CELDF

Retail Chains

CELDF helps communities threatened by big retail chains. Below, learn about the harms caused by these behemoth stores, and what you can do in your community.

In America, we seek the good bargain, and retail chains know this. Ad campaigns bombard us with sales, coupons, and price matching. And everyone loves a good deal, right? But what are those low, low prices really costing us? 

Around the turn of the 20th Century, only about 50 chains existed in retailing. As of 2004, there were about 50,000 retail chains.[1] Sales by the 20 largest food retailers totaled $449.3 billion in 2013, accounting for 63.8% of U.S. grocery store sales, an increase from 39.9% in 1993.[2]

Why does it matter?

Retail chains are often sold as a way for families to save money, but they’re really doing more harm than good. In their ceaseless search for ways to cut prices and increase profits, they underpay wages and benefits for workers, move production overseas, disrupt local economies when independent retail establishments are forced to close their doors, and harm farmland and nature. No one living in the community has a say about whether or not the retail chain can locate there; nor do they have a say regarding its harmful impacts. This is a denial of people‘s fundamental right to govern their communities.

History of the Anti-Chain Movement

One might think that the fight against retail chains is a recent struggle, but the anti-chain store movement dates back to the early 20th Century.

Chain stores have been in business since the 19th Century, but it wasn’t until the 20th Century that these stores became significant in number. During the 1920s, the U.S. saw an explosion of retail chains. At the start of the decade, the top 20 retailers had fewer than 10,000 stores. By the end, they had more than 37,000. [3]

Communities saw the dangers of letting these stores in and an anti-chain-store sentiment swept the country. People organized boycotts and catalogue burnings. It was so strong that the Sears Roebuck Corporation promised its customers that all transactions would remain confidential and goods would be shipped in unmarked packaging. Anti-chain-store laws established taxes aimed at discouraging chains. Between 1931 and 1939, 27 of the 48 states passed such laws, and in 1938, 19 were active. However, the tide against chain stores began to turn as state and federal courts struck down these laws as unconstitutional, setting dangerous precedents and empowering corporations with constitutional powers that gave rise to the powerful chain stores in business today.[9]

Walmart: The High Cost of Low Prices

Nothing typifies the impact retail chains have in our communities like Walmart. It not only impacts shopping and spending habits, but also quality of life in communities and the U.S. at large.

Motivated by the company foundation of “The Lowest Prices Anytime, Anywhere,” Sam Walton opened the first Walmart in Rogers, Arkansas in 1962.[4] As of 2014, there are now 11,000 Walmart stores in 27 countries that employ 2.2 million people. The six Walton heirs have a net worth of $149 billion. That’s equal to the combined assets of the bottom one-third of Americans – about 100 million people.[5]

A Walmart on Every Corner

90% of Americans live within 15 miles of a Walmart and one in four dollars Americans spend on groceries is spent at Walmart.[5][11] This juggernaut in American retail accounts for 1/50th of U.S. GDP and is the world’s biggest corporation (past and present).

And that is a very big problem.

When a corporation of Walmart’s size and strength is allowed to determine wage and worker quality of life, communities suffer.

Take the average wage for a Walmart cashier: $8.81 an hour. If that Walmart cashier is also a single mother, working typical retail hours of 30 hours a week, 50 weeks a year, she would earn $13, 215 a year, making her eligible for government food stamps.[6]

Walmart takes in about 18% of the food stamps spent in the U.S. each year (that equates to about $13 billion dollars).[6] It is probably safe to assume that our Walmart cashier on government assistance is spending some of her benefits at Walmart.

It’s a troubling cycle. Pay employees a low enough wage, and they will have no choice but to spend their money where it will stretch the furthest.

