Des Moines Register
06-26-06
County brings dollars home
Struggling rural area gains $1 million in retail sales with shop-local campaign
By PATT JOHNSON
REGISTER BUSINESS WRITER
Louisa County has held the dubious title of having the lowest per-capita retail
sales in the state for too long, county development officials decided.
Weary from watching retail sales bleed into neighboring counties - a trend
common in an era where major shopping centers congregate in metropolitan
areas - the county wanted to reverse the trend, a five-spot at a time.
The plan to pump up local businesses by keeping retail dollars in this rural county
with no stoplights was simple: Ask residents to spend $5 more a week locally.
The campaign, "Shop Louisa," combined with the opening of two Dollar General
stores in the last year, resulted in more than a $1 million increase in taxable retail
sales in fiscal 2005.
"We know it's really baby steps," said Mallory Smith, executive director of the
Louisa Development Group. "Our thought is: Let's just reverse the trend. Being
last, there's nowhere to go but up."
Louisa County remains in last place, luring about $28 million in retail sales in
fiscal 2005. In contrast, Polk County led the list with $6.2 billion in retail sales in
the same period.
Rural counties across the state struggle with the same issues. Des Moines, Iowa
City, Davenport, Cedar Rapids and Council Bluffs pull in shoppers with malls and
big box retailers.
"The dominant trend during the last 25 years has been the increasing
consolidation of retail into larger trade areas," said Liesl Eathington, a researcher
with Iowa State University's Office of Social and Economic Trend Analysis.
Louisa County is made up of a limited but varied group of businesses in Wapello,
Columbus Junction, Morning Sun and Grandview. The largest retailers are
independent grocery stores, a farming supply store that sells general
merchandise, and Dollar General, which opened stores in Wapello and
Columbus Junction.
Wapello residents who want other goods and services generally drive 30 minutes
north to Muscatine or south to Mount Pleasant. Regional mall shopping is farther
away in Coralville.
Louisa County's taxable retail sales had been declining in the past decade. In
1995, taxable sales totaled $26.42 million and in 2000, sales had dropped to
$25.27 million, Smith said. When local business leaders formed the Louisa
Development Corp. in 2004, they decided to recapture some of the retail sales
leaving the county.
"People shop where they work, and a lot of people here work outside the county,"
Smith said. Statistics show that 53 percent of Louisa residents work in other
counties.
Smith came to the county as part of a Peace Corps fellowship while pursuing her
master's degree at Western Illinois University. She studied Louisa County
statistics and discovered the dead-last ranking for per-capita retail sales. She
decided Louisa Development Corp. could do something about the situation.
What resulted was a fairly simple plan to bring dollars back home.
"We set very realistic goals. We figured $5 a week was doable," Smith said. The
group suggested practical ways to meet the goal, including buying lunch, fishing
bait, shotgun shells, light bulbs, cat food and batteries locally. They also pointed
out practical benefits: Buying locally means personal service, quality and more
jobs.
"We did not expect that they would completely change their habits, but modify
them," Smith said.
The benefits of having a healthy Main Street reach beyond civic pride, said Mark
Edelman, a professor of economics and director of the Community Vitality
Center at Iowa State University. Counties, like Louisa, that have a local option
sales tax depend on that money to finance school improvements, he said.
The Louisa Development Corp. paid for the campaign with donations from local
banks. It advertised in the local newspaper, mailed information to residents, put
up "Shop Louisa" signs in businesses and banks, and had members speak to
local clubs and organizations.
At the end of 12 months, the efforts paid off. Most retailers said their tills showed
a slight improvement, and overall the campaign made people think more about
the economic health of their communities.
Jodi Boysen, who has operated J.D.'s Irish Ivy florist and gift shop in Wapello for
15 years, said customers have come in saying, "I'm spending my $5 in your
shop."
"I can't see things blossoming big time because of this," Boysen said. "I think the
program has good intentions behind it. It will just take time to grow."
Some residents said it was a painless transition.
"I have made a very conscious effort to fill up my car with gas in the county," said
Kent Wollenhaupt, president of State Bank of Wapello. "I used to buy it wherever
I was. Now I'll buy gas before I leave the county or wait until I get back."
He also does all his grocery shopping in town and uses a local veterinarian,
among other services.
Carmen Legaspi, who runs La Reyna, a Mexican grocery store and restaurant in
Columbus Junction, said she talks to customers about the Shop Louisa program.
"I love the idea," she said. "We need more people to shop here instead of other
places. Then the money can stay in town."
The majority of her grocery business comes from Hispanics, who work at the
local Tyson Foods plant, while most of her restaurant business comes from
Anglos, she said.
"The Anglos are more involved in the shop locally program," she said. "The
Spanish people like to go out of town to shop, like on the weekends."
The Shop Louisa program began its second year in January. Smith said
residents are now encouraged to spend a little more locally.
"We're looking for another $1 million this year," she said. "We think whatever
switches they made last year are habit now, and we're asking them to add
another $5."