This box-shaped community

JOEL DAVIDSON-Frontiersman reporter

MAT-SU -- In 1992, Wal-Mart decided to build a store on the Parks Highway, kicking off what has become an accelerating influx of mega-retail stores to the Valley.

Twelve years later, five national mega-retailers have established satellites in the Valley, and experts predict more are on the way.

Combined, these stores have more than 1,000 employees, cover nearly 800,000 square feet of retail store space and offer roughly 800,000 products for Valley shoppers. Wal-Mart, Home Depot, Lowe's, Sears and two Fred Meyer stores have changed both the physical and economic landscape of the Mat-Su Borough's core area.

Along the way, Valley residents have both praised and cursed their arrival.

Some say the larger selections and cheaper prices are a blessing. Critics say the mega-retailers have squeezed out small businesses and marred the landscape with massive concrete buildings. Whether for or against, it seems certain that the mega-retailers are here to stay.

Mega-retailers and shopping convenience

Undoubtedly, mega-retailers provide more selection at cheaper prices. They also eliminate two-hour-round-trip drives for shoppers who once bought the same items at Anchorage stores.

"They're cheap and they've got everything," one Wasilla Home Depot customer said this week as he walked across the parking lot with a long shopping list in hand. "Before, we had to go into Anchorage and it was a pain."

Not long ago, many Valley residents complained of the lack of shopping opportunities in Mat-Su. Twelve years after the first mega-retailer arrived, those same complaints are far fewer.

Similar scenarios have played out in small communities all across the country.

In 1962, Wal-Mart began building its financial empire through providing small towns with huge selections of nationally recognized name-brand products. Today, Wal-Mart is the world's largest retailer, with nearly $250 billion in annual sales and more than 1.3 million employees who work in roughly 3,200 U.S. stores.

A quick glance down the Parks Highway reveals that Wal-Mart is not the only national retailer to strike gold in the Valley.

The recently arrived Home Depot and Lowe's are the first- and second- largest home-improvement companies in the world, each with multi-billion-dollar annual sales figures.

"They're tough competition, no doubt," said Bob Poe, president of the Anchorage Economic Development Corp. "But small retailers have not historically offered the price and range of products that these stores offer."

For years, Poe said Alaskans traveled out of state, to Seattle, for their shopping needs. Now, with the mega-retailers in-state, Poe said Alaskan cities benefit from increased sales-tax revenues and more service opportunities, as well as an influx of out-of-town shoppers.

"Some people come to the Mat-Su just to do shopping there," Poe said. "In Anchorage, there are hotels specifically for out-of-town-shoppers and I wouldn't be surprised if some of the hotel growth in Wasilla is not the same thing."

With more people shopping in the Valley, city officials in both Palmer and Wasilla have spoken positively about additional sales-tax revenue.

"It's good because it provides a local employment base and it creates a tax base for the local economy," Palmer City Council Member Tony Pippel said. "It's hard to pay for heavy stuff like roads, water and sewer without a tax base."

Fred Meyer finished building a 74,000-square-foot store in downtown Palmer this year, and sales-tax revenue in Palmer is up 12 percent from last year.

"I'm sure some of it is attributed to Fred Meyer," said Sara Jansen, Palmer's community development coordinator, "but some is also due to general growth."

Sprawl busters seek big-box regulations

As successful as the mega-retailers have been, they are not without critics.

Community watch groups, committees and conferences have popped up across the country, some flat out against mega-retailers and others who say communities need to plan for these stores so they don't run roughshod over local values.

Critics often contend that these big-box stores are eyesores that end up destroying local businesses with prices so low that none can compete. Others complain that traditional downtown shopping areas are gutted as established businesses fold, leaving behind empty storefronts along once-bustling main streets.

In 1993, Al Norman achieved national attention when he stopped Wal-Mart from locating in his hometown of Greenfield, Mass. Since then, he has appeared on "60 Minutes" and gained widespread media attention in his battle to keep mega-retailers, including Kmart and Home Depot, from expanding across the U.S.

Norman is now editor of the monthly "Sprawl-Busters Alert," and has traveled throughout the country in his anti-mega-retailer campaign. "60 Minutes" called Norman "the guru of the anti-Wal-Mart movement."

Not all critics take as hard-line an approach as Norman.

Organizations like Friends of Mat-Su just want to see the Valley develop responsibly. As a nonprofit group, FoMS seeks to inform local residents about land-use planning.

"[Mega-retailers] have changed the Valley," said Kathy Wells, FoMS' executive director. "They've brought in more retail jobs, but they've also brought traffic problems and they're not very attractive visually."

While Wells admits the community supports having these stores, she argued that regulations should be enacted to keep them accountable.

"These stores come in and cities are not prepared to deal with them in terms of traffic, design and the impact they have," Wells said. "Cities can't hold these businesses to standards if they don't have ordinances on the books."

When Fred Meyer moved into Palmer, the city had very few regulations regarding the size and design of the store. In those situations, Wells said cities are forced to build relationships with the mega-retailers and hope they listen to local concerns.

"That's the only thing available if there are no ordinances," she said.

Wells said cities that do have ordinances for large stores often end up with more aesthetically pleasing buildings.

"If you look at some developments across the country, there are Wal-Marts and McDonalds that are built into communities and you'd never know what they were," she said. "Businesses want to know the rules when they come to a town and if there are none, then they won't do the extra stuff."

During the construction of Fred Meyer, the Palmer City Council passed an ordinance pertaining to large retail establishments. The ordinance came too late, however, to affect the new Fred Meyer.

"We passed the ordinance and there are discussions to modify it and make it a little tougher," Pippel said. "We were fortunate that Fred Meyer worked with us and complied with 90 percent of our requests."

