The Vision Has Not Dimmed

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Gayle Shanks on the Importance of Independent Retailers

Changing Hands Book Store in Tempe, Arizona, was recently honored by the Center for the Advancement of Small Business at the W.P. Carey School of Business at Arizona State University with a 2005 Spirit of Enterprise Award, recognizing ethics and excellence in entrepreneurship. In accepting the award on behalf of the entire store, co-owner Gayle Shanks spoke eloquently about why "independent, local ownership is the essence of our unique American experience."

Gayle Shanks

On behalf of my entire store, I congratulate all the other award winners and I thank the Spirit of Enterprise Center at ASU's W. P. Carey School of Business for this wonderful honor.

When my partners and I started our tiny store in the early '70s, we never imagined it growing into the business that it has become today. We loved books, we loved talking about books. Books had changed our lives, and we hoped that our store would be a place for people to talk about ideas that would change the world. In spite of intense competition, that vision has not dimmed.

You may be wondering how we have managed to survive surrounded, as we are, by national chain discounters and by Internet book sites. We are succeeding as a bookstore because our customers love their experiences in our store, love bringing their children into our store, and feel good about supporting us because they know that we, in turn, support their community. We sold the latest Harry Potter book at full price, $29.95, and sold 834 copies the first weekend it came out. Wal-Mart was selling it for $15. For every copy we sold, $6 in books went to one of four local charities that our customers had suggested to us. We hired fire dancers to entertain people waiting for the book's midnight release and gave away free snow cones to keep them cool while they waited. They could have gone the next day to Wal-Mart or Costco and picked up the exact same book but they didn't.

I spoke with a teenager that night named Samantha who recounted for me all the other Changing Hands Harry Potter parties she had come to with her family over the years. She remembered every detail of every party. And she said, "I can't wait 'til I have kids and can bring them to CH. There probably won't be any more Harry Potter books by then, but they'll be other great books that will get them excited about reading, and I'll show them where I sat the very first time my mom brought me here."

I'm sure Samantha would feel comfortable in any of the businesses represented here today. These businesses give a community its heart, its distinct sense of place and its humanity. Local ownership holds intact our long-held desire for choice and diversity. Independent, local ownership is the essence of our unique American experience. It represents our historic love affair with "rugged individualism" and is the path to achieving the American Dream. Not only are locally owned businesses important for the economic health of a community, they are vital to its social and emotional health as well.

Much attention has been focused on the love/hate relationship Americans have with national chains and big box stores, and some of us feel uneasy with their growing dominance in our communities. And while we see certain conveniences in the big box experience, we also know that there is a downside. Many people assume that chains are uniformly good for the economy and that "locally owned" translates to marginal. But, in reality, when new chain store development causes sales to decline at existing businesses, some are forced to either downsize or close. The resulting job and tax revenue losses typically equal, and sometimes exceed, the job and tax gains created by the new chain. And, more importantly, there are a number of recent economic studies showing that for every dollar spent in a locally owned business, well over three times as much is returned to the local economy (in the form of dollars spent in other local businesses, as well as in taxes) than is the case with a dollar spent at a national chain store.

It's important to inform the public of the value of local businesses to the economy so that government and the public don't make economic choices based on faulty assumptions. Recent national trends provide a sobering picture of what stores like ours are up against.

  • Since 1990 more than 11,000 independent pharmacies have closed.
  • The market share of independent bookstores has fallen from 58 percent in 1972 to just 15 percent today. Two chains, Barnes & Noble and Borders, now control nearly one-quarter of all book sales.
  • Local hardware dealers are disappearing too; Home Depot and Lowe's have captured one-third of that market.
  • Five firms account for one-third of all grocery sales, and
  • Wal-Mart now controls seven percent of all consumer spending.

We know that locally owned independent businesses such as yours and mine are an integral part of every community, making up the membership of charitable, arts, and educational boards and generally participating in the social and civic as well as the economic life that is the fabric of any community. Collectively, we give our communities not only texture and vitality, but also a uniqueness that is essential if our community is have its own identity and not become a city that could be anyplace -- a city comprised of the same strip malls and big-box retailers that can be found everywhere else. We want people to think before they shop, to be aware of all, rather than some of the facts, to consider the whole picture.

Today, the Spirit of Enterprise Center is honoring:

  • Entrepreneurs with a sense of purpose and core values that include ethics by example,
  • Entrepreneurs who promote excellence in their industry, and who support education and lifelong learning in the workplace.

As the Samanthas of the world grow up, have children, and become an active part of our communities, how fortunate they will be to have businesses like these, like yours, in their world.

Thank you.