Archive for urban retail trends

Hope against the spread of generica

Visiting a new city becomes far more meaningful when you can find unique places where local people live and interact — when you can find an actual community.   Usually this requires finding locally owned and operated restaurants, cafes, shops, etc. that often anchor neighborhoods.
In so many cities, whether in North America or around the world, global brands have taken over certain commercial areas, including (or particularly) around where visitors might congregate such as off ramps from freeways, around tourist hotels, and near tourist attractions.   Not knowing whether any alternative exists just a few minutes drive or walk down a side street means that people often patronize the familiar generic chains at the expense of local independent business.

Brendan at the Where Blog offers hope against the spread of generica.  He proposes that RSS feeds on small devices like the Blackberry might offer a way for visitors to explore a new neighborhood.

Now imagine that you’re a tourist on a first-time trip to New York. Subscribe in advance to a feed like this and have bite-sized neighborhood tours sent to you every three hours. These tours could even be sequentially linked to start you off in each neighborhood, allowing for a few hours of independent exploration between tours. Heck, with the ubiquity of GPS technology, you could download a series of geo-coded tours in advance that would be triggered when you passed from one neighborhood to the next. As you walk north across Houston Street from SoHo to the Village, your phone rings. You answer, and a voice suggests that you walk three blocks east to Houston and Thompson to begin the Greenwich Village tour.

With this sort of technology, unfamiliar territory becomes a bit less intimidating. Recent transplants get out and meet more of their neighbors. Tourists get a boost in confidence that would likely encourage them to cover more ground and venture farther off the beaten path

What intrigues me about a technology like this is that it would allow many visitors to venture beyond Burger King for lunch and thereby support more independent businesses.

The same technology could provide links to restaurant menus, customer reviews and other information such as prices and speed or type of service (ie is this a restaurant for quick take out meals, or more of a sit-and-linger place).   Perhaps photographs could be available — or even live web cams.  The latter might allow locals could check to see who is there and would allow anyone to see if the place is busy or would have room for them.

With this information more people might try someplace new, whether close to home on when further away.

Neighborhood guiding technology, written by locals, could be a great way to preserve independent businesses and the character of communities within cities.

Density, family business and “mompreneurs”

In the dense neighborhoods and suburbs of Mexico City (such as Ciudad Neza or Coacalcos) I’ve often been intrigued by the variety of home based businesses that families — often the mother — operate. Some make paletas — ice creams and popsicles — to sell on the street or from a door in front of their house. Others roast chickens or grill hot dogs. Some sell school supplies, or sodas, or cel phone usage, or baby clothes.

Their entrepreneurial imagination is almost limitless. The large numbers of people living nearby creates a steady market. This is often the primary income for a family, or a reliable second income.

In US and Canadian cities and suburbs, opportunities for home based businesses have generally been fewer. Try opening an ice cream stall in your suburban home — there is not enough of a market. Selling Tupperware or Avon products exists, but generally requires the entrepreneur to visit houses.

The internet age has opened new employment opportunities for suburbanites, city dwellers, and rural residents alike. For parents — particularly women — wanting to spend more time with the kids while also earning some income and maintaining a professional identity, it has been a revolution in many ways.

However, there are limits to internet-based employment. Only certain types of work lend themselves to being done by one person in relative isolation. Some freelance writing and web site design, for example, can work from home. Contracted out data entry or information processing offers other options and many women sell hand-made products on e-Bay. But many of these businesses would benefit from face-to-face meetings with clients as well.

And what if these are not your areas of expertise?

The combination of higher density living and the internet results in much broader opportunities for home based businesses. And the internet can be valuable as a supportive medium. Here are some examples.

  • The fit4two pre- and post-natal fitness company’s founder, Melanie Osmack, started the business offering fitness classes for moms to be, new moms (and new parents) in downtown Vancouver where 100,000 people live in close proximity. Word of the classes helped to generate demand throughout the metro area and Melanie soon franchised to other moms with fitness instructor designations in other neighborhoods. She was a recent runner up in a contest for Mompreneur of the year. Fit4two uses the internet to promote their programs, but is based on access to lots of people living in close proximity.
  • Children’s clothing stores and family-oriented cafes are retail style businesses that some women have opened just blocks from their homes. Being the boss at these retail business allows a parent to set their own hours and in some cases it works to have a young child in the store with you while you work.
  • The makers of the Baby Buddha wraps and Milk Factory quick wick clothing and blankets initially sold their first products locally, through word of mouth and at “baby fairs” and swap meets. They now sell nationwide and internationally using the internet.

