The American nation was founded on the very hope that each person could be self-reliant and economically free. Up to modern times this goal was accomplished through small business ownership, by independent entrepreneurs in local communities. In the mid 19th century, a new phenomenon started to emerge: the first appearance of big business and the so called big-box stores. Americans loved the convenience of these new stores that had everything one needed in a one stop shopping center. Over the years, big-box chain stores grew at an amazing rate, becoming the most popular and profitable businesses in the nation.
However, most people never realized the consequences this kind of system would bring. These effects have become especially evident in the twenty-first century. Big-box and chain stores are destroying America economically, socially, and environmentally – they should therefore be reformed or at least partially replaced by the small business system that flourished for so long before the arrival of these corporate giants.
What can be considered a small or independent business? Stacy Mitchell, author of Big-Box Swindle: The True Cost of Mega-Retailers and the Fight for America’s Independent Businesses, answers this question. She explains that “no commonly agreed upon definition” exists, but proceeds to give one that is fairly accurate. An independent business is owned by several people living in a community who have complete decision making power over their company, and who have little enough outlets to “remain personally connected to employees and customers” (Mitchell). With this definition, “franchise outlets,” are quickly excluded for they do not have full decision making power over the business, because they are under the larger chain company’s authority (Mitchell 260). Louis Uchitelle of the New York Times gives a more tangible definition: small businesses are “the 27 million companies” in America “employing fewer than 500 people and in most cases fewer than 20 people” (Uchitelle). Unlike chain stores, most entrepreneurs start their businesses not only for money, but because they also have a passion they want to share with the community (baking, fashion, carpentry, etc.). For the purposes of this paper, to be considered an independent or small business the company must meet all of the criteria above.
Chain and big-box stores are the polar opposites of small businesses. Big-box stores are almost always owned by a large corporation with countless branches and outlets. Most chains operate not only on a national level but on a global one too (Mitchell 15). Big-box stores are a type of chain store; not only are they owned by huge corporations, but the stores themselves are huge. The average big-box retail store is over 50,000 square feet, and many of them actually resemble the shape of a big box. It is not only the size of big-boxes’ that brings problems. Most small chain stores are just as harmful, because they bring sameness to a town and make it like “everywhere else, U.S.A.” (Haya). These companies supposedly bring benefits such as “low prices, free parking, and one stop shopping convenience” (Jost 733). However, the harm they bring outweighs these supposed benefits.
Big-box stores are notorious for destroying jobs. Most Americans believe that these stores actually create jobs, because on the surface it looks like they do. When a big-box moves in to town it creates about 200 retail positions. But if one explores the matter thoroughly it is clear chains destroy more jobs than they create. In an interview by Multinational Monitor, Stacy Mitchell refers to a major national study released by David Neumark from the University of California in April 2006 to support this point. He discovered that on average when a big-box store moves in, a community loses 180 more jobs than the store creates (Big Box Swindle). Big-box stores are built to destroy smaller businesses through unfair and even unethical competition in pricing. But the job destruction does not stop at getting rid of other retailers. It is quite obvious that local businesses spend money in the local economy. According to Mitchell, small businesses “hire local accountants, local attorneys, local website designers and they tend to buy more of the goods that they stock locally, as well” (Big Box Swindle). Big-box companies that move in don’t need these local services, thus further extending job loss to those in the service sector. In a personal interview Slavik Salfetnikov, owner of Slav's Painting in Vancouver, said that even though he is not directly affected by big-box competition, he loses business because there are fewer small business retailers to hire him. Large home improvement stores also hurt his business by encouraging people to do a project themselves instead of hiring a professional painter. By getting rid of local businesses big-box stores destroy a huge number of jobs.
Big-box stores also destroy jobs in the often overlooked manufacturing sector. Local manufacturers need local businesses to survive. When a chain moves in to town it wipes out a majority of the small businesses around, thus getting rid of the manufacturers’ main buyers. Local manufacturers now have to sell to the big-boxes to survive. Liza Featherstone, a writer for the Columbia Journalism Review, confirmed that Wal-Mart’s “always low prices” put tremendous pressure on the suppliers to lower costs. There is no doubt that this pressure is credible, because big-box stores represent a huge majority of the market after the small businesses have been depleted. This demand forces manufacturers to close down, and if they want to continue business they must move overseas to low wage countries with fewer regulations (Featherstone). As a result local high paying jobs with good benefits at manufacturing centers are lost to foreign countries, and Americans have to work at low paying jobs big-box stores.
