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Sunday Poll: Will You Patronize McKee’s Gas Station or Grocery Store?

April 7, 2019 Featured, North City, Retail Comments Off on Sunday Poll: Will You Patronize McKee’s Gas Station or Grocery Store?
Please vote below

It was three years ago (March 2016) Paul McKee announced plans for a gas station and a grocery store:

At a news conference under a white tent, he announced his latest plans Wednesday afternoon, this time for a grocery store and gas station. The GreenLeaf Market will be located at 1408 N. 13th St., not far from the Stan Musial Veterans Memorial Bridge. Right across the street, McKee said, there will be the ZOOM Store — a gas station, store and car wash. (St. Louis Public Radio)

The ZOOM Gas opened last October, though not the cafe & car wash. The GreenLeaf Market opened last Monday, April 1st.

On Saturday the 13th both will hold a grand opening, 10am – 3pm. Both are the subject of today’s poll.

This poll will close at 8pm tonight.

— Steve Patterson

 

 

Opinion: Dollar Stores Are A Problem In St. Louis

February 20, 2019 Featured, Retail Comments Off on Opinion: Dollar Stores Are A Problem In St. Louis

In the 70s we didn’t have dollar stores, we had the five and dime.

Long before the days of big-box stores like Walmart and Target, these five-and-dime stores had everything you needed. You could buy clothes, grab some treats, and eat lunch for under $20. These iconic American stores dotted Main Streets across the country before the big guys came around and put them out of business. (MeTV)

In my hometown of Oklahoma City my favorite five & dime was TG&Y (1935-2001), I’d also ride my bike to the larger Woolco“It was a full-line discount department store unlike the five-and-dime Woolworth stores which operated at the time. At its peak, Woolco had hundreds of stores in the US, as well as in Canada and the United Kingdom. “  After closing, the space became a Venture, a retail chain based in the St. Louis suburb of O’Fallon MO.  Of discount department stores I’ve preferred Target for decades.

Walmart, in the early years, brought the discount department store to small towns all over America. Eventually they’d build a larger store in the same town. Main Street businesses began to close. Then Walmart began closing stores, forcing customers to drive a town or two over to shop at an even larger store.

And now Amazon is hurting all brick & mortar retail, right?

Family Dollar on Gravois near Bevo Mill, 2012

Not exactly.

Many investors believe the popular narrative that Amazon is crushing brick-and-mortar retailers. The e-commerce titan certainly humbled plenty of them, but some retailers continue to expand by opening new stores.

The top three dollar-store chains in America, for example, opened more than 1,800 stores last year. Dollar General (NYSE: DG) led the pack, followed by Dollar Tree (NASDAQ: DLTR) and its subsidiary, Family Dollar.

In 2018, Dollar General plans to open 900 new stores. Dollar Tree plans to open 350 more namesake locations and 300 new Family Dollar sites and re-banner 50 Family Dollar locations as Dollar Tree stores. All three chains posted positive comparable-store sales growth in their latest quarters. (Motley Fool/USA Today)

How did we get here? From 2014:

Wal-Mart Stores (WMT, +2.19%) executives could not have been too happy to wake up to the news this morning that dollar store dominator Dollar General (DG, -0.17%) offered $9.7 billion in an all-cash deal to buy out its smaller, struggling rival Family Dollar Stores (FDO, +0.00%), outdoing an earlier, accepted cash-stock offer by Dollar Tree (DLTR, +0.20%).

Dollar General is by all accounts a supremely well run retailer: it has reported 24 straight years of same-store sales growth, all the while managing a massive expansion in recent years that has won it millions of shoppers looking to save money. Moreover, its operating profit margin has also improved in the last five years despite the costs of opening thousands of new stores.

That management prowess could turn Family Dollar into a far more formidable rival than it has been on the watch of CEO Howard Levine, whose father founded the chain in 1959. Family Dollar has expanded quickly but also has run into trouble in the last two years by misreading its customers and ramping up its offering of pricier items such as beauty products. It has since backtracked, ramping up its inexpensive offerings. (Fortune)

However, it was Dollar Tree that prevailed, buying Family Dollar in 2015.

