Main Streets Across America
I can not give you charts or graphs in this commentary. However, it is a good read and I hope you take the time to read it. The story reminds me of a factory where I consulted, in the city of Bryan Ohio. Bryan was a neat little town with its Town Hall and County Court in the middle of it.
The movie “Places In the Heart” would probably be a good depiction of it. I was not a big-time consultant but I knew my stuff and how to help these smaller companies in scheduling and material control. If you do not know it . . . materials is your biggest cost factor.
I am Certified by APICs and also ISM. The big deal is having the experience of doing what these organizations talk about actually doing it. I never consulted to a distillery which is a part of this post. It does sound interesting. Anyway, the post . . .
The Death of Main Streets Across America—and the People Trying to Save Them
– By Lori Ioannou
WSJ
Opening a business on Main Street can take true grit.
There was a time when the main streets in small towns were the lifeblood of small businesses. The hardware store, the candy counter, the dress shop—this was where the locals gathered and where entrepreneurs thrived.
But that hasn’t been the story for a long time. Across the country, many small towns have been reeling, as local industries close down, and people move to find jobs. Main streets have lost out to the convenience of online shopping, as well as to nearby malls, where chains and big-box stores offer lower prices and a greater variety of goods. Meanwhile, credit can be hard to obtain for entrepreneurs, and inflation has driven up costs.
The effect is stark: Many Main Streets are riddled with shuttered storefronts and struggling businesses.
But for some entrepreneurs, the blight is an enticement—not a deterrent.
They are drawn to start businesses on failing Main Streets for any number of reasons. Some have roots in the community and want to help rebuild it, while others are new arrivals drawn by the small-town atmosphere or the chance to create a dream business in a seemingly perfect location.
Whatever the reason, it is rarely easy to put down stakes where so many have recently pulled them up. Here is a look at three entrepreneurs who challenged the odds on Main Street, and how they fared.
An engineer comes home
Eight years ago, Harvey Williams Jr. decided to replant roots near Helena-West Helena, Ark., a farming community on the Mississippi River delta. Williams, an agricultural engineer, grew up close to the city (which until 2006 was the separate cities of Helena and West Helena) on his family’s 86-acre vegetable farm. He was proud of his heritage. His great-grandfather and grandfather were sharecroppers, and his grandfather purchased the farm in 1949 with money he earned selling cotton and moonshine.
Eight years ago, Harvey Williams Jr. decided to replant roots near Helena-West Helena, Ark., a farming community on the Mississippi River delta. Williams, an agricultural engineer, grew up close to the city (which until 2006 was the separate cities of Helena and West Helena) on his family’s 86-acre vegetable farm. He was proud of his heritage. His great-grandfather and grandfather were sharecroppers, and his grandfather purchased the farm in 1949 with money he earned selling cotton and moonshine.
So, he quit his corporate job in Dallas and moved his wife and family back home. What he found was a city in decay. Back in the 1980s, West Helena’s major employer, Mohawk Rubber, closed its tire plant and Walmart came to town, crushing small businesses. Many factory workers and entrepreneurs moved to Memphis to find jobs and a better way of life.
AB: This something WalMart does quite well. Run the small businesses into the ground so that all that is left is them.
Vacant stores and dilapidated buildings lined Cherry Street, once the town’s main thoroughfare and home to dozens of small businesses. The town’s annual blues festival—which used to draw tens of thousands of people from around the world—had drastically shrunk.
“It was a dying Main Street,” Williams says. “It was shocking to see how downtown became a ghost town.”
Williams took a job running a food-manufacturing plant about 100 miles away in Newport and started considering how to start a business. In 2018, he was inspired to create Delta Dirt Distillery at 430 Cherry St., making sweet-potato vodka from produce harvested on his family’s farm.
The distillery opened in April 2021, and locals began spreading the word on social media. The business gained more attention as it won prominent awards for its products. The distillery has become a tourist attraction, and many also take a tour of the Williams farm to learn about the history of Black farmers in America.
