Independent business still has a place
Drive down Southeast Delaware Avenue in Ankeny and it looks as if the busy retail thoroughfare has been taken over by chain stores. Wal-Mart and Target both have “super centers,” a phrase coined to describe retail behemoths that offer everything from health and beauty staples to clothing to groceries to gasoline and oil changes. Menard’s and Home Depot have also located there, as has Kohl’s. Big-box retail is coming of age in a town coming of age, a trend welcomed by consumers who like the additional choices, the opportunity to save a little money and the efficiency of having such varied merchandise under one roof, but one that makes independent business owners nervous.
Ankeny isn’t alone. Big-box stores flock to the outskirts of most towns, pulling consumers to the city limits with them, exacerbating a problem independent business owners have been fighting since the development of the suburbs.
Though retailing has experienced a sea change in recent decades, locally owned businesses still have a place. Study after study extols their benefits, including a 1995 study by former Iowa State University economist Ken Stone, a nationally known expert on retail trends, which found that five years after the opening of a big-box retail store in a typical Iowa community, locally owned businesses within a 20-mile radius experienced a 19 percent decline in sales.
Other studies suggest that locally owned businesses are more likely to use local contractors, accountants, attorneys, insurance brokers, computer consultants and advertising consultants than are their nationally based competitors, all of which fuels the local economy. They may also carry more locally produced merchandise in their stores.
There’s truth in the maxim that good local businesses and restaurants will survive on local support. But it’s also true is that retail chains are here to stay. Successful local businesses will search out ways to complement their big-box neighbors, not compete with them, to beat them on selection and quality when they can’t match the large-volume discounts the chains’ buyers receive or offer exceptional customer service.
Initiatives such as the Greater Des Moines Partnership’s Buy Into the Circle help, too. In a little more than a year, participating businesses shiftedat least 5 percent of their out-of-state purchases back to local vendors, pumping more than a $6.7 million back into the local economy.
Primarily, though, local businesses depend upon customer loyalty. The power to keep independent businesses alive rests with the consumer.