On the macro-economic front there is good news and bad news for independent urban retail business owners, according to Karl Seidman, a senior lecturer in Economic Development at Massachusetts Institute of Technology’s Department of Urban Studies and Planning.
Rising oil prices and the recent meltdown of the sub-prime lending market have spurred concerns that the US is heading into an economic downturn. But Seidman said decades of focus on revitalizing urban centers should shield their commercial districts from the potential fallout.
“I am sure it will have an impact on some businesses. Will it have an impact or the efforts around Main Streets? I don’t think so,” Seidman said.
More people are moving into cities, he said, and concerns about climate change have led to an increased focus on smart growth and high-density mixed-use development, he said.
“A lot of these things are going to keep interest in commercial centers strong,” he said.
Small businesses will, however, continue to see increased competition from big-box stores and online retailers, he said.
“It’s more of a challenge for somewhere like a bookstore or a toy store,” he said. “They have to offer clientele something different from buying online.”
Bookstores have been responding to the challenge by doing things like incorporating cafes and offering more readings by authors, he said. “They can’t just sell books as a commodity. They have to educate and entertain.”
For toy stores, “You could look at toys that are more unique or harder to find, or offer the opportunity to touch, feel and explore the toys before you buy them,” he said.
Retailers “have to be very creative,” he said. “You cannot offer the same fare in the same way for the same price and expect to be able to survive.
“You have to foster a social experience and a sense of community with the place and the people…It fits in nicely with what a neighborhood commercial area is offering people.”