A great way to have access to a large number of customers or people with whom to do business is to live in a higher density area. You can always use the internet as well. But people like to do business with others whom they know.

Women in the US and Canada are starting businesses in large numbers (as Penelope Trunk often tells us), often to bring flexibility to their lives. Whether the intend to use the internet or not, those living in higher density areas with a supportive community will often have an advantage in making their venture a success.

Infrastructure and human capital needed

CEOs for cities has a post this week entitled “Can Bass Pro Shops Really Save Troubled Cities.” In it, the author challenges the planners of Buffalo for inviting a large Bass Pro Shop to open on the waterfront as part of a revitalization scheme, citing Ed Glaeser:

Harvard economist Ed Glaeser questioned the strategy. “It’s crazy to think you can solve the problems of declining cities by building lots of infrastructure,” he told the New York Times. “While all of the colder, older cities in America looked troubled 30 years ago, the turnaround of some cities has been sharply linked to high levels of human capital, or a higher share of the population having college degrees….

To a point, I agree: if a city struggles to attract and retain talented people, then focusing only on infrastructure and making nice waterfronts will not help much. But if a city does have some creative and knowledge clusters — but needs more — then attention to infrastructure and ambiance is crucial.

Without quality infrastructure — whether parks, roads, utilities or shopping and entertainment — cities will struggle to attract and retain talented people. In the 21st century, the economic development of cities requires efforts to create home grown talent through good education and inspiration. But infrastructure is equally necessary for the city to function — and that is cultural infrastructure (and shopping is part of our culture) as well as transportation arteries.

While I’m not sure a Bass Pro Shop is the key, as is being tried in Buffalo, creating lively bustling retail districts is important.

Cities and spiritual needs

Centuries ago, churches, temples, mosques or other spiritual building anchored a city. For example, when the Spaniards founded cities and towns in the new world, they built a large church at the centre (along with a public plaza and a government building). Around the world people traveled to cities near and far in order to worship, as well as potentially to buy or sell in a market.

Today, visiting a religious edifice is not as likely to be the reason people visit or move to a city. Nevertheless, it may be that cities do still fulfill spiritual needs, but ones not attached to organized religion. At least, this is the suggestion in an Economist article from May 2007.

The article offers the hypothesis that cities today offer shrines to other cultural needs or passions that people have — and not all people will be attracted to the same urban places, even if they are attracted to the same city:

  • Shopping — consumer culture — is something that large cities offer in a much more grand style than smaller towns.
  • Special cultural opportunities are also offered in particular cities — such as unique museums (or museum collections), opera houses, and theater.
  • Finally, professional sporting events and venues offer a further “spiritual” option in cities. Based on the ways some sports fans worship their teams and heroes, the religious comparison seems appropriate.

Just as religious shrines used to form part of the city’s central core, today sports complexes, fashion forward retail streets, and cultural opportunities are flourishing downtown. Indeed, city planners today are often advocating building these venues downtown if they are not already there — fulfilling the new spiritual needs of residents.

Taxing “car culture”

A Toronto city councillor is advocating the municipality impose higher property taxes on businesses that promote automobile use, including gas stations and big box stores.  According to a report at cbc news, the idea is that money raised from taxes would go toward mitigating the costs to the city of increased automobile use (presumably road maintenace).

Another city councillor would prefer to simply ban big box stores, rather than tax them at higher rates.

But would either of these solve the problem?  If you tax gas stations more heavily, they’ll likely raise gas prices (so why not just tax the gas), or shut down.  In either case, higher taxes affecting gas stations may start encouraging people to drive further to buy gas at lower prices, outside city limits.

If in one city you ban big box stores — for which there is significant consumer demand — might you be actually encouraging more automobile miles?  If people want to go to Wal-Mart regularly, many will simply drive further to locations outside city limits to shop (instead of perhaps a closer trip to a Wal-Mart inside city limits).  

Taxing big box stores and power centres more heavily might help city funds, but as Sean Marshall writes at the Spacing Toronto Blog there is a question of how do you define promoting automobile culture.  What about a large shopping centre built along metro and transit lines, but that also has ample parking?  And, do you grandfather existing stores and businesses?  Marshall believes that although the current proposal is flawed, taxation might be useful as one of several planning tools to discourage automobile use.

