Evanston’s Downtown Plan Committee this morning heard claims from the head of a Chicago neighborhood business group that local businesses generate more economic benefit to a community than chains.

Ellen Shepard, an Evanston resident who is executive director of the Andersonville Chamber of Commerce in Chicago, said the chamber-sponsored study showed that more money spent in locally-owned stores continues to circulate through the local economy.

The study, conducted by a Civic Economics, a research group that advocates for local businesses, compared the financial performance of ten Andersonville businesses that volunteered to take part in the study with publicly available aggregate data from ten national chains.

Because the local businesses were self-selected, it’s impossible to know whether they are representative of the local community, and because the chain data is based on average nationwide performance, it’s unclear whether it reflects how the chain stores perform in a particular local community. The study also excluded chains headquartered in Chicago.

The study concludes that 10 chain outlets will generate twice as much revenue as 10 locally-owned stores but that a dollar spent in a local store generates 68-cents of direct and indirect impact on the local economy compared to only 43-cents for a dollar spent at a chain store.

The study says local stores spend more on local labor, acquire more goods and services locally and distribute more of their profits locally.
 Downtown Plan Committee member Diane Williams said determining what businesses qualify as local is “a sticky wicket.”

Ms. Williams, the executive director of EvMark, cited as an example the Clean Plate Club Restaurant Group.  It is headquartered in Evanston, but only one of its three owners lives here. In addition to three restaurants in Evanston, it also has outlets in Wheeling and Schaumburg.

Plan Commission Chairman James Woods said he believes there are considerable differences between downtown Evanston and Andersonville.

“Part of what Evanston’s downtown is about is counteracting the draw of malls outside of Evanston, so there is a desire to attract certain chains into town so we don’t have to go spend our money in Skokie,” he said, “And we’re a big enough community to do that.”

Committee Chair Larry Widmayer said Andersonville, with a mile-long commercial strip from roughly 5000 to 5800 on North Clark Street and mostly one- to three-story storefronts occupied almost exclusively by locally-owned businesses, is more like Evanston’s Central Street shopping district than downtown Evanston.

Ms. Williams added that sometimes communities have to make value judgments about what chains they want. A Design Within Reach or a Whole Foods chain store is considered a lot better than a Walmart or a CVS, she said.

Ms. Shepard, who has publicly criticized the 49-story tower proposed for the Fountain Square block, said she loves the Uncle Dan’s store on the site and said it’s part of the character of downtown.

Uncle Dan’s is a small chain with two Chicago stores and one in Highland Park, in addition to its Evanston store.

At the meeting tower co-developer James Klutznick said Evanston is more of a regional draw than Andersonville. “People in Andersonville come to Evanston to do some of their shopping,” he said.

He said Evanston’s policy of creating subsidized public parking and its location on mass transit lines has served to draw people from neighborhoods on Chicago’s north side and even from Old Orchard.

Tim Anderson, the other developer of the tower project, said a study in Oak Park showed that national chains account for just 10 percent of the downtown retail square footage but generate 65 percent of the sales tax revenue.

Evanston Chamber of Commerce Executive Director Jonathan Perman said in a phone interview that he’s sympathetic to the problems the Andersonville neighborhood has faced and impressed with its success.

He said Chicago’s tax increment financing policies sometimes have been used in ways that have harmed existing smaller businesses, with huge subsidies to big projects that don’t really need the public help.

And he said many of the steps that Andersonville has taken to help small businesses, such as facade improvement programs, are also being used in Evanston.

But he said Ms. Shepard appears to oppose in Evanston the same high residential densities that have supported the success of Andersonville’s business district.

He also noted that chain stores can draw customers to a neighborhood, customers who then may also patronize locally-owned businesses.

Bill Smith is the editor and publisher of Evanston Now.

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  1. In the downtown small businesses are not the issue
    The council should be concerned about preservation of the small business districts. That does not mean they need to keep small businesses in the downtown. There are several very good small business district that have few chains. Such as central street and main street. The council should be protecting these areas versus worrying about the downtown which clearly is being very upscale to displeasure of some residents. High density in the downtown is Ok – but not all over Evanston. It may be Ok to require some developers of the large projects rather than give funds to affordable housing to create small business rental spaces to add some interest to the downtown.

    The council needs to hold the line on zoning in the small business districts and not allow condos that elminate retail and have all parking at grade level. There are several poor examples of this on Central street. The scale of the small districts must be preserved.

    I think if council members had any sense – which I doubt most of the time – they would understand what they need to protect,preserve and change to keep Evanston a interesting place to live.

    Ofcourse if you read the article here on the Pizza business open to 3:00 pm you realize our council members have no sense.

  2. Interest in independent retailers / small businesses downtown?
    The input of the over 350 “residents, business/property owners, merchants, institutions, and other interested parties” who participated in the three downtown visioning sessions has been tallied by the consultants. It indicates that there is indeed a stated interest on the part of the community in supporting local businesses. Go to this page on the city’s website and click on:
    Combined Meeting Summary, Pt II (Excel)

    The presentation discussed the practices put in place in Andersonville. A number of years ago Andersonville began drawing interest from developers and chains, and local businesses began being priced out by rising rents and real estate assessments. As a result of a Chamber of Commerce survey of over 500 randomly chosen Clark Street patrons which found that over 70% preferred local businesses, the Anderson Chamber of Commerce researched the issue (using data generated in Austin, TX and San Francisco) and then put simple, positive practices into place to retain and attract new local businesses. Chamber of Commerce practices include branding Andersonville as unique and local, maintaining a list of interested local businesses (mostly restaurants or stores from Chicago waiting to open a second location in Andersonville) which they give to landlords who call with upcoming vacancies, and helping with signage (although stores are free to put up what they want), façade improvements, historic preservation, and more. It is a policy of active encouragement, ie carrots, not sticks, working closely with businesses and landlords alike.

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