Impact of high oil on the spatial economy

DanB writes here:

"Your comparison regarding trips to Renton makes sense only if you assume that it is necessary for people to shop at big box stores. It is quite possible that the big box model will not survive in the world of peak oil and GHG gas emissions regulation"

I am not quite sure I follow Dan about the big box stores. I think that many people are overstating the impact of higher oil prices on the spatial economy.

Here's an example. Even assuming gas at $6/gallon, I don't see how a mom-and-pop store can compete with big box stores for a host of consumer goods such as appliances, electronics, books etc.

Think about it from the pov of a consumer. Let's say I live 7.5 miles from a Costco. That's 15 miles round trip. In my gas-guzzling 15 mpg car at $3/gallon it costs me $3 to get there last year. Two years from now $6/gallon it will cost me an additional $3. That's trivial If I am expecting to spend greater than $3-4 hundred for a big ticket item like an appliance or new TV or a month's worth of food, especially when I can save many times that $3 and get a far wider choice at the big-box. Plus neighborhood appliance and electronic stores simply no longer exist; and the idea of re-establishing them seems unlikely. As a consumer (and maybe even an environmentalist) it is well-worth the $3 to have a wide choice so immediately available in one location. It saves time, effort and gas as I don't have to look further at five small shops to get the same choice I get at one large one. Do you think that such efficient choice may be one of the reasons for the overwhelming success of the big box in the first place? Maybe?

(In fact, interestingly enough, I live within 7 miles from 3 Costcos and with 10 miles from 3 more. And I assume that I am not unusual.)

The economic logic of the big-box is powerful and eliminating it does not strike me as realistic. I believe that our prime choice is to civilize the big-box, make it use its space more efficiently and I think that is quite doable.

Btw, none of this is to say that high oil will not have enormous ramifications but I think that the impacts on the spatial organization of cities is sometimes overstated.

Comments

[DanB]

Yes, maybe we shouldn't listen Kunstler:

"National chain discount shopping will shut down as its economies-of-scale dissolve and formulas like the “warehouse on wheels” and just-in-time inventory lose viability."

http://www.kunstler.com/mags_localism.html

But then again, the more time passes, the more I believe that I, like most of us, are in deep denial about the potential effects of peak oil. I've got some more reading to do about this...

[Daniel Nairn]

I suppose it depends on how you believe our retail economy evolved into the large-scale box store model in the first place. If the model simple emerged as transportation potential increased, then it does seem likely that a decrease in mobility would cause us to revert back to the mom-and-pops of decades ago.

But if other factors have been primarily driving the economy of scale the story would be different. Other kinds of technology that would not be as likely to be scaled back post-peak oil have also improved. Better information processing and communications, for example.

But a cultural shift in values, on the other hand, could bring back neighborhood stores.

[David Sucher]

DanB.
Kunstler is good at getting people upset about the condition of the built environment in the USA, which is quite important and useful. But I am not convinced by his analysis of "why" or his scenarios of "what next?"

Daniel.
I am having problem visualizing any near-term "cultural shift in values" which could "bring back neighborhood stores."

Could you offer some examples of what might prompt people to, for example, prefer the fewer choices and higher costs which go along with neighborhood stores? Or putting it more favorably, what scenario can you see which would allow the neighborhood store of 1500 SF three blocks away compete with the 150,000 SF box 6 miles away? We are limiting the issue for the moment to purchases of appliances, electronics, food, clothing etc.

Btw, I am not saying that there is NO place for small retailers of such items as there obviously are. The question I am addressing is what is the greatest point of leverage for societal change to adapt to higher oil prices?

[Daniel Nairn]

ok. Appliances and other large, infrequent purchases probably won't change, but something as routine as food could be scaled back to a more local level.

Think about how Starbucks changed coffee purchasing in the 90's. People were suddenly willing to pay much more for there coffee in exchange for a social environment. "third places" filled that latent desire that was lacking in the American economy. There's no reason to believe that the same impulses couldn't also, at least to some degree, shape how we buy our food. If we continue to shift from efficiency towards community.

It's also possible that food production and distribution may become more localized in response to higher transportation costs. A 1/2 acre plot of land, tended well, can actually grow quite a bit of food. If that happens at all, neighborhood stores could become more competitive by being so close to the source.

But really, I'm in substantial agreement with you. Whatever shifts may happen, it's highly unlikely that the big box store will go away.

[Sam W]

One of the things people do not realize about shopping at big box and chain stores, is that by shopping at these stores they are just taking money out of their local economy. By shopping at local shops you may be paying a little more but you often get better service from them, and they will support other local businesses and non profit groups.

Local businesses typically takes up much less land than a big box establishment. 100k+ building foot print along with the sea of parking which remains unused This requires people to get into their automobiles and to drive to the store vs. their local business which are typcially located closer to neighorhood residents within walking distance.

[Josh Mahar]

What about the oil prices of bringing goods to the big box store.

For a big box store, which I think by defining it as something separate from a mom-and-pop shop, means that it is either regional, national, or global, it means that you can count on the same general products at each and every one of those stores. This is simply not viable, especially if you add in choice, with peak oil.

The benefit of a mom-and-pop shop, or a small retailer is that they can get close, local products for consumers.

Spatially, I think the IDEA of a big, single market does make sense. Its much easier to transport all goods to a single location and have people from the area all come to that location for goods. This is exactly why public markets have arisen in cultures throughout the world.