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Arnett Muldrow: Camden gaining, ‘leaking’ dollars

Posted: October 8, 2013 4:21 p.m.
Updated: October 9, 2013 5:00 a.m.

Camden has some “very dynamic market things” going on, according to Tripp Muldrow of Arnett Muldrow, the Greenville-based firm hired by the city of Camden to conduct a marketing study, tourism plan and branding effort.

“At the end of the day, you are a ‘gain’ community,” Muldrow said during his firm’s second public information meeting, held Monday evening at the Robert Mills Courthouse. “Consumers here, in 2012, spent $312 million, all merchandise in about 50 retail categories.”

Being a “gain” community, Muldrow explained, means that, overall, businesses in the 29020 zip code -- which includes business outside the city of Camden -- are selling more than consumers in that zip code can spend. That, in turn, means Camden is attracting dollars into the community, he said.

Overall, Muldrow said Camden-area businesses are selling $377 million worth of goods and services. Compare that to the $312 million people living in the 29020 zip coded are spending and the area is experiencing an inflow of $64 million. However, Muldrow warned, those gains are only reflected in selected categories.

The 29020 zip code is considered the “primary trade area.” The secondary area consists of neighboring zip codes in Lugoff, Cassatt and Bethune. Overall, the secondary market is “leaking,” or losing, millions of dollars to businesses outside those areas despite the fact, Muldrow said, that consumers in that secondary market are spending more. He said consumers living in those areas are spending $325 million (compared to 29020’s $312 million), but the stores there are only selling $268.1 million. That leaves $57.6 million those residents are spending elsewhere.

“The retail (there) simply has not caught up, and that makes perfect sense,” Muldrow said. “Sandhills (Village) is pulling people in one direction, you’re pulling them in the other direction. When you match those two (sets of figures) together, you’re about at market equilibrium, but you’re not at equilibrium when we look at all categories that are involved.”

For example, most 29020 spenders on automobiles are purchasing vehicles outside the zip code, whereas Lugoff (29078) attracts dollars -- not surprising, Muldrow said, since Lugoff has a number of car dealerships across the river.

Muldrow said both the overall numbers and individual categories provide opportunities, whether there is inflow or leakage.

An example of a leakage providing an opportunity is in furniture and home furnishings. Both the primary and secondary trade area do not have enough supply to satisfy existing demand, so people are spending outside Kershaw County.

“Furniture and home furnishings stores are those where there are unmet needs,” Muldrow said, pointing out that antiques -- an important category for Camden -- does not fall under furniture and home furnishings. “There’s certainly existing supply here … but when you see leakage in both those categories, that presents a really good opportunity. One, because that was a great segment up until the recession, the recession hit that segment really hard, but it is recovering and rebounding … it’s where we see opportunity for growth.”

Muldrow said that Tee Coker, an urban planner with the firm, is already working on calculating the retail square footage Camden can “reasonably support” in each of the categories.

In a related category, building maintenance and garden supply, he said Lowe’s is supporting an inflow of dollars in that category for the city.

Muldrow said “very interesting things” are happening in the grocery category. While he acknowledged that the grocery industry has been “ravaged” and that Walmart has “eviscerated” traditional grocery stores along with mergers of regional chains, Camden is actually gaining outside dollars in traditional grocery sales.

“The secondary market is leaking traditional grocery store sales. I see this is as an opportunity -- people are still coming here to buy their groceries,” Muldrow said.

He noted that while there are probably a lot of Lugoff residents who work in Columbia, they likely do not buy their groceries in Columbia because “they don’t want ice cream melting” on the trip home. Instead, he indicated they are coming to Camden, whether to buy groceries from inside Walmart or other stores in the city.

Camden is leaking dollars, however, when it comes to specialty food shops -- “the cheese-maker, the butcher, the wine shop, specialty beer store.”

“As Walmart kind of took the rug out from under our traditional grocery stores, specialty foods have sort of come back in and filled in the gap,” Muldrow said. “In large metro areas, specialty food and grocery stores -- we’re seeing places like Fresh Market, Whole Foods and stores like that. They have a very high threshold of population and income in order to locate into a community. A community like Camden, you do not have the warm bodies to support a Fresh Market. So, the drive over to that part of Columbia is still going to happen, but we see smaller communities capitalizing on it in a different way, like the market that you have downtown. We continue to see that as an opportunity and a growing opportunity.

“You’re already winning in the grocery category, why not win in the specialty category as well?”

A big inflow category for Camden is gasoline stations.

“This is where you hit things out of the ballpark. This is really important -- communities that are located along exit interchanges just do an incredible job with gas sales. This is a tremendous opportunity or a tremendous opportunity missed,” Muldrow said.

