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Sunday, July 7, 2013

The Romantisicing of Mom and Pop Stores

As we enjoy a holiday weekend in the United States, many friends and relatives get together for barbecues and cookouts. One topic that always comes up is “the good old days.” And, it is rare when someone does not conjure up how much they miss the Mom and Pop shops they visited during their childhood.

It is not merely nostalgia for most people. For many people, the small shops that you visited frequently in your youth were a connection to the community. If you live in the suburbs today, that world is truly gone forever. They still exist in very big cities such as New York where people either walk or take mass transit to work. You can stop after work and make a purchase as you are not in stuck in traffic as many of your commuting co-workers often are. The line from the old NBC program “Cheers”--“I want to go where everyone knows my name” still resonates with most of us.

There is a romance that has evolved about the Mom and Pop shop. It seems to tie in the anti-big business sentiment that some people hold. You want to go to a place where people will get to know you and where the service is personalized and often exceptional. Independent hardware stores are a great example where you can spend 10 minutes explaining to an old codger what your problem is and he provides a workable solution that may cost you only $1. Try that at Lowe’s or Home Depot and the youngster may suggest that you go down aisle 16 and look to the right.

As suburbs grew and supermarkets came in to vogue, the small shop began to die. Shopping malls killed off more and the big box stores like Wal-Mart and Target really hurt them. As one senior marketer told me, “We all like to give our money to locals who are often nice people in our community but these days most offer overpriced merchandise and limited selection.” His comments may sound harsh but he makes a very big point.

One exception appears to be restaurants. Most new businesses fail within their first five years of operation and the majority of them are restaurants. Despite the difficulty of the long hours and slim chance of success, there is never a shortage of people trying to open anything from a coffee shop to a white tablecloth establishment. If a restaurant clicks and maintains standards (very hard to do), it can buck the tide against chains in most US localities.

I have read from a few sources that Ben & Jerry’s tried to move in to West Seattle several years ago. They opened a shop and tried elaborate couponing and other promotional ideas. People ignored it and went to the long standing ice cream shop and, after a year, Ben & Jerry’s quietly closed up shop. So, local guys can succeed against long odds but the service and product has to be exceptional.

People with a bit of money often tout the “David vs. Goliath” struggle and aim their verbal attacks at Wal-Mart. I understand their passion but why don’t mass Wal-Mart boycotts get any traction? The reason is that top 5% of America is doing great (many of you reading this post) but the majority of Americans are struggling. In study after study, shopping at Wal-Mart can save the average middle class family about $50 per week over other alternatives and the spread may be much higher vis a vis Mom and Pops. So, as much as they might like to use Mom and Pops they simply cannot afford to do it for many items.

One outspoken multi-millionaire told me “for package goods, you are crazy not to go to Wal-Mart. I would not be caught dead in their clothes but Kellogg’s Corn Flakes and Crest Toothpaste are the same quality everywhere. So, why pay so much more for identical items? I got rich by watching expenses and I still do it.”

So, the bottom-line is that if you are going to support your small local merchants you are going to have to pay for it. For mainstream items, they simply cannot compete on price. Big box retailers often charge less than they can buy items from a distributor.

How can they survive? Well, as cities become gentrified, people are driving less. This can help as young adults in particular can walk to local shops and, in places such as New York, many do not have cars.

Also, the internet is saving some speciality shops. This past spring my wife and I were visiting a small but very lovely city in New England. There was small shop on a side street that sold only salt. They had all types of exotic salts from a few dozen countries. It was very expensive but we bought a few gifts for our gourmet friends. The owner told me that he also sold to restaurants in the region. When I asked about the internet, he laughed and said that he sold to people everywhere. A local greasy spoon cannot mix it up in the international marketplace but a unique shop with a decent website can go global quickly and often profitably.

Where I grew up in seaside Rhode Island, my father would often take me to the local village drugstore before school. Coffee was a nickel and hot chocolate was a dime. There was indeed a sense of community and all the regulars had their own booths or counter stools. It was a wonderful atmosphere and everyone knew our names. That way of life lives on in a few spots but does not fit in with the long commutes and traffic snarl many of experience today.

Is the struggle of Mom and Pops simply progress or a sad commentary on the world of 2013? Hard to say.  It is certain though that Mom and Pop survivors will have to be able to adapt to changes perhaps faster than larger companies and maintain an incredible service oriented ethic in the future.

If you would like to contact Don Cole directly, you can reach him at doncolemedia@gmail.com

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