Despite retail giants like Toys “R” Us and GR-based MC Sports closing their doors, GR recently took second place in the category of “Best Cities for New Small Business” in a LendingTree report. In this installment of Making it in GR, Rapid Growth observes the relationship between the current state of national retail and the local retail climate, as well as the effects of e-commerce on local business.
With all of the development taking place throughout the city, terms like ‘gentrification’, ‘displacement’, ‘beautification’ and ‘revitalization’ are becoming commonplace. Regardless of which side of this issue you are on, business owners are doing their part to help make their neighborhoods and communities more vibrant, welcoming places. The retail industry, in particular, is experiencing vast shifts but local entrepreneurs are rolling with the punches.
Walking along the vibrant corridor of Southeast Wealthy Street is a multi-sensory experience. The smoky scent of espresso wafts out of the constantly opening and closing door of Rowster Coffee. Across the street, Donkey Taqueria conjures mouth-watering aromas of handmade Latin fare. A delicate treat from Mokaya electrifies the taste buds. Then there’s the countless storefronts, without the tastes and smells, but offering a feast for the eyes and the imagination. Stepping into Woosah Outfitters
is akin to stumbling into a lush forest filled with towering murals, the foliage of clothing racks, and the flora of magnificent, colorful designs.
“It’s hard to trace it back to the very beginning because it’s been such an organic thing and it’s just kind of grown as it grows,” said Erica Lang, owner and artist behind Woosah Outfitters. She sits at a high-top wooden workbench inside her new store at 738 Wealthy St. and pauses between sentences to greet customers as they enter at the front of the building.
“For me, it’s just been hustling and working really hard to grow it, which has been working. It’s been really cool to see it start from just like an idea on Etsy to having the first studio, then a store, and now we’re here.”
With the recent news of retail giants like Toys “R” Us planning to shutter all U.S. stores
or regional retailers like Grand Rapids-based MC Sports filing for bankruptcy and pulling the plug
on its 68 stores in seven states, it’s hard not to question the vitality of retail, especially when it comes to physical storefronts like that of Woosah Outfitters. With the world’s favorite brands and stores just a click away, making a trip to local retailers can seem almost obsolete.
Though even with an evident decline in retail nationwide, the city of Grand Rapids continues to grow and thrive. Last fall, the city was named the number one fastest growing economy in the country by Forbes
, with a workforce growth of 4.4 percent in 2016 and unemployment at just 2.8 percent. There are also the visual signs: new breweries, boutiques, and towering apartment buildings continue to sprout up on every block. According to a study published by Trulia
in December 2017, Grand Rapids was ranked as the No. 1 housing market in the nation “to watch” based on employment growth (ranked 11th), low vacancy rate and a high share of households under 35 (ranked 16th and 17th).
But does that growth include local retail? Is the expansion of Grand Rapids as a community indicative of growth in retail and small business?
According to another recent study by LendingTree
, Grand Rapids took second place in the category of “Best Cities for New Small Business,” with businesses reporting an average annual revenue of $293,495 with 85.2 percent of applicants reporting as profitable.
“We are in a bit of a transitional period. There’s old business models and old ways of learning about business like radio and television,” says Anthony Puzzuoli, Member Relations Manager at Local First
, an organization that offers resources and support for local businesses.
“The value of more traditional marketing is still important but in order to have a successful business, people have to get on board with how things are changing, whether that’s having an online presence or how they’re sharing their information and having different options for people to access their product. The foundation of having a successful business—building relationships, trust, honesty, doing what you say you’re going to do, having good products— those things haven’t changed. Just the way in which were expressing those things have,” Puzzuoli expounds.
Bridging the gap between physical storefronts and online businesses, pop up shops offer a unique compromise for online business owners looking to get the best of both retail worlds.
When Tova Jones started her own online clothing store, Luv Jones Plus Size Boutique, in 2014, she noticed her customers desired a physical storefront so they could visualize products and try on clothes in person. Though for Jones, that didn’t warrant the monthly rental cost that would come with a space of her own. So she sought out DIY spaces that she might be able to rent for short periods of time. When her search came up empty, she and her husband Sam decided to start their own. In 2016, they scoped spaces, found an ideal storefront at 315 S. Division St., and GR Pop Up Shop
“Our goal wasn’t to make money doing this. It really was a passion. We wanted to provide the brick and mortar feel without the bill. We wanted small business owners to be able to afford it. I think being in the industry, a lot of the small businesses are suffering because of the big corporations like Amazon. I hear a lot of complaints from business owners that I come into contact with who say it’s very hard to compete,” says Jones.
“But for West Michigan the trend that I’m seeing is more artist-based retailers such as galleries or Michigan-made themed business. That is really thriving in West Michigan. This is the place to absolutely thrive in that arena.”