Last year, Williams’s sales reached $340,000—5% from online sales, and 95% from in-person traffic and through distributors in Arkansas, Mississippi, Pennsylvania and Tennessee. Williams has plans to expand distribution, offer new products and open a pizzeria next door.
He has also been active in the town, which is still struggling and losing population. He has become the president of the Philips County Chamber of Commerce to help attract new businesses to the town and draw more visitors to the area.
“Harvey has developed a blueprint on how to open a successful world-class business in rural America despite all the challenges he had to overcome,” says Whitfield.
A community pitches in
Jennifer Jones and her husband, Brian, owned a water-filtration company in Northern California, but over the years, the stress of crime, taxes, the high cost of living and wildfires took its toll. While on vacation in Virginia three years ago, they stumbled upon Big Stone Gap, a former coal town of about 5,300 people nestled in the Appalachian Mountains.
“We fell in love with the town, its beauty, and its people; they were so nice and welcoming,” Jones says. “We felt like we stepped back in time 30 years ago.”
The Joneses closed up their business in California and moved to Big Stone Gap with their three children, granddaughter and Jennifer’s parents.
In April 2022, they bought a struggling vegan pizzeria and its building on 215 Wood Avenue East. At the time, Wood Ave. East was a shadow of its former glory, lined with failed and struggling businesses. The town had been losing population since the 1990s after the closing of Westmoreland Coal’s coalfield, the major employer.
The Joneses aimed to transform the restaurant into Good Times Coal-Fired Pizza and Pub, a traditional pizza parlor and bar with live music that featured local artists. They invested $223,000 of personal savings and obtained a $187,000 industrial loan.
What happened next was an outpouring of community support. The town manager and other local small-business owners and residents pitched in to help get the business up and running. They helped lay floors, build the bar and paint the restaurant. At the same time, the town manager and his economic-development team heavily marketed the business, along with others in town, on social media and advertising platforms.
For their part, the Joneses have supported community events and hosted local festivals that have helped market the business.
That pay-it-forward mentality among civic leaders and small-business owners has ignited a small-business revival in Big Stone Gap.
“The Joneses’ pizzeria and restaurant has had a positive impact on our town and has inspired other entrepreneurs to set up shop on Wood Avenue,” says Stephen Lawson, Big Stone Gap’s town manager. “We are seeing more business activity and some population growth as people move here from all parts of the country in search of a better life.”
Passion vs. reality
Four years ago, Bill Waterhouse, a former finance administrator, and his partner, Sonja Olbert, a home health aide, quit their jobs and moved from Turner Falls, Mass., to Dansville in the Genesee Valley in upstate New York, to care for aging parents.
Their home was close to the tiny town of Leicester. This hamlet of 2,500 people once had a bustling Main Street with about two dozen small businesses. Then, in the 1980s, the town’s major employers in Rochester began shrinking their workforces, and the town’s population dwindled.
The couple yearned to start a business where they could follow their passion for hiking and the outdoors. After winning a $25,000 grant from Livingston County Economic Development in April 2020 they opened Trail Otter, a store that sold boating, hiking, camping and backpacking equipment, on 134 Main St. The location was close to Letchworth State Park, a popular destination known for its cascade of waterfalls and scenic gorge.
During the pandemic, business boomed as people yearned for outdoor recreation. To build a customer base, they marketed the business at local hotels and B&Bs and on Facebook, Instagram and radio. Visitors came from all over the state, and store sales hit $40,000 a year.
But competition from Amazon and big chains like REI in nearby Rochester took its toll, along with inflation. Last year, sales plunged by 25% as foot traffic dropped. In March, the couple decided to close the store and pivot to a new business: guiding people on outdoor experiences such as hiking, rafting and backpacking trips. Thanks to a partnership with Adventure Calls Outfitters, which runs rafting and other outdoor activities in Letchworth State Park, Waterhouse expects revenue for his business to reach $50,000 next year.