 

Passing the Buck

“For every dollar the boss has and didn’t work for, one of us worked for a dollar and didn’t get it.” –Big Bill Haywood

Paying its employees a subpar wage is one way Walmart is able to offer such low prices. Another way is its utilization of imported products from China. 80% of Walmart’s suppliers are in China.[12] Between 2001 and 2007, as large swaths of production moved overseas, the U.S. saw 40,000 factories close and along with the loss of millions of jobs. In the same period, Walmart’s imports from China tripled in value, from $9 billion to $27 billion.[5]

And, according to the Economic Policy Institute, Walmart’s use of imports from China is responsible for displacing at least 196,700 U.S. jobs.[10]

 

A Chain Reaction

Walmart’s practices not only contribute to the loss of jobs, but it and chains like it pull money out of the pockets of communities. According to the U.S. Census, the number of independent retailers fell by over 60,000 between 1992 and 2007.[5] In that same period, Walmart experienced incredible growth.[4]

Where you spend your money has great impact on your community.

A study in Chicago found that “for every $100 spent with local businesses, $68 remains in the Chicago economy; $100 spent with a chain, $43 remains in the Chicago economy.”[8] In Grand Rapids and surrounding Kent County, Michigan, “if residents were to redirect 10% of their total spending from chains to locally owned businesses, the result would be $140 million in new economic activity for the region, including 1,600 new jobs and $53 million in additional payroll. Local restaurants return more than 56% of their revenue to the local economy in the form of wages, goods and services purchased locally, profits and donations. Chain restaurants return only 37%”.[8]

 

“There are also far-away harms, largely invisible and unmentioned. These harms result when a handful of corporate emperors join the elites of other countries to deny worker and community rights, and when they rewrite the laws for global investment, sales, labor and trade, reconfigure global production methods that maximize harms to workers and the planet, and when they institutionalize everything based on an insane WalMart Corporation model of ever-increasing sales, made possible by virtual slave labor and the endless environmentally destructive extraction of resources and dumping of toxic junk.” — Ben Price[9]

 

What can you do?

In recent years, organizations, communities, and community leaders have begun to question why their use and enforcement of zoning laws, environmental regulations, environmental impact studies and other legal land-use tools have failed to protect the natural environment, create an improved quality of life, or increase community control over corporations. As some community leaders have learned, utilizing regulations is misleading. Created to enable communities to make it more expensive for corporations to site or operate in a particular location, those regulations maintain the illusion that the community has fundamental decision-making authority over how, or whether, the corporation will operate within the community.

CELDF partners with communities and municipalities to develop local laws that stop the encroachment of  large retail chains like Walmart. We help communities to reframe the issue from a regulatory one, to one that challenges the corporate claim to constitutional “rights,” as well as state-level laws that claim preemptive authority and force retail chains into communities. By shifting focus to these rights-based ordinances, communities can reassert their right to local governance in the face of corporate rights and state preemption assaults.

Take action. Tell the big chain stores they aren’t welcome in your community.

If you or your community is struggling to keep corporate retail chains from invading your town, contact CELDF and learn how to take action. You and your community have rights and CELDF is here to help you fight for them.

Learn about the underlying problem

Sources

[1] Ingram, Paul, and Hayagreeva Rao. “Store Wars: The Enactment and Repeal of Anti‐Chain‐Store Legislation in America1.” American Journal of Sociology110.2 (2004): 446-487. http://celdf.org/wp-content/uploads/2015/08/Anti-Chain-Store-Store-Wars.pdf
[3] Mattera, Phillip. “Fighting Chain Stores Past and Present: The Roots of the Campaign against Walmart.” Corporate Research E-Letter No. 54. Corporate Research Project, July-Aug. 2005. Web. http://www.corp-research.org/e-letter/fighting-chains-stores-past-and-present.
[9] Price, Ben. A Movement Diverted: How Corporations Neutralized Anti-Chain Store Campaigns Of the 1920s and 1930s. Issue brief. CELDF, 2005. Web. http://celdf.org/wp-content/uploads/2015/08/A-Movement-Diverted.pdf