Chapter 4



(Narrative Statements)

As was indicated in Chapters II and III, there was an approximate 10% return of the 6,000 questionnaires mailed to Pennsylvania, California, New York and Illinois. The research staff has categorized these responses which provide comments and suggestions on how to cope and prepare for the survival of the small retailer. The categories are grouped by state returns and indicate the types of product lines or services provided by the respondents.

Chapter IV reveals the depth of fear and discouragement of the small retailers, as per their own statements, who are desperately concerned with their chances of survival in the face of mega-retail discount chain competition by the Home Depots, Kmarts, Wal-Marts, Targets and other "Big Box" competitors, as well as competition from other powerful retail chains. The narrative comments and quotes are [resented here in geographical order.

Before launching into the comments and suggestions made by the retail respondents which are to be found in Part II of Chapter IV, the author believes it appropriate in Part I of this chapter to review suggestions made by authors, Taylor and Archer, on how the small retailer can survive in the face of mega-chain competition.1 This work was published by the American Management Association in 1994. It hoped to provide the small retailer with a strategy for survival.



Part I of this chapter is a response to the book, Up Against the Wal-Marts, authored by Taylor and Archer. The author recognizes this serious work as well meaning--but finds the suggested strategies almost impossible to implement at the current stage of retail failure and stagnation. These small firms simply do not have the financial resources, staff or leadership to snap back in the ways suggested by Taylor and Archer. Were there a reason to start a new business with more than adequate management experience and venture capital, their "Ten Strategies to Survive" would be both helpful and essential. It is possible that some individual retailers might survive in the face of the "Big Boxes" by following Taylor and Archer's "Ten Commandments" or strategies. However, for the most part, the dying breed of "Main Street" merchants requires external and formidable help from local, state and federal governments as well as specialized agencies such as zoning boards, planning commissions and community development authorities prepared to provide incentives and subsidies to small retailers, currently available to the mega-retail discount chains who generally build their "Big Boxes" on former agricultural or industrial land. For example, a mega-retail discount chain store is given the right to retain sales taxes collected for a given number of years in order to help finance construction of and debt service for the "Big Box." As small retailers close, the sales taxes they formerly collected are no longer available to local government. These entrepreneurial subsidies and dozens of other incentives as well as tax abatements are generally not available to the small retail merchant.

Taylor and Archer are among those writers and journalists who attribute the failures of the traditional "Main Street" retailer to causes other than the price competition of the mega-retail discount chains. Taylor and Archer present a provocative and interesting volume which appears well-meaning in identifying ten survival strategies to enable the small retailer to compete more effectively with a giant Wal-Mart or other mega-chain retailers. The title of their book, published in 1994 is Up Against the Wal-Marts (How Your Business Can Prosper in the Shadow of the Retail Giants), as was listed in Footnote 1.

One cannot argue with the time honored principles presented such as "satisfy your customers"; "study the success of others"; "gather and analyze management information regularly"; sharpen your marketing skills"; "increase the customer's perception of value"; "position your business uniquely"; "eliminate waste"; "find something to improve every day" (the Kaizen Japanese method of incremental improvement); "embrace change with a positive attitude"; and "pull the trigger and start the battle."

These prescriptions would appear sound if the small retailer were not finding daily vacancies among his neighbors in strip malls; vacancies that result in the "Main Street" or the Mall taking on the appearance of a city ghetto, with boarded up properties and a sharply reduced traffic volume that makes the surviving retailers' look like lonely commercial outposts.

If out of every ten stores on "Main Street" or on a strip mall, three to five retailers close because of a neighboring Supercenter's announcing special promotions and discounted sales, what is a staunch "survivor" to do? The small retailer is unable to procure mass purchase discounts from manufacturers. Even in military parlance, if sixty percent of a company is devastated by superior weaponry, can a company commander rally his decimated troops and win? Do the valiant surviving retailers possess unique leadership skills and professional staff of the sort engaged by the mega-retail discount chains? Do they have the logistical support to survive the invasion of the supercenters?

The writer has visited many strip centers, "Main Streets" and malls, in a number of states and has interviewed a number of valiant survivors. In Part II of this chapter, the reader will certainly recognize their discouragement and disillusionment about the end of their "American Dream."

Taylor and Archer, while truly attempting to encourage small retailers to survive; nevertheless do recognize and observe the present devastation going on in malls, strip malls and the former "Main Streets" of Middle America. Furthermore, it is easy to see observers are shocked by the decline and elimination of most small retail stores in the ethnic and minority enclaves of our very large cities, in the East, Midwest and the West. The elimination of small retail store in the neighborhoods results in job loss and contributes to the ultimate conversion of a formerly socially stable neighborhood into a ghetto, beset by violence, crime, drugs and an underground economy.

This view is clearly expressed in the following quote from Taylor and Archer's opening statement in their book:

"'Main Street' Is Changing"

"'Bowman's Hardware is closing!' The rumor had spread like wildfire through the small Georgia town just weeks ago. Now the store building stands quietly empty. The auction is over and the owner is gone."

"The 'for sale or rent' sign dominates the right-side display window. A hand-lettered poster board is taped up in the left hand window. Its message expresses the bitterness of the former store owner and the area's other failed merchants. It reads:


"Bowman's is the eighth 'Main Street' business to close since Wal-Mart came to town. The owners are quick to blame the giant retailer for the failures. However, signs of neglect, apathy, and decline were evident on 'Main Street' long before the discounter located at the edge of town."

"Bowman's had been the only full-line hardware store in town. Its closing is a blow to the remaining independent owners. For the first time in seventy-three years the big corner store is empty."

"'Main Street' is changing."2

While it is true that all of the troubles of the small retailer can not be attributed to mega-retail discount chains; nevertheless, the pricing power of these chains makes recovery on the part of the small retailer well nigh impossible.

A lack of foresight on the part of local governmental authority in failing to back downtown improvements; to make parking readily available; to control traffic congestion; and to provide fiscal stability have all contributed to the plight of the small retailer in America.

After describing the Bowman's Hardware closing (which the authors of this current study find very typical of the fates of hundreds of retailers studied in Pennsylvania, California, New York State and Illinois), Taylor and Archer cited several successful survival instances in New Jersey, Missouri and Arizona. Based upon this writer's experience, these "miracles" are the exception rather than the rule.

Taylor and Archer quoted Mr. Jack McNabb of a Trenton, Missouri Hardware Store as saying, "This is a tough business, and these are tough times," he told us. "But I'll soon have it paid off, and then we'll have some fun again."3

Taylor and Archer tell the reader that, in more prosperous times, this store supported the families of five owners. 4 Now it appears that only McNabb manages a living. Like the family farmers that make up his customer base, this independent "Main Street" merchant may be one of a vanishing breed.

"'Main Street' is Changing." 5

Taylor and Archer also tell of Casey's in Flagstaff, Arizona that apparently has had the capital to advertise, promote and add specialized employees. Casey's president, Robert Gondek, attributed his firm's survival in part to watching prices. He stated:

"We're watching our prices too. Wal-Mart has 50 or 60 items they advertise pretty hard in this area. We watch those items all the time. If Wal-Mart is at 97 cents on a bag of steer manure, we'll be at 99 cents and load it in your car for you." 6

Admittedly, small retailers must fight back to survive. But how can Casey's continue to match Wal-Mart's prices when Wal-Mart and other mega-retail discounters such as Kmart, Target, and all other "Big Box" retailers who buy through mass purchasing buy "direct" from manufacturers and suppliers, while McNabb and Casey are apparently unable to secure this type of recognition. As has been indicated in this study, access to wholesalers is disappearing for the small retailers.

Numerous retailers are buying from such wholesale clubs as Price/Costco and Sam's Clubs. Price and Costco merged in 1993 and is now the largest factor in the wholesale club industry with over $15 billion in sales. Sam's Clubs is the wholesale/warehouse sales division of Wal-Mart. In 1995, 453 Sam's Clubs had combined sales of $19 billion. Retailers are becoming members of these clubs in order to purchase inventory for resale in their stores in the short run. How can they match prices with Kmart, Wal-Mart, Home Depot and Target, "over the long run?"

Taylor and Archer provide ten survival strategies for small retailers to consider in competing with Target, Kmart, Wal-Mart and other important mega-discount chains. These precepts are:

1. Focus completely on satisfying the customers.
2. Study the success of others.
3. Gather and analyze management information regularly.
4. Sharpen marketing skills.
5. Increase the customer's perception of value.
6. Position the business uniquely.
7. Eliminate waste.
8. Find something to improve every day.
9. Embrace change with a positive attitude.
10. Pull the trigger and start the battle. 7

Their work appears to be more appropriate in helping a retailer in planning a new venture, starting a new business, or selecting a new location. The book provides sound business advice for all retailers, large and small, of every type and description. However, the "generic" type of advice so generously offered cannot help most of the nation's small retailers who are under-capitalized; possibly deep in debt, unable to afford sophisticated information systems, costly advertising and promotion, and who are presently located in what appears to be "disadvantaged," "ghetto-like" locations. Here, the formerly lovely "Main Street" is loaded with vacant real estate. The historic neighborhood enclaves in large cities now exhibit abandoned stores and residential decline. Even malls constructed within the past five or ten years now suffer vacancies and reduced traffic as the "Big Boxes" of Target, Kmart or Wal-Mart open, perhaps a half mile to three miles from the former bustling commercial center.

