Expert tells smaller retailers how to compete with large stores – locally owned retailers have a more positive impact on the local economy than do national chain stores

"Competing with Supercenters," a seminar with Dr. Ken Stone, America’s foremost authority on the impact of discount mass merchandisers on local communities, was presented for area business owners Tuesday at Williston State College.

The presentation covered an overview of the Wal-Mart company including details of operations, strengths, weaknesses and strategies.

By Ellen Robinson

Sidney Herald

http://sidneyherald.com/articles/2004/11/01/news/news02.txt

Stone also went into detail about the impact of Wal-Mart Supercenters on competing and non-competing businesses and outlaying smaller towns, strategies and actions for existing businesses, merchandising, marketing, service, customer relations and continually improving efficiency.

Suggestions Dr. Stone presented business owners instructed them to adjust merchandise because it’s hard to compete with big box centers’ prices, offer service they can’t match, adopt a "no hassle" return policy, extend business hours to better accommodate target customers, know the customers, refine your competitive advantage and use it in all marketing efforts.

"It’s possible to co-exist and even thrive among discounters," Stone, an economics professor at the University of Iowa of 27 years, said.

Stone dispelled many myths and misconceptions like "Wal-Mart has everything cheaper."

"They don’t have better prices on everything. They put the items they do have a competitive advantage on in the front which creates that illusion," Stone said to the captive audience at Williston State College.

Stone suggested businesses carefully analyze their businesses’ strengths, weaknesses, determine competitive advantages and determine their market shares.

"If you can develop a niche market, that’s the key. Like in one town a supercenter moved into, the local bicycle shop started focusing their target on the enthusiasts instead of the casual users which allowed them to offer items the supercenters don’t have," Dr. Stone said.

Analyzing the competition is vital to understanding how to compete with them, he said.

"Find out what your average customers think about your business. Know your market and know your competition," Stone said.

Having convenient hours of operation is another topic Stone emphasized on. "It you are a retailer open from 9 a.m.- to 5 p.m., you are shutting out about half, maybe more, of your sales because you are catering to the unemployed and the elderly."

Stone gave an example of a jewelry storeowner who changed his closing hour from 5 p.m. to 7 p.m., which turned his business around.

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Andersonville: Keep stores local

By Steve Daniels

http://chicagobusiness.com/cgi-bin/news.pl?id=14296&base=14296

A study commissioned by the Andersonville Chamber of Commerce concludes that locally owned retailers have a more positive impact on the Chicago economy than do national chain stores.

The chamber is hoping the study will convince city leaders to consider policy changes that could forestall an influx of chains the group says would imperil the rapidly gentrifying North Side neighborhood.

The research, released Wednesday by community-focused economic development consultancy Civic Economics, looked at the financials of 10 independent shops in Andersonville and compared them with 10 national chains including Borders, Olive Garden and Pearle Vision. It found that every $100 in sales at the independent stores generated $73 that stayed in the local economy. The same amount of sales at a chain store provided $43 in local economic impact on average nationally.

Ellen Shepard, executive director of the chamber, says she knows local residents are emotionally attached to the independent businesses in Andersonville and believe they should be preserved. “We didn’t know what the difference would be economically,” she adds.

The chamber hopes city planners will consider measures like a recently passed ordinance in San Francisco that gives neighborhood groups say over how many chains to allow into their areas.

“We are looking into that,” says a spokesman for the city’s Department of Planning. “It may be hard to defend, singling out different types of business with everything being equal other than where their corporate headquarters are located.”

The Andersonville chamber found out about Civic Economics after the firm performed a similar analysis on a neighborhood in Austin, Texas. Michigan-based Borders Group Inc. had proposed building a store across the street from a locally owned bookstore and record store, but earlier this year abandoned the plan after the study generated national press coverage and local backlash.

No such store is knocking on the door right now in Andersonville, but Ms. Shepard says chains clearly are interested in the area. McDonald’s Corp.’s Chipotle chain, in particular, is looking for a site there.

“We have reason to want to be proactive,” she says. “We didn’t want to shut the gate after the horse already left the barn.”

Ann Christophersen, co-owner of the Women and Children First bookstore in Andersonville, says she had to move the store from Lincoln Park in 1990 after chain stores started proliferating.

“The pie doesn’t change much every year,” she says of book demand from customers. “It’s not a growth industry. But that doesn’t seem to deter mammoth store after mammoth store from opening up.”

In Hyde Park on the South Side, Borders opened a year ago despite the presence of a large number of bookstores in the academically oriented community dominated by the University of Chicago. The Seminary Co-Op’s 57th Street Bookstore saw a 12% decline in sales, the first such decrease in years, says general manager Jack Cella.

Sales have started to come back, but now Borders is offering 20% discounts on most merchandise to university students and graduates.

“They certainly can’t make money on that,” Mr. Cella says.

Lisa Stein, general manager of the Hyde Park Borders, declined comment, referring calls to the company’s headquarters.

A spokesperson for Borders was not immediately available.

"Independent retailers are learning to compete with larger retailers," says a spokeswoman for the National Retail Federation, which represents both. "Many can tout service and quality when they can’t compete on price."