I’m not so sure that special property taxes on certain retail businesses would be effective in controlling resident behavior.  But I would love to learn more.

Losing vibrant, long-standing street markets.

When I go travelling to places in Latin America or Asia or even parts of Europe, I’m always drawn to the open air markets. These are places where the chaos and creativity of the city meet — where commerce and multiple cultures collide. Anywhere in the world at these markets you can hear diverse languages being spoken, watch improvised sign language negotiations, and buy amazing things.

These market streets are often a combination of actual stores (with roofs and walls) and temporary street vendors who roll out their wares on blankets or set up their table each day.

Many cities around the world have been redeveloping these street market zones, removing the randomness. Too often, they are being replaced with a more sterile warehouse-like building filled with generic, identical stalls. Sure, the vendors each have their own personality in these new structures, but it’s not he same as when they’ve carved their own niche into the landscape of the city.

The International Hearld Tribune ran a great article this week by Patrick L. Smith about Hong Kong’s Graham Street district, which is slated for redevelopment.

There is a twist to the redevelopment plan in Hong Kong. The city is arguing that market forces and gentrification are pushing street vendors and other ad hoc vendors out. As rents and prices go up for store fronts on Graham Street, new national/global tenants insist on removing street vendors from in front of their shops. Therefore, the redevelopment will, they say, offer space for these smaller independent vendors.

It seems that whether through government urban renewal projects or the informal process of gentrification, the world is losing its urban, spontaneous street markets — at least in the larger, cosmopolitan cities.

To me, this feels like a sad era in human history and urban history — the end of long standing, open air markets in big cities.

But perhaps it’s not for me to judge; I live in a city and country without many informal, open air market zones.

When I lived in Mexico City in the mid 1990s, the government was trying to remove street vendors from the Zocalo (main plaza). This was one of my favourite places to hang out on the weekend because of the energy as well as all the cool stuff they had for sale that often mixed commerce with politics (the Zapatistas and Sub Comandante Marcos in Chiapas were big then).

A Mexican friend (born and raised in Ciudad Neza, a shanty town on the edge of Mexico City) saw it differently. He saw cleaning up the street vendors as modernizing his city and country and contributing to economic and social development.

If he’s right, maybe there is a silver lining… certainly, the not all the vendors in Smith’s article on Hong Kong seemed upset. It was the ex-pat shoppers who appeared to be voicing the most opposition.

Tesco – Coming to an urban neighborhood near you

Tesco, the British-based food selling giant, has decided to make a rapid, dramatic entry into the American market this year. According to a Reuters news report they will open a chain of environmentally friendly, smaller convenience stores focusing on fresh, healthy products. Reports suggest that they could open 300 stores over the next 12 months with more to follow in subsequent years. The initial focus will be inner city locations.

Stores will be approximately 10,000 square feet — much smaller than a typical supermarket which is 40,000 to 60,000 s.f.

Look for a “Fresh and Easy Neighborhood Market” near you.

Apparently, Tesco wants to challenge Wal-Mart for the American grocery business. Wal-mart typically sells food in Supercenters which are 200,000 square feet and usually in more suburban locations. So this move my Tesco is interesting — hit the more densely populated inner cities first, and attract a loyal following.

Wal-Mart has been trying to adapt a formula for downtowns and inner cities, but is clearly struggling to figure it out. This suggests that both Wal-Mart and Tesco are noticing that many gentrifying urban neighborhoods with growing populations are under serviced by grocery retail or soon will be as populations grow. They’re scrambling for a share of the action.

If I were a betting person, my money would be on Tesco to figure it out before Wal-Mart. Their British and European experiences will serve them well here.

A step away from "Automobilism" in Salt Lake City?

City council and some citizens in Salt Lake City have put forward a motion to ban chain stores in certain neighbourhoods. A parallel motion would not ban chain stores, but would require their architecture and street front appearance to blend into the local neighbourhood. (Via Planetizen)

I disagree with banning chain stores outright — it’s undemocratic and opens up many messy questions. What happens when an independent store starts opening other locations? What if locals want certain chains and will drive elsewhere to obtain that product. Starbucks has a lot of addicted followers, for example. Banning them from a neighbourhood won’t necessarily help a family-owned coffee bar and might hurt the entire neighbourhood shopping market if Starbucks-aficionados leave the area for coffee and shop while away.

