the future and the Upper Peninsula
The New York Times had an interesting article the other day in its Small Business special section: Small-Town Shops Bulk Up on the Web.
One of its points was that small businesses are now selling enough on the internet not only to sustain themselves but to compete with the big chains and box stores. That’s remarkable.
Not that long ago - within the century, depending on the location - many Americans bought from small independent stores locally, and ordered from large national stores through the mail. Now we’ve reversed that, rather neatly: Americans buy from large (inter)national stores locally, and order from small independent stores over the web.
Most of the article’s examples - Healthy Chocolate Treats, for instance - are specialty retailers who provide goods that simply aren’t available from the box stores. But not all: Getz Department Store, in Marquette Michigan, sells brand name clothes and hard goods. According to the article, fully half of their revenue comes from web sales.
The other interesting point was that this newfound success is allowing these businesses to keep their real stores open, in their real towns.
This stands in sharp contrast to the way that most mail order companies operate these days, in which they have warehouses and call centers located wherever it’s convenient and cheap. Some of the money that they generate does, of course, stay wherever their facilities are, but only a portion; and, as a general rule, they do little to keep the actual towns afloat, since it’s never cheapest to do business in town.
But these small stores that make their money online do stay in town and are locally owned, meaning that more of the money stays local and that it therefore helps support all the rest of what makes a small town function: the other businesses, the non-profits, the community groups, etc.
So perhaps, even though it seems that small independent business is doomed by the seemingly neverending growth of the big (inter)nationals, the web might well be the key to their continued existence; and the web might even be the key to their undermining of the big stores. Now that’d be cool, huh?
2 Comments
margarita
brilliant. i missed that article and it’s brilliant – the idea that small stores could survive and thrive based on web commerce. i just read another nyt article about the increasingly competitive pet supply industry so i wonder, as an example, whether the web would be a reliable tool to help small pet stores survive against the big dogs, if you will?
and further, how would this conversation change if the setting were, say, a large, hypercompetitive, commerce-rich city? could this small business + web idea fuel a resurgence of preference for local goods and local business even in a place like new york?
very interesting.
November 18, 2005 at 04:20 PM
cboone
Well, I would think that if a small pet store were focusing on a specialized market, then e-commerce would be a natural for it. There are so many pet owners in this country, and so many of them love to lavish expensive gifts on their pets…
I would also think that New York has lost less ground than much of the rest of the country in the keeping-commerce-local fight. There’s the simple limitation of the real estate situation, which keeps stores from getting too large; there’s the size of the population, which provides more of a market for more things; etc. No?
Of course, there are the downsides that come with that: higher rent, increased marketing difficulties, the increased competitivity, etc. And the sorts of stores that that Times article focused on were taking advantage of the low costs of small town business. So…
November 22, 2005 at 12:55 AM