At 04:27 PM 11/25/09 -0500, you wrote:
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 agree, although I think Wegman's will give Walmart a run for its money.
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.
A couple of points could be made here. For one, the buildings that housed
the local stores, whether in Danby or downtown, are mostly still there and
could be reused without a whole lot of investment. All that is needed is
for the possibility of economic viability to resurface. Jon's points about
the prospects for that are thought-provoking. I have thought about them
myself long and hard and think that the future path is hard to predict with
any kind of reasonable probability. While the ordering of society
pre-automobile and cheap energy is instructive, a lot has changed in the
last century or so that will influence where we go from here.
What is missing from the relocalization process is local processing and
distribution. Those will have to be rebuilt practically from scratch, and
that won't happen until transportation and production costs rise
significantly due to higher energy costs. A couple of years ago, I would
have said that that was immanent. Then came economic near-meltdown and
global recession, postponing that shift into the indefinite future. The
Marcellus and other shale gas plays have had a huge impact on natural gas
prices, and with them, the cost of producing nitrogen fertilizer. That in
turn buys time for conventional agriculture, keeping it competitive with
the alternatives we need to develop for the high energy cost future. I
still think that future will come; I'm not so sure when.
As for local stores, I suspect that in a high cost energy future, their
location will follow employment. If I had a job in Ithaca, I would probably
shop in the course of commuting. I already shop at Wegman's Tops, and
Greenstar because they are on my travel route to and from church. Someone
living here 100 years ago would never have attended an Ithaca church. Will
our oil-paved highways survive high-priced oil? Paved secondary roads
almost certainly won't. Can we afford to plow rural roads in the future?
Almost certainly not as often and almost certainly with less use of
deicers. Where will the jobs be? Hard to predict, but not so hard is
predicting many more in agriculture. Those workers won't necessarily
commute very far, and they will be looking to meat their needs as nearby as
possible. A lot can change pretty quickly with strong economic prompts.
As for the big boxes, I offer a couple of comments. For one, a big box is a
pretty efficient shape to construct and maintain. While the construction is
pretty simple, buildings like Wegman's are engineered structures. They are
structurally robust and flexible. I hope we will stop the insanity of
tearing them down and rebuilding them just because the existing ones don't
match some corporate footprint. That practice is an indulgence enabled by
cheap energy. If we don't need as many in the future (a pretty safe bet),
they too can be adaptively reused.
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.
I don't see how supply chain management can possibly enable the smallest
vendor to compete on equal terms with the biggest. The costs of delivery to
multiple small vendors has to exceed the cost of delivery to a few large
ones. The driver to enable the small vendor to compete will not be the on
the supply side, it will be on the access-by-the-consumer side. When it
becomes cheaper to access a nearby supplier, despite higher product costs,
than some remote purveyor of the same goods, decentralization will gain a
foothold.
Joel
Jon
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_______________________________________________
For more information about sustainability in the Tompkins County area, please
visit: http://www.sustainabletompkins.org/
RSS, archives, subscription & listserv information for:
[email protected]
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