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Small stores keep wary eye on competition

Exacting change?

Posted: Friday, February 17, 2006

 

  Heather Love stocks shelves at the new location of Soldotna Trustworthy Hardware before the store's grand opening last spring. Small retailers have differing opinions regarding their fate against large "box" stores. Photo by M. Scott Moon

Heather Love stocks shelves at the new location of Soldotna Trustworthy Hardware before the store's grand opening last spring. Small retailers have differing opinions regarding their fate against large "box" stores.

Photo by M. Scott Moon

Small business owners on the Kenai Peninsula have seen it before.

Large retailers including Kmart and Fred Meyer came in, and the question was, “Can the little guy survive?”

Now, Wal Mart and Lowe’s have announced plans to build here.

As the number of large retailers grows in the central peninsula, what will be the fate of smaller business owners, many of whom have been here for years?

Some say it’s curtains, some say they won’t be bullied into closing their doors and some say, with a little adjusting, they’ve survived the arrival of big retail in the past and they’ll survive again.

After 20 years of running a small-town hardware store, Paul Miller saw a dream come true last year when Soldotna Trustworthy Hardware moved into its brand new, enlarged store on the Sterling Highway.

This year, his optimism for the future of the business is gone.

“Probably within four years, we’ll close down,” said the lifelong retailer.

“There’s only so many dollars on the peninsula,” Miller said.

Kathy Slone, daughter of the owner of Dan’s TV in Kenai, sees things a little differently.

“There’s no danger of us closing. If we close, it’ll be our choice, not because someone forced us,” Slone said when asked if the planned new Wal-Mart supercenter coming to Kenai will force the television and appliance retailer out of business.

Mike Sweeney, proprietor of Sweeney’s Clothing in Soldotna, also does not see Wal-Mart’s arrival as cause for him to shut down.

“Most of the time, we offer higher quality,” he said, pointing to name brands including Pendleton, Carhartt, Columbia, Xtra-Tuf, Red Wing and Sorel.

“We also offer Levis, but ours are the same (quality) as everywhere else,” Sweeney said.

The difference is that Sweeney’s can stock Levis more deeply in all sizes than a big store that buys in large lots of one run of sizes.

While the large retailer will purchase one lot of three smalls, six mediums, six larges and three extra larges, Sweeney’s can be more selective, replenishing stock as specific sizes sell down.

“I think all small businesses will be affected. It does affect the cash flow of the community,” he said.

The owner of Beemun’s in Soldotna also sees higher end merchandise — particularly bicycles — being the edge that will keep the general merchandise retailer afloat.

“We offer quality bicycles — Specialized, Trek and Kona — and Wal-Mart’s are cheap and fall apart,” said Steve Beeson, who has operated Beemun’s for 18 years.

Beeson said his store survived the arrival of Kmart and Fred Meyer on the Kenai Peninsula, and he believes it will survive Wal-Mart, as well.

“We made lots of changes. We got rid of pillows and bedding. It made us more focused,” Beeson said of the earlier arrival of big retailers.

Besides providing high-quality merchandise to Kenai Peninsula customers, the smaller retailers also offer good jobs.

Beemun’s employs 14 people offering flexible schedules, some profit sharing, a retirement plan and paid vacations.

“We pay better (than Wal-Mart),” Beeson said.

The store also provides jobs for some high school students, and adds extra people in the bike shop during the summer.

Soldotna Hardware, which employs between 16 and 18 people year-round and between 25 and 30 during the summer fishing season, offers its workers health insurance, paying 80 percent of the premiums, profit-sharing and a retirement-savings plan.

Sweeney’s has 10 employees throughout the year, most of whom are full-time, and pays between $8 and $12 per hour depending on how long the employees have worked there.

The store does not offer medical insurance, but gives its employees generous discounts on its clothing, according to Sweeney.

Slone sees service as the big advantage Dan’s TV has over large retail firms.

“We service what we sell,” Slone said.

“We have the time for our customers.

“A lot of people go up to Anchorage for lower prices, but they don’t want to pay for service,” she said.

Some city officials have said the large retail stores will draw more customer traffic past the small stores, increasing their business, as well.

“They might drive by, but they won’t stop,” said Slone.

“Tourists will come to Kenai because they know Wal-Mart. They’ll shop there,” she said.

Miller believes people will continue to drive to Anchorage to shop at Costco and Sam’s Club. He does not believe having Wal-Mart in Kenai will stop people from driving to Anchorage.

“You think the little stores will find a niche, but they don’t,” he said.

“Unless you’re right with (big retailers) on price, sooner or later customer service erodes.

Eventually, Miller said he believes, the only stores left in Kenai will be Wal-Mart, Lowe’s and Home Depot.

“It’s going to be pretty grim,” he said.



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