Big box boondoggle:

Why small and local is beautiful

Earlier this month, city council made a bold and unexpected decision to turn down an application from WinSport Canada to redesignate land uses at Canada Olympic Park. The redesignation would have opened the door for WinSport to sell land for auto-dependent, big box commercial and retail development requiring the construction of an eight-lane interchange. Faced with objections from residents of Bowness and Montgomery about the effects of the development on traffic and on local business, and in deference to the municipal development plan’s goal of creating a more compact city, the application was rejected.

City council’s stand on big box was well considered. In 2008, the city commissioned a comprehensive study of the over 30 million square feet of retail in Calgary and region.

The study, Recommended Direction for City-Wide Commercial/Retail Policy, noted that Calgary has more large-scale auto-oriented retail than most jurisdictions. These include super-regional centres like Chinook Centre and the Sunridge Mall district; power centres like Deerfoot Meadows and Country Hills; and factory outlets like Deerfoot Mall. In contrast, the study found that Calgary is deficient in community and neighbourhood retail.

The study also noted that peripheral developments — like Cross Iron Mills — are oversized but opportunistically located to attract car-driving shoppers from the entire region.

The study also asked what elements of urban form best support high quality retail. Diversity of housing choice, walkability and compact development all made the list. Most critical were accessible and convenient transportation networks, and the co-location of shopping, residential, recreation and jobs (a.k.a. mixed-use development). The recommended strategy was to focus on smaller-scale retail inside the city.

While big box has its challenges, it also delivers jobs, economic development and, most importantly, consumer choice. Right? Well, not according to Stacey Mitchell, author of Big Box Swindle: The True Cost of Mega-Retailers and the Fight for America’s Independent Businesses.

According to Mitchell, “the mega-retailers impose a variety of hidden costs on society and contribute far less to our economic well-being than they take away.” Case in point: the development of retail and commercial space at COP would require at least $110 million of investment in road upgrades and interchanges.

In contrast, Mitchell argues that local business is a vital ingredient to the fabric of community life and that local business owners are more financially and personally vested in their communities. Unlike big box retailers, they have nowhere else to go. Their kids go to local schools, are taken care of at local hospitals and swim at local pools, so they have a different attitude towards taxation that supports these amenities. In fact, small business has been found to contribute twice as much per employee to charitable organizations as large businesses. Mitchell cites research showing that with more local business ownership you get lower poverty and crime, and that citizens are more engaged — volunteer more, vote in greater numbers and drive less.

The Institute for Local Self-Reliance, an American organization that champions local self-reliance, has done its homework on big box retail. A study in Austin, Texas found that spending $100 at a big box bookstore generates $13 of local economic activity, while spending at a local bookstore generates $45. Researchers from Cornell University found that for every job created at Wal-Mart, 1.4 are lost in a local regional business. A University of California, Berkeley study found that in 2000, nationwide, total retail worker earnings “were reduced $4.5 billion due to Wal-Mart’s presence.” A Loyola University study found that within a 6.5-kilometre radius of a new Wal-Mart store in Chicago, one-quarter of businesses closed.

All too often the result of big box retail development is displacement of local jobs, depressed wages and benefits in the retail sector, reduced local tax revenues and increased costs for social programs that low-wage workers rely on to make ends meet.

Why? Because local retailers buy more from local producers; they buy local services like accounting and legal and they do not have the overhead of employees based in distant head offices. More money stays put.

A city requires only so much retail — the North American average being about 25 to 30 square feet per capita. More big box retail means less local retail. Big box at COP would likely mean that Montgomery and Bowness would face an uphill battle to attract and grow local business and build vibrant main streets.

Absentee landlords have little understanding of, or allegiance to our community as anything other than a source of revenue. It’s great that the profit motive drives them to provide good service, but local businesses offer that and much more. In the end we exercise our own choices about where to shop. Will that choice be based solely on the sticker price, or will we make decisions in support of healthy, vibrant and resilient local and regional communities and economies?

Geoff Ghitter teaches urban studies at the University of Calgary. He can be reached at geoff.ghitter@gmail.com. Noel Keough is an assistant professor in the faculty of environmental design at the university, and is co-founder of Sustainable Calgary Society. He can be reached at nkeough@ucalgary.ca.

 


Comments: 1

Clairvoyant wrote:

@ Noel: Still have not hear back from you about Jeff's last book.

On this article it's good to see that the Professors agree that "In the end we exercise our own choices about where to shop." Unfortunately the professors prefer to preselect, to remove choices, so that "we" are not really allowed a choice, sort of like the old Communist elections.

The anti-democratic underpinnings of the arguments made by the professors are disturbing. "Big box at COP would likely mean that Montgomery and Bowness would face an uphill battle to attract and grow local business and build vibrant main streets." So the professors position is prohibit the big box; that is, the choice is made for us, not by us. The other message to be taken is that the professors concede that given choice, we the people will not make the choices that the professors want us to make, that the local business do not or cannot or will not offer enough to attract customers to their stores from the big box stores, that is the local stores are simply modern day versions of the old company stores in the old company towns. I am not convinced that both cannot do well in a large city: the local specialty shops appeal to the $6 latte crowd of Druh Farrell and the professors: the big box stores cater to those of us in the $1.97 for a coffee & a muffin at McD's crowd. The attempt to prevent big box is very much class warfare, ala the words assigned to Marie Antoinette "if they can't have bread, let them it cake". Perhaps beyond the polemics against Walmart, perhaps the academics (& the "local" retailers) should ask why people shop at Walmart (& the other big boxes). Price, for sure, but why is price so important? Maybe these customers don't have tenured jobs paying six figures? Maybe they need the money for something else? Maybe there is selection, within their price range? Maybe there is convenience? Maybe there is true humanity in the staff, someone who is working hard for not a lot of money, who has good days & bad, who does try to help & looks at you like a person, not just another cash cow? The Walmart greeter is not a member of the elite in-crowd, but maybe he resonates with us old pensioners?

What does preventing big box at COP achieve? For a start, COP will continue to struggle financially, it will need to be a ward of the state, always dependent on subsidies and grants. Will the absence of big box provide more customers to "local" businesses in Montgomery & Bowness? Yes, a few, but most that would go big box will still go big box, be it Market Mall, or Northland Mall, or CrossIron Mills, or the new one to come at 22.

Removal of choice & social engineering, no matter how good their intent, never have and never will "support healthy, vibrant and resilient local and regional communities and economies".

on Jul 2nd, 2012 at 1:16pm Report Abuse


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