City officials and small businesses seek more studies and controls on formula retailers
In neighborhood commercial districts, national chains and other formula retail stores such as PETCO, Target, Subway, Walmart, and Starbucks are hot button issues for residents who don't want to see San Francisco turn into a strip mall or have local money pulled from the community.
Sup. Eric Mar and other city officials want to make sure local small businesses aren't being unnecessarily hurt by competition from national chains, which is why he called a hearing on Dec. 5 to discuss big box retailers and their impacts on San Francisco's small businesses, neighborhoods, workers, and economy.
"There is no vehicle to see the impacts of big business on the city," Mar told us, saying he is contemplating legislation to do just that.
Mar was part of city efforts to keep formula pet stores from locating in the Richmond area, working with a coalition of pet food small businesses concerned about PETCO and Pet Food Express trying to move into the area. But it isn't just pet stores.
"There is a perception that Walmart might make a move into the city since we already have stores like Fresh n' Easy," Mar's Legislative Aide Nick Pagoulatos told us.
The city doesn't have a comprehensive analysis on how these companies impact San Francisco. Mar says he wants to "have a clear scale of their influence and see what we need to do to protect small business in San Francisco."
History of wariness
In 2004, the Board of Supervisors adopted the first Formula Retail Use Control legislation, an ordinance that "prohibited Formula Retail in one district; required Conditional Use Authorization in another; and established notification requirements in all neighborhood commercial districts."
The Planning Code changed again after a voter ballot initiative in 2007, Proposition G, required any formula retail use in neighborhood commercial districts to obtain a conditional use permit, which gave neighboring businesses a chance to weigh in during a public hearing.
Mar said the intent wasn't to bar big box retail from entering the city, but to simply give neighborhoods a voice. But now, he said the city needs to take a more comprehensive look at what's coming and how they will impact the city.
Small Business Commissioner Kathleen Dooley echoed the concern, which extends even beyond city limits. "I've heard through the rumor mill that Lowe's in South San Francisco is going to close and
Walmart is looking to take that space since they know they'd never get into the city," she told us. "It's bad enough that Target is opening stores [in San Francisco]. They are the quintessential big box because they sell everything."
Target is in the process of opening a massive store inside the Metreon in SoMa, and another store at Geary and Masonic. Mar isn't diametrically opposed to the big box industry, but he thinks those companies should be appropriately situated.
"I've seen that people in Richmond are positive toward big box like Target coming into the district, but some are nervous that it will take down business," he told us. "There are some property spaces that are supposed to be for big box, like the property at Geary and Masonic where the old Sears and Toys"R"Us used to be."
But it's not easy to figure out what other big box stores have their sights set on the city. The Planning Department's list of projects in the pipeline aren't always filed under the name of the business, making it difficult to stay vigilant.
For example, while application #3710017 at 350 Mission Street describes the project as a "95,000 sq. ft. building of office, retail and accessory uses," it isn't clear what businesses are actually setting up shop. And these days, some big box stores are coming in smaller boxes.
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