Competing When Wal-Mart Comes to Town

WAL-MART IS COMING! Those are fighting words for the family owners and operators of the 60 shops that line State Street the main thoroughfare in Belle Fourche, South Dakota. When news leaked out last March that the legendary discounter would open a mammoth outlet this fall, only 10 miles away on the outskirts of Spearfish, panic spread through this ranch town of 4,700, once the largest cattle transfer center in the world.

In Spearfish, local merchants may actually benefit, as thousands of bargain seekers flock to the area from the many small towns that dot the hills here and in nearby Wyoming and Montana. But in Belle Fourche (pronounced Bell Foosh), almost all of the businesses are family owned, retailers stand to lose more than 23 percent of their sales by the time the new Wal-Mart celebrates its fourth anniversary, according to Kenneth E. Stone, an economics professor at Iowa State University who has studied the impact of Wal-Mart on local retailers. To prepare countermeasures, Fourche's town leaders called in Stone for a day-long workshop. Before telling them what they could do to survive, he shared some disturbing research about small towns in Iowa, located within 20 miles of various new Wal-Marts that have sprung up there:

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