Will the Kmart blue light specials get a red light on the paradise island of Barbados? Local merchants on this small island in the Caribbean have organized to stop Kmart from gaining a franchise license to build a 180,000 s.f. superstore outside of the central downtown district of Bridgetown. The headline in the June 26th issue of the Barbados Advocate newspaper reads: “Megastore Threat”. “In a hair-raising address to journalists,” the article says, “Al Norman outlined how big box retailers had turned the downtown of small communities into ghost towns..” The Kmart plan is being reviewed by a three person panel set up by Prime Minister Owen Arthur, who will make the final decision on the franchise application. A community presentation critical of the plan drew concerned businesses from across the island. Roughly 60 businesses attending signed a letter to the island’s Director of Finance & Planning expressing “our strong objection to the granting of a franchise license to Kmart in Barbados.” The businesses said that “this out of scale development will lead to significant negative economic and social impacts on the island: 1) undermining of the national interest in redeveloping core centers like Bridgetown and Speightstown 2) significant closure of smaller retail establishments, leading to increased blight and disinvestments 3) a narrowing of the diversity of retail businesses in the marketplace, leading to price increases to the general public.” The letter from the businesses to the government calls for “a full economic impact study for all such future franchies.” Barbados has a retail economy largely comprised of small merchants and distributive workers. The island has been relatively free of large US chain stores, with the recent exception of a Price Smart warehouse club now under construction. A National Physical Development Plan, which has been in draft form for years, urges the government “to ensure that any proposed additions to these retail facilities will not compromise the role, economic viability and attractiveness of shopping districts” in the core cities of the island. The largest city, Bridgetown, is undergoing urban revitalization, and a report on Out of Town Retail Development warned that “our strong advice is that any development proposal containing 25,000 s.f. or more of durable retail shopping should be required to provide an impact statement which would estimate the “likely effect of this trade diversion on the economic health of each of the centers affected” and “the likely benefits of the proposed development, identifying which sections of the community would gain from the proposal, and which would not.” The island’s Town and Country Planning department, which controls land use on Barbados, was advised in this Urban Rehab plan to refuse “all applications that are likely to have a deleterious effect on the viability and vitality of the city center”. The report goes on to suggest that shopping centers should be limited to a maximum of 10,000 s.f. of gross leasable floor area. A public hearing on the Kmart proposal may happen later this fall, but objectors to the plan had to file their comments by June 29th. The head of the Barbados National Trust told his members that a Kmart “would have an extremely damaging effect on the towns of Barbados, as well as impacting negatively in a major way on our social climate…Whereas competition is healthy, Kmart is not here to compete…Any gain to the consumer will be short-term. The policy that Barbados adopts for the future of our island must be long term.”
Kmart has 4 stores on the Virgin Islands, and 22 stores on Puerto Rico. But these island stores are mostly the smaller Kmart prototypes. The Barbados store is a Super Kmart. One of the largest commercial sectors on Barbados is the tourist trade, which brings foreign exchange into the economy. Critics worry that Kmart will do just the opposite: serve as a vacuum for domestic dollars leaving the country for Kmart headquarters in Troy, Michigan. They also worry that strip highway development with American logos will do harm to the tourist lure of Barbados. Will Americans want to visit an island that begins to look like the place they left? Road infrastructure, which is already a problem on the island, would be further stressed by large scale retail sprawl. Kmart has set up an operation in the Caribbean, and is building a superstore in Trinidad/Tobago. That store was described by Kmart as a “complete shopping destination”. Kmart’s general marketing manager, Steve Slade, was quoted in a Trinidadian newspaper as saying “I am very aggressive in pricing. We killed Wal-Mart in Puerto Rico. I’m so aggressive with pricing my boss sometimes has to tap me on the head.” In Barbados, local entrepreneurs worry that a price war started by Kmart would drive smaller merchants under, and undermine national policies to rehabilitate the central business districts. The President of the Downtown Merchants in Port of Spain, Trinidad said competition from Kmart was not on “a level playing field.” Kmart could turn out to be not a shot in the arm to the local economy, but a shot in the head. Kmart, which calls itself a “symbol of Americana”, may be just what this tiny island doesn’t need. For a copy of the speech presented by Sprawl-Busters on Barbados, contact [email protected]
