Tuesday, May 31, 2016

Small Business and the Suburbs

Some readers may be aware that over the last few years, and the last year in specific I have been working on ideas for a small, independent business. The idea has always attracted me. I like the notion of being my own boss and while making money making a positive contribution to my community. At first I thought about setting up my business in my hometown, Brampton, but I discovered a competitor had beaten me to the punch and so I looked elsewhere. Yesterday I met with some people from the Brampton Economic Development office. For anyone considering starting a business I would highly recommend speaking with your local chapter.

I sat down with one of their experts about locations in the city and neighbourhoods that might be of interest. After about an hour of conversation we parted ways, me with new ideas in my head and went to reconsider if Brampton might work for what I hope to accomplish.

I sat staring at a map last night, and drove to the locations we discussed and as I reflect back upon that experience I wonder if there might be a fundamental problem. Is suburban-style development hostile to independent, small businesses?

Hostile is probably too strong a word, what is probably more accurate to say is that they are a steeper uphill climb than in a more urban environment. I do not think the particular problem is Brampton, instead it is the land-use patterns in the city commonly found elsewhere. Downtown Brampton offers some solutions to the problems I am about to list, but instead I Want to talk about some of the problems first.

Every business has a certain logical catchment area. This is the area in which customers are likely to encounter a business in their daily activities, or the proximity to the business in their day-to-day lives. You can probably draw a circle around your business and within which you can reasonably expect customers to drive/walk/bike/transit to your business, and beyond which people are far less likely. In denser urban environments this circle could contain tens of thousands of potential customers. Given the lower densities found in suburban environments the business is drawing a smaller population. There is also an element of specialization here. Let's take the example of a bakery. Most people don't have need for a bakery anymore as they buy their bread from grocery stores. Bakeries now almost exclusively cater to desserts and pastries. Are there enough people five kilometers around a strip mall to make a bakery sustainable? Obviously in some cases yes, but it certainly more of a challenge.

If a business wants to reach beyond that circle it needs to pull in an audience and reach across the boundaries. In a suburb like Brampton that means driving. Transit, while improving, take longer, operates on an independent schedule and may not deliver you to your end location. Brampton is a large, sprawling city. Even as a person who has lived here most of his life my knowledge of it is constrained to certain districts and regions. Rarely do I find myself north of Bovaird, or in East Brampton. Likewise, a customer is unlikely to visit a business that is beyond a certain mental horizon. It took me months to go visit a board game store in Brampton because it seemed so distant and inconvenient.

Outside of the Downtown a business in Brampton is probably found in a mall, a strip mall or a shopping complex. I am unfamiliar with malls, so I'll leave that aside. The design of a strip mall and shopping complex are such that people going there already know why they are there. People don't browse in these locations. They drive to their store and leave. Worse still, unlike a traditional downtown, oftentimes the businesses are not visible from travellers on the road. The complex obscures businesses deep in its well of buildings and parking lots, and the strip mall is difficult to see. These types of shopping complexes encourage chains and franchises because customers have some idea what they are. It would be exceedingly easy to miss a unique name on one of those towering signs or hanging over a building and, since you are likely driving, it is difficult to investigate.

Finally the suburban development pattern that I have observed tends to create larger spaces. This is likely a benefit to some but that square footage costs money in rent and maintenance. A 3000 square foot restaurant might not make a lot of sense to an entrepreneur with limited resources, but a 1500 square foot one may let him/her get started and test the market.

There are no doubt successful independent, small businesses to be found in the 'burbs. When I reflect though on my favourites in my hometown only two are out in the sprawl while the rest are tucked inside the small downtown. These are definitely things I think about as I decide whether or not my idea is feasible and I wonder how many are faced with similar dilemmas.

1 comment:

Jared Milne said...

I'm no expert, but maybe the willingness of suburbanites to drive to a particular place might have an impact on its viability? In my suburban hometown of St. Albert in Alberta, many of our businesses are concentrated along the main highway that runs through the city on its way into and out of Edmonton, or on roads that branch off it. While driving everywhere to shop isn't always ideal, sometimes it's necessary if you have something that's too big or unwieldy to carry on foot or on a bicycle.

As for downtowns, Edmonton has its Whyte Avenue. However, I very rarely go down there because parking is such a pain in the ass, and traffic is so heavy. At the St. Albert strip malls, I find that I usually have more choice about which exit to use when I get back on the road.

Just some thoughts from a suburbanite.