Could Walmart Revive the Downtowns They Helped Kill Long Ago?

You've heard the story before. Walmart opens a store near a small town.  The store is often on the edge of that community on greenfield land.  Folks realize that everything from apples to Zenith stereos are cheaper.  Locals no longer shop at the downtown hardware store, local supermarket, toy store, or pharmacy.  Main Streets become empty streets.

This process has evolved since Walmart started expanding in earnest back in 1962.  The company’s slow, methodical expansion crept across the rural south to big cities.  Areas as remote as Virginia’s Eastern shore have a Walmart, usually by an interstate or major state highway.  In fact, most Walmart stores you drive by are in their second or even third incarnation, as the big discount store has often relocated and turned into the big box supercenter that many people both love or revile (sometimes both).  Plenty of studies, like an Iowa State University paper from 1997 that I randomly found, talk about the demise of town centers thanks to Walmart and its competitors.  Of course, the flip side of this argument is that no one forced anyone to walk into Walmart - and consumer habits have changed, especially after the early 1990s recession, so Walmart was one company that hugely benefited.

But what if Walmart had a role in reversing that downtown decline?

Walmart, like any company driven to maximize shareholder value (as entrenched in US business law), will still build superstores.  Analysts have predicted the company’s demise off and on for several years, but have been proven wrong (though same stores sales have declined the past two years).  But any smart company will realize that it must develop new products and services in new markets.  To that end, Walmart is test marketing its “Express” stores in three test markets:  Arkansas, its home base; Richfield, NC; and Chicago, where the first of these stores opened in June.  The company also has a few “Marketside” stores that offer organic food options.

Walmart Express or Marketside stores are a way for the company to gain a foothold in urban areas.  Tesco’s Fresh & Easy have opened branches in “food deserts” like downtown Fresno; if you had the misfortune to walk into a new Trader Joe’s in Washington, DC or Manhattan, the lines that still snake through the aisles on a Sunday evening speak volumes.  For some New Yorkers who tire of shopping at “bodegas” that charge random prices for low-quality goods, the idea of a store that offers decent prices for food is an attractive option, even with that “Walmart” label.  Of course, that would depend on the neighborhood that Walmart seeks to enter.

But what if Walmart actually opened stores in some of these smaller cities that many claim the company turned into ghost towns long ago?  Such stores could serve as an anchor that could encourage other stores to open within a few blocks.  Residents in nearby neighborhoods do not always want to make that several mile shlep to just pick up a few items, and with Walmart’s commitment to sell more organic food, this would be one way for the company that it could commit to those food deserts that have a role in America’s lagging health and spiking obesity.  But these small Walmart stores could also help revitalize those small main streets that seem as long ago as Route 66.  An Express moves in, a coffee shop follows, then a cafe, a gift shop, some offices, etcetera, etcetera.

Not that reviving small towns would be easy.  Shopping habits are changing with the Internet and large retailers are scrambling to compete with the Amazons and other online stores.  Walmart also has not been open about participating in “mixed use” development projects, though it has green-lighted a few, including one in suburban Washington.  Nevertheless, people always need to eat or pick up those one or two items that do not always justify a long trip across town.  If Walmart’s smaller stores prove successful, there could be opportunities to revive those main streets of days gone by, from Jamestown, North Dakota to Jamestown, California.  Whether Walmart would be welcomed, however, is another story.

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Leon Kaye is a consultant, writer, and editor of GreenGoPost.com and also contributes to The Guardian Sustainable Business; you can follow him on Twitter.  He lives in Silicon Valley.