12/12/98- Updated 04:17 PM ET
The Nation's Homepage
Mom-and-pop shops face new threat
NEW YORK - They've barely survived the shopping malls and the giant
discounters, but now America's small neighborhood merchants are facing a
new threat - and it's right down the block.
Big corporations, including Home Depot, Wal-Mart and Sears, are opening
compact new stores right on Main Street, targeting shoppers who don't
have the time or desire to brave the mega-marts.
"Their big stores have knocked out 60% of the competition," said Joe
Dobrzynski, who owns Eighteen Lumber in East Brunswick, N.J., a short
drive from five Home Depots.
"We are still here, but there aren't too many of us left. It's scary," he said.
The retail exodus from America's downtowns began decades ago as
merchants yearned for bigger stores with more merchandise.
While millions of shoppers enjoy the vast supply at superstores, a growing
number of people say they just aren't convenient - especially the huge
parking lots, crowded corridors and long checkout lines.
A recent survey of 1,000 people by the retail consulting firm Kurt Salmon
Associates found that 21% shopped more at stores in their neighborhood
this year than they did in 1997.
"The competitive advantage doesn't mean just price and selection anymore,
but convenience is also very important," said Walt Johnson, managing
editor of Home Improvement Data magazine in Indianapolis.
Since late 1997, Sears has opened 13 compact stores mostly in communities
that aren't a quick drive to any of their full-line stores.
Wal-Mart, best known for its huge superstores, is testing the Wal-Mart
Neighborhood Market in four Arkansas towns. Next year, Home Depot
will begin testing its Villager's Hardware concept with four stores in New
Jersey.
"Finally, these retailers are beginning to see that people don't want to
travel to shop. They are too busy, but that doesn't mean they don't want to
spend," said Walter Loeb, who runs the retail consulting firm Loeb
Associates.
Price is clearly the biggest threat posed by the new mini chain stores. They
can charge less than their local neighbors because the giant corporations
supporting them have better purchasing power with suppliers.
Ed Trygar, who owns Trygar's Hardware in South River, N.J., plays up
the reliable service and selection at his tiny 25-year-old shop, which is near
the site of a Villager's Hardware due to open next year
"We are still alive, but any time that you have new competition around
you, you have to take it seriously," he said.
By The Associated Press |