In fact, the local economy in general suffers when chain stores expand. As stated above, almost all chains are not locally based companies, so they tend to spend their revenue outside the community and even the nation (Big Box Swindle). A study by the Institute for Local Self-Reliance and Friends of Midcoast Maine concluded that: when goods and services are bought from local businesses 53.3% of the money stayed in the local and state economy, while only 14.1% of the money spent at big-box stores and chains stayed in the local economy (qtd. in Jost). Small businesses leave almost three times more money in the community’s coffers than the big-box corporations.
Big-box stores cause even more economic problems by creating a class of full time workers who make little money with no benefits. Al Norman, author of Slam-Dunking Wal-Mart: How You Can Stop Superstore Sprawl in Your Hometown, points out that Wal-Mart itself admits that its workers do not get paid enough to support a family (qtd. in Jost). This forces countless employees to rely on government support programs which drain money from the community. The University of California- Berkeley Labor Institute reports that the average Wal-Mart employee makes 31% less than any other employee at a large retailer. As a result workers use more “taxpayer-subsidized public assistance—such as health care and food stamps” (qtd. in Jost). I must admit that big-box stores do create some jobs, but most of these jobs are almost not worthy of be being called jobs.
Despite this overwhelming evidence, critics argue that chains are good for consumers and the economy. According to researcher Kenneth Stone of Iowa State University, big-box stores bring increased overall sales to a community. This happens because people are willing to cross community borders to shop at chain stores. He also found that small businesses not directly in completion with big-boxes got more sales from the increased number of consumers attracted by the big-boxes (qtd. in Villarreal). Research associate, Pamela Villarreal, also claims that counties with a Wal-Mart experienced a gain of 50 retail jobs (Villarreal). In fact, the Wal-Mart Corporation sent out a statement saying that its stores create countless good jobs for American workers (Krugman). Villarreal argues that big-box stores increase the variety of choices for consumers and lower prices for shoppers. She claims that this is because big-box stores are more efficient than small businesses and are able to buy in bulk (Villarreal). Convincing as they may seem, these claims are invalid.
Although one community may gain sales from big-box stores, it is only because it is destroying another community’s small business sector. Communities need to work together to build our nation up rather than compete to the death. Chain stores may bring some visible job gain, but as shown above they destroy much more jobs than they create. The assertion that big-box stores are cheaper is also false. Stacy Mitchell, the senior researcher at the Institute for Local Self-Reliance, explains that most shoppers don’t regularly compare prices. If they think that Wal-Mart has the lowest prices they will go there first and not bother to check elsewhere. Big-box stores are professionals at using the “signposts and blinds” method of retail. “Signposts” are items that most consumers know the current price for (such as bread or milk). Chains will advertise these “products at or below cost to get your attention and get you in the store. Once you are in the store, there are thousands of other products that you are likely to buy that have much higher margins,” these products are the blinds. Blinds account for most of a store’s products and all of its profit (Mitchell 128). As far as variety goes big-box stores actually reduce consumer choice by getting rid of local small businesses. Consumers then have a lot fewer stores and products to choose from. Paul Krugman, Nobel Peace Prize winner in economics, said that “Wal-Mart has decided to insult our intelligence by claiming to be, of all things, an engine of job creation” (Krugman). According to Krugman the statement that Wal-Mart creates jobs is nothing short of a lie. It’s impossible to deny that big-box stores really do hurt economics in America and the world.
Economics is not the only field hurt; chain stores make a substantial impact in the social aspects of a community as well. Perhaps the largest social issue is how big-boxes treat their workers. Al Norman stated that 45 percent of Wal-Mart’s workers quit each year. He also found that Wal-Mart spends “38 percent less on healthcare per worker than the average U.S employer” (qtd. in Jost). According to the University of California, the average wage for Wal-Mart workers in 2001 was $9.70 compared to the $14.01 retail industry average wage (qtd. in Jost). Wal-Mart has also been proven guilty of union busting and preventing workers to join unions. The brightest example of this is the countless lawsuits with the United Food and commercial Workers (UFCW) union in California. Because Wal-Mart is the biggest and most popular big-box, its actions show a pattern that is generally true of all chain stores: disrespect to, and unethical treatment of workers.
