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Friday, December 15, 2017

Retail shifts are a new opportunity

From the Newsroom by Chad Knudson

It was a predictable question from a familiar type of person dropping by the Ranger-Review.

“What is happening to Glendive?”

In the moment the question was referring to the liquidation then underway at Kmart, but it was asked many times before and will undoubtedly be asked again. 

The questioner is by now familiar: a retired baby-boomer passing through Glendive, usually for the first time in decades. 

Perhaps it is the nostalgia of a class reunion or the sadness of a friend’s funeral, but the mistake is the same: believing that rather than going back to one’s hometown one is actually going back in time. 

They arrive expecting to find buildings that are 30, 40 or 50 years newer than they are and the same shops and eateries they remember from their youth. 

Glendive, it seems, has gotten far worse than they remember and the loss of Kmart is just the latest sign of decline. (Many a local thinks the same.)

Yet it isn’t Glendive that has changed, but the nation and the world. 

About 30 years ago big-box chain stores started popping up across America in large numbers. With massive product offerings, volume discount prices and large, well-lit parking lots, they were an alluring improvement over crowded downtown shops with parking meters and limited selections.

Many local businesses were driven from the marketplace. Downtowns large and small were left to deteriorate and languish as buying habits shifted. 

Because small towns lacked the mass needed to support big-box stores, shopping hubs in cities started to attract buyers from tens or hundreds of miles away.

Here, the shopping trip to Billings became a way of life.

Now, the retail landscape is changing again. Big-box retailers are shuttering stores at a record pace. 

According to an Oct. 25, 2017 report by CNN Money, more than 6,700 brick-and-mortar store closings have been announced since Jan. 1, 2017.

Credit Suisse says as many as 8,600 stores may close by year’s end.

Bankruptcydata.com reports that at least 300 retail companies have declared bankruptcy this year.

The closures span the spectrum of retail: Walgreens, GAP, Sears, Staples and of course Kmart — all during a time of strong economic growth, not recession.

Considering there are 3,144 counties in the United States, the closings announced as of the end of October average 2.1 per county.

Not surprising then that one of the most vulnerable retailers in the country closed their box store here.

Obviously this isn’t something happening to Glendive; it is happening all over. Indeed liquidations were underway at JC Penny stores in Sidney and Dickinson at about the same time.

The explanations are varied. Less consumerism among Millennials, over-saturation of the market (the U.S. has far more retail space per capita than any other advanced economy) and of course the ever-growing prevalence of online shopping.

Whatever the causes, this latest shift brings with it reason for optimism. That’s right, there is good reason to be hopeful.

Big shifts in culture or the economy take awhile to understand and to adjust to, but adjustment is starting to happen.

The decline of big-box may well mean the revenge of mom-and-pop. These small, hyper-local businesses will cater more directly to local demand with personal attention not available online. 

This isn’t to say local stores will reverse the trend toward online retail — they won’t. Rather they will fill specific niches with interesting products and experiences not easily delivered in a brown box.

One can see this at work all over Glendive. Lost amidst the anguish over Kmart is new construction of an ag supply store and a travel center in recent years. 

Many small shops have opened and commercial spaces across town have been expanded, remodeled and refreshed. If you haven’t noticed, take a closer look.

Meanwhile, the Internet is a great equalizer. When life’s basic necessities and virtually any luxury good are easily purchased online, it really doesn’t matter if the delivery address is in Denver, Billings or Glendive. 

Buying these items in Glendive now involves browsing the same marketplace, the same pricing and the same service as every other consumer in the world.

No need for a road trip to a commercial hub in a larger city to get the best price or more variety.

That also means it is easier to keep and recruit talented people. If one prefers a great quality of life without traffic jams and crowded parking lots, they don’t have to sacrifice access to fast, efficient online options and they get to enjoy unique local shopping experiences.

So, what is happening to Glendive? It is becoming more competitive and more interesting all the time.

Chad Knudson is publisher of the Glendive Ranger-Review. He can be reached at rrpub@rangerreview.com.

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