There is little question that
recent news about the cancellation of plans for a Tom Thumb store at Red Bird
Mall stunned many interested parties that had invested considerable time, energy
and finances in recent years to recruit a mainstream supermarket to this
community. The planned Tom Thumb
supermarket was set to receive $5.8 million in city tax incentives to open the
store next year at the Red Bird Mall area.
The planned Tom Thumb was envisioned
as a welcome resource for residents who have long been yearning to see quality
grocery stores in the area which would also include a pharmacy. The planned store was especially appreciated given
that Southern Dallas includes half of the 90 food deserts in Dallas County and
populated by a growing number of dollar stores (Dept. of Agriculture 2019 Food
Atlas).
Red Bird Mall developer, Peter
Brodsky, was especially disappointed at this decision: “We had gotten through the design process —
fully designed building, fully designed site plan, had already received a
permit — and it was sort of the last possible moment they let us know that they
were going to pull out.” (Interview in DMN 12,16-24).
As a compromise, Albertsons Cos. stated
that they would provide no-fee delivery to ZIP codes surrounding the previously
planned store through nearby Tom Thumb locations. But one community leader in Southern Dallas
responded that “They want our business but do not want us to visit their store – that is very disappointing.”
Specific reasons for cancelling the
planned store were not provided by Albertsons Cos. although a spokesperson explained
that it followed discussions with the City of Dallas and had conducted a
thorough economic evaluation. Peter
Brodsky, however, did not appear satisfied with this explanation: “You got to
ask them their exact reasons, but I can only assume that they didn’t have
confidence that the store will be successful in the market, even with the city
subsidies.” (DMN 12-16-24).
Indeed, it is possible that other
reasons were driving the decision by Albertsons Cos. to cancel the planned
store? Let’s consider the following
issues:
·
Diminishing the Competition: Was the earlier introduction of the Joe V
Smart Shop store by H-E-B approximately one mile from the planned Tom Thumb
store at Red Bird Mall just a coincidence? Perhaps, but it is also likely that
it was a planned move to erode whatever competitive advantage the planned Tom
Thumb store would have enjoyed from City of Dallas incentives and significant community
support that had grown in recent years. Indeed, the Joe V store could have been
located at several other locations throughout Southern Dallas, but the decision
to place the store in close proximity to the planned Tom Thumb store was viewed
with skepticism by some community members.
·
Absence of Community Involvement: In a recent study of 70 supermarket
interventions in food deserts throughout the U.S., Dr. Catherine Brinkley of UC
Davis concluded that community involvement was one of the best predictors of their
success. Yet, there has been no evidence
that a trade area study of the Red Bird community has been conducted. Such a study would have measured the
estimated market share for the planned Tom Thumb and Joe V stores well as the
estimated food expenditure that could support a 50,000 sq. ft. supermarket. Importantly,
such studies are often used to evaluate the store design, products and services
that would best fit the expectations of community residents.
·
Use of the Wrong Metrics: The “thorough economic analysis” that was
conducted by Albertsons Cos. may not have included the right metrics in
reaching their decision to cancel the planned Tom Thumb store. Past studies
have demonstrated that traditional site selection metrics are not as effective
for selecting promising communities in lower-income areas (Rincon & Tiwari,
2020). Without an independent evaluation of the economic analysis conducted by
Albertsons Cos., one cannot determine if the analysis was sufficient to support
their decision.
Moving forward, Albertsons Cos. should support an independent evaluation of their economic analysis as a measure of good faith and to avoid perceptions that other factors were driving their decision making. Prior to inviting other supermarket providers to invest at Red Bird Mall, a trade area study that includes a survey of community residents should be conducted to determine demand, market share, retail leakage and other key metrics that are critical in site selection studies. Of the various recent announcements of new store openings in North Texas by Kroger, Tom Thumb and H-E-B, most have excluded locations in Southern Dallas – so a new site selection strategy is clearly needed.
Rincon, E. T. and Tiwari, C. (2020) Demand Metric for Supermarket Site Selection: A Case Study, Papers in Applied Geography, https://doi.org/10.1080/23754931.2020.1712555
Please send comments/feedback to the following email: edward@rinconassoc.com