The responses to our study show hopelessness, frustration and inability to respond to Taylor and Archer's ten strategies for survival, albeit, the advice is good. At a certain point the small retailer becomes a dying breed, unless the nation and Congress realizes what the impact of these failures will be on communities, joblessness and social disorganization.

Generally, wages in the mega-retail discount chains do not match the earnings of employees who worked in family-owned small businesses. Not only has the economic impact of the mega-chains been negative; but also the sociological impact, as communities lose their small stores, the mega-stores will become socially unstable influences, resulting in increases in violence, crime and joblessness.



The surveys offered each respondent an opportunity to make further comments, explain their quantitative answers or to express ideas or opinions on the current state of their businesses and their communities. What follows are those responses. They have been organized by state and city or region within each state. All responses are presented in order for the reader to get a feel for the positive as well as the negative comments of the small business owners.

A. California

San Diego
Chula Vista
Mira Mesa

B. Pennsylvania


C. Illinois

Des Plaines

D. New York (Finger Lakes Region)


[San Diego Area]

S1 - Luggage/Bags:
"Our store primarily deals with bags and luggage. One block away there is another luggage store. None of them are (including ours) large stores. Yet, there is enough competition to really drive the retail price down, even between two small stores. We can imagine what it will be like if a national chain store is placed near our store. This reminds us of a game of MonopolyŽ! But perhaps this is an inevitable trend every one wants to make the most 'bang' for the most buck. So, it is only natural there will be the predominance of nation wide chain-stores in which they may bypass wholesalers and purchase goods directly from manufacturers. We are aware of the diminishing wholesalers (from L.A.). We sense economy of scale at work everywhere, but in a more overt form."

S27 - Men's and Women's Resort Wear:
"The wording of your questionnaire makes an accurate answer difficult. We operate specialty resort wear stores in resorts. A large store opening _ mile away would have no impact but an operation across the street would. Also a large discount store would not offer similar products. It is highly unlikely a discount operation would want to pay $60-$100 per square foot rent and could discount the upscale merchandise we offer."

S26 - Books and Magazines:
"Information regarding publishers and other suppliers offering preferential terms for 'mega stores' would be helpful."

"Research regarding possible trade violations by mega stores helpful. Also their influence on making 'best sellers' simply by their purchases - what is their influence on a book's success?"

"Cultural influence of chain/mega stores purchase pattern (de facto censorship) - less profitability of some books - also their negative impact on small publishers - (high purchase and high return)."

S25 - Security Equipment:
"In our experience, the large mega-retailers carry the low end of product lines which appeal to 'do-it-yourselfers' and handymen. Therefore we have shifted our emphasis to commercial customers and the Navy. The large retailers buy directly from the manufacturer and eliminate the distributors. We can not compete under those circumstances. If we do not have distributors to supply us with merchandise, and we can not buy from the manufacturers, that doesn't hold much of a future for small businesses."

S22 - Men's Casual Wear:
"I am located in Seaport Village, which is tourist/convention orientated. This may not suit your survey objective, as many of our customers wouldn't have the option of visiting a discounter because of time restraints or wouldn't want to, as they would feel they could do that in their hometown. I currently make a strong effort not to carry same labels available in the discount stores you named. Many manufacturers use a different label for discounters - same goods, or they manufacture a lighter weight garment (less quality) same look."

S20 - "Other":
"It seems a little late in the game to be trying to come to terms with the destructive aspects of mega stores. Perhaps some time should be spent anticipating the impact of electronic shopping and other emerging phenomena of our rapidly restructuring economy."

"My experience with superstores - Home Depot, etc. - is that they have a broad range of products but lack depth. I find myself patronizing the niche retailers - the specialty bookstore, or 'Real Goods' catalog for products I want. My concern with superstores is that they don't just save the customer but they also define what's marketed without concern for origin of product (e.g. Chinese prison labor) or ecological consequences."

S19 - Jewelry:
"We are in a unique situation, as all our merchandise is hand crafted locally. However, the average person has only so much time to shop and will usually prefer to go to where they can get all their shopping done at once. We can not afford to go into a mall and of course, could not produce/compete in price with the larger volumes necessary for discount sales. We are seriously considering going out of business after 22 years in San Diego."

S18 - Home Improve/Building Supplies: "The old adage in retail that 20% of the items make up 80% of the sales is pretty much true. The big box retailers tend to stock and sell mostly these items. In traditional retailing, these items (the 20% items) subsidize the other slower selling items. Additionally most of these items (the 20% fastest selling items) are purchased on a direct basis from the manufacturers excluding the wholesalers from the picture."

"As the 'Big Box' retailers come to dominate the market, traditional retailers are driven out of business because they can no longer survive just selling the slower selling items. Wholesalers are driven out of business for the same reason (and because of direct selling). Manufacturers cannot find retailers and wholesalers to stock and distribute the slower selling items. The end result is that consumers find that there are fewer and fewer of these slow selling products available. Yet, these slow selling items once represented 80% of total number of manufactured items."

"That local governments are doling out tax incentives to the mega-discount chain retailers in exchange for opening stores in their communities shows an incredible lack of understanding of the big picture. These huge businesses operate differently than small and medium size business and do not need help from our government. Instead of providing incentives for big business our governments should relieve small business of the huge burdens that they have imposed. There are an incredible amount of rules, regulations, and paperwork requirements that impact small business and large business differently. Because of economies of scale, each new regulation imposed on business has a minimal impact on large business but a huge and detrimental impact on small business. Governments at all levels need to understand this."

S16 - Tobacco Shop:
"It should be noted that my store is in an outdoor mall. I have a primary location with innumerable tourists. The S. D. Convention Center is down the boardwalk and I am surrounded by 7,500 hotel rooms. I may not be an ideal candidate for your existing study. I felt you should have this insight for your study. I am primarily a tobacconist selling cigarettes, pipes, tobacco and cigars."

S15 - Apparel:
"I have personally seen Wal-Mart and other discount stores completely shut down a small town in southern Indiana. Businesses which had been in operation for years were closed and the only opportunities for employment were minimum wage jobs. In addition, clothing and other items are of a low quality, not really quality for price."

S14 - Beverages, Snacks:
"We are a small coffee vending (retail) operation which enjoys a good location in the business district and long standing track record. Our 'edge' on the market is quality and service and very low overhead. The disadvantage is that we rent our locations; and, if a large company comes into the area, they could well afford to offer our landlord a deal they couldn't refuse or one that we couldn't match. If we did pay the 'increased market rent' one of our largest advantages would be lost (low overhead)."

[Oceanside Area]

O7 - Electric Equipment/Kitchen Equipment:
"The large retail stores have nothing but a negative effect on the small business, especially in California. There is only so much business to go around and the increase in the number of stores only means that each one's slice of the economic pie is only that much smaller."

O2 - Picture Frames:
"Thank you for the opportunity to be included in this survey. As a young small business man I feel that some of the large chain stores do a greater deal of bad than good. If the United States wants to become an unfriendly discount warehouse then so be it. But being a 'service' business I don't believe that is what's happening. I honestly feel that someone forgot the most important thing about being a small business - 'the customer.' Without service to the customer it is just a matter of time before all the big stores are gone and the smaller 'Mom-and-Pop' shops come back (I hope)."

O21 - Specialty Shop:
"We are a specialty business with very little competition from large chain business. We provide products and customer service on use of products not found in large chain stores."

O105 - Sports Products:
"Large discounters will move in with lower prices. Independents will be forced out and then when competition's gone, prices will go up again until the cycle starts again. Service is the only way the small guy can compete. We have just liquidated due to discount competition!"

O101 - Bikes/Equipment:
"I will close my business by July 1, 1994. No tax concessions were offered to bring my business into town or to keep it in town. Many products which were sold in my store and made available from the manufacturer solely for 'independent' stores now have appeared in the discount stores via gray market trading. My customers were always quick to tell me about the great deals they got."

"The American public will always pay in the long run for the services they get and expect and perhaps service and quality are after-thoughts soon forgotten. Many cities have over built re: shopping malls, especially those anchored by discounts firms, only to have the mall become a picture of blight when it cannot be filled with small tenants or the discount firm packs up and leaves."

O99 - Nutrition Store:
"Mega-chain stores buy or discount wholesale, because of high volume then sell or discounts to attract consumers. Smaller margin of profit is offset by higher sales volumes. Tax breaks and other incentives from all levels of government (local, state, federal) favor big business unfairly to the detriment of the small business who gets no break even though small businesses are the national economy's backbone. If this trend continues, small businesses will soon become a thing of the past. Small business should now get the breaks and larger ones should pay their full dues. When small businesses are gone, the larger chains will be able to raise prices without competition from the small entrepreneurs and retailers. Large chains are like sharks scavenging the fiber of the retail world, swallowing schools of smaller retailers, leaving dead zones within 'miles.' They will finally fail themselves and fold, because of over-building and the retail chain wars."

O94 - Food Products:
"Some California laws need modifying to be more 'small business friendly'."

O93 - Eye Glasses/Contact Lenses:
"Please tell these cities that want these stores the truth about the lower wage jobs, etc. They don't understand that they are putting small business out of business. Unfortunately, here in Oceanside, they don't care! I have spoken to the Chamber of Commerce and it has only got one side of story on these mega stores. There should be a limit as to how close these stores can be to each other. In the San Diego area, we now have 4 Price Clubs all within 6 miles of each other!! And now Wal-Mart wants to have 2 locations in Oceanside with the possibility of a 3rd!! I don't care what anyone says, but it does hurt small business including myself. Thanks for sending me the survey. I'll be happy to do it again."

