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The Chain Store Dilemma

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Corporate chains are spreading to every nook and cranny of North America, making each town look exactly like the next. But some local governments are acting to protect the uniqueness of their business districts by either limiting or banning outright any new chain businesses. Banff, Alberta, Canada is the latest municipality to attempt to regulate the proliferation of chain stores inside its’ city limits.

From the Calgary Herald:

In 2007 the Banff community was up in arms over the arrival of Chapters-Indigo, which in part led to the eventual closing of the treasured family-run Banff Book and Art Den after 43 years of business.

The latest chain to touch off a storm of controversy in Banff is David’s Tea, a Montreal based company with about 70 stores across Canada and parts of the United States, expected to open by the end of February.

In responding to the expansion of chains into Banff, the town council first considered a ban, and now are exploring the concept of quotas.

In Banff, the current landuse bylaw regulates eating and drinking establishments in the same manner, whether it’s a coffee shop or nightclub, a franchise or an independent.

It’s not yet clear what a possible quota system would look like, whether it’s tied to square footage, a percentage of total establishments or an exact number.

A report will come back to council in the next few months.

A similar fight is going on right now in Sonoma, CA, though not without opposition. From the Press-Democrat:

Opponents of proposed chain-store restrictions in Sonoma won a victory last week when city leaders backed away from enacting a temporary ban.

But with a narrow majority on the City Council clearly favoring the concept, it’s probably only a matter of months before the city of 10,000 joins a select few nationwide that have such regulations.

There has been marked increase in recent years of municipalities restricting the entrance of so-called “formula businesses” into their jurisdictions. Areas such as Provincetown, MA, Fredericksburg, TX, Chesapeake City, MD and Port Townsend, WA have all used local land-use laws to keep out the chains. Of course, efforts like these have been attempted in other eras as well. The Great Atlantic & Pacific Tea Company’s meteoric rise led to a national effort to restrict its’ movement in the 1930s, in favor of family-owned, local grocery stores. The A&P won out in the end, with the politics of the “consumer” and the right to low prices carrying more weight than the plight of the local businessman. And in A&P’s wake, the era of the chain store began.

Today’s argument, on the other hand, has as much to do with cultural preservation as it does economic preservation. After all, it’s not just one town vs. the A&P anymore. With countless branded shops, stores, restaurants and more, the invasion of chains bent on homogenizing the American landscape is a much stronger force than one business leveraging economies of scale in the 1930s.

 

Takeaway: As communities attempt to build their local and regional economies to promote resilience and sustainability, and try to mitigate against the actions of major corporations, formula-business bans and quotas will be a major tool. More and more municipal governments are trying to limit or ban chain stores from their jurisdictions in favor of locally-owned, independent businesses.

 

photo: sminor, via flickr 

cross-posted at CEOLocal.com

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