Some thoughts about town centres

Back in 2005 I wrote this on another blog. I’m reposting it here as a way into a discussion about the town centre and its problems.

An article from the Vancouver Republic [no longer publishing] poses some interesting questions about small business and how they might be encouraged.

It’s accepted as axiomatic these days that small retail businesses will forever struggle to stay afloat. Mine, a specialty magazine and book store called Magpie Magazine Gallery in Vancouver’s funky Commercial Drive district, is twelve years old and still I feel like a short trip out of town, and out of cell phone range, could end with me finding the sheriff’s note posted to my front door.

And yet, my small independent store in this lower-rent street generates as much revenue per square foot as is achieved in Canada’s best-performing mall, the Pacific Centre, in downtown Vancouver. All my business neighbours feel as provisional as I do, but taken together, our roughly 12-block strip with about the same amount of total floor space as an average WalMart, generates more revenue, raises more gross profit, achieves a better net profit on revenue, employs way more people, provides a much wider range of goods and services, and contributes much more to the civic common good than that average Walmart.

So why is WalMart the most valuable company in the world while the stores of Commercial Drive, if put on the market all together today, would fetch in total a tiny fraction of what each WalMart store is worth? And why are WalMart owners sitting so pretty in the top ten of the world’s most wealthy, while I and a lot of my business neighbours eye the official poverty line with daily wariness?

I don’t know if the proposal put forward would be feasible in the UK, but would be interested in hearing comments.

…entice a large enough group of businesses in some commercial district to set up a cooperative company that creates a subsidiary investment holding company that engages in stock swaps with each of the participating small businesses such that the holding company comes to own 49% of each small business while the small business owners each come to own some equitable part of the overall holding company. Neither the investment holding company nor the coop that controls it would ever gain controlling interest in any one of the small businesses, but the investment company itself would be one with considerable clout if it came to represent 49% of the interests of an entire district like Commercial Drive….

The holding company could additionally provide benefits to its owners by taking advantage of the economies of scale it could achieve on purchases of business supplies and services like insurance, courier costs, accounting contracts and more.

This would probably need a trusted third party to get things started, which might usefully be a role for a local Development Trust or an organisation like Locality – or perhaps even the Coop itself.

[Original link via Kevin Carson’s Mutualist Blog]

Since writing this both the newspaper and the business have ceased trading.

Would this work in Devizes? Who knows? I’m not alone in thinking about cooperative approaches though.

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Posted in Economy, Town Centre

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