Monday, May 16, 2005

Big Box Baloney

Let me see if I understand this correctly. Some people believe we should embrace a 100,000 sq. ft. Walmart for economic reasons. According to the Heber City Big Box presentation we have "Sales Tax Leakage" on sales on "lost sales" of some $50 million dollars per year amounting to $290,000 per year. That amounts to approximately $3,000 spent out of Wasatch County (Heber City) for every man, woman and child in the County or about $10,000 for each family. Does your family spend and average of $800 per month on merchandise outside the county?

The proposed solution, WalMart, has a forecast sales projection of $1,618 for each person in the buying area or about $5,000 per family. The report also indicates that most local business will suffer 10 to 20% losses. This will reportedly add $200,000 to our tax coffers, (if the inflated projections hold true), or about $12 per person per year. Will your be spending that amount at WalMart, if they build here. Personally, I think my family may have spent $50 last year at WalMart and I doubt it would increase much - I'd rather pay the $12 in taxes.

Is it true that government (tax) incentives are being offered for WalMart to come? Leave the building size cap at 50,000 sq. ft. and continue to encourage people to buy more locally.

1 comment:

CharlesWorlton said...

I don't understand the opposition to WalMart stores. There is opposition in both affluent suburban neighborhoods and poorer urban areas. Oddly, despite the resistance from certain groups, WalMart has been very successful.

How has WalMart achieved its success? I think this is the pivotal issue for me. If they have achieved their success by bringing consumers a good selection of products at low prices, I find it hard to oppose that. (I personally find the stores to be more convenient to shop at than "mom and pop" stores.)

If, however, the argument is that WalMart has achieved success in an underhanded way, then these are the issues that ought to be brought to public attention. So far, the only serious concern I have heard is the traditional concern that arise when a big company gets itself preferential treatment with a city that is trying to woo its business.

This type of concern is certainly valid, and it needs to be attacked at both ends. The decision to subsidize a company with tax breaks or other incentives is seldom questioned because it is touted as being "for the long-term public good." Such assumptions need to be carefully scrutinized, but it is tough to get the public to rally behind such issues because the proponents of such incentives are expert at spining the issues in favor of their suggestions. The public seldom takes the time to research who is telling the truth.

Another issues I have heard are "WalMart kills competition." For me, this doesn't matter unless the reason the competition dwindles is because of some unfair advantage on the part of WalMart. To deny WalMart a chance to compete seems like government intervention to me. Why shouldn't they be allowed to buy land and compete?

I have frequently heard that WalMart stores are ugly. This may be true. They use a cookie cutter design which I assume reduces their costs and gives some consistency to their stores. I sympathize with both sides of this argument.

Whether or not I understand the reasons for opposing WalMart, WalMart clearly has issues it should not ignore because it seems to me that more and more people are opposing them.

WalMart could help themselves by showing that they are willing to alter their stores to meet concerns of the communities they want to be in.