Plus, banning stores people want from their neighbourhoods only encourages automobile travel. Allowing retailers to go where there is a market for their product makes far more sense as we try to cut carbon emissions, reduce pollution, and reduce automobile travel. Otherwise, the shoppers have to go to them — usually by car.

But, I support the idea of architecture and character guidelines for neighbourhoods, and making chains fit the community and the street. A particular look helps give communities a sense of uniqueness — being special. It also draws in tourists and most importantly makes the locals want to shop in their community.

Plus, for what it’s worth when a global chain tries to blend into an area I’m actually more likely to shop there. I like Wal-Mart’s look in Squamish BC (I might go in there, even though I’m not a Wal-Mart shopper), and I’ve been to some rather unique and subtle McDonald’s restaurants in Transylvania and Krakow, for example (oddly enough McDonald’s was about the only place to find a salad in Eastern Europe).

I’ll try to check back to see what happens in Salt Lake City.

Must be something to the Downtown revitalization trend

When Wal-Mart is moving in, you know downtowns are not dying. Recent writings by Joel Kotkin as well as superficial interpretations of the 2006 Canadian Census have suggested that suburbs are the future of metro areas and not the cores.

Well, if this is true, why are Wal-Mart and other traditionally-suburban big box retailers are actively seeking downtown locations? As revealed recently to the Globe and Mail, Wal-Mart Canada CEO Mario Pilozzi, announced unspecified plans to open stores in the downtown cores of Canadian cities, with Toronto, Vancouver and Montreal specifically named in the article.

“There is a trend to redevelop the urban core,” said Pilozzi, “and we plan to take advantage of the opportunities that this trend presents.”

Indeed other traditionally-suburban boxy stores have already beat Wal-Mart into downtowns and dense urban areas, spotting the trend earlier and being first to capture downtown residents and workers shopping dollars. In Vancouver the Best-Buy owned Future Shop sits on the second floor of a box retail building, underneath TJ Maxx’s Canadian division known as Winners which occupies the third floor. A 7-Eleven and misc fashion and restaurant retailers occupy the street-front ground level. I’d estimate each level is about 25,000 s.f.

Moving into high-cost dense urban areas typically requires suburban-based stores to create new smaller formats. Home Depot has launched a smaller format, lifestyle oriented store. In the UK, IKEA has launched a series of smaller stores – although small being a relative term at 200,000 s.f. over three levels.

These brands must suspect that residents in dense urban areas will not typically drive to the suburbs to shop — at least not often. If they want the business of this captive (and sometimes car-less but cash rich) market, they have to go where the people are going, and adapt to fit their neighbourhoods.

Downtowns and density are creating a whole new retail boom.

Downtowns lure big box retailers (including Wal-mart)

Triple Pundit recently posted about Wal-Mart opening a new store in Pass Christian Mississippi, a town of 6,400 before the Katrina Hurricane and now about 3,200. Sounds like typical Wal-Mart, opening in a struggling town where people will welcome low prices. And one would assume Wal-Mart would build on the outskirts of town, as they have done so often, driving business away from downtown. But no!

Wal-Mart has decided to build a multi-storey store downtown, according to USA Today. Design plans suggest it will blend in with the streetscape and offer a multi-level shopping experience. Wal-Mart’s existence will also likely help draw shoppers from surrounding Gulf-Coast communities, as well as Pass Christian, thereby helping many downtown merchants rather than destroying them (yes, some will struggle with Wal-Mart nearby, but not all — small, family run stores offer a different experience that will draw people in even if similar products are available at the retail giant).

Is Wal-Mart learning from the experience of other big box retailers who are moving into the downtowns of big cities?
In chasing the growing populations of increasingly wealthy people, many big box retailers have been scouting downtown locations across North America and some innovative stores have opened. The retailers have been experimenting with multi-storey developments offering a different big box retailer on each level. Parking has had to move underground, or to the rooftop. And a street-front-retail, street culture is being maintained and furthered.
These big box stores combined with downtown, street-front fashion and restaurant retailers draw consumers from across the region and in some cities, from around the world. Presumably, sales per square foot are high (although I couldn’t find figures). Being a part of the community instead of competing against it can work.

It’s intriguing that even Wal-Mart is starting to recognize that.
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