Family Dollar at 6000 Natural Bridge has no paved pedestrian access route from public sidewalk to entrance, even though it would’ve been easily achieved during construction. Click image to see my 2011 post.

From November 2018:

Dollar Tree acquired Family Dollar in 2015, after undergoing a bidding war with Dollar General, its main US rival. Dollar Tree and Dollar General are almost neck-and-neck in terms of store count and annual sales. Both dollar chains have about 14,000 to 15,000 locations. Dollar Tree generated $22 billion in sales in 2017 compared with $23.5 billion at Dollar General. (Business Insider)

First, how many of these stores are in the St. Louis region?  I checked all three within a radius of my zip code just North of downtown, 63106.

  • Family Dollar has 50 stores within 10 miles, still just 50 within 25 miles.
  • Dollar Tree has 18 within 10 miles, a total of 59 stores within 25 miles,
  • Dollar General has 28 within 10 miles, a total of 69 stores within 20 miles (they didn’t have a 25 mile option)

Added up, I’ve got 96 dollar stores within 10 miles. That’s a lot! Food is a big part of their business.

They technically aren’t even grocery businesses, but dollar stores are feeding more people than one of the highest-profile supermarket chains in America.

The finding, in a new report by the Institute for Local Self-Reliance, is a testament to dollar stores’ growing dominance of the American retail landscape.

Grocery sales at the two biggest dollar brands, Dollar Tree and Dollar General, approached $24 billion this year, compared with roughly $15 billion at Whole Foods, according to private market data from the research firm Chain Store Guide.

The ILSR is using the numbers to highlight the threat to independent businesses posed by low-end retail monopolies. (Huffington Post)

Ok, Whole Foods is a niche player in the U.S. grocery segment. Still, what are people eating from dollar stores? Certainly not organic kale. Even ALDI has a nice selection of organic products and lots of fresh produce.

Yesterday I checked out the Groceries, Food & Beverages section of the Family Dollar website.

Give your family delicious, healthy, nutritious meals for less. At Family Dollar our discount food and grocery items include the name-brand products you need to cook great meals at home or enjoy a snack on the go.

At the bottom of the page was the following:

Your local Family Dollar has all the same food and beverages you’ll find at grocery and big-box stores – but here, you can buy them all for less. Our shelves are stocked with delicious ingredients for meals and great snacks from the brands you know and trust. From Hormel, Betty Crocker, and Kellogg’s to Frito-Lay, Wise, and Hunts, you’ll find great discount groceries for everyone in your family. Best of all, we even have frozen and refrigerated foods, like potpies from Banquet, pizza from Red Baron, and fresh milk and eggs.  

Yes, the food items found at dollar stores can be found at grocery stores — but so much at grocery stores can’t be found at dollar stores. The biggest category is fresh produce.

Family Dollar’s food categories, no produce
Dollar Tree’s food. Again, no category for fresh produce
Dollar General’s food. Note it has a fresh food section!
But those fresh food includes lots other than produce

 

Their site does include fresh produce, like bananas. However, only 3 out of 69+ locations within 25 miles have them in stock.

Many are researching the problem of the growth of dollar stores:

This follows two decades in which Walmart’s super-charged growth left small-town retail in shambles. By building massive, oversized supercenters in larger towns, Walmart found it could attract customers from a wide radius. Smaller towns in the vicinity often suffered the brunt of its impact as their Main Street retailers weakened and, in many cases, closed.

Today the dollar chains are capitalizing on these conditions, much like an invasive species advancing on a compromised ecosystem.

Local grocers that survived Walmart are now falling to Dollar General. “This has become the number one challenge of grocery stores,” says David Procter, an expert on community development and director of the Rural Grocery Initiative at Kansas State University. (Institute for Local Self-Reliance)

Much of the above link focuses on predominately-black North Tulsa, here’s another quote:

In late August, just a few days before Labor Day, the City Council finally took up Hall-Harper’s proposed dollar store moratorium. Residents of North Tulsa filled the chambers and one by one spoke in favor of the measure — a show of support that Hall-Harper says made all the difference. The moratorium passed by a 5-to-4 vote. It suspended the permitting of new “small-box discount stores” for a period of six months in Hall-Harper’s district.

