EXECUTIVE SUMMARY - i
Civic Economics is pleased to present the San Francisco Locally Owned Merchants Alliance with thisExecutive Summary of the San Francisco Retail Diversity Study, completed in April 2007. The study,built upon the prior work of the firm in quantifying the enhanced economic impacts of locally ownedbusinesses relative to their chain competitors, proceeded in three analytical steps. This study focusedon four lines of goods and services in a study area that included the City of San Francisco as well as theadjacent communities of Colma, Daly City, and South San Francisco.Across the board, for all impact measures and all lines of goods, locally owned firms generatesubstantially greater local economic activity than do their chain competitors. Thus, while San Franciscoindependents are currently doing well relative to the nation, modest increases in their market share willgenerate tremendous economic impacts. Conversely, continued expansion of chain store market shareswill withdraw from the community those same economic benefits.The study began byanalyzing the market sharesheld by independent retailersin the four lines of goods:books, sporting goods, toysand gifts, and limited servicedining. We began withClaritas estimates for totallocal sales in each line in2005. Then we estimatedtotal sales for each majorchain active in the marketarea, with additionalestimates for generalmerchandise stores (Targetand Costco) and onlinesales. The remainder wasallocated to local independent merchants.In each case, the market share of locally owned stores is substantially higher than estimates of nationalaverages. The relative health and diversity of the independent business community in San Franciscoprovides a benchmark for other communities, whether urban, suburban, or rural. Such firms helpmaintain the unique local character of a community and, as will be demonstrated below, substantiallyenhance the economic vitality of any region. Indeed, the enviable vitality of the Bay Area economyclearly results, in some part, from this healthy independent retail sector.
Estimate marketshare of independentbusinesses in eachline of goods
2005 MARKET SHARES –FULL STUDY AREALimited Service Dining ($848.0 Million)Toys & Gifts ($137.6 Million)Sporting Goods ($196.5 Million)Books ($306.6 Million)
Chains, 15.5%Internet, 18.9%GeneralMerchants, 3.3%Book Clubs, 7.0%Locally Owned,55.4%Chains, 30.9%Internet, 7.8%GeneralMerchants, 5.1%Locally Owned,56.2%Chains, 35.6%Internet, 6.0%GeneralMerchants, 14.0%Locally Owned,44.4%Locally Owned,63.9%Chains, 36.1%