O91 - Automotive:
"Big chains sell way too low the first year to gain customer base. My main concern is automotive and your survey didn't pertain to this area. Large chains will decrease employment because small businesses will close."

O85 - Food Products/Popcorn:
"One example: We sell a 3 _ gallon tin of popcorn for $18.95 with butter-cheese-caramel. Wal-Mart has a 3 _ gallon tin they sell for $6.95. Their tin doesn't have handles, but it is hard to justify three times the price. We pay $6.36 for an empty tin."

O83 - Food Products:
"Elimination of small and medium size business would be the result of discount stores moving to an area which eventually will cause the removal of working class and middle income categories. In short term, middle class and probably some low income consumers benefit from these changes but in the long run both will be losers and pay for short term benefits."

O81 - Furniture/Appliances:
"We are so busy trying to keep the doors open, so I don't have time to make comments. Business is BAD - BAD!"

O78 - Computer Equipment:
"As a small businessman I recognize it is next to impossible to compete against mega/retailers/discounters on price. But we will continue to strive to beat them on service."

"A large part of our business is selling, installing and maintaining networks. I believe (hope!) that this focus will keep us profitable and allow us to compete in the future. We also repair computers quickly, again something that the mega/retailers/discounters have not adequately provided."

O76 - Optometry:
"These companies, while they profess to promote jobs and add to the tax base and help the economy: nevertheless, from input I have had from other practitioners, they actually do just the opposite: They run small business 'out of town'; provide inadequate jobs and are only concerned about the bottom line! Prices that they charge for similar products that I have, are at times below my cost or at a level that I cannot compete with. There are only so many tax dollars. By adding another store, how can the tax revenue be increased? This is the big lie of the discount chain stores."

O73 - Shoe Store:
"I have two views about national discounters. 1) Our town already has 1 Target, 2 Kmarts, 2 Long's and now we are getting a Wal-Mart. All of these retailers sell 'some' similar products to mine and they get them much cheaper than I do - thus this is bad for my business. 2) Our town is in terrible need of businesses who can bring employment opportunities and tax dollars to us. I personally would rather see more upscale larger retailers come."

O68 - Food Products:
"The big question is what are local merchants and centers doing to compete with the national discount centers. For example, uplifting stores and malls that are looking so worn and are not as attractive to shop in as are new stores."

O63 - Audio Stereo:
"It is my opinion that the U.S. Government PX's are engaged in unfair business practices which present the most adverse impact on my business. They sell the same product at an average mark up of 20%. They do not charge sales taxes and in addition they now offer financing. I feel this has been a major impact causing about a 40% decline in business for the last 3 years. I feel the Exchange and PX should be limited to selling necessary items such as food only, not luxury items such as car stereos and electronics. We as business people and taxpayers are financing the government to operate at a loss and extending the time of recession."

O61 - Furniture:
"I am a sales representative in the home furnishings field. I also offer warranty services as an addition to the products I sell. I currently sell to Price\Costco, so I can't say it would be bad for me personally for their expansion. However, the other large discount chain retailers do take away from my customer base on a retail level."

O59 - Computer Equipment/Electronic Equipment:
"We are a family business in existence for over 20 years. Two locations (1 - Escondido; 1 - Oceanside). When we opened typewriter shops, we sold typewriters. Now Price Club, Sam's, Wal-Mart, Kmart, Silo, Circuit City, Sears, Montgomery Wards, all sell typewriters, word processors, etc. They sell at prices less than we can purchase from the manufacturer as a dealer. As a dealer we have quotas to meet in order to stay a dealer and be able to buy machines, supplies and parts. We are now a service oriented business."

O58 - Optometry:
"I am personally against retailers such as Wal-Mart, etc. They do not offer good jobs to the local public and do take away from jobs provided by the smaller business. Thus, their promise to add the 'so called' revenues to the city coffers is untrue, since these big retailers put many others out of business. Then the profits leave the local areas and go to the big corporate guys."

O56 - Paper Products:
"In 'general' there is already too much retail space now available and the giants are killing off the small retailers. While some of us hope to grow big enough to compete, most of us will not survive. Community planners and local and state governments put too much emphasis on tax revenue and not enough on quality of life, and plan too much commercial and not enough desirable housing, which leads to too many instant slums and not enough family desirable living areas."

O54 - Scuba:
"Currently I compete with the Federal Government 'MCB Camp Pendleton.' They have already created a mega store environment. You excluded government competition from your study. PX systems are as big as Target. The PX in my area went into competition with me in 1983. My business dropped 30%."

O53 - Food Products:
"The aspect of mega-retailers which greatly affects me is my ability to buy 'a few items' from a local hardware, lumber or business supply store - they're gone. Meanwhile the mega-retailer thrives and I have to buy 10 of something when I only want one, because they only package usually in bulk sizes."

"No personal contact, no help with products, limited variety, etc. are all problems with mega-retailers. Everyone can save if you would consider the savings in terms of paper/tree waste, postage (2 ways) and general ecological conservative principles."

O52 - Food Products:
"I have been in this location for four years. One year ago another store just like mine, but four times bigger, opened up about _ mile from me and my sales since then have decreased over 50%. They have not gone back up yet."

O51 - Electronic Equipment:
"Some of the products sold by the chains may be factory seconds, refurbished and not clearly stated. Small business must have the same leverage as bigger stores. If a product cost me $200 - the bigger stores should not be able to buy cheaper except in car load lots. I am selling a personal service and products that the big stores have a hard time competing against. Experience and fair competition may be a solution to the problem."

O49 - Food Products:
"My business is in a center that has a Target store in it. There is a proposal to put a Wal-Mart two blocks away. The tax base will not increase because the people that were shopping at Target will buy at Wal-Mart. Target will be forced to compete more aggressively, prices will come down and less taxes will be collected. The customer base will stay the same."

"Within a five mile radius we have two Price Clubs; one was very busy all the time until they opened the second one. Now they are not so busy at both locations. It proves my point that they are splitting their customers, not increasing the customer base."

O48 - Beach Snack Shop:
"I am very concerned with large chains moving into and eliminating small business. Over a long period of time, there is dramatic damage in the community. We lose the community family."

O47 - Food Products:
"In Oceanside, proposals are being considered for three Wal-Marts, - one has been okayed! In these economic times the carrot of sales tax revenue is being taken by local government. All the while, the three established Price Clubs (San Marcos, Vista, Carlsbad) have all reported reduced sales (cannibalized each other) and one will have to be closed. We have cities competing against each other for a mega-store and the result is short-sighted irresponsible planning with the small business losing out big time."

O38 Building Supplies:
"The Home Depot has been here for 10 years. We can offer more for less on a service and personal level. They, on the other hand, can purchase certain goods at a substantial saving usually under my price. They buy direct; we cannot. How can we compete?! The government thinks that these companies are small business. They are wrong - we are!"

O37 - Lawn and Garden:
"When Home Depot opened its doors several years ago, my sales dropped 15-20%. With a slow economy, people assume Home Depot and Home Base are cheaper, therefore my sales have continued to drop."

"On a positive note, many customers are returning to the service that we provide. The 'circus' atmosphere is costing them sales as well. Thank you for asking our opinions."

O34 - General Store:
"Predatory pricing by large retailing chains should be controlled."

O30 - Florist:
"No one said it would be easy to compete in any venue."

O27 - Photo Processing:
"We already have a tough time surviving in Oceanside. The city's business has decreased. Businesses in my center have moved or gone out of business, accounting for a 40% vacancy in the center."

"Selling my firm is probably out of the question because of Oceanside's reputation for poor business as of late. Wish me luck!"

O26 - Doors/Windows/Kitchen Cabinets:
"If the manufacturer sells direct to the large chains, then why not sell direct to the small businesses?"

O39 - Home Improvement/Lawn & Garden:
"I love the big guys - they sell the cheap products that break down, and I repair, or replace with quality products."

O24 - Furniture:
"Give small business same breaks that are offered to large chains, particularly tax breaks."

O23 - Auto Equipment and Services:
"There is no question that big chains, who have such buying power, are putting small and medium size business out of business. I did not know that any one out there cared about small businesses going out. These big stores carry everything. The Price Club even has a travel agency inside. I think this is absolutely disgusting."

O20 - Women's Work Apparel:
"Uniform sales are generally a more service oriented and group sales type of retailing. It requires a more knowledgeable type of selling and marketing. I would only expect a moderate decrease in sales. Most uniform locations require male/female garments in all sizes, ranges and colors. National discount retailers do not have the space nor qualified personnel to handle our type of products."

O18 - Meat:
"There is nothing positive I can say in regard to having a large discount store locating in our area."

O17 - Hearing Aid Sales/Service:
"This survey is an excellent idea. I had not considered the impact on my business of the large retail outlets, so I appreciate the opportunity to respond."

O65/66 - Electronics/Video:
"I am totally opposed to the 'corporate-tization' of my community. (store A). We are being run out of business by blockbuster corporate companies who have more buying power, governmental tax breaks and the ability to direct dollars and lobby groups to keep status quo. The 'Mom-and-Pop' video business is in peril! (store B). We compete with everyone from grocery chains to drug stores to McDonald's which are using rental and sell through videos as 'loss leader' items. No entity is willing to stop this from happening. We cannot compete with below cost or free!"