Local businesses need a unique service or “wow factor” to compete with big-box stores, says Waterhouse. “This is something we learned the hard way.”
Lori Ioannou is a writer in Long Island. She can be reached at [email protected].
Bill,
I remember when we were kids that economists were rabidly pitching the miracles of economies of scale. Along with the disdain towards equity dividends (i.e., the coupon clippers) then the lax view towards mergers (in pursuit of economies of scale) were the justifications for the capital gains tax preference which incentivized selling publicly owner firms to bigger firms or private equity even to the extent of leveraged buyouts. Furthermore, the capital gains tax preference enhanced liquidity of securities markets which was a necessary ingredient to the ascension and dominance of Wall Street bankers and traders over US business and politics. The other thing that was weird was that I knew how this was going to turn out when I was just a kid in high school, but I did not know that Keynes had figured it out before I was even born. Keynes’s message had been lost and I did not find it until well after I began my focused autodidact investigation of the body of economic study beginning about twenty years ago.
The unrestrained free market capitalists fail to realize that nothing is free in markets and the Neo-liberal litigators fail to realize that we cannot adequately regulate what we so aggressively fertilize and irrigate.
https://www.marxists.org/reference/subject/economics/keynes/general-theory/ch12.htm
John Maynard Keynes
The General Theory of Employment, Interest and Money
Chapter 12. The State of Long-Term Expectation
…..(4) But there is one feature in particular which deserves our attention. It might have been supposed that competition between expert professionals, possessing judgment and knowledge beyond that of the average private investor, would correct the vagaries of the ignorant individual left to himself. It happens, however, that the energies and skill of the professional investor and speculator are mainly occupied otherwise. For most of these persons are, in fact, largely concerned, not with making superior long-term forecasts of the probable yield of an investment over its whole life, but with foreseeing changes in the conventional basis of valuation a short time ahead of the general public. They are concerned, not with what an investment is really worth to a man who buys it “for keeps”, but with what the market will value it at, under the influence of mass psychology, three months or a year hence. Moreover, this behaviour is not the outcome of a wrong-headed propensity. It is an inevitable result of an investment market organised along the lines described. For it is not sensible to pay 25 for an investment of which you believe the prospective yield to justify a value of 30, if you also believe that the market will value it at 20 three months hence.
Thus the professional investor is forced to concern himself with the anticipation of impending changes, in the news or in the atmosphere, of the kind by which experience shows that the mass psychology of the market is most influenced. This is the inevitable result of investment markets organised with a view to so-called “liquidity”. Of the maxims of orthodox finance none, surely, is more anti-social than the fetish of liquidity, the doctrine that it is a positive virtue on the part of investment institutions to concentrate their resources upon the holding of “liquid” securities. It forgets that there is no such thing as liquidity of investment for the community as a whole. The social object of skilled investment should be to defeat the dark forces of time and ignorance which envelop our future. The actual, private object of the most skilled investment to-day is “to beat the gun”, as the Americans so well express it, to outwit the crowd, and to pass the bad, or depreciating, half-crown to the other fellow.
This battle of wits to anticipate the basis of conventional valuation a few months hence, rather than the prospective yield of an investment over a long term of years, does not even require gulls amongst the public to feed the maws of the professional; — it can be played by professionals amongst themselves. Nor is it necessary that anyone should keep his simple faith in the conventional basis of valuation having any genuine long-term validity. For it is, so to speak, a game of Snap, of Old Maid, of Musical Chairs — a pastime in which he is victor who says Snap neither too soon nor too late, who passes the Old Maid to his neighbour before the game is over, who secures a chair for himself when the music stops. These games can be played with zest and enjoyment, though all the players know that it is the Old Maid which is circulating, or that when the music stops some of the players will find themselves unseated……