He explained that someone stopping at a gas station at or near I-20 and filling up their gas tank may just get back on the interstate and continue on their way.

“You’ve gotten their gas dollars -- $47 million importation of gasoline (dollars). If you’re not collecting some other money from them, that’s a missed opportunity,” he said. “In what ways can Camden skim even 2 percent, 1 percent? If I’ve got $1 out of every $10 of gasoline in additional spending, that would be $4.6 million in additional spending in Camden, South Carolina,” Muldrow said.

Camden is “hemorrhaging” dollars in the clothing category, Muldrow said, but said there might be an opportunity for someone to recapture that market. He said a category made up of sporting goods and related sales are also leaking. Muldrow said he did not know where tack shops “fell” and thought they might actually be reflected in another category somehow.

In general merchandise, Muldrow said Kmart, Roses and Walmart are helping to bring in an $82 million inflow into Camden.

“That is amazing importation -- that is tremendous,” he said. “So, it naturally begs the question … you’ve got a very interesting dynamic set up where you’ve got huge importation of dollars at the exits, where you’re getting $50 million importation of gas (dollars), you’ve got huge importation of dollars right (at) the river where Walmart and Kmart both stand. These customers are coming right to the edge of Camden -- so how can we take a few of them and get them in the middle to do more?”

Muldrow said that question is becoming more important because those markets are continuing to grow while visitors are getting more sophisticated, becoming more interested in heritage tourism, the outdoors and recreation.

He also said that small cities such as Camden should no longer look at big box stores such as Walmart as the enemy. The “damage was done” 20 years ago, he said, although the ripple effect is still being felt today. Muldrow said that Walmart and other large stores now have a “grounding effect” that either keep or bring into the market shoppers that would otherwise leave.

Antiques came under a miscellaneous category where there is a $6.3 million inflow of spending, $3.1 million of which is antiques. Muldrow said, however, that needs to be placed in perspective with the huge $82 million of general merchandise inflow. He suggested there might be opportunities for furthering clustering of antique and furniture/home furnishing stores.

Food services, which includes dining, is not a winner for Camden at the moment. Muldrow reported that the 29020 zip code is leaking $17.23 million worth of dining dollars to other areas. The secondary trade area is also leaking food service dollars, to the tune of about $6 million.

“Food is another cluster, and there is really not a good reason why Camden can have an antiques cluster and not have a food cluster as well, because they go hand-in-glove with one another. Do your shopping and then eat your meal. Or spend a day on the river or the lake, spend a day at the horse park and then come downtown to eat,” Muldrow said.

He said Coker performed a calculation of what it would take to capture 15 percent of the $17.23 million leakage and determined Camden could support about 17,000 square feet of additional dining space to do so.

 “That’s probably two or three small downtown restaurants. So that represents opportunity for you,” Muldrow said.

During a brief question and answer session after his presentation, Muldrow agreed with one audience member that “restaurants beget restaurants.” He said the dining market presents an opportunity for Camden in that more Americans are eating out, but that they are also more concerned about what they eat.

Earlier in the presentation, Muldrow also discussed Camden’s strengths, challenges, wants and threats, discovered during interviews with key stakeholders and meetings with the city’s marketing/tourism steering committee:

• Strengths -- horse culture, the Camden Archives and Museum (including the Ross Beard gun collection), Historic Camden Revolutionary War Park, antique stores, festivals, access to I-20, retirees, a sense of identity, arts and culture, KershawHealth, the city’s historic district and neighborhoods, Carolina Motorsports Park, Price House, Robert Mills Courthouse and that the city is family friendly.

• Challenges -- lack of industry, political divide, river divide, “tired” downtown, lack of shared vision, not business friendly, demographic splits, apathy in some quarters and a loss of bus tours over time.

• Wants -- expanded equine services, improved recreational facilities, capitalizing more on Lake Wateree and the Wateree River, a downtown hotel and meeting spaces, strengthen the city’s brand identification, identifying or adding “third spaces” (gathering spots), improved city/county cooperation, Broad Street road diet (although Muldrow recognized there are those against the proposal), improving relations with nearby state parks, full National Park Service status for Historic Camden, an updated sports arena and getting more young professionals to work and live in Camden.

• Threats -- limited funding for projects, a fear that political divides may open up again, not reaching a critical mass of opportunities for visitors to engage in “browsing” of what Camden has to offer, problems with business retention, limited business hours, resistance to change and not knowing what Camden wants to be.

Muldrow said his firm’s next steps will be to conduct follow-up interviews, perform a tourism analysis and then present that data as early as three weeks from now. He said Arnett Muldrow is also scheduled to return in November to conduct a branding workshop, and then bring forward its implementation plan and recommendations in December.

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