In most of North Carolina, the presence of a national retailer in a large storefront is not a cause for alarm. However, Orange County is not like the rest of North Carolina. Here a big box store is anathema.
Why? Let’s look at the reasons given to the Chapel Hill News by Mr. Jason Baker in response to recent attempts by State Senator Ellie Kinnaird to get a Costco in Chapelboro:
1) Big retailers result in a net outflow of money from the region.
2) Marketing, merchandising, IT, finance, human resources, and other business support and executive jobs would largely be somewhere else.
3) Locally owned business provide the full gamut of job opportunities to bring just as many high-skilled as low-skilled positions to the area.
4) Locally-owned retailers struggle and go out of business because of competition from national retailers.
5) The progressive nature of Chapelboro should support local businesses because of their unique character, the jobs they bring to our community, the preference for high-quality and locally produced products over cheaply made and morally questionable foreign imports.
Unfortunately, the truth lies elsewhere.
1) Local retailers also result quite often in a net outflow of money from the region. The goods they offer are made elsewhere.
2) Marketing, merchandising, IT, finance, human resources, and other business support and executive jobs are jobs not dependent upon any particular geographic site. Costco IT jobs can be performed in Chapelboro, assuming that the smalll business was competitive in quality service and pricing.
3) Locally owned businesses do not necessarily use local high paying wage service providers. There are no studies showing this assertion. Is using a Raleigh based law firm considered progressive?
4) Small business failure occurs for many reasons. Seven out of ten new employer firms last at least two years, and about half survive five years. More specifically, according to new Census data, 69% of new employer establishments born to new firms in 2000 survived at least two years, and 51% survived five or more years. Firms born in 1990 had very similar survival rates. With most firms starting small, 99.8% of the new employer establishments were started by small firms. Survival rates were similar across states and major industries. More particularly to the Progressive doomsday arguments, in some cases, small businesses suffer the same termination rate as larger businesses. According to a research report from the Office of Advocacy in the US Small Business Administration “larger eating and drinking retailers (most likely multistore chains) are no more likely to shut establishments than are other retail firms of that size. Clothing and shoe retailers have a relatively high rate of establishment exit across all size categories (the highest for the 20-99 employee and 100-499 employee firms, second or third highest for the two smallest size categories).”
5) Notice how Progressives don’t talk about creating a successful business that creates a net inflow of money into Chapelboro by selling goods and services desired outside Chapelboro. If unique business character is a societal value to be prized, then successful Chapelboro small businesses that penetrate other non-Chapelboro markets are not to be prized. In essence, Progressives are advocating for a late 19th century economic model.
The argument of what to do about “cheaply made and morally questionable foreign imports” is one for a national discussion. Imports stop at the national borders, as much as Progressives wish to eliminate those national borders.
The more interesting fact ignored by Progressives is what a good job local municipal governments have done building a regulatory maze for big box retailers. According to Chapel Hill’s ED specialist, Mr. Dwight Bassett, the Chapelboro roadblock takes about four years to navigate before a store can open its doors. Of course, the reaction by business is “thanks, but no thanks”.
Thankfully, being a Progressive community, no one is to blame for the detour.
