Commerce Buzz

13 Comments

1. 

   James Barrett

    /  August 14, 2017

   I assume the lack of drive-through for Dunkin Donuts is based on a town policy and not a restaurant decision. Either way, it is the reason I continue to get my coffee and bagel on 54 in Durham on my way into work. Until (if ever) public transit to RTP is a real alternative, cars remain the major part of transportation. Please don’t continue to make TC decisions based on how we’d like the world to be, ignoring how things are.

2. 

   plurimus

    /  August 14, 2017

   Heh. Leadership in Durham and Orange seem to want to ignore well established economic principals such as Marchetti’s Constant, and Jevon’s Paradox when they make decisions regarding transit and development.

   As an aside, there is an interesting piece in the current Atlantic Monthly about and tracing the roots of, our national detachment from reality:

   https://www.theatlantic.com/magazine/archive/2017/09/how-america-lost-its-mind/534231/

3. 

   Nancy

    /  August 16, 2017

   James, here’s the official word from town staff about the drive-thru policy: The Land Use Management Ordinance (LUMO) allows drive-through windows as a permitted use in one district (DA-1), and with a Special Use Permit in seven zoning districts (TC-1, TC-2, TC-3, CC, NC, OI-1, OI-2, OI-3, OI-4). In addition, it allows them as an Accessory Use in Planned Development Districts.

   From my map, it looks like the Dunkin’ Donuts is in CC, which means it could have had a drive-thru, if it applied for an SUP. I”m guessing Dunkin’ Donuts didn’t want to go through the SUP process. It did not come before council.

4. 

   Bruce Springsteen

    /  August 21, 2017

   In related news, Wal-Mart on 15-501 is still open. Considering it was obviously going to be a success (until eventually something even further from local business models, like Amazon, took over), it would have been a good idea to put it a couple hundred yards north and have it it on our side of the Orange/Chatham border so we could get the sale tax revenue. As Mister Spock said at the end of The Wrath Of Khan, “The needs of the many outweigh the needs of the few.”

5. 

   David

    /  August 21, 2017

   Bruce,

   The case of Walmart on 15-501, or in Durham’s New Hope Commons for that matter, shows the importance of regional planning and coordination. Chapel Hill had many good reasons not to want Walmart to locate here, since the research shows they generally bring more harm than benefit to the communities in which they locate (see https://ilsr.org/key-studies-why-local-matters/). But all the municipalities and County governments in a given region need to be on the same page about this; it does little good—which is not to say it does no good—for one municipality to smartly reject big box stores if the adjacent jurisdictions welcome them. The problem is not that Chapel Hill said no to Walmart; the problem is that Durham and Chatham said yes. And this raises the question: should we do what we think is right even when our neighbors make what we consider a poorer decision, and their poorer decision undercuts the efficacy of our better decision?

6. 

   Bruce Springsteen

    /  August 22, 2017

   I don’t think it’s that simple that Wal-Mart is necessarily bad but without getting into the details of that let’s assume that everyone around here agreed that Wal-Mart is bad. Given that we knew Durham and Chatham Counties were going to eventually let Wal-Mart in anyway, wouldn’t it have made sense to lure them onto our side of the county border instead of the other side so that we’d be the ones that get the tax revenue? If we move the Chatham Wal-Mart north 1/4th mile what effect does it have on Chapel Hill (aside from increased tax revenue)?

   Also, note that the reason Wal-Mart puts their stores right outside the Orange County border isn’t because they want to inconvenience their Durham County customers by making them drive westward and their Chatham County customers by making them drive northward but rather because they want to make it convenient for people in Orange County. IOW, Orange County people want it. Chapel Hill didn’t say no to Wal-Mart, the Chapel Hill power structure did.

   But just as a thought experiment, suppose you could snap your fingers and Chatham Wal-Mart would go away as well as the million stores in the New Hope Commons general area. All those people that have shopped at those stores before now…where would they shop instead? What if the entire country was like Chapel Hill and Carrboro? Where would people shop?

   There’s a Weaver Street Market a hundred yards from me that sells eggs for about $6 a dozen (which I never shop at because their eggs cost about $6 per dozen) and if they weren’t pressured by nearby vendors selling eggs for a lot less than about $6 per dozen they’d be selling eggs for about $16 dozen. Has anybody thought this through? Where does the money come from? Pretty much this entire area revolves financially around UNC, which is…wait for it….non-local money! To paraphrase Dennis Moore, this is trickier than I thought.

7. 

   David

    /  August 22, 2017

   Bruce,

   There are other readers who know more than I do about the circumstances resulting in various big box stores locating just outside Orange County, and I hope they will weigh in, but it’s my understanding that the idea that these retailers wanted to locate in Orange County but the local “power structure” drove them away is largely a myth. They never preferred to be in Chapel Hill because land was cheaper and taxes were lower on the Durham/Chatham side of the line. To entice them to locate in Chapel Hill we presumably would have had to offer various incentives, such as tax exemptions (as the Town did to lure Wegman’s across the county line) which then undermines the fiscal argument for wanting them to locate here.