Apart from increased traffic and light pollution, Pippel said mega-retailers are oftentimes the largest building in a specific area.

"Large buildings, in small backgrounds like Palmer, become landmarks," he said, "and landmarks say something about the city. Having monuments built to minimal standards is not acceptable. We want buildings that are aesthetically pleasing, not just concrete block walls."

Unlike many mega-retailers, Fred Meyer built its store in downtown Palmer. Some local businesses expressed anger over the location, but Pippel said the store will probably contribute to, rather than detract from, the life of downtown Palmer.

"Typically a large retailer comes to the edge of town and looks for easy access off the highway where they can put up their big building and parking lot," he said. "What I like about Palmer is that Fred Meyer developed in downtown, where the action is."

When Fred Meyer first expressed interest in coming to Palmer, Pippel said there were concerns that it would kill local merchants and end up leaving the city with vacant downtown shops. Pippel didn't think that would happen and he thinks that by building downtown, Fred Meyer will hopefully encourage more development in the core area to keep Palmer from sprawling into the traditional surrounding farmlands.

"I thought it would just attract more customers to the downtown area," he said.

In the future, Pippel hopes to see Palmer grow up, rather than out.

"I'd like to see the core area of the city with two- and three-story buildings, with retail space on the ground level and residences above. We have people working on multiple-use ordinances for the downtown core," he said.

Local businesses forced to adapt

While consumers benefit from cheaper products, many small businesses suffer and often close down when mega-retailers move into town.

Kenneth Stone, a former economics professor at Iowa State University, has studied the effects of mega-retailers on smaller communities for nearly 20 years. He now works for various cities around the country and in 1998 was commissioned by the city of Kodiak to study the potential impact of Wal-Mart moving there.

Stone's studies have shown that businesses competing directly with mega-retailers usually suffer the greatest losses. Other specialty businesses, however, which are not in direct competition with the mega-retailers, suffer less and sometimes even thrive.

In the long run, businesses do better in places where mega-retail stores are allowed to develop.

According to Stone, shoppers from surrounding towns will go to towns with the mega-retail stores. While in town, those shoppers are more likely to visit other businesses as well.

In one report, Stone found that smaller businesses do better when they focus on products and services mega-retailers don't provide, such as technical advice, deliveries, on-site instillation, special-order capability and highly trained employees who can provide superior customer service.

Poe argues that the box stores often make smaller businesses focus their attention and end up raising the overall quality of stores that do succeed.

"Many downtown businesses survive by becoming niche stores," he said. "A downtown district needs to be focused on supplementary areas that the box stores will never do a good job at."

Many small businesses in the Valley do currently focus on specialty products, and strip malls from Palmer to Wasilla are full of ethnic restaurants, specialty gift shops, barbershops, bookstores, smoke shops and antiques dealerships.

Businesses such as Kash's Carpet and Cabinets and Outdoors and More are trying to compete, head to head, with the mega-retailers.

Judy Thomas and her husband own Kash's Carpet and Cabinets. She admits that Home Depot and Lowe's will affect her business, but she said smaller home-improvement stores will suffer the most.

Thomas said she plans to focus on their strengths.

"There's no doubt that each and every one of these stores will have some impact on us," she said, "but we have more flooring in stock than any other place in the state."

Thomas said her ability to provide large quantities of in-stock merchandise separates her from her competitors.

"Here, customers can see their carpet, feel it and take it home with them that day," she said. "Our staff is also very knowledgeable."

Outdoors and More is another well-established Valley store that has conducted business for more than 22 years in the same location at the D & A Shoprite Mall.

Store sales manager Julie Amgwert said the store competes directly with the outdoor departments of Wal-Mart and Fred Meyer, and so far has been successful.

Part of the store's success, specialization, mirrors what Stone said was necessary if smaller businesses are going to compete with mega-retailers.

"We've go the largest Carhartt selection in the Valley," Amgwert said. "We also place orders all throughout the year, which allows us to keep items in stock that the other stores may run out of."

Amgwert also indicated that customer service was one of the biggest draws.

"People tell me that they get good customer service here -- service they don't get at bigger stores," she said. "A lot of customers know me by name."

One such customer, Sara, was buying gloves and winter cleats for her shoes on Thursday.

"If you have any questions, they always help you here," Sara said. "If I need outdoor gear, I come here."

"There's no going back"

According to Poe, over the past 17 years, the Valley and Anchorage have experienced uninterrupted job growth, a fact that has corporate offices scrambling to open Valley stores.

"You're going to see more box stores," he said. "It will lower the cost of living, thereby making Alaska an even more attractive place to live."

If recent trends are any indication, overall business growth will continue to skyrocket. Since 1992, the number of businesses in Palmer has nearly doubled, from 645 to 1,241, and Wasilla now has more than 1,500 businesses, with more opening every day.

Poe said businesses, both local and national, will follow the population.

As they do, local city officials, along with planning and zoning committees and nonprofit groups, will increasingly face the challenge of balancing the unparalleled rise of national businesses with local values and consumer needs.

With most of the mega-retailers locating in Wasilla, Mayor Dianne Keller said landscape ordinances and zoning measures need to be balanced with long-term developments and planning efforts.

"I see Wasilla becoming more and more the economic hub of the Valley; we've positioned ourselves to be that," she said. "But these issues are things that all communities will have to deal with out here as they grow."

According to Pippel, a number of people have told him Fred Meyer has changed the feel of Palmer.

"Some say it's not the way it used to be and no doubt it is not," he said, "but there's no going back."

Contact Joel Davidson at joel.davidson@frontiersman.com.