If chain stores continue to grow at the current rate consumers will lose the old-fashioned service they got at locally owned businesses. In fact some consumers have started to realize that shopping at a big-box is something entirely different. Many small businesses have used this to stay in business. They make their stores specialized and offer experienced advice on the products (Bair). For example, Arbor Biofuels, in Vancouver WA, offers environmentally friendly biofules that are hard to find anywhere else. This originality helps reduce competition and bring in customers (Apalategui). In contrast big-box stores hire workers who are for the most part inexperienced, and chains can’t specialize in a specific area as much as independent businesses can. The growth of chain stores makes people forget the simple pleasures of employee – customer friendship.
Big-box or even chain stores do a great job of destroying a community’s unique social character. As stated above, small businesses all provide a special twist on their business that big-boxes can’t match. In a personal interview Mary Lee, the owner of Columbia River Beef in Goldendale, said: that her business “affects the way of life in the community giving it its country feel," without businesses like hers “there would be no Goldendale”. Slavik Salfetnikov stated that his painting business brings a Northwest character to neighborhoods, making them look unique. It is clear that unlike local businesses, chain stores make communities boring and less attractive for both visitors and residents. Haya Nasser from USA Today, supports this claim in saying that chains “spread suburban sameness and ruin the distinctive character of neighborhoods” (Nasser). Suburbanization is almost always a direct result of chain stores growing out of control in any community. Mitchell explains the social effect of big businesses taking over a community through an example: “Observe a busy Main Street and you are apt to see at least a few people chatting, strolling leisurely, or sitting idly on stoops and benches” (80). This kind of atmosphere is rare if not impossible at big-box stores. Because big-box stores are built for regional level shopping, the odds of seeing a friend or neighbor are slim. Big chain stores are designed to maximize profit, not “foster social networks” of communities (81). However, this fact is sadly overlooked in most community debates and counsels. One may say that those ages are long past and we don’t need this kind of social network today. The person saying this would be greatly mistaken. Humans are social creatures and they need to interact. A strong social network will also improve a community’s problem solving skills. These kinds of networks not only give a community its distinct character, but they help build the nation as well.
These large corporations bring environmental destruction that is not only a national problem, but a global one. Just because of their size and location big-box stores cause pollution. They are the biggest cause of polluted runoff, which is the leading cause of water pollution. The Sierra Club, a nonprofit environmental organization, stated that every acre of parking lot produces 25,000 gallons of polluted runoff during a 1 inch storm. That’s 24 thousand more gallons than an uncultivated piece of land. Big-box stores also cause a substantial amount of traffic and air pollution. Because they are built on the edges of town where land is cheap and because they drive out locally owned businesses, people are forced to drive longer distances to shop. This also encourages road development in rural areas, which causes more polluted runoff and air pollution (Sierra Club).
Hearing all this, it is surprising to note that the owners of Wal-Mart say that their business is good for the environment. They claim that they can use their size to reduce environmental harm. In an interview, Mitchell explains why this claim is preposterous saying: it is a fact that transportation (of both goods and people) is the largest contributor of greenhouse gasses in America. Mitchell also argues that the most important economic goal should be, reducing the amount people and goods travel. The growing number of big-box stores and chains is doing exactly the opposite of this goal. Big-box stores tend to transport their goods over very long distances from sweatshops in low wage countries to their stores all over the world. Also, because chains are located on the fringes of town they force people to drive long distances to shop. Over the past twenty years Americans have increased the amount they drive to go shopping by “more than forty percent.” So when chain stores argue that they are reducing packaging on their products or that they have more efficient lights in refrigerators, they are just bailing water with buckets when the companies’ expansion will make the boat sink even faster (Big Box Swindle).
