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NEW RULES - While many parts of the country are overrun with chain
stores, San Francisco remains a stronghold for locally owned businesses,
according to a new study, which also found that those local stores
generate sizable benefits for the city's economy. The San Francisco
Locally Owned Merchants Association, one of the sponsors of the study,
hopes it will spur residents to choose locally owned businesses more
often and encourage cities in the region to re - examine policies that
favor chains.
The study calculated the market share of independents and chains in
several categories: bookstores, sporting goods stores, toy stores, and
casual dining restaurants.
In all four categories, the study found that independents capture a much
larger share of consumer spending in the region than they do nationwide.
Locally owned bookstores in the San Francisco area, for example, capture
about 55 percent of book sales. Internet retailers account for 19
percent of the market and chain bookstores, including Borders and Barnes
& Noble, have about 15 percent. Nationally, independent bookstores
account for just 10 percent of book sales.
Independent sporting goods stores in the San Francisco area likewise
capture 56 percent of sales in that category, while independent
restaurants have almost two - thirds of the casual dining market.
Locally owned toy stores account for 44 percent of toy sales, while
specialty toy chains, general merchants like Target, and internet
retailers capture the rest.
Local bookstores accounted for less than 12 percent of book sales in the
suburbs. Independent toy stores fared even worse with just 3 percent of
the suburban market.
The second part of the study finds that $1 million spent at independent
bookstores creates $321,000 in additional economic activity in the
region, including $119,000 in wages and salaries paid to local
employees. That same $1 million spent at chain bookstores generates only
$188,000 in local economic activity, including $71,000 in local wages
and salaries.
Much of the difference in economic impact is due to two factors. One is
that the chains have some of their management, marketing, and other
functions carried out at corporate headquarters and therefore employ
fewer people locally per unit of sales. In the toy category, for
example, for every $1 million in sales, independent stores create 2.22
local jobs, while chains create just 1.31.
The other factor is that the local retailers spend more of their revenue
buying goods and services at local businesses such as print shops,
accounting firms, web design companies, banks, and so forth. Chains have
little need for these local goods and services; many of the dollars that
flow into their outlets instead leave the region.
A 10 percent shift in spending from local stores to chains would deprive
the community of $192 million in economic activity and put almost 1,300
people out of work. Locally owned businesses in San Francisco have been
losing ground to chains, as they have in the rest of the country, for
more than two decades. Continuation of this trend would further harm the
city's economy.
http://www.newrules.org/retail/news_slug.php?slugid=358
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NEW RULES - While many parts of the country are overrun with chain
stores, San Francisco remains a stronghold for locally owned businesses,
according to a new study, which also found that those local stores
generate sizable benefits for the city's economy. The San Francisco
Locally Owned Merchants Association, one of the sponsors of the study,
hopes it will spur residents to choose locally owned businesses more
often and encourage cities in the region to re - examine policies that
favor chains.
The study calculated the market share of independents and chains in
several categories: bookstores, sporting goods stores, toy stores, and
casual dining restaurants.
In all four categories, the study found that independents capture a much
larger share of consumer spending in the region than they do nationwide.
Locally owned bookstores in the San Francisco area, for example, capture
about 55 percent of book sales. Internet retailers account for 19
percent of the market and chain bookstores, including Borders and Barnes
& Noble, have about 15 percent. Nationally, independent bookstores
account for just 10 percent of book sales.
Independent sporting goods stores in the San Francisco area likewise
capture 56 percent of sales in that category, while independent
restaurants have almost two - thirds of the casual dining market.
Locally owned toy stores account for 44 percent of toy sales, while
specialty toy chains, general merchants like Target, and internet
retailers capture the rest.
Local bookstores accounted for less than 12 percent of book sales in the
suburbs. Independent toy stores fared even worse with just 3 percent of
the suburban market.
The second part of the study finds that $1 million spent at independent
bookstores creates $321,000 in additional economic activity in the
region, including $119,000 in wages and salaries paid to local
employees. That same $1 million spent at chain bookstores generates only
$188,000 in local economic activity, including $71,000 in local wages
and salaries.
Much of the difference in economic impact is due to two factors. One is
that the chains have some of their management, marketing, and other
functions carried out at corporate headquarters and therefore employ
fewer people locally per unit of sales. In the toy category, for
example, for every $1 million in sales, independent stores create 2.22
local jobs, while chains create just 1.31.
The other factor is that the local retailers spend more of their revenue
buying goods and services at local businesses such as print shops,
accounting firms, web design companies, banks, and so forth. Chains have
little need for these local goods and services; many of the dollars that
flow into their outlets instead leave the region.
A 10 percent shift in spending from local stores to chains would deprive
the community of $192 million in economic activity and put almost 1,300
people out of work. Locally owned businesses in San Francisco have been
losing ground to chains, as they have in the rest of the country, for
more than two decades. Continuation of this trend would further harm the
city's economy.
http://www.newrules.org/retail/news_slug.php?slugid=358
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