By Christina Galoozis

When Charlotte Cook’s neighborhood pharmacy was bought out by CVS in 2005, she took her business to one of the last independent pharmacies in Oakland. But four years later, that pharmacy was bought out by CVS too.

“I just gave in to the fact that CVS was now our only option,” says Cook, a writing teacher and resident of Oakland’s Adams Point neighborhood for 34 years.

Sadly, this is a reality many Californians face. Our beloved independent stores are closing up for good, headed online or getting swallowed up by national chains. For those of us who would rather buy local than shop at big-box stores or national chains, the options are getting fewer and farther between.
So, are we headed for a world—or at least, a California—without any independent stores? And how can we prevent others from closing their doors?

Why It’s Happening
California is routinely at the bottom of the Small Business & Entrepreneurship Council’s “Best States for Small Business” list. This year, it ranked California No. 48 out of 51 (including D.C.) for its high tax rates, expensive energy and strict labor laws. While most socially conscious business owners may agree with those policies, they certainly take a toll on operations: High costs and regulatory red tape disproportionately affect small, independent businesses.

For example, companies with fewer than 20 employees spend three times as much on tax compliance, per employee, than companies with 500+ workers. And large corporations with a nationwide presence can balance their high-cost California operations with lower-cost operations in other states.

The consequence? National chains like CVS, Target, Wal-Mart and others infiltrate city neighborhoods and steal market share from independent pharmacies, retailers and grocers. In the Los Angeles area alone, there are 50 Target locations.

Tax breaks for big-box stores don’t help either. A study from the California Budget Project shows Enterprise Zone-related tax breaks primarily go to corporations with assets of $1 billion or more. And as the economy remains sluggish—especially in California, where double-digit unemployment remains—the media and general public have little choice but to welcome new employers and their 500-plus jobs per
store.

Yet, an increased corporate presence is not the right course for California. Bill Callahan, who owns handmade-furniture store Tamalpais NatureWorks, opposes the proposed Target three miles from his San Rafael business. For Callahan, it’s not about losing customers to the retail giant, which also sells furniture. It’s about the welfare of his community and lack of social responsibility.

“These stores sell a lot of cheap, short-lived products that are made in other countries and shipped around the world. They live in people’s homes for a little while, and then get thrown away. That process is degrading everyone’s quality of life,” Callahan says.

A Corporate World
The money spent at big-box stores isn’t always recirculated in the community. While big-box store sales may boost local tax revenue, the parent corporations don’t invest their profits back into the community as a small business would. Instead, they siphon profits out to investors, use them to purchase more foreign-made materials and products, and put them toward creating jobs in other states.

Herein lies the danger of losing independent businesses, says Antoinette Kuritz, a public relations professional from San Diego: People are no longer living, working and shopping within their communities.

“When I lived in Saratoga Springs, N.Y., for 10 years, if my child got sick in the middle of the night I could call the local pharmacy owner and he would open it up for me,” Kuritz says. “There was a sense that you lived and worked and purchased from your neighbors. You don’t get that with these chain stores.”
Indeed, many Californians are living in a sprawl of suburbia—no longer self-sustaining small towns or city neighborhoods—where they drive to work, drive to a big-box store, and then drive home. If we keep on this track, we all may eventually participate in a caste system of corporate employers, corporate employees and corporate buyers. Such a system would mean less economic freedom and incentive
for entrepreneurship.

The Solution?
It’s unlikely that a majority population will rise up against the increased corporate presence. However, a handful of cities, such as Turlock and Tuolomme, have banned big-box discount stores altogether. (San Diego also held a ban for five years, though it was recently overturned by the city council.) It’s also unlikely the breadth and depth of California taxes and regulations will ever swing in small business’ favor.
But as consumers, we can do our part to help keep independent stores alive.

Kuritz, the public relations professional from San Diego, says she is “so passionate” about keeping her local New York-style pizza restaurant open that she’s given them free PR. “I want that place to stay alive so badly that I’ve gotten them on TV six times,” she says. Kuritz also shops at her neighborhood bookstore, Mysterious Galaxy, and even when she goes online to buy an e-book she punches in a store code so Mysterious Galaxy gets the revenue.

Charlotte Cook, the writing teacher from Oakland, says she makes it a point to tell bargain-hunters their shopping habits can be detrimental to the local economy. For example, when a friend suggested Cook buy her wine at BevMo to save a few bucks, Cook told her she’d rather pay more for the wine at Piedmont Grocery, her local grocery store. She also tells fellow shoppers who complain about the grocery store’s
prices that she’d rather be at Piedmont than the Safeway down the street.

“Sometimes they look at me strangely, because they expect me to complain,” Cook says. “But I’m in line because I choose to be in line.”

Lesser of Evils

With fewer independent stores, sometimes we’re forced to buy corporate. But we still have choices. Here are some of the most socially conscious brands that come from California.

Patagonia (Ventura) Since its founding in 1972, this outdoor clothing company has kept environmental responsibility a top priority. Patagonia donates 1 percent of its annual sales to environmental groups and encourages other companies to do so through its “1% for the Planet” alliance. Plus, Patagonia employees can take a two-month leave of absence—with full pay and benefits—to volunteer for an environmental nonprofit of their choice.

derma e (Simi Valley) These skin care products may be sold in national chains like The Vitamin Shoppe, but they’re as green as green products come. The manufacturer offsets 100 percent of its conventional electricity usage with renewable energy certificates (wind, specifically) and has a robust in-office
conservation and recycling program. Derma e lotions, face washes and soaps are all made with non-genetically modified organisms and are packaged with 100 percent recyclable materials.

Levi’s (San Francisco) The average pair of jeans uses 11 gallons of water in the finishing process, but Levi’s WaterLess line reduces that consumption by 28 to 96 percent. The company also uses “Evaluate,” a scientific tool that measures the environmental impact of every fabric, button, snap and zipper. Plus, Levi’s has been at the forefront of supply-chain transparency.

TastyBaby (Calabasas) Major food brands have jumped on the organic bandwagon, but this small company—founded by two SoCal moms—has carved a portion of the organic baby-food market by selling through national grocery chains Kroger and Whole Foods. The foods are 100 percent certified frozen organic, gluten-free and minimally processed without artificial ingredients, preservatives, irradiation or cloning. TastyBaby’s mission is to “end childhood obesity.”

—CG

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