Since its start two years ago, GR Pop Up Shop has hosted over 300 local business owners. For $30 an hour Monday through Thursday, and $60 an hour on weekends, artists, clothing retailers, crafters, and others can utilize the modern space and make it their own for a short period of time. The storefront is fully equipped and can be rented out for hours at a time, or even weeks, depending on availability.
“It provides a safety net for those who are looking to one day get a brick and mortar location. And it’s just a fun opportunity for your clients. If you enjoy being online it’s always good for your clients to know every now and again they can come and see you in-person, feel a part of the brand, catch up, catch some specials and also not have to pay shipping,” Jones says.
The effects of e-commerce on local retail
With the development of the internet, business owners have experienced both positive and negative effects over the past twenty years. On one hand, the web has leveled the playing field. Pre-internet entrepreneurs required large sums of startup revenue, the rental and purchase of a storefront, and were reliant on the patronage of their direct local community. In the modern retail climate the only things needed to start a business are a product and a website. Expenses can be kept extremely low while a broader range of customers can be reached. Businesses with a web presence have the opportunity to cater to an international audience.
“It depends on the client,” Jones says about effects of online business. “For some clients, e-commerce is the way to go. They love it, it’s their bread and butter. But then we have some clients who struggle a little bit with the online side of things. It just depends on where the client is with their business and how well they are acquainted with e-commerce.”
Puzzuoli adds, “I think a lot of mid-level and regional stores, where people are shopping for a lot of everyday items online, those stores have been hit hard. I think it is affecting some of our smaller brick and mortar locations, but I think a lot of what they do is not only sell a product but also provide that experience of shopping too. I do see a lot of smaller business looking for ways to provide more convenient access to their products.”
Downsides to the growth of e-commerce include small businesses being overshadowed by larger corporations and their ability to provide wholesale products at cheaper prices with little to no shipping cost. An observable shift has occurred where consumers are no longer looking to local business for provisional items, but rather for specified, one-of-a-kind goods—items they can’t find at their area big box store or online.
In a study performed by JWT Intelligence last September
, it was deduced that “88 percent of U.S. 18 to 34-year-old consumers prefer shopping with Amazon above other retailers generally,” and “80 percent of U.S. 18 to 34-year-old consumers believe shipping should be free.” Both statistics are heavy blows to local retailers who simply can't compete with their corporate equivalents, and those are only two examples.
“I think retail is suffering. Is it dying? No. I do think business owners have to get a little more advanced and a little more trendy and do a little more research on the ways to reach their target audience,” says Jones. “We have pride for handmade items and Michigan made things. Anything in that niche is really doing pretty well.”
Adapting to change
With shifts in the retail industry, business owners have found it increasingly necessary to rethink their approach to customers. Not only do businesses need a professionally-built website, but social media is becoming increasingly more important. Facebook and Instagram are vital tools to connect and communicate with customers, as well as a way to share upcoming events and news.
“I think one thing business owners can do is not fight it. This is the direction we’re moving and so I think understanding that things are going to continue to go this way, and then to work to develop a plan to get your business involved and online,” says Puzzuoli. “At the same time, I don’t think there’s a substitute for that personal interaction of walking into a store and those businesses can strive to provide the absolute best services and experience with the understanding that the person could be buying that product online but chose to walk into the store.”
Looking ahead at the future of Grand Rapids, the city’s growth shows no signs of slowing down. Upon diving into discussions about local business and economy, there’s an energy and excitement among residents as well as area business owners.
“There's a very strong heartbeat. People are still seeing Grand Rapids as a spot where you can come and make something happen. There’s fertile ground, resources, and community backing. There are people who have done it before and want to see other people succeed,” says Puzzuoli. “I think we’re almost at the cusp of taking that next step in retail and I think a lot of that is because the folks here really want to see that happen.”
Inside Woosah, customers peruse the eccentric nooks of the store, taking time to investigate a few trinkets and gaze at Lang’s immersive artwork before eventually making a purchase or bidding farewell and leaving the store. Most likely, they’ll wander a little ways down the road and into another local shop to enter, curious and captivated.
“I feel like local stores are like the soul of the city,” says Lang. “You go to a place and you meet the local makers, the artists, the cooks, try the restaurants, listen to the music, and you kind of gauge where the scene is at. I feel like if there weren’t these local stores, that are genuine and made from the heart, what is there to represent a city? To me it’s very important.”
“Making It In Grand Rapids” is a series about local entrepreneurs and the issues that matter in building a sustainable startup-friendly community. Read more in the series here. Support for this series is provided by Start Garden. You can reach the Editor of this series, Leandra Nisbet, at [email protected].
Ricky Olmos is a freelance writer, musician and photographer living in Grand Rapids. When he’s not writing for Rapid Growth Media, he writes about music for Local Spins, plays keys with Joshua Powell & the Great Train Robbery, and drinks copious amounts of coffee.
Photos courtesy of Pasagraphy.