Back to top Jump to featured resources
Article filed under Independent Business

What New Census Data Show about the State of Independent Retail

| Written by Stacy Mitchell | 3 Comments | Updated on Dec 16, 2010 The content that follows was originally published on the Institute for Local Self-Reliance website at http://ilsr.org/what-new-census-data-show-about-state-independent-retail/

placeholderAccording to newly released data from the U. S. Economic Census, overall sales at independent retailers grew by about 4 percent, after adjusting for inflation, between 2002 and 2007.

The bad news is that chains grew faster and independents still lost market share, falling from 31 to 28 percent of consumer retail spending. This decline in market share, however, was considerably slower in this five-year period, compared with the preceding 20 years, in which independents lost ground at a faster rate. In 1982, independent retailers captured nearly half of all retail spending.

Graph: Sales at Indies vs. ChainsIn 2007, Americans spent an average of $2,520 at independent retailers, $941 at Wal-Mart, and $5,615 at other chains.  Here’s how that’s changed over time:
2007-census-percapita
The U. S. Economic Census is conducted every five years. The resulting data are released in batches two to four years later. For this analysis, the New Rules Project defines independent retailers as those with fewer than 10 outlets.

Because the 2007 Census preceded the current recession, the downturn’s impact on both independents and chains will not be evident until the 2012 Census.

Here are a few other highlights from the new data:

  • The number of retail firms in every employment size category declined, except for the smallest firms, those with fewer than 5 employees. Their numbers grew by 10,453. Firms in this size category also recorded a modest increase in their revenue and market share.
  • Perhaps most remarkable has been the growth of specialty food stores, such as bakeries and greengrocers. The Census showed a net gain of over 1,400 small specialty food retailers (those with fewer than 20 employees). Sales at these stores shot up 23 percent even as grocery sales overall grew just 3 percent. This trend likely reflects increased public interest in locally produced foods, as well as a growing desire to shop at neighborhood stores.
  • Employees of independent retailers earned more per year than employees of national chains (an average of $27,451 vs. $20,313). Whether this reflects a higher hourly rate or more hours worked is not discernable from the data. (A similar pay gap shows up in the 2002 data as well.)
  • The number of independent supermarkets remained relatively unchanged at 40,000, although revenue slipped by about 4 percent.
  • The number of independent hardware stores fell by 854, but the remaining 12,122 increased their sales enough that overall revenue at independent hardware stores held steady.
  • The U. S. recorded a net gain of independent retailers in several categories, including 870 new clothing stores, 425 fabric and sewing stores, 352 pet supply stores, and 549 office supply and stationery stores.
  • Among harder hit categories, the number of independent camera and photo supply stores fell by about one-third, though the remaining stores saw revenue growth of about 13 percent.
  • Independent florists declined by 2,800 and lost 19 percent of their sales, as more people purchased flowers at supermarkets and big-box stores.

As of 2007, the U. S. counted the following independent retailers: approximately 60,000 grocery and specialty food stores, 38,000 clothing shops, 19,000 florists, 18,000 pharmacies, 18,000 furniture stores, 17,000 sporting goods retailers, 12,000 hardware stores, 12,000 nurseries and garden centers, 7,400 appliance stores, 6,400 shoe stores, and 2,700 general bookstores.

 

 

Tags: / / / /

About Stacy Mitchell

Stacy Mitchell is co-director of the Institute for Local Self-Reliance, and directs its Community-Scaled Economy Initiative, which produces research and analysis, and partners with a range of allies to design and implement policies that curb economic consolidation and strengthen community-rooted enterprise.  She is the author of Big-Box Swindle and also produces a popular monthly newsletter, the Hometown Advantage Bulletin.  Connect with her on twitter and catch her TEDx Talk: Why We Can’t Shop Our Way to a Better Economy. More

Contact Stacy   |   View all articles by Stacy Mitchell

  • Stacy Mitchell

    @craigcoup:disqus Alas, the relevant 2012 data will not be published until 2015… That is the pace of the Census Bureau. But you can be sure we’ll post about it as soon as it comes out.

  • Ellen

    Very interesting post! I am curious: are there particular categories that have a higher percentage of independent retailers?

  • smitchell

    There certainly are categories where independent retailers constitute a high percentage of the stores.  Art galleries, for example, are more than 95% independent. 

    However, in some categories, this doesn’t necessarily translate into market share. For example, 95% of florist shops in the country are independently owned, but flowers are not just sold at flower shops.  They are also sold at supermarkets, big-box stores, etc.   So, independent florists shops have only a fraction of the market for flowers. 

    This is increasingly true for many products.  The largest category of book sales, for example, are warehouse club and big-box stores, like Costco and Target.

    Unfortunately, the way the census data is set-up, it’s not possible to say what percentage of all flowers or books or clothing is sold through an independent store versus a chain store.