“We’re not over retailed. We’re under demolished”. This quote was from a retail industry insider before the pandemic. Recent headlines highlight the struggles of restaurants and other retail businesses and conclude that more of the storefronts in our smaller downtowns may go vacant. 

This “bricks-and-mortar retail is dead” narrative misses the innovation and resilience that exists at the local level.  Local companies are changing the way they offer goods and services. Main Street storefronts, once exclusively used for retail, now combine different parts of the production and sales process. Local communities are promoting experiences rather than discrete shopping opportunities.  These strategies offer a road map for supporting and sustaining retail in our local business districts.

Create Place Led Experiences

Within the shopping pattern data there is one area where our smaller downtowns have a competitive advantage – consumers increasing value experiences over transactions. Two seemingly opposed trends are happening in parallel. Consumers are increasing their online purchases yet searching for more goods and services they can buy locally. The popularity of farmers markets is one example of this trend. In a world where all you need is an internet connection and a Paypal account to shop, the desire to connect with local merchants and producers becomes more important to many consumers.

Small downtowns have unique history, architecture, stores, and other assets that make for an interesting shopping experience. These elements attract consumers that desire a unique shopping experience – an experience that can’t be replicated elsewhere. Successful small downtowns brand and market more than just individual stores—they market experiences. They highlight what an enjoyable few hours in their town could include. 

Here in western Pennsylvania, a network of small towns adopted a business development strategy based on their proximity to the Great Allegheny Passage (GAP), a recreational trail connecting Pittsburgh to Washington D.C. The experience of a trail user can include stopping for lunch, replacing a flat tire, buying a souvenir to remember the trip—all of which are accommodated within the business district.  This strategy breathed new life into older downtowns by drawing from both local and out of state trail users. Other communities have utilized this framework while tailoring it to their own attributes.

As the retail sector changes, we also need to adapt the format of retail spaces.

Right Size Retail Spaces by Incorporating Other Uses

The changes in retail over the last decade led to one premise that we are better off acknowledging than ignoring -- our downtown storefronts now require less space to accommodate local retail needs.  Macro level changes in the way we shop coupled with the fact that many of our smaller downtowns have lost population mean fewer in-store purchases. While ten years ago the downtown clothing retailer may have needed 2,000 SF of retail space today that need may be only 500 SF and a fraction of the size of most existing retail storefronts.

Some Main Street businesses have solved this challenge by combining a typical retail storefront with other related functions such as making, assembly and fulfillment. Many retail businesses, including more typical brick and mortar businesses, have grown their ecommerce and delivery platforms over the past few years.  Hoffman's Drug Store, a staple of Aliquippa, Pennsylvania’s business district for 100 years now offers free deliver. Delivery helps differentiate the store from local competitors and supplements revenue from walk-in customers. 

Oxford Pennant, in Buffalo, NY is a very different business than Hoffman's, but it applies a similar approach using e-commerce. It has a small storefront and showroom at 731 Main Street, although the bulk of its sales are generated online. Fulfilment of the ecommerce orders occur out of this space, so the storefront is not reliant on walk-in sales to cover the cost of leasing the space. 

Oxford Pennant's retail space and show room at 731 Main St. in Buffalo, NY

In both examples, the businesses maintain a traditional Main Street storefront that is visually appealing and an active part of the business district. The retail component is still physically front and center, while being supplemented by related activities. This is a change from past patterns where even in mixed-use buildings uses were on different floors.  Our zoning and planning laws need to accommodate the changing market and allow for a broader mix of uses within neighborhood business districts.

Update Zoning & Other Regulations to Accommodate New Uses in Old Buildings

Many business districts have older zoning ordinances that permit only retail or restaurant uses on the first floor. These ordinances should be updated to allow for greater flexibility in how these spaces can be utilized and specifically permit light manufacturing, small scale assembly, and fulfillment. These uses can be allowed while maintaining site development standards that are appropriate for a business district – requiring properly sized storefront windows, signage, etc.

One successful example of combining a retail and light manufacturing comes from the Leadville, Colorado’s (population 2,742) historic downtown. Melanzana makes, sells, and ships outdoor clothing from a space on the main street in the business district. The front portion is a retail storefront where customers can browse and purchase items. Behind the retail counter the clothing is manufactured in full view of the customers. Together these functions fill a large storefront that would be oversized for most purely retail uses.   This multi-use space creates additional interest for shoppers who want to catch a glimpse of the production process. 

Melanzana combines retail and making within a storefront in Leadville, Colorado's historic business district

Many of the traditional business districts in have some larger buildings that once accommodated larger retail items (furniture, appliances, home accessories) that are now predominantly purchased outside of downtown. These larger buildings are good candidates for combining retail with other related uses and our land use policies should facilitate rather than inhibit these developments. Our company is currently facilitating the City of Aliquippa’s downtown planning process and linking that effort with a parallel process to update the City’s zoning ordinance.

The changing nature of retail is more nuanced than the newspaper headlines suggest. Underneath the growth of e-commerce is a current running in the opposite direction—a desire by consumers to have more meaningful and connected shopping experiences. These are the experiences that local merchants and local business districts provide. We can support them by creating place led experiences, right sizing retail spaces, and updating our zoning and development policies.