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business newsYesterday's TV, Today's Economy: "Happy Days"
Would Mr. C. fight back against big box invasions?
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With the passing of time, however, you might forgive Mr. Cunningham if he came to believe that hardware was no business for old men. Although Milwaukee’s suburbs kept growing, the city’s population peaked around 1960. By the 1990s it had dropped almost 20% and sat at World War II levels.
Even worse was the arrival in the 1980s of mega-retailer home improvement stores such as Home Depot (HD), Lowes (LOW), and Wisconsin-based Menards.
True, Mr. Cunningham once misguidedly supported the construction of a freeway right through make-out hot spot Inspiration Point (Richie and the Fonz managed to block development), but there’s little question whether the small-business owner would have protested progress of the big box kind.
Home Depot’s rise under Ken Langone and other co-founders happened with particular head-spinning speed. Having opened its first shop in 1979, the company operated 118 warehouse-style shops 10 years later, and a whopping 930 stores by 1999, by which time it was making more than $30 billion in sales annually.
It currently has 2,274 outlets in North America and China, employs an army of more than 300,000 orange-apron clad clerks, and is making more than $70 billion in sales. (Second place Lowes has 1,649 locations and brought in about $48 billion in sales last year).
In many places where the mega shops opened, smaller stores selling any of the same products -- which can range from Windex to washing machines -- found themselves forced to close.
All hardware stores, even Home Depot, the category killer, have suffered since the beginning of the economic downturn two years ago, however.
As a writer for the North American Hardware Retailing Association has pointed out, “Trying to figure out what was going on in the home improvement industry in 2008 and 2009 was a bit like trying to make sense of a car crash while it’s occurring.”
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Photo by ABC Photo Archives/ABC via Getty Images
For the Mr. Cunninghams of the industry, the recession has been just another burden, one that’s only made the big box threat harder to shoulder.
Fortunately many indie retailers are becoming experts at fighting back against stores like Home Depot and Walmart (WMT), mostly through community-wide “Buy Local” campaigns.
The micro-movements, which started in the late '90s, allow small retailers to pool resources and save on advertising and other costs, and arrange events like Shop Local weeks.
As BusinessWeek reported last year, a national survey by the nonprofit Institute for Local Self-Reliance showed that independent retailers in cities with buy-local networks saw 2008 holiday sales fall 3.2% versus 2007, while those in cities without such associations saw a more substantial drop of 5.6%.
Store owners in towns about to face a box-complex invasion can also turn to a new Big Box Tool Kit to help ward off the threat to their businesses. Created by ILSR, the kit explains how to use municipal zoning laws, traffic regulations, and community organizing techniques to block mega store bids.
But most family-run stores that have remained open this long have already learned how to make their shops indispensable. They've leveraged the asset that continues to elude big box managers: personalized, shoulder-to-lean-on customer service.
Here’s where the “Mr. C.” we knew would have an edge.
With the quiet authority he used to lay down the law for his teenage children, not to mention the rebel motorcyclist who rented a space above his garage, Cunningham was just the type of tools-smart proxy-parent one would want to have handy in the middle of a minor household emergency.
And as a New York Times columnist once observed, “In hardware as in health, the right advice at the right moment can save us from something much worse.”
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