   I like your thought experiment, because it has actually been conducted in real life in cities that have ordinances to discourage “formula retail.” (see https://ilsr.org/rule/formula-business-restrictions/ and http://sf-planning.org/chain-stores-formula-retail-use). I expect that what would happen is that Franklin St., University Mall, Eastgate, and other commercial areas of town would have a greater diversity of shopping options (e.g., more clothing and housewares stores and fewer restaurants) and residents would do more of their shopping at these places other than driving to Durham or Chatham. Prices would probably be a bit higher than at the big box stores, but when you take into account the full individual and social (i.e., externalized) costs associated with big box stores in general and Walmart in particular, the effective public subsidy of local, independent retailers may actually be quite small.

   The parking issue would need to be addressed, but that’s a topic for another day.

8. 

   plurimus

    /  August 22, 2017

   Snapping my fingers, I suspect that Amazon, Wal-Mart’s JET and other online retailers will close many of the stores. My question is when this comes to pass, what will the surrounding towns do about their commercial real estate and the resulting tax loss .

   Orange county resistance to commercial development may appear visionary in the near future.

9. 

   Bruce Springsteen

    /  August 24, 2017

   Those links are kinda creepy. So we’re going to start banning stores because they’re similar to other stores elsewhere? Why don’t we just get straight to the endgame and ban Orange County citizens at shopping from big box stores?

   It’s like we do more and more to try to prevent local
   people from shopping at stores that “we” don’t like and yet they keep shopping there (which means that “we” actually do like them). And then we wonder why only 16% of people vote in local elections. Maybe it’s because they’re cowed and intimidated from verbally expressing themselves.

   University Mall, er, Place has a luxury food store in A Southern Season and a luxury cinema. Regular folk rarely go to those places. OTOH regular folk go to Wal-Mart or Target or whatever every week. And since the Wal-Mart is over the county line instead of at University Mall, er, Place, they go across the county line.

   If the shopping places right over the county line went away then suddenly stores on our side of the county line would pop up offering decently priced products? Does it even make sense to say that stores not offering a product right now will, if given a monopoly, suddenly start offering it at a decent price? I don’t buy that (no pun intended).

   Big box stores aren’t even the biggest issue in discussions like this. How about “local” food? Anyone ever looked into the externalities generated by small scale, inefficiently produced food from land close to a large university that a large number of employees are forced to drive to each workday? Hmmm.

10. 

    David

     /  August 24, 2017

    Bruce,

    Until fairly recently, Chapel Hill did have stores where low- and moderate-income households could purchase clothing and other necessities. There were three department stores in University Mall and a variety of shops downtown selling everything from clothing to hardware to books. The town government has no control or influence over the larger societal forces that led to loss of these retailers. To blame the local “power structure” for the fact that we now have to drive to Durham to buy clothing for our kids is just silly.

    As far as my own family is concerned, the money that we used to spend at local retailers is not, for the most part, now going to Durham. It’s going to Amazon and other online retailers.

11. 

    plurimus

     /  August 24, 2017

    And the FTC just approved the purchase of Whole Foods by Amazon. This is likely a trend that will continue as more and more retail consolidation occurs.

    Wal-Mart has recently employed Uber for delivery in an effort to one up Amazon on delivery times.

    As of 2017, the state has started a sales tax on repair, maintenance, and installation services.

    In a related development SB 126 proposes changes to the LOST formula for sales tax distribution to the counties redistributing tax revenue in order to level the playing field as determined by § 143B-437.08. Orange and all of the surrounding counties would lose revenue under the revised formula. http://wncn.com/2017/03/14/nc-bill-changes-formula-for-counties-receiving-state-wide-sales-tax-revenue/

    My point is taxes and retail are going through seismic changes in both the public and private sectors. Doesn’t it make sense to look at solutions for the future rather than the past?

12. 

    Bonnie Hauser

     /  August 27, 2017

    There are many changes underfoot- but I have to say that its scary to drive down Franklin Street and see all the empty storefronts. Who’s going to fill them?

    The businesses that stay seem to be the ones that cater to the student crowd – a reliable market under any circumstances. They like the vive at Trader Joes and seem to like head shops, sporting goods, and bars. Wegmen’s is going to be a good match for our markets.

    Lets not forget that Walmart in Hillsborough is the single largest producer of sales tax revenue in the county – by far (last I looked it was over 10%). Wegman’s is expected to top it! I’m excited to see what’s coming of the new urban Target.

    My favorite home growns are Phydeaux and the Vaccum hospital, Med Deli and the Ch Hill Restaurant Group. I love spending money there.

    Is it possible that the retail answer is all of the above?

    Still wondering who’s going to fill all those retail shops on Franklin Street….

13. 

    David

     /  August 28, 2017

    Don’t forget Driade cafe, Flyleaf Books, Merritt Store, Sunrise Biscuit Kitchen, Twigs, Mariakakis, Grimballs Jewelers, the Ackland Museum shop, Sandwich, to name a few. These are all one-of-a-kind, distinctive, locally owned small businesses. There used to be many more. The report below describes some things municipalities can do to help businesses such as these avoid being displaced by commercial gentrification.

    https://ilsr.org/wp-content/uploads/downloads/2016/04/ILSR-AffordableSpace-FullReport.pdf