Three months later, Hall-Harper proposed a permanent change to the city’s zoning code. She introduced a “dispersal” ordinance that would restrict the development of dollar stores in North Tulsa. Intended to foster “greater diversity in retail options and convenient access to fresh meats, fruits and vegetables,” the measure prohibits a dollar store from opening within one mile of an existing dollar store in a designated “overlay” district. It also prioritizes full-service grocery stores by cutting in half the number of parking spaces they are required to have.

I’d love to see leadership in the St. Louis region to visit North Tulsa and take action here. Limit their numbers, proximity to each other, require sales of fresh produce.

Here are the results of the recent non-scientific Sunday Poll:

Q: Agree or disagree: We should be happy dollar stores (Dollar Tree, Family Dollar, etc) are willing to operate in low-income neighborhoods.

  • Strongly agree: 4 [11.11%]
  • Agree: 8 [22.22%]
  • Somewhat agree: 3 [8.33%]
  • Neither agree or disagree: 5 [13.89%]
  • Somewhat disagree: 6 [16.67%]
  • Disagree: 5 [13.89%]
  • Strongly disagree: 3 [8.33%]
  • Unsure/No Answer: 2 [5.56%]

No, we’re not lucky. These dollar stores are part of the problem, not the solution.

— Steve Patterson

 

Sunday Poll: Are We Lucky Dollar Stores Are Willing To Locate In Low-Income Areas?

February 17, 2019 Featured, Retail, Sunday Poll Comments Off on Sunday Poll: Are We Lucky Dollar Stores Are Willing To Locate In Low-Income Areas?
Please vote below

Today’s non-scientific poll is about dollar stores:

These stores have gained attention as success stories in the country’s most economically distressed places — largely rural counties with few retail options. Two main chains, Dollar General and Dollar Tree (which owns Family Dollar), operate more than 30,000 stores nationally and plan to open thousands more, vastly outnumbering Walmarts and other retailers.
 
In cities, dollar stores trade in economic despair, with many residents saying they are a vital source of cheap staples. But as the stores cluster in low-income neighborhoods, their critics worry they are not just a response to poverty — but a cause. Residents fear the stores deter other business, especially in neighborhoods without grocers or options for healthy food. Dollar stores rarely sell fresh produce or meats, but they undercut grocery stores on prices of everyday items, often pushing them out of business. (Post-Dispatch)

In many neighborhoods dollar stores are the only stores.

So here’s today’s poll:

This poll will close at 8pm.

— Steve Patterson

 

On This Day: Fields Foods Opens (2014), Rams Ask To Leave (2016)

January 4, 2019 Featured, Popular Culture, Retail Comments Off on On This Day: Fields Foods Opens (2014), Rams Ask To Leave (2016)
Produce at the opening of Fields Foods

A couple of interesting events took place on January 4th in recent years.

Five years ago, in 2014, Fields Foods opened for its first day of business. A red ribbon was cut at an event the night before.  Since then a Tim Hortons opened & closed out front.

Field Foods is set to expand from their original location by adding locations in Dogtown & Downtown West this year.

Three years ago the Rams formerly asked the NFL to relocate to Los Angeles.

The St. Louis Rams, along with the Oakland Raiders and San Diego Chargers, have filed relocation requests with the National Football League, league officials said Monday.

The requests come less than 24 hours after the application period began and sets the stage for a key owners vote on relocation expected to happen next week in Houston. There, owners will vote on which team or teams will be allowed to move to the Los Angeles market in the 2016 season.

The applications will be reviewed this week by league staff and three league committees, which will make a recommendation to owners on the issue.

In a statement on the team’s website, the Rams said, “The St. Louis Rams informed the National Football League today that the Rams propose to relocate to the greater Los Angeles metropolitan area. The relocation would be effective for the 2016 NFL League Year.”

The St. Louis stadium task force, which has proposed a $1.1 billion stadium in an effort to keep the Rams in St. Louis, said the Rams’ relocation request was expected. (St. Louis Business Journal)

Eight days later the NFL owners approved the Rams request 30-2.