[Chula Vista Area]

C20 - Variety Store:
"As a franchisee I rely on my franchisor to constantly be on top of my business needs and changes. We are very limited to what we can do. I feel because of their constant changes and the downsizing of their staff, that these actions have affected my business [ex: advertising, upgrading equipment, new ideas to keep up with the changes of our competitors]. I am relying on myself more and more to stay in business. I have gone from being able to have 2 days off and working 8 hour days to working 6-10 hour days and I'm not alone. Many other franchisees are doing the same thing."

C19 - Jewelry:
"Cities are strapped for income and have to raise revenues with increased parking fees which affect businesses that cannot afford large areas for free parking. Also, increased business license fees and large mega stores with their 'in-house' credit plans will eventually doom all small businesses. City Councils have not got business 'smarts' and legislate small businesses to death. I have had my own business for 35 years and it just gets worse every day. The fun is gone and the money is gone - only a fool would open a small business today."

C15 - Hardware:
"The big chains usually sell cheap products which puts the home owner in need of our services. However, quality products prices can't compete with big chains so we end up with a rip off reputation for charging a decent price for quality work and quality material."

C13 - Home Improvement:
"The best way to compete is service. Our big job is getting customer in the first time."

C12 - Home Improvement:
"Most small businesses have been hard hit by the economy in last 3 years. Our business is down 35% to 50%. We have used up our savings and other resources. We have cut staff and all the fat from our budget. As owners we spend more time in our stores. There is little left to give, if we lose any more of our business - WE ARE OUT OF BUSINESS! 'Mom-and-Pop' are on death row! Down to the last appeal! Send in the priest not the tax man!"

C10 - Ice Cream:
"Large businesses can afford lower prices by allocating or prorating profit margins among several different products. Economy of scale."

C8 - Office Products:
"I do not like the City helping major stores open with tax breaks/land deals, etc., when the effect is to put many small business people out of business. Unless they are bringing new buyers into the city, they are only moving sales tax dollars from one place in their city to another."

C4 - Paper Products:
"A large competitor that handled the same or similar services would put me out of business."

C2 - Jewelry:
"It is necessary to stop irresponsible opening of new businesses in the areas already filled up with similar businesses."

C58 - Jewelry:
"1) Restrict to some areas all national discount retailer stores. 2) If local government waives taxes five or more years, than obligate the mega-retailer to stay five extra years after the five years waiver. 3) Tax extra for the number of stores they have. 4) Obligate manufacturers to give same prices to small business. 5) Waive some taxes to small business. 6) Lower Workman's Compensation insurance to small business. 7) Special loans to small business at lower rates."

C55 - Reupholsterer of Furniture:
"Small business can compete with large business providing government entities do not tax and or regulate us to death and offer incentives to large business that are not available to small. Small business worst problems include above and excessive insurance premiums, especially Workman's Compensation, health care cost of employees, unions. Small business is only surviving now because it gives better service and quality and is accepting less pay or rewards for its efforts."

C51 - Kitchen Products:
"Fedco, military base are 'not for profit.' It's very hard to compete with this type operation. I think if they are not for profit, they should not be allowed to sell the same products I do. People will often come in and see products I sell (and stock) then once they have all the information on the product they will go to a warehouse club or military base and purchase it cheaper."

C48 - Food Products:
"I have found that the large mega store customers have a negative impact because their business is one stop shopping. After an hour in Wal-Mart, etc. the last thing you want is to stop some place else for ice cream, etc."

C47 - Sewing Fabrics:
"Chula Vista, CA is unique. The Mexican border is five minutes south, San Diego proper is ten minutes north. There are now 3 and very soon 4 Kmart stores within 8 minutes of my store. There are 3 Home Depot centers, 1 Home Base, 2 Targets, 3 Major Malls, 1 Office Depot as well as a multitude of other strip shopping centers . . . all within 8-10 minutes. Drive for 20 minutes and easily triple these figures."

"Originally, these mega stores offered depth and low prices . . . very competitive prices. Price/Costco has zero profit prices . . . (net) margin. They are selling at cost only . . . deriving their 'profit' from quick selling in volume and 60-90+ day terms from their supplier. Price Club sells the same products as I do at a cost below my wholesale cost . . . and I still must pay freight! Competitively, it's not very fair. Will they still sell below my cost after I am gone?"

"For the consumer (me too) it is very good. I get selection, depth, low prices...if I shop around, and quick delivery, no hassle refunds. I travel a lot and observe other small communities (i.e. Eureka, CA; Grants Pass OR...etc) where the small 'Main Street' has become one-way only and boarded up or vacancy signs proliferated about the 'Main' part of town. Property values declined and 'Main' street moved to the outskirts near the interstate. This is progress?"

"I would hate to work all my life for a business that I am committed to, only to find it worthless after 50 years and retire to a Social Security program which may not exist when I am eligible."

"Only answer: Change with the times. Technology is moving foreword and so must we. Go back to school . . . get smart."

"Note: In the interim many new-generation type establishments such as coffee houses, teen related businesses generally run by new business families i.e.; the young and the restless, are popping up in the downtown areas and giving new life to those blighted areas. Small scale, but it's working. The blighted downtown/abandoned dockside in Boston, MA has been and is being rejuvenated with AFL-CIO funding into senior housing...and it looks pretty nice."

C45 - Communication Equipment:
"We are not worried about honest competition, because we provide excellent service to the customer. But the real problem begins when they start selling their equipment at cost or making only a very small profit (i.e. Price Club). We need to mark up our merchandise at least 20% over cost so we can pay a decent salary to our employees."

C43 - Optometry:
"Currently in practice eight years. It has never been necessary for me to see patients more than 2 _ - 3 days per week. Income is supplemented by working as an independent for other offices. Kmart and Wal-Mart (and Price Club) have moved in recently and that has sent the small patient load that I did have plummeting. Other private practitioners in the area have been impacted similarly. The profit margin was barely enough to justify the existence of my practice. With the current changes in competition; the practice will either have to be moved or sold."

C41 - Books and Games:
"Video Games - The large chain mega-retailers buy direct at cheaper prices and often use the video games (i.e. Nintendo/Sega) as 'loss leaders' and therefore make it extremely difficult or impossible to compete on new video games."

"Comic books - Many comic book publishers are embracing the mega-retailers, but at this time I think it will be a plus for direct market comic stores. But we will see what the future brings."

"Trading cards - Many trading card manufacturers offer special products to the mega-retailers which usually are more desirable than the products offered to small hobby shops such as mine. Usually these products are sold by their employees at drastically inflated prices to small stores such as mine and rarely offered to the public."

C37 - Food Products:
"At the present time it seems to me we have more stores than customers. With more stores all we do is keep dividing business."

C36 - Men and Women's Clothing:
"We are owned by a corporation (Melville) so I don't know if I should even be releasing these figures. The reason I am is that I am an entrepreneur and currently opening a small business of my own. The hardest thing about this whole business venture is lack of support. Communities need to get together and work together in order to keep the money flowing. I am interested in any ideas on how to pull people together. Please contact me!"

C34 - Food Products:
"How can a small business compete when my purchasing of some products are more expensive than their retail prices?"

C30 - Variety Store:
"I feel that the small business managers must somehow make cities that give your Wal-Marts & Kmarts non-tax status for years should be held accountable, as the cities lose revenue whenever the small businesses are forced to close due to the excessive competition. Also one should check-out the methods that Kmarts and Wal-Marts use to keep their cost down as far as employee wages & benefits. Do they give their employees the total package that my company offers?"

C28 - Pipe and Cigarette Shop:
"Predatory pricing also affects manufacturers in a negative way. Suppose you manufactured a great quality washing machine and had agreements with lots of independent stores to sell and service your product at reasonable prices. A big discounter moves in and demands that you sell him your product. He discounts the hell out of it, probably offers no service. All of your independent outlets drop your product. Now the discounter wants to buy more but at large discounts. The manufacturer has no choice but to discount to the discounter. He cheapens his product in materials and by possibly moving production to another country. I firmly believe that manufacturers have the right to decide who they will and will not sell to. After all they may have generations invested in their product's good name. We see some of the collective items that we sell and have a lot of our money invested in, being discounted by Costco/Price Club."

C25 - Men's Clothing:
"If the present trend continues of the mega-stores, numerous small merchants will not be able to survive with such competition; as is already evidenced in many areas. Bankruptcies are and will continue to be a common occurrence amongst small business."

"The 'impact' is and will continue to be devastating. It is the strangulation of the small business segment in general."

"After 32 years in my business, never have I been more discouraged by trends in the large corporate invasion and the ultimate break up of small business."

C22 - Health and Beauty:
"It is a difficult environment for small business. Unfair pricing from manufacturers is a major concern. Contract lock outs is another. Changes in those may help lead to a more level playing field."

[Poway Area]

P10 - Men's and Women's Casual Wear:
"It is getting more difficult to compete not only with the large retailers, but with garage operations, i.e. screen-printers, etc. If things don't improve soon, I will be forced to make some decisions regarding selling, liquidating or some other option."

P7 - Computer Equipment:
"The cheaper brands of computer equipment sold in mega-retail stores floods the workplace with inferior products. Purchasers, who do not understand the technical differences between brands and models, base their purchase decision on price alone. As a result, I have been forced to service increasing numbers of 'junk' computers - that often takes more time, and is less 'fulfilling' (professionally speaking)."

