Why Walmart Is Not the Threat to Downtown We Might Expect

A couple of weeks ago, when word came that developers were eyeing the former Fulton Bellows site along Third Creek as a possible location for a new shopping complex to include a Walmart and Publix, hands started wringing. After all, Walmart has a reputation for luring customers away from local businesses, and some felt that if the plans go through it could take dollars away from our downtown.

In Jack Neely's excellent column of the same week, he posited that despite growth, our reinvigorated downtown is missing some very basic amenities. He pointed our lack of a pharmacy, hardware store, electronics store, and a basic clothing store among other things. He's definitely right that we're missing those fundamentals, but it's for that very reason that I'm not too concerned that a big box retailer near downtown would threaten our local businesses. Downtown Knoxville isn't exactly small-town U.S.A., and our locally owned mom-and-pop enterprises aren't exactly the type Walmarts typically destroy. Jack's list is what they destroy. Locally owned restaurants, boutiques, and specialty retail like cigar stores and chocolate shops aren't really threatened by Walmart. If anything, the small-scale, unique stores that we have downtown are almost anti-Walmart in their appeal, with little direct overlap in product offerings. If you want cheap plastic junk from China, you'll do better shopping at suburban big boxes than on Market Square or Gay Street.

As for the Publix and its place in the market, it would just become yet another supermarket within a two-mile radius of downtown, joining Kroger, Food City, and the Three Rivers Market competing for residents' dollars. And the three grocers we already have in downtown proper seem to be hanging on despite their competition, due in large part to the convenience they offer downtown denizens. The other big chains in town may have something to be concerned about. But I don't see the addition of another supermarket affecting downtown's markets.

While I agree with Jack that his wish-list items would all be welcome additions, I'm afraid I don't hold much hope for many of those things happening. In an era where big chains have reached the level of feeding on their own (remember Circuit City?), it's hard for me to envision, say, something like a new hardware store opening anywhere these days, let alone downtown. For years, I contended that if downtown Knoxville had something akin to a modern Walgreens, it would go a long way toward meeting the day-to-day needs of center-city residents. But despite my own wishful thinking, the reality over the past 25 or so years has been pharmacy chains across the country closing downtown locations and setting up shop in the 'burbs. I just couldn't see that trend reversing.

Then that same week, I read an interesting article from the Chicago Tribune. Walgreens has announced that they are opening a new store at a downtown intersection there they had inhabited for over 75 years before closing its in 2005. This time, however, it's a little different in concept. In addition to their pharmacy and selection of household goods, the new "flagship" store will include a "humidor, international newsstand, made-to-order smoothies, self-serve frozen yogurt, sushi and juice bars, and a barista" according to the Tribune. It's also slated to have an upscale cosmetics department offering manicures and makeovers, a clinic, and (not being Tennessee) offer wine and spirits.

I find that new concept to be interesting in a couple of ways. First, the type of new departments that Walgreens is adding are more closely associated with urban retail trends, including downtown Knoxville's, than suburban fare. It's not that coffee shops or sushi bars are by any means exclusive to center cities. But collectively, the additions to their traditional lineup are much more akin to the cosmopolitan retail that has gained popularity in revitalized urban areas nationwide. Maybe even more interesting is that they aren't trying to create that model in the 'burbs. They're doing it in Chicago's core. It almost sounds as if they've been assessing new trends in urban retail and leveled their crosshairs directly at that sector. Nearly all of the new amenities added to the Walgreens project are likely going to compete directly with surrounding fare.

I still see a tremendous amount of retail potential in our downtown. Foot traffic continues to grow here, and I think there's plenty of opportunity for the right merchants. I just feel it may be more viable to nurture more homegrown offerings delivering originality that can't easily be imitated by big chains. They aren't offering what our downtown has, though at least one is apparently giving it some thought. And given that, a Walmart near campus is starting to sound a lot better than a Walgreens downtown.