As recently announced, St. Louis will be getting an XFL football team. Games begin in just 13 months! It’s hard to predict how well the XFL will do financially, if it’ll survive the initial 3 years of funding set aside.

Even though we knew it was coming, it was still a blow when the Rams asked the NFL to leave. As we welcome the XFL next year, and collecting more rent per game, we might look back on January 4, 2016 as a blessing.

— Steve Patterson

 

Not Every IKEA Purchase Requires a Car; New ‘Planning Studios’ Will Serve Dense Urban Cities

December 10, 2018 Featured, Retail Comments Off on Not Every IKEA Purchase Requires a Car; New ‘Planning Studios’ Will Serve Dense Urban Cities

This post is about our personal IKEA shopping habits and about how IKEA is changing course to respond to a new retail landscape.

IKEA St. Louis opened on October 1, 2015, since then I’ve been many times — Mostly in my wheelchair via public transit. A few visits were just browsing, most were small purchases that would fit in the canvas bag I keep on the back of my wheelchair.

My most common IKEA St. Louis purchase has been food: This is veggie balls with vegetarian black bean sauce, steamed veggies, Swedish apple cake, and tap water. This is from 2016

Very different from the many trips I’d previously taken to the two IKEA locations in the Chicago area — my car would be stuffed to the ceiling, the receipt long, and the total in the 3-4 digits. At least twice I ordered from a 3rd party company to have a large order picked up from Chicago and delivered.

It wasn’t until September that we made a local IKEA purchase that required our car, a new bed frame.

Our biggest IKEA St. Louis purchase after checkout
We couldn’t close the trunk, we had to use twine to keep the trunk lid from staying open

This was nothing compared to earlier purchases, but with IKEA store so close there’s no reason to wait and make a big purchase. Last month I got an email from IKEA about comforters on special pricing for IKEA Family members for 3 days only. Since we needed a new comforter to go with our larger bed, I returned in my wheelchair.

My most recent visit was in the wheelchair. I plugged the chair in to recharge while I used a shopping cart to go to bedding and get a new comforter.

While IKEA St. Louis is close to downtown, that’s not true for locations in other regions. In places like NYC not everyone is willing to travel out to the edge to shop. So IKEA is forced to respond:

IKEA U.S. announced today that it is opening its first city center store in the U.S., marking the company’s ongoing transformation and commitment to bringing IKEA into the heart of urban areas. The ‘IKEA Planning Studio’ is slated to open in Manhattan in spring 2019.

Globally, IKEA is adapting and evolving to be more accessible and convenient for customers wherever they are and they recently announced the development of 30 new touchpoints in city centers over the next three years. The New York City location is the first market in the U.S. for the Planning Studio concept.

“We recognize that we are in a rapidly changing retail environment, and to be fit for long-term growth, IKEA is transforming in a way that lets us meet our customers where they are,” said Lars Petersson, Country Manager, IKEA Retail U.S. “New York City is the natural choice to open the first city center store – the most vibrant, dynamic city in the US, and the epicenter of retail, business, and culture.” (IKEA)

Manhattan is just the first in the US to get this new concept, but other cities will follow:

Ikea’s move into Manhattan comes as many retailers — including Target, Kohl’s and Macy’s — are shrinking their existing full-size stores or experimenting with opening up smaller-format locations in densely populated markets such as Manhattan, Los Angeles and Chicago. As more and more shoppers are turning to the internet to ring up purchases, companies are finding they don’t need as much real estate. (CNBC)

Don’t expect to see an IKEA Planning Studio in St. Louis. Again, our full-size IKEA is just a few miles from downtown. With the recently-opened CORTEX MetroLink light rail station the store is easy to reach via transit. A bus line stops right out front.

The idea that every purchase requires a car is false. No doubt many drive to IKEA St Louis and fill their car before returning home, but when you’re just a short transit trip away grabbing a bite to eat making a small purchase (or not) is very easy. I’m glad to see more retailers realizing they need to change to attract customers who live in dense urban centers.

— Steve Patterson

 

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