P4 - Specialty Sales:
"My business is a specialty sales business. This area is difficult for a challenge from mega-marketers. However, my daughter's job as a pharmacy tech for a drug store chain is threatened by Wal-Mart's arrival here, as is my friend, the optometrist, and many others."

P2 - Full Service Restaurant:
"I have felt the impact of several 'cookie cutter' chain restaurants that have sprouted in recent months. In the last year 13 new restaurants have opened in a 5 mile square area. They are confined enough to offer a variety of choices to customers and are located near Price Club, Home Depot and a few other discount houses nearby. They are not owner/operated and I believe without personality or the 'human' touch. I have to work too hard to please many of my customers only to have them tell me how wonderful this new place is or that. Chain restaurants seem to have very deep pockets to decorate and send out colorful, slick ads in our local paper. 'I can't afford it, so I have to work harder. I will never offer specials - my quality will not be compromised just to compete."

P27 - Auto Parts/Labor:
"The largest problem I see with a large retailer moving close would be its ability to buy direct from factory. If I were also able to buy direct, I could compete."

P26 - Home Improvement, Building Supplies/Labor:
"We are in the construction industry. We provide a full line of glass products and commercial case work. Since the Home Depot and Home Base opened up we have all but lost our glass income. They provide and install all glass related products either direct or through subcontract with area shops. Our suppliers are selling to them at big discounts because of their volume, we can't compete in this market. We've been reduced to a commercial cabinet installation shop - having to move our business."

P24 - Food Products:
"Wal-Mart's arrival has hurt and helped in our area. It forced Long's Drug Store out of business so that site - the 2nd major business of Poway Town and Country Shopping Center, has been vacant over two years. Several adjacent businesses were forced to close."

"Wal-Mart's employees frequent the restaurant improving my lunch business. I lost several employees to Wal-Mart. Several of the merchants in our center have been hurt by Wal-Mart's lower prices."

P20 - Flowers/Gifts:
"In Poway and surrounding areas, there are too many businesses competing for the same thing.

1) Why does the city allow similar business to open?
2) Population remains same and grocery stores increased from 2 stores to 6 stores in 10 years."

P18 - "Other":
"Cities should strongly weight the needs of the small business owners, who are solid establishments over the prospects of luring a national chain mega store."

P33 - Toys/Games:
"We no longer carry a large variety of nationally advertised merchandise. We no longer carry bicycles, only on special order. Wal-Mart opened 2 years ago."

P48 - Liquor:
"Comments below will be hard to change in my geographic area (10 mile radius). Rancho Bernardo is the best place to own a small business (retail). Why? Because it is a very small business area compared to population."

"Poway in comparison is the worst place to own a business because the business area is much too large compared to the population. The City of Poway derives its income from retail dealers. The more small businesses (retail) the more income for the city of Poway."

P46 - Retail Auto Sales:
"We are a franchised new car dealership. In general, a mega-chain outlet will not harm our business. However, they do provide a threat to our low end automotive service business. We can compete given our name recognition with the factory. An independent garage would have a more difficult time surviving."

P40: Art:
"Although I am in Poway, my business does not depend on this community for business. I have an art business that deals with a wide range of clients and quality of art work. However, I am impacted by these mega stores because they attract the client with a limited budget and there is no way I can compete with the buying power they have in purchasing low cost art and framing which they then transfer to their pricing. Often a poster framed is sold for less than it costs me wholesale."

P37 - Pet Food/Supplies:
"I am a small pet store. There is a Petco pet supply store that has been almost directly across the street from us for a number of years. Recently (May '93) a Pet Supply Warehouse opened down the street, several blocks away. As they came in with the aspect of lower prices, Petco dropped theirs (particularly the pet food, which is already a low profit margin). To maintain my customers I had to lower my prices as well. I experienced a 30% drop in sales from a very good year in 1991. The recession hit us in 1992, and the Pet Supply Warehouse opened in 1993; we are hoping for some recovery."

"Further, a Wal-Mart and Home Depot opened in or near our community, also Price Club. Theoretically they should bring more business to our community, but Wal-Mart also sells fish and the supplies I carry. Customer service, however remains our real asset as well as the need to keep our prices competitive, if at all possible."

P36 - Drug Store:
"Give breaks to the individual businessman (taxes, 'signage,' etc)."

P32 - Optometry:
"Cities give away so much to the big retailers to get the sales tax revenue. All other commercial developers have to pay full fees for sewers, drainage, roads, etc. So since the mega-chains do not have as much costs going into a project so that their 'rent' can be significantly lower aiding them in undercutting existing businesses that got no breaks."

P35 - Food Products:
"Our business is mainly for India, Pakistan, Afghanistan and other mid-east countries. So, there is no effect from big chain stores. However, we can't compete with them in fresh produce and soft drinks."

P52 - Computer Equipment:
"It is impossible for the small business to compete with the national discount retailer. For every one that opens, 10-20 small businesses go under."

P50 - Women's Clothing:
"I feel communities should be very careful not to give a deal to the big retailers that hurt the community financially."

[Mira Mesa Area]

M30 - Furniture:
"I am a distributor for a national specialized product with a high dollar price tag. It is a very small volume customer base. If my manufacturer were to sell to a major chain there would be no more distributors for them any where it took place. It would be impossible to compete even if they purchased at the same price; however, it is usually lower. If it is only for some of the product line, I think today's consumer will settle on a lower price and compromise for it."

M2 - Computer Equipment/Stationery:
"Small business is being forced out - too many rules and costs and competition. Soon, many people will be on unemployment."

M7 - Fitness Equipment:
"In general, mass merchants, at least in the fitness equipment industry, carry lines of equipment that don't measure up to the quality equipment specialty stores sell."

M8 - Carpet:
"The impact on small companies by the 'Home Depots' of the world with unlimited capital, etc. is causing an erosion of the middle America. In the end the consumer will pay more."

M16 - Carpeting/Flooring:
"In the flooring business in which I am engaged in retailing carpets, vinyl, wood and ceramic tile, several major carpet mills, i.e., most prominently Shaw Industries are engaged in what I consider anti-small retail store programs. They offer programs, such as Shawmark which require stores to buy in at from $20,000 - $40,000 annually which I can't afford!"

"Home Depot is our largest competitor locally in flooring. However, customer perception that Home Depot has better prices (not true) is being discovered. Further, HOME DEPOT does not provide the personal helpfulness, as well as professional installation, that I do."

M19 - General:
"We are a family owned corporation. I have been in retail several years and experienced a decline in business when large chain stores carried the same product line (western wear) at lower prices. It seems customers are willing to give up service and product knowledge for a lower price."

M25 - Athletic Equipment:
"Unfortunately, at this time the superstores appear to be the future in retailing. In order for small businesses to survive, they must be extremely specialized in their field of profession and offer services that can't be offered by the discount retail giants. Small business can no longer rely on the basic retail sales, but must pursue special services and orders that will enable them to be successful. The impact of the discount superstore will be devastating to most small business that compete directly with the superstores who can not differentiate their business from others."

M26 - Flooring/Counters:
"Their size (chains) lets them buy for less. They pay their help less money, consequently workmanship is poor. Too late for customer, they have already signed contract. These large companies know exactly how to stop people from backing out. Even when the product quality is bad."

M32 - Carpeting/Flooring:
"These types of clubs are hazardous to my business because of the margins they work on. We combat them by smart selling and service they can't match."

M31 - Home Improvement/Domestic Products:
"We are a very service oriented business specializing in designing and coordinating living spaces. Our main mega chain competition would be Home Depot. We cannot buy as well as well although we also buy from manufacturers - therefore we must impress our clients with our personal care and talents as designers."

[Philadelphia Area]

4N - Pharmacist:
"Part of the biggest problem in our Industry today is multi-tier pricing by Drug Manufacturers. They sell to different classes of trade at different levels. If they have one standard price for everyone with volume discounts available to everyone it would place competition on a level playing field. Discriminatory pricing must be eliminated. Once the price factors are gone, then the consumer will look for service and this is where we as small businesses can prevail."

11N - Furniture Importer:
"Personally, I resent mega-chains who receive significant tax-breaks. They usually provide no relief to the community's economic dilemma. CARREFOUR was a primary example. Soon after their 5-year tax break, they took their profits home. Although I shopped there, I was not impressed with their company and usually went elsewhere for more knowledgeable salespeople. If mega-companies want a parcel of land, they should not be catered to; rather, provide a good community economic plan. I am confident that small towns don't want them - therefore, no tax breaks!

12N - Hardware:
"Opening the big chain store, it should assess the customer, but not the small retailer like myself. Currently, my business sales have not increased for 5 yrs. It means that I already lost or am losing some customers to the chain store. On top of that, if more chain-stores come to town and open up new businesses, I no longer will be able to compete. Because I know I'm the losing one. Don't you think bankruptcy or leaving the town will be better off for me?"

19N - Market:
". . . . Because they too sell similar products as I do, the competition is high and the sales low. But undeniably, the major grocery chains that have recently been built right outside of my immediate neighborhood and hurt my business greatly."

20N - Jewelers:
"Closed our doors 12/31/93 after 23 years in business!"