In her interview with the Multinational Monitor, Stacy Mitchell encourages communities to fight against chain stores and grow small businesses. She states that communities have tremendous power over zoning laws. All community members need to do to influence this is to come to city halls and vote. Citizens should also encourage and vote for “mentorship programs” which are designed to help college graduates make their own business as opposed to working for someone else. The community and especially the small business owners need to support and form cooperatives and alliances. These alliances give independent businesses the same access to manufacturing giveaways and the ability to buy in bulk as the big-box corporations. Mitchell also promotes community alliances. She explains what they are by bringing up an example. In 1990 the 14 towns that make up Cape Cod formed The Cape Cod Commission. This was an alliance of communities that was used to regulate economic activity. For example, when someone wanted to build a large store they had to ask not only that county but also The Cape Cod Commission who would then decide if the store would be good for the whole area. This kind of tactic is much more effective in the fight for America’s independent business, because it protects the whole area (Big Box Swindle). Big box stores are causing major problems for communities and the world that cannot be ignored and must be fought. The way to face this problem is to support the local small businesses of Vancouver and not the chain store giants.
I strongly believe that big-box stores and chains are not good for America. Communities all over the nation are affected by the spread of these corporations. Clark County in Vancouver Washington is just one of the affected communities. The county already has several big-box stores, and chain stores cover the landscape. The community’s small businesses are slowly disappearing. It is possible to save Clark County even now. The citizens of Vancouver are responsible for their community. Chain stores should be limited in our community least we lose the distinct character of our Northwest town. The economic state of our country is worsening, but small businesses can provide the local jobs we need. Even global warming can be substantially limited if we just limit big-box growth. Every able citizen should get involved with organizations such as Wake up Wal-Mart or Wal-Mart Watchdogs, which are designed to fight chain stores. These organizations are both local and easy to join. Most individuals don’t even have to be that radical. One of the most helpful and easiest things an individual can do is to shop at locally owned businesses and avoid big-box stores while encouraging friends to do the same. The Wake up Wal-Mart website states that “America's largest employer must reflect America's values. But, Wal-Mart will never change on its own” (United Food and Commercial Workers International Union). We can’t let chain stores control the image of our nation. Communities must step up and show the world what America is really about. If local individuals do not take serious action big-box stores will destroy America.
Works Cited
Apalategui, Eric. “Biofuels Sold Here.” The Columbian. 4 Jan 2009: <http://columbian.com/article/20090105/BIZ01/701059992/-1/ARCHIVES>.
Bair, Jessica. "Small pet stores find ways to compete with big boxes.” Central Penn Business Journal 13 Oct. 2006: 19. ProQuest Newsstand. ProQuest. Cannell Library, Vancouver, WA 10 Feb. 2009 <http://0-www.proquest.com.oswald.clark.edu:80/>.
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Krugman, Paul. “Big Box Balderdash.” The New York Times. 12 Dec 2005. <http://select.nytimes.com/2005/12/12/opinion/12krugman.html?_r=1&scp=17&sq=big%20box%20stores&st=cse>.
Lee, Mary. Personal interview. 18 February 2009.
Mitchell, Stacy. Big-box Swindle: the true cost of mega-retailers and the fight for America’s independent businesses. Boston: Beacon Press, 2006.
Nasser, Haya. "Cities put shackles on chain stores." USA Today (n.d.). Academic Search Premier. EBSCO. Cannell Library, Vancouver, WA. 16 Feb. 2009 <http://0-search.ebscohost.com.oswald.clark.edu/login.aspx?direct=true&db=aph&AN=J0E074357747304&site=ehost-live&scope=site>.
Salfetnikov, Slavik. Personal interview. 17 February 2009.
Sierra Club. "Chain Stores Harm the Environment." At Issue: Are Chain Stores Ruining America?. Ed. Kirsten Engdahl. Detroit: Greenhaven Press, 2007. Opposing Viewpoints Resource Center. Gale. Clark College - Cannell Library. 10 Feb. 2009 <http://0-find.galegroup.com.oswald.clark.edu>.
Uchitelle, Louis. “Small Businesses Feeling the Chill.” The New York Times. 2 Oct. 2008: A1.
United Food and Commercial Workers International Union. Wake Up Wal-Mart. 12 Feb. 2009 <http://www.wakeupwalmart.com>.
Villarreal, Pamela. "Chain Stores Benefit America." At Issue: Are Chain Stores Ruining America?. Ed. Kirsten Engdahl. Detroit: Greenhaven Press, 2007. Opposing Viewpoints Resource Center. Gale. Clark College - Cannell Library. 9 Feb. 2009 <http://0-find.galegroup.com.oswald.clark.edu>.
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