educational market. And unlike the mass market, educational materials aren't affected by trends. It doesn't matter what the economic environment is, because no matter what, kids need to know math, and reading, and writing. So our business can hold its own."
Planned Growth -- But some small-business owners still envision neighborhood shops that are designed for and cater to a specific regional consumer base. It's a vision that Spokane City Planner Leroy Eadie hopes to foster with the developing Centers and Corridors Plan.
"Sprawl was killing us," Eadie says of the city's structure after the Comprehensive Plan was adopted. "We were spending all of our capital interest dollars on the edges, and not much investment was going into the inner-city neighborhoods. So we looked at different areas in the community -- district centers that serve one area or multiple areas."
These centers have been designated for future development, limiting further retail growth on the edges of the city. If a big store wants to move onto Spokane's arterial districts now, it needs to find a space that has previously been zoned for retail space.
Eadie is convinced that this type of city-planning can help curb the sprawl that larger corporations have brought to Spokane and stop the use of city resources for the expansion of those fringes. Unfortunately, he says, this plan is not being championed actively: "We've struggled to get leadership out of the mayor's office, but it didn't materialize the way that we thought it could."
Consequently, the Planning Department has devoted its resources to working with the residents of the centers and corridors. "A big part of this," he explains, "is working with small businesses and developing them. In Spokane, we haven't done a very good job of that. We're always looking for a big fix. But there is no one business that is going to come in and save Spokane. It's going to be a series of neighborhood centers and small businesses. Small business is huge."
Not surprisingly, big businesses have discovered this as well, and they're now starting to develop smaller-scale stores that can fit into neighborhoods like those envisioned by the Centers and Corridors plan. "We've seen Wal-Mart build the Wal-Mart Express, which picks the top sales and puts them in a conveniently small store," Don Taylor says, explaining what he envisions as an increasing trend among national stores. "Sears has developed a niche in their neighborhood hardware, furniture and appliance stores. These are stocking stores of 6,000 to 8,000 square feet in some cases."
Promoting Success -- These smaller mega-stores can bring another aspect of the battle with big businesses to a neighborhood level: competition for good workers. The positions offered by a national chain store may not be as dynamic as the jobs in a smaller, more personal store, but larger stores can often offer medical benefits and a structured work environment. The results are often employees who work for the company longer, and at consistent levels.
Northwest Seed & amp; Pet, a family-owned business since 1944, is an example of a local company that pays medical benefits and offers paid vacations for many of its employees. According to Lori Bailey, manager of the store on North Division, it's one of the reasons employees stay with the store. "I've been here 24 years," she says cheerfully. "A lot of our employees have been here 17, 16, 12 years." These long tenures have led to a well-informed staff, able to field questions about exotic animals and regional plants equally well. They're also extremely passionate about their products.
"I think probably the primary thing that folks struggle with in big boxes is lack of product knowledge," Taylor says. "Nobody in the store knows anything about what they're selling. There are some exceptions to that, and there are some companies, like Home Depot, that work very hard to change that image. But in general, consistent product knowledge is a weakness, and I think this is where the small independents have a real opportunity."
It's only after the solid foundations are in place, Taylor and other business specialists suggest, that a small business should consider advertising. Since an advertisement is a promise to be able to deliver something, Taylor advises small businesses to first concentrate on developing the ability to fulfill that promise. But once it's in place, he emphasizes building a relationship with local advertisers. "The big boxes advertise less per dollar of sales than any other kind of business," he says. "It's the smaller local businesses that will become the ad salespeople's bread and butter."
Leroy Eadie at the city's Planning Department also hopes that small businesses will learn to promote themselves more effectively once they've established themselves. To help them along in this process, the city's Planning Department has organized several retail clinics designed to help business owners market themselves better. "We brought in a window display specialist, to teach shop owners how to create a better window display. We did several window redesigns, and we got feedback from those businesses saying that they've increased their businesses. Also, we're encouraging the businesses that don't necessarily have enough advertising dollars on their own to group together and advertise their neighborhood center."
It has the ring of something marketable: Come shop at your neighborhood center. But small businesses better hurry. It's going to be up to local entrepreneurs and the consumers who support them to decide if that center is a thriving regional collection of shops, or a big, boxed-in space.
Publication date: 03/06/03