6.12. SR 10-18-1999 - Laserfiche WebLink

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J Chapter 10 ~' Page 1 of 25 CHAPTER X . CONCLUSIONS AND RECOMMENDATIONS The writer has devoted almost three years to this study. He has sent out approximately 6,000 questionnaires to small retailers asking their views on strategies for survival in the face of the formidable gains of the mega-retail discount chains. The questionnaire returns have been analyzed statistically and data has presented a picture of fear, sadness and disillusionment about the chance for small retailers to survive the impact of the mass discounters. This data is available in Chapter ill. Most of the returns included essay type answers explaining concerns about the survival of small business and the lack of serious efforts on the part of the federal, state and local governments to save their family businesses as well as the jobs and investments created over many years of hard work and sacrifice. Much of the resentment was focused on redevelopment agency plans in many states where tax funds have been made available to the mega-retailers to pay for capital outlay and debt service for these "Big Boxes" which have destroyed the viability of the "Main Street" merchant, while denying the small business merchant the use of development funds to end center city blight. This type of subsidy for the mega-retail discount chains has been described as "corporate welfare." In many instances the retention of sales taxes for 10-15 years has deprived school and other local governments of needed . revenues. It is clear that there is only so much demand in a given area, and where a supercenter opens, the result is often the closing of the smaller competitors. While the chain retains the sales taxes, the ultimate closure of the small retailers eliminates a traditional flow of revenue to the, schools, counties and state governments. The writer also visited and studied the commercial activities ofthe "Main Streets" and malls in California, Illinois, New York, and Pennsylvania. In the urban areas, the closing of apparel stores, drug stores, shoe stores, sportswear stores and hardware stores has destroyed the economic balance of the enclave or neighborhood. These stores have been unable to compete with the mega chains, such as \Val-Mart, Kmart, Target and others; and jobs have been lost within the enclave and neighborhoods. A lack of jobs in small family type businesses reduces the purchasing power of the neighborhood and eventually affects even the prosperity of regional chains such as Bradlees and Caldor, both having declared bankruptcy within the past few years. Moreover, Kmart has recently reported serious losses which have been noted onW all Street. Problems have also been reported at Charming Shoppes and other regional and national chains. The author also visited malls which 5 or 10 years ago were clean, bright, prosperous and bustling with customers. In many of these malls, the appearance in past five years has changed radically for the worst. There now could be a 30% to 40% vacancy rate. The traffic flow has become weak. The boarded, closed stores are loaded with graffiti and the malls have a slum-like appearance. How Could This Happen? . Suppose a Kmart or a Target was an anchor store opening in the mall 5-10 years before. The square footage of the store ranged from 30,000 to 60,000 feet. Suppose several years later a Supercenter, http://www.shilsreport.org/chap 1 O.html 10/6/99