21N - Office Equipment:
"My business is primarily a service business, but I have still felt the impact of large business. KINKO's recently opened a 24 hr. 'mega-center' in my area and the only way I can remain competitive is to spend a great deal of money in advertising. A small business obviously doesn't have the advertising budget of a major franchise and the level of frustration rises with each passing day."

5FG - Lumber/Home Improvement:
"The legal system and the federal government have failed the small business people immensely. Family- owned business people, middle class people, who have worked in these businesses, they are the core of people left to carry the burden of supporting the City and the government. What will happen if we are gone? Total collapse is possible. The result of these stores infiltrating a city like Philadelphia will cause the small family business to become extinct."

1S - Video Store:
"We have already seen the effect that Blockbuster and CVS, for example, have had on our business. Our video store nearest a Blockbuster (517 S. 4th St.) has the slowest growth rate of all five of our stores - 4% compared to 20%. On the films that both we and larger chains sell, like children's videos, our sales are very low. They often sell these videos at our cost. We have just started a promotion of three free rentals with selected 'Kid Vid' purchases in an attempt to stay competitive. Our major advantage is customer service. We also sell and rent unusual titles, creating a different niche. On the other hand, as a consumer, I think these stores will save me money. I've already seen this with Caldor. My other, non-business thought is a concern about traffic. I have seen other neighborhoods where the increased flow has put a serious strain on existing roadways, making travel for the locals a nightmare."

3S - Hair Salon:
"The small business owner has kept service a priority and in a time of poor service that has a unique value."

10S - Wallpaper:
"I feel that manufacturers and distributors are helping the chain stores put the smaller businesses in bankruptcy by offering the chain stores better pricing and discounting."

12S - Jewelers:
"Currently have Wal-Mart for anchor store in our S. Jersey location. Has definitely shown to have negative affect on our business volume."

17S - Market:
"I think it is very bad for the government to allow these types of businesses to come into areas and operate. Too much burden has already been put on small business without the giant companies coming in and putting a lot of small businesses out."

"Small business is the heart of this country employing the majority of the workers. They keep getting knocked down by taxes and now these types of business practices."

21S - Jeweler:
"I believe that if you offer good service & quality you will have very little to lose to a discount store."

24S - Clothing:
"My company also manufactures men's neckwear, vests, and robe/boxer short sets which we sell to retailers. Large discount operations have a deleterious effect on our business on two fronts. They tend to drive small retailers out of business (our main customer base); and, two, they are ruinous to our bottom line by their very nature of being a mass discounter. In other words, it is not profitable business with them. They source the world looking for cheap labor which makes me non-competitive."

26S - Electrical/Home Improvement:
"Our main concern is Home Depot, not that we can't compete; but, when a Home Depot comes into an area, we believe that they lower prices below cost to get their foot in the door because consumers are creatures of habit. Then we've heard that when they put everybody out of business they raise their prices."

27S- Auto:
"The area of South Philadelphia is heavily saturated with auto repair shops and would be hurt economically with the addition of discount service facilities coming into the area. This would cause a number of shops that are on the verge of closing to do so causing more people on the unemployment lines. The economy is very fragile in this area and should not be subjected to anymore mega-chain business openings until the economy becomes more stable."

29S - Hair Salons:
"The large chains should NOT be given any type of tax deferments because the responsibility of paying the taxes and/or increases will again fall upon the small businesses who cannot afford it and who will be forced to close."

"With the economy the way it is people want to pay cheaper prices for almost everything even if the community in the main loses jobs. These large chains can do nothing, but hurt small businesses. If a new business wants to be in an area, then the government and the community should decide whether that chain will help or harm the community."

33S - Jeweler:
"Jewelry business is rather personal/individual - consequently, some of your questions were not relative to our particular company. Ours is an 80 year old business and lots of our sales are by word of mouth, our proven honesty, and our employees who continue to enjoy their positions working for a small family type of business."

35S - Pet Store:
"I feel it is unconstitutional to stop any retailer from entering an area. I do feel the tax breaks and real estate deals are wrong."

"Just make the playing field the same and let the competition continue."

37S - Pharmacist:
"Wal-Mart just lost a law suit to three pharmacies in the local courts of their home state, Arkansas, for allegedly driving drug stores out of business because of claims of "predatory pricing." I believe that the major mega-retail discount chains are known for taking more out of a community than they put in."

38S - Jeweler:
"If a large company moved into our area, I would try to enter into contract work with them to do the repair or special order work my jewelry store deals in. If we could not do the work, we would try to advertise quality work, personal service, and better prices. If we see a drop in overall profit and gross sales, I would then look for other locations to start over; but, it would have to be a large drop in business."

41S - Bookstore:
"I own a small independent bookstore. After 2_ years as the only 'new' bookstore in my area, a huge Tower Books opened around the corner (about 300 feet away). My sales started to drop slowly as my loyal clientele were wooed away by price cuts of 35%! Tower could sell books (because they bought larger quantities and 'drop shipped' to their various locations) at prices that I was buying them for! I have survived 2 more years, now I am closing up." (May 1994)

44S - Optical:
"Out of all of the nationals coming in, only Wal-Mart does optical right. Therefore, most will have very little impact on our company. I believe that the customers the deep discounters attract are the customers they bring in for TV's, appliances etc."

49S - Home Improvement/Tile:
"Companies such as those Mega companies mentioned, have caused much concern in my field. The impact on product identification is cause for alarm, with most people related in the field of ceramic tile imports. Since the recent opening of Home Depot in the Philadelphia market, I cannot say that I can express the same confidence that I have had in pricing products. It is quite obvious that easy product identities are singled out and low-balled so that smaller businesses dealing with some similar products will look bad. This type of tactic has had a negative effect and has caused hype in our industry."

[Chicago Area]

CH 86 - Plumbing/Kitchen Supplies:
"Since large mega-retail chains entered into the retail trade, they have attained tax benefits not available for the smaller shop. Typically these large scale companies deal directly with the manufacturer and then sell to the consumer. Now if they receive tax credits i.e. Home Depot, they have the best of all worlds. They sell, in some cases, for what the smaller company buys the goods for. We do have a community interest, product selection interest and service (complete) to the end. We want to be here to stay, but with an uneven playing field, why waste the time."

CH85 - Women's Casual Clothing:
"We started in Des Plaines in 1897 and have never had any special favors or help from our city fathers. Our money has stayed here in town and we have helped hundreds of local people earn a living. Why an established discount retailer has to have help is beyond me. If they can't stand on their own two feet, they should be told to move on. Their profit goes to headquarters, ours pays taxes for the town."

CH77 - Stationery:
"Events that have hurt our business in the office supply industry are:

(a) Predatory pricing and 'loss leaders' items and (b) Manufacturers giving better prices to upstart superstores based on the size of the total business versus actual stationery sales. Then superstores use this to gain market share."

CH73 - Health and Beauty/Rx Drugs:
"My situation is unique in that I have an ethical pharmacy which is surviving only because I value the quality of my workplace more than I value a large paycheck. Consumers aren't aware of the fact that small businesses are quickly disappearing. The service and personal service given will be a thing of the past unless something is done. It will be like the 'service stations' and no one will even miss having a service attendant pump their gas for them because they weren't from that generation."

CH72 - Paint/Wallpaper:
"I'm hopeful that the independent dealer will survive. It takes a lot of people, sales and profit to keep these big chain stores going. Let them fight each other! In the interim, we will continue to offer above par service, and product knowledge with the thought of out living the big store image."

CH71 - Optometry:
"Tax breaks are given to mass retailers to move into an area. I get no tax breaks - totally unfair."

CH68 - Office Supplies:
"We have Super Kmart, Wal-Mart and Eagle about 3 blocks apart in Elk Grove. What's the point?? Woodfield is 5 minutes from them and now Office Max is 5 minutes from there. It's not fun anymore. 50% or more of office supply dealers have gone out in Chicago area."

CH67 - Snacks, Sodas, Cigarettes:
"Low select prices on select items such as sodas hurts the vending business."

CH62 - General:
"Don't give tax breaks!"

CH61 - Restaurant Equipment:
"Redevelopment, industrial revenue bonds and tax abatements should only be used for manufacturing or distribution businesses; not retail. Jobs are not created, only transferred by retail."

CH59 - Food:
"The large chains run so many 'loss leaders' that it is almost impossible to survive, much less grow your business. They sell many items well below my cost."

CH47 - Equipment Rental:
"Simplify government regulation and paperwork both nationally and locally to allow more time to focus on the developing business. Anything to level the playing field with larger deep pocket companies."

CH40 - Video Equipment:
"The commercial property tax is driving small businesses out."

CH38 - Food Products:
"I just spoke recently with our mayor about the 'tax breaks' that 'Sam's Club' gets. I, as a small business owner, would never get the breaks and concessions that our elected officials give these large retailers. The mayor agreed. This left a feeling of hopelessness in my throat. It is very difficult to compete these days."

CH36 - Medical Equipment:
"We provide home medical equipment. The majority of our customers receive our products and service via our drivers and service vehicles. The large retailers have had an eroding effect on our business. The result to date has been customers receiving less service with no knowledge of warranty, billing, or adequate follow-up. If compatible tax incentives were made available to existing established small business, long term employment and tax revenue would have a positive impact, long term, on each community."

CH35 - "Other":
"Tax concessions to large companies should be given to start-up businesses only, not established companies who take advantage of local inducements regularly. Kmart used low rate financing on their leased properties. Wal-Mart as well. On the other hand, these large discounters offer attractive well stocked stores at low prices which benefits all. Many small businesses at retail are mismanaged by their owners."

