SB 469 - Good For Your Community?

Tucked in the back op-ed section of the August 29th edition of the Los Angeles Business Journal, economic development consultant Robert J. Rodino wrote an interesting piece entitled "Gains From Wal-Mart Style Stores Not So Super".  In it, he discusses State Measure SB 469, a proposal that would require California cities to conduct economic impact studies before approving large, super-center type stores, and the criticism it's getting.

The argument that this measure would inhibit economic growth here in California's communities stems from a misunderstanding of the dynamics of the retail business.  Rodino says, "The impact of Wal-Mart style superstores on the businesses in local communities is often just the opposite of what superstore advocates claim".  This is something that the Americal Independent Business Alliance has been talking about for years now.  During studies conducted in 2003, and updated in 2010 for the city of San Diego, Mr. Rodino documents the dynamic he coins "retail cannibalization" - the tendency large superstores have for sucking the life out of a community. 

"Consumer retail expenditures are dependent on consumer income", Rodino states.  "Developing a Wall-Mart style superstore in a mature urban market does not alter consumer incomes and does not alter their expenditures.  Superstore gains in sales largely come from the surrounding retailers' losses.  While a portion of sales can be made up from consumers coming into a trade area, i.e., into the city of Los Angeles from outside the city, this is rarely sufficient to satisfy superstore annual sales volume.  Regionally, there would be little or no net new retail sales growth, since retailers outside the trade area would correspondingly lose sales volumes".

He goes on to cite other instances of the devastation a large superstore could cause.  He advises that advocates for business need to be asked what businesses are they advocating for - giant corporations or local small businesses?  He says, "Nationally we accept the idea that small businesses are job creators.  Why does this change for local retailers in Southern California?"

Why do we see that disparity here in SoCal?  I'm no politician, so it's a mystery to me.  Local, independent businesses have been proven to be the drivers of job creation, innovation and the lion's share of economic development in cities and towns across the county.  I can only imagine the economic stimulus these overreaching corporations get from our local, state and national government, without making good on their promises to stimulate the local economy.  But there it is, happening around us every day.  Read up on SB 469, and please vote to keep your communities unique and vibrant - choose small business over big box business!

This has been a public service message from Webster's Fine Stationers - thank you for reading!

Have a wonderful week ahead, my friends!

Lori & Scott