Simon St.Laurent wrote:
It's P&C's third bankruptcy within a few years - I think they have their
own crises.
Well, yes. But they're not the only grocery chain to have fallen
on hard times; it's a tough business to be in, and only the most
efficient and ruthless survive. Which is why Wal-Mart has been so
successful.
I have a few disagreements with Jon about the rest:
Second, I am (very reluctantly) coming to the conclusion that a
return to local markets is off the table for most people in the
county. I can see a few returning to certain neighborhoods in the
city of Ithaca itself, but the energy already invested in the big
box stores and the increasing cost of energy that would be
required to replace them with something else means that we're
probably stuck with them.
If these were buildings meant for the ages, I'd find it easier
to agree, but they're largely piles of cinderblock with flat
roofs poorly suited to our climate and vast parking lots subject
to potholes. Remarkably, of course, people often tear down
buildings meant for the ages and patch up the junk, so that may
not matter.
I don't think we're actually disagreeing here. Yes, the buildings
are tilt-up junk with a projected lifetime of about 25 years. So
we won't just be stuck with big box stores, we'll be stuck with
crumbling big box stores. But I still think we're not going to
have the energy available to construct an alternative. Or to be
more accurate, we will have the energy, we just won't have an
economic incentive to allocate it in that direction.
I think you're likely right about central markets remaining
important, though I suspect we'd return to something like the
city-village-hamlet- neighborhood structure of the days before
cars. The city would offer more of the items worth traveling
for weekly or monthly, while more local places would have the
staples worth getting daily. That's a different model that the
"local is exciting" I'm happy to support in brighter times,
though.
I'd really like to think you're right about this, and maybe we can
return to the model you describe if we can convince the villages
and hamlets to concentrate more housing closer to their centers.
But with the population distribution we've got now, it just
doesn't appear to make sense either economically or from the
standpoint of energy use.
Take Danby (to cite a concrete example that might induce Joel to
confirm or deny). It would be great to see a general store in
Danby, but most people who count themselves residents of the
hamlet don't actually live within easy walking distance of the
center. And once you're in the car, it doesn't make sense to
drive two miles to pay a substantial premium for your groceries
when you can drive just a few miles farther to shop at Wegman's
and get a much wider selection to boot. This remains true even if
fuel prices rise; at some point you start putting more people in
the car to split costs, but you still take the car.
Someone please convince me that I'm wrong about this.
I also suspect that the nature of that central market will
change. Big boxes aren't merely about our willingness to drive
great distances to them. They also rely on very sophisticated
logistics systems to keep track of what's selling where,
ensuring that it gets replenished, and adjusting to changing
customer interests. These systems are amazing, but I'm far from
certain they'll be able to adapt to higher energy costs.
Au contraire (and this is what started me rethinking all this in
the first place). The vendor-managed and just-in-time (JIT)
systems you're referring to exist because they increase efficiency
and lower costs. In other words: they save energy. It's true
that JIT systems also make their users more vulnerable to price
and supply shocks, no doubt about it; but this just means that the
big box operations that aren't quite as smart will fall to the
ones that are (witness P&C again, or KMart's slow yielding of market
share to Wal-Mart). So my hunch is that energy descent doesn't
mean the death of the (crumbling) big box store, it just means
that there will only be one of each type in a given area, and much
more of the space in the box will be devoted to warehousing in
order to buffer price and supply fluctuations.
I also suspect (BTW) that instead of seeing electronic supply
chain management fail, we'll see exactly the opposite: its
democratization and adoption by the small businesses as well as
the big ones.
That makes me suspect that while there will be central markets,
they won't necessarily be run by single large operations the way
Wal-Marts, Targets, or even Wegmans are now.
There I hope you're right, and I think we could have this model if
local planners could see clearly where we're headed. I won't try
to describe a Latin American-style central market in detail here,
but imagine the Farmer's Market moved downtown and arranged to
house 2-3 times as many vendors in roughly the same space.
Or for that matter, housed in one of the big boxes, though a
downtown location would make vastly more sense in terms of access
to public transit from all over the county. We're only a year or
two away from free or very inexpensive electronic supply chain
management systems that will allow the smallest vendor to compete
on equal terms with the biggest; such systems are being deployed
as we speak in places like Panama. This is the kind of
"centralized relocalization" that makes the most practical sense
to me right now.
Jon
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