CH32 - Food Products:
"Major complaint is these large merchandisers ask for and generally reclaim large tax breaks and incentives to come into a community. This is never offered to small business. We always pay full price and continue to carry a heavy load of the community responsibilities."

CH20 - Lighting/Electric (a distributor):
"As a distributor, the trend to buy direct is not only with the national discount retail chain, but also smaller, independent family owned business. The problem is, they still can't compete. Their distributor, such as my company, also can't compete. Therefore the middleman and small companies both get destroyed."

CH19 - Auto Parts:
"This country was founded on freedom and the free enterprise system. This system is in grave danger by both our government and big business. The tax burden on small business is now higher than our profits. A ground swell of small business is needed to stop these current trends. Small business is a major employer, yet government treats us like second class citizens."

CH14 - "Other":
"At least make it so large retailers must make a profit on items sold and pay their full share of all taxes (sales and real estate)."

CH12 - Auto Body:
"We are an auto body repair facility and not really affected by mega-retailers but have seen concerns from local hardware stores and neighborhood drug stores."

CH11 - Pharmacy:
"Large chain stores are robbing America of its heart. The average person is not capable of perceiving what they will be missing when all the small business people of America are gone. Their children will not find their first jobs, the little leagues and churches and bowling leagues will not have sponsors. Our country is losing its soul - corporate America is like a bad virus!"

CH9 - Greeting Cards, Stationery:
"My business distributes greeting cards, etc. to non-chain accounts. Our business has been strongly affected in addition to our customers. A significant number of 'Mom-and-Pop' locations have fallen by the wayside, unable to compete. In addition, the number of party outlets has also diminished our sales as well. Our highest year in sales occurred in 1991."

CH8 - Software:
"I certainly agree with what you are surveying, however my answers and survey are probably meaningless as I am in the proprietary software market and the companies you speak of have little or no impact on me other than to possibly pull some of my business if they sell some of the supplies I need."

CH91 - Auto Equipment:
"Big retailers have definitely decreased our sales in tires and exhaust parts and shocks. Difficult to compete with Kmart prices on above items - also tires sold at Sam's Club in area."

CH96 - Party Supplies:
"The larger discount houses hurt the small retailer. Consumers do not understand that their claims to have lower prices are not always true. They can afford T.V. and radio advertising while we can only rely on reputation and service. Grocery stores are getting out of hand; they should sell groceries and leave the greeting cards, gift items, flowers to the small retailer. I feel soon there will be no room for the small retailer because of rent, taxes and discount stores."

CH98 - Lawn/Gardens:
"We handle premium lines of mechanical equipment that have traditionally been marketed through certified independent dealer networks, outlets created by manufacturers to assure the availability of professional expertise in the sales, service and maintenance of their product lines. This 'value added' support cost is rarely provided by mass merchants and thus this savings in their cost of sales plus their buying power, provides them with their retail price advantage. In the long run its the consumer who will suffer overtime as mass merchants force out 'value added' dealers. This type of product eventually needs service. Few manufacturers of top end products provide for service only dealerships. Sales have always been and still are the prime requisites of a dealer franchise. As sales through 'value added' dealers diminish and those dealers become competition victims to the low prices of mass merchants, then sources of professional service and maintenance will become a problem for customers, and too late we will understand that the lowest price was not the best price in the long run."

CH97 - Jewelry:
"I think the large corporations will dominate our economy. The true craftsmen will sell out or go bankrupt. The jobs created in the large corporate stores are low wage and often part-time. There are not as many management positions in the large corporate stores. The youth in America are not studying the right subjects to compete in our global economy. Technology is also taking jobs away. What took the U.S. 50 years to learn up to World War II now takes less than 5 years to learn. I think the strongest entrepreneurs will survive. Many less motivated people will work at Kmart and spend their checks hoping to win LOTTO or gamble at the Casinos! Plus, big firms take over other firms and then they scale down help, etc. - laying off many people."

[Kankakee Area]

K51 - Auto Equipment/Services:
"We are an automotive repair/service business with over 32 years experience in this field. We have had mega-retailers entering our area rapidly in the last 2 years. Being able to determine the problem and to determine the cause and effect, and to recognize the solutions would be very difficult. As an example, to lower prices would only be a possible temporary fix. Our local government has waived mega-retailers requirements through tax abatements in the Northfield Square Mall. I am very interested in your study and look forward to receiving additional information."

K50 - Florist/Arts and Crafts:
"Products you have listed do not pertain to our florist/gift shop retail operation. However, there are national and regional chains that would affect us like Frank's, Michael's, and Christmas chains."

K48 - Video Equipment/Games:
"There was a time when the video rental business was profitable as a stand alone business. Now it is not, for a number of reasons: 1) Large stores use rentals as a 'loss leaders'; 2) Purchase price to large stores are much lower; and 3) Major discounts are available from manufacturers not available to small independents."

K47 - Food Products:
"We are faced with severe competitive pressures. We are truly an independent food operation. Our competition is Jewel, Kroger, Eagle Supercenter (new 180,000 square feet) and Kmart Supercenter (new 160,000 square feet) store. We will probably not survive. We have fight and desire but we don't have the capital or mega dollars to compete with the discount chains. We can't purchase product in many cases for what competition is selling at retail. We also lack the buying power that large national and discounters have. As I see it, the large are forcing out the small, with discounts to the consumer, until they secure the market - then they do what they want."

K45 - Lighting/Electrical:
"Having regional warehouse home centers (Blains, Menard's, Home Base, Builder's Square, Big 'R') in our areas has sharpened our abilities to survive. We are able to describe the 'enemy' to our team members much more clearly."

K44 - Telephone Systems and Lines:
"Discount chains are wonderful for products that do not require additional service. The customer ends up with the best price. On the other hand for products that require any service, you should purchase at a smaller more personalized store."

K43 - Athletic Equipment:
"Currently, within a two mile radius, Wal-Mart, Super Kmart, K's Merchandise, and Target compete for the same customers. The only way our retail business survives is through service and quality products. There was a time in the business when large retailers could not buy the high end sporting goods' products. Recently that niche has eluded us - the specialty store. Fortunately for us, we have developed a sporting goods team business which sells and serves the needs of over 300 grade schools, high schools, and colleges. If we had not started a new business and continued to solely concentrate on retail, we would have considered selling the business."

K39 - Health and Beauty:
"We have already experienced Super Kmart, Wal-Mart and soon Target. When I purchase products for my business I have been forced to look harder at price and quality. Consumers right now are only concerned with price; they are not looking for quality. When in a discussion with clients we try to point out the value of personalized service and that the mega-retailer really doesn't care, as to what will happen if they spend all their money there in terms of jobs, families, communities, etc."

K - 38 Food:
"In our local area (Kankakee, Bradley, Bourbonais) TIF[Tax Incentive Funding] Money has been used by Bradley & Bourbonais to develop large retail areas in the last 10 years. They used the TIF money to develop farm ground (not blighted areas as originally proposed). During this time they have raped the tax base of the City of Kankakee. Many Kankakee business have moved from Kankakee to Bradley and Bourbonais."

"Now that retail business has left Kankakee, Bradley and Bourbonais and county officials have decided to end TIF money for retail business, Kankakee has lost the weapon (used against them) to recoup retail business. TIF money was misused here and a warning should go out to other communities."

K37 - Games, Hobbies, Books:
"I live in Bourbonais, IL and have my radio controlled hobby business in Bradley, IL. When we started seven years ago, we had no help from the village as far as tax incentives; in fact never gave it a thought to inquire. We have worked hard to keep our business intact, but find our taxes going higher each year both personally and business-wise to maintain these large retailers that come in under the TIF Programs and then leave in seven years or less. We little people are getting the shaft."

K33 - Optometry:
"We need to get rid of the one hour labs that draw people. They don't do the service that they say and prices are high. We need to get back to the old ways. If we have to have them I would try to limit only one per town. In so many towns there just too many of them."

K25 -Doors and Windows:
"The tax abatements provided chains are an unfair practice; I know that helps mega chain competition. This alone allows them to reduce prices to hurt other small businesses."

"A free market to all, giving large and small businesses the same local advantages in taxes, land, etc, is most important to the survival of the small retailer."

K24 - Electronic Equipment:
"I have experienced several times in my career what happens when a major chain leaves. The buildings are left vacant. Their restrictions to buyers because of competition are contributing to why these large buildings are left empty. In our area TIF increments have led stores to move a mile or two at most to be in another town and receive tax breaks. I have also got to see local schools and police forces suffer through problems because no tax money comes from TIF."

K21 - Audio Stereo Equipment:
"With a lower overhead I have been able to compete favorably with the large discounters; however, if one moves close to me I may lose a handful of customers but the increase in traffic would also increase new customers."

K20 - Food:
"A Super Kmart opened in February 1994 near our business strip and we have noticed a definite decrease in customer traffic and sales. A Target will be opening in July and we will probably experience another decline."

K18 - Auto Mechanical Service:
"I have a service business that employs four employees that make a decent living, not minimum wages like mega chain stores. This puts me at a disadvantage even before their tax breaks come into effect. I get no tax breaks. If I need money to remodel, I have to finance it myself at local banks not unlike the national corporations."

