Supercenter cities see steady growth

Published 12:00 am Monday, June 21, 2004

Shelton Day believes that if a Wal-Mart Supercenter comes to town, people will drive from miles around to shop at it.

Or, perhaps, they may just drive from around the corner.

Day, mayor of Thomasville and a former Wal-Mart store manager, has seen the growth that follows the giant retailer firsthand and believes it serves as a strong drawing card for other business development.

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“Business breeds business,” he said.

Day’s advice for Demopolis is simple: prepare for a Supercenter, get existing businesses competitive and customer-service oriented and be proactive.

“We didn’t just sit there and watch this train come through town and hurt our businesses,” said Day, who was president of the local Chamber and the Wal-Mart manager when the project was announced. “Most people are reactive about things, but if a community is proactive,

you can make it … an asset.”

Day said his Chamber got busy, bringing in business consultants for existing businesses and providing education support to business people in their efforts to compete against the retail giant.

“(The Supercenter) has been very good in the long run. It’s forced our businesses to be competitive, find their own niche and take care of their customers,” he said. “Small businesses have honed in on their skills of taking care of their customers.”

While many critics say Supercenters kill small businesses with whom they compete off, Day said that hasn’t been the case in Thomasville, where the Supercenter contributes 30 – 35 percent of the city’s monthly sales tax base.

It’s had the opposite impact, spurring growth in the restaurant sector and new business locations, he said.

“There’s been a flurry of new businesses locate in Thomasville since (the Supercenter) opened,” Day said.

“(Prospects) want to know ‘Is there property close to Wal-Mart – they feed off the frenzied that Wal-Mart provides.”

City statistics bear out Day’s claims. Last year, the city issued 80 licenses for new businesses.

“We’ve had a phenomenal growth in a number of businesses since Wal-Mart opened here,” he said.

New businesses, Day said, look at traffic counts and Wal-Mart kicks those numbers up. As support, Day said Alabama Highway 43 in front of the Supercenter has the highest traffic counts on the road between Tuscaloosa and Mobile.

“It’s definitely a drawing card,” he said.

The city’s sales tax receipts bear out the story.

In 1988, when the first Wal-Mart store was opened, Thomasville saw a 45 percent increase. A 22 percent increase was added to that in 1995 when the Supercenter opened.

“Since 1988 when Wal-Mart first opened, sales tax revenue is up well over 100 percent,” he said.

While Day doesn’t attribute all that growth to just sales at Supercenter registers, he does believe an intangible came into play.

“The other thing people have to look at is how many times people say ‘I couldn’t find what I wanted and I’m going to Mobile’,” he said.

“Having a Supercenter in Demopolis, you will see a good bit of sales tax increase will come from recapturing those sales made elsewhere,” he said.

In Jackson, a similar story is shared by Brian Leathers, chairman of the Clarke County Development Foundation and president of the Chamber of Commerce.

“Before the Supercenter there were many items that folks traveled to Mobile to purchase. Wal-Mart has provided a great many of the items that were not locally stocked by our normal retail merchants so there’s been both convenience and value-added products by Wal-Mart,” he said.

In Jackson, Wal-Mart went from no presence to Supercenter about five years ago.

“The flip side is that although some of the smaller retail merchants who were existing before Super Wal-Mart came to town had to adjust marketing, product lines and sales, most have done that successfully,” he said.

“With changing times and economic positions, we’ve lost a few of the small merchants but I think we can’t directly attribute that to Wal-Mart. Some merchants here have done a great job leveraging strengths, managing their inventory and managing market niches so they successfully compete with Wal-Mart.”

Leathers said Jackson’s downtown district, for example, has continued to thrive even though the Supercenter draws people toward the edge of town.

“For Jackson and Thomasville … instead of being bypassed people come here to shop at Wal-Mart and it’s not only sales at Wal-Mart –

at the same time they’re stopping at our other merchants. It’s a ripple effect – a multiplier effect on sales tax revenues – and people don’t have to drive to Mobile,” he said.

Day attests to the drawing power of a Supercenter.

“I can’t tell you how many people come from Demopolis to shop at the Thomasville Supercenter.

You will find it will keep more people at home because they can find it at home and that’s a win- win for Demopolis,” he said.