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Stores ready for new Wal-Mart

Some of the supercenter's new neighbors are looking forward even to the chain's usually feared opening day.

By JENNIFER GOLDBLATT

© St. Petersburg Times, published March 13, 2001


PORT RICHEY -- The average Wal-Mart supercenter the size of the one at U.S. 19 and Ridge Road should ring up annual sales of $69-million. But that money will not, owners of surrounding businesses insist, come out of their pockets.

Larry Mistretta, who has a 6-year-old custom window blind shop and a 6-month-old bed and bath shop, says his customers will keep returning for top-of-the-line products, as well as the basics he carries.

Gulf View Square mall spokeswoman Kelly Lowrey says that Wal-Mart just draws "a different shopper."

The manager of the Eckerd drug store across the street says he's counting on the new companywide ad campaign to keep traffic strong.

And a spokesman for Publix says a supercenter -- scheduled to open Wednesday -- down the street is just business as usual.

He might be right.

But Iowa State University professor Kenneth Stone doesn't think so. He found grocery stores in the surrounding area suffer most from a supercenter's arrival, with sales falling by 8 percent the first year. After three years, Stone found, grocery and drug store sales are down by 20 percent. In addition, there are minor impacts on opticians, tire lube centers and other businesses that offer services found in a Wal-Mart supercenter.

At trade shows around the nation, retailers flock to workshops to learn how to take on the world's largest retailer. And Amazon.com features books titled Slam Dunking Wal-Mart, Up Against the Wal-Marts and How Wal-Mart Is Destroying America and the World and What You Can Do About It.

About one mile down Ridge Road from the new Wal-Mart is a new Publix, a gleaming, 44,000 square-foot store that opened last month after abandoning a spot in Ridge Road shopping center it had held for 22 years. The store is stocked with everything from Canadian Veggie Bacon to Mr. Coffee Machines, crock pots and carpet cleaning supplies. Most importantly, the store has a pharmacy, which the older store did not. The only sign taped onto the spotless glass front doors: we honor all competitors' coupons.

Mark Swartsel, broker/owner of Re/Max Advantage Realty, which has offices across the street from the new Wal-Mart site and listings in the surrounding area, says potential investors are waiting to see what kind of impact the supercenter has before they decide to sign leases or purchase land. "It scares a lot of retailers," Swartsel said. "It's certainly going to bring a lot of traffic to the area that we haven't had before. So if you're not a business that intends to compete with Wal-Mart, that's a good thing."

But with all of the products that supercenters offer, few retailers fit into that category.

The supercenters' offerings are so varied that, "it takes just a little piece from a lot of different players in the market," said Chuck Gilmer, editor of The Shelby Report, a Gainesville, Ga.-based trade publication.

The stores "bleed from a lot of different areas."

But that's not worrying Gaylyn Hancock, co-owner of Davis Hardware. In her 42 years in business, she's weathered two Home Depots and a Lowe's Home Improvement Store setting up within miles.

"I think the average person doesn't go into a store like that with the purpose of buying hardware. There are impulse buys when they're in the store, but it's not going to have that much of an impact on the hardware store," she said. In fact, she and the large home improvement stores refer customers to one another.

Larry Cinadr district team leader for the area Target stores, says he anticipates a slight impact with the supercenter at first, but it won't be as severe as if it was Wal-Mart's first entry into the area.

"We'll be able to hold our own in the long run," Cinadr said of the Target store in Port Richey. He added that any time new competition opens, Target tries to adjust inventory levels and to reinforce the Target brand, which aims for more of the department store customers. As far as commodity items that customers can get anywhere, "we're competitive with the discount stores," he said.

In other categories such as housewares and clothing, "we've created a very exclusive brand in our stores," he said.

Cinadr said Target is looking to open additional stores to add to its one in Pasco although he could not reveal any details of any new location.

Some nearby business people are hoping to benefit from the supercenter.

Karen Huntoon hopes it will bring more exposure to her 4-year-old ceramics workshop on Ridge Road. "I'm dying for some exposure," she said. "People say they can't see me."

Even those who run not-so-invisible businesses such as Golden Corral and Gateway Honda are excited about the possibilities.

Gateway owner Tom Wood already has calculated how his giant new neighbor could impact sales at his 21-year-old dealership.

He figures the new Wal-Mart will bring about 9,000 people driving by his inventory every day. "A lot of car purchases are started when they look over and see something they'd like to be driving," Wood said. "If they weren't coming to this corner to go to Wal-Mart, the might not have seen it."

He is considering altering his landscaping to create an additional front row to expose drive-by traffic to more of his inventory. Even if it does not, he is happy to see that corner cleaned up.

"Just the idea of having something new and clean next door," he said, "is outstanding."

- Jennifer Goldblatt covers business in Pasco County. She can be reached in west Pasco at 869-6229 or (800) 333-7505, ext. 6229. Her e-mail address is goldblatt@sptimes.com.

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