K17 - Children's Dance Shoes:
"We are a small manufacturer of dance shoes, shipping nationwide to retail stores and dance studios. Also we have a very small local retail business. Local Pickway and Wal-Mart have brought in cheaply made dance shoes from other sources and sell them at almost wholesale prices. We have lost several large retail accounts across the nation. Due to this low pricing, small retailers cannot compete because of the nature of the product and customers who are uninformed about quality."

K16 - Lawn and Garden:
"It looks like local, state and federal government help the giants who want to take all the sales away from the small merchant who made the American way of life possible, leaving us just to do service work for the giants. They make the easy money and we do the hard physical work for them in the service sector."

K15 - Furniture:
"The big chain stores are taking advantage of tax breaks. They move from town to town and close smaller stores. They build their stores with out-of-town builders, so nobody local makes a profit on them. They want to make a living in town but don't support the town."

K14 - Hunting/Fishing Equipment:
"We have four chain discount stores in our area and it is very hard to be competitive and make a living."

K12 - Meats/ Poultry:
"We in the Kankakee, IL area are already experiencing the opening of several TIF businesses which are creating problems for the smaller operations due to their discount pricing on certain sale items. In my business we deal with fresh meat products and they are highly perishable, so any drop in business is very critical. In the last year we have experienced the opening of a Super Kmart and the state has been working on the highway for one year. These two factors have created a 10% drop in our total sales."

K10 - Optometry:
"We are a full service, one hour optical business. We already have experienced a Super Kmart opening (3-6 months ago). Our prices were already competitive - in some cases lower. The only people we lost were a few (approximately 20-40) contact lens patients who wanted a lower price on contacts. The average was $10-$15 lower, however, we don't make our main profits from these patients, so the loss was negligible. Also when these people go back for a new exam they will find it (the exam) $25.00 more!"

"Overall the opening hasn't hurt us much; however, we are a franchise with a national name, not just a small local owner. Even though we are not just a single owner, I do agree that Kmart, etc. do have the advantage, insofar if they have a slow month they can get an infusion of funds, etc. from their corporation, while we have to struggle along!" K7 - Home Improvement/Building Supplies:

"There should be some kind of truth in advertising when quoting such as 50%, 60% or 70% off, or 'Special Sale.' But what was the original price?"

K4 - Foods:
"There should be government regulations that super or big business locations be limited to certain areas, because most or almost all of those big businesses get a tax break from the state or city that they go to. Small businesses don't get that privilege."

K1 - Gift Shop:
"We try not to carry the same products you find in discount stores. Our gift shop carries the finer crystal, bronze, pewter and other specialty items. The Railroad Shop, located on the second level, also carries items not found in discount stores."

K61 - Water Conditioning:
"We have to meet a customer on service and personalized greetings since we do not have the buying power to attain the 'best' price as the large chains do. We are able to meet an individual customer's needs personally; they are not just a number."

K58 - Jewelry:
"I mainly feel that mass merchandisers serve large numbers of people but lack quality merchandise in our field. We, on the other hand, have to present a quality picture or image to attract those who are more discerning. This includes educating the market we go after, while still maintaining an edge on fair competitive prices. We belong to trade groups that help us compete. The Kmarts, Wal-Marts, etc. don't seem to help the communities they do business in."

K62 - Home Improvement Supplies:
"1. Reduce trading area to 3 mile radius. 2. Advertising locally. 3. Chains steal employees to hurt your effectiveness. 4. Chains steal employees to hurt traditional experience. 5. Chains then release employees after two years to reduce their payroll after competition has been knocked out."

[Finger Lakes Region (Geneva, Auburn, Syracuse)]

NY48 - Athletic Wear, Toys, Athletic Equipment:
"Geneva is an area in need of development, and Geneva already has Kmart and Wal-Mart. The damage from their development was not major at best. There wasn't much available that they created too much competition for. The area that needs to be reviewed here is the definition of what we have in small businesses and then attempt to attract businesses that are needed and wanted by the people. Geneva is too much duplication which is so counterproductive. Same old-same old doesn't sell."

NY44 - Office Products:
"We operate an office products business. At the present time we are still not greatly affected by the new Wal-Mart store. What the greatest influence is the prices published by discount stores operating out of Syracuse and Rochester and the 'Paper Cutter' (Fays Drugs) in Auburn and the catalogue they distribute. My concern is the fact the discount stores sell, at the same or lower prices what I pay for the same merchandise. The manufacturer offers these products at prices that are not available to me because of a much lower overall volume."

NY40 - Marina Supplies:
"Wholesale stores have forced me to lower my inventory, reduce the prices of goods sold and reduce my work force, but that's only part of the problem. School and county taxes have doubled. Canal permits have gone up 800%. Cigarette and Alcohol tax has increased. Beer licenses also went up this year, making me think seriously of ending the sales of beer and cigarettes, because the reduction of the profits being made. New York State is forcing the small business man out."

NY37 - Jewelry:
"Too many stores which are 'Mom-and-Pop' operations will be closed down by these mega stores with their buying power and low prices. Only stores that can provide service and knowledgeable service employees will survive."

NY36 - Silver and Crystal:
"Factory Outlet Malls and mega-retailers are destroying and will continue to destroy 'Main Street' in small town America. As 'Main Street' disappears, so will the tax base which is so vitally needed for the entire community."

NY34 - Furniture and Stationery:
"I only hope I can make our business last long enough to educate our four children. I will not allow any of them to work for us. I would not wish this on anyone. We have told our children they would be better off working for a large company. My 15 year old says 'You say you have more freedom with owning your own business, but all my friends' parents get days off and vacations and their families don't always discuss work.' I think the way retailing in America has changed is revolutionary. There is no going back, the consumers will not permit it."

NY29 - Computer Equipment:
"We have responded to the encroachment of large retailer selling computers by specializing in markets that are not the 'retail' consumer."

NY28 - Food:
"Most open minded small businesses can survive large chain competition by adjusting to their weaknesses such as specializing, offering personal services, delivery, and the list could go on and on depending on the individual situation."

"Generally small business cannot be everything to everybody when they are up against the giants. Reduce the areas that you are weak in and concentrate your efforts on the strength of the business."

"Our strength is subs, salads and sandwiches. When we opened 12 plus years ago, McDonalds and Burger King were here already. Now there is Arby's, Wendy's, Subway, Denny's, etc. While a dozen or more independent businesses have come and gone, we are surviving."

NY10 - Home Improvement:
"We have had a Wal-Mart move into our area within the past two years. We lost 35% gross sales and fired all employees. The best thing to do is to provide service and knowledge."

NY7 - Tavern:
"I feel the American public welcomes the discount prices offered by large discount houses, as long as it does not affect them personally. My business is a small 'blue collar' tavern. I pay $2,140 every three years for a state license to sell on premise liquor and beer and off premise beer. Large food and discount stores (i.e. Newmans, P&C, Fays Drugs) pay $75 per year for a license to sell off-premise beer. These large stores use beer as a 'loss leader' to get the public in the door. They sell my only product to take out for less than I can purchase it wholesale. In my opinion, N.Y. State requires license fees for the money only."

NY6 - Restaurant:
"It is extremely difficult at the present time to compete with larger competing restaurants, especially franchises, because in a tourist area, it's the franchises that are the first draw. Taxes and insurance and Workman's Compensation costs continue to rise. Suppliers continue to raise their prices and yet if we do, everyone becomes upset and stays away. It's basically a 'no-win' situation."

NY5 - Auto Supplies/Service:
"The way things are right now, if a chain came here in Geneva it would probably force us out of business."

NY4 - Men's Wardrobe:
"We are a better men's specialty store. Chances are, a customer who wants a better quality in men's wear will come to us or a similar type store. I feel a Wal-Mart type store hurts a store like us by taking away traffic from our 'Main Street.' We lose window shoppers who might stroll in just looking, and possibly make a major purchase. The mega-chains compete with so many types of stores (hardware, electronics, etc.) that people will tend to go there first before checking 'Main Street'."

NY2 - Jewelry:
"The Geneva market was already affected by introduction of Kmart, Wal-Mart (2 locations), Wegmans and Tops (Superstore). Market surveys for this area do not support this amount of retail space and now three major outlet strip plazas of over 150 stores are planned for Geneva development within 12 months."

NY1 - Men's Casual Clothing:
"One of the biggest negative impacts is the reduced downtown traffic caused by these mega stores. It is hard to draw customers to a downtown location. These chain stores, by being situated on the out-skirt of the city further erode customer traffic. A positive impact is that you have to become a better merchant in order to compete. You cannot remain stagnant."

NY54 - Bikes/Equipment:
"It's a free enterprise society so they have every right, but these 'mega stores' are putting us small guys out of business and ruining downtowns."

NY55 - Bar and Grill:
"I don't understand why I was sent this survey. My business is a floundering bar and grill. In the nine years that I've owned it, I have seen business dwindle to nearly nothing because of laws, rules and regulations and the economy."

NY57 - Lumber:
"We currently have Builders Square locations in Syracuse and Rochester. Although they are approximately 40 miles from us we still realize their impact. Home Depot is currently building and/or planning stores within both of those market areas. To further complicate our rural market, the Depot is developing a strategy to penetrate the rural/smaller market areas. It goes without saying that it is tough as hell out here and getting worse. We are doing everything possible to survive. Our business plan is not designed for 3 to 5 years, it is based on daily survival. Without help, I believe most independents will not survive."

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