We have a four decade experience in watching the business market in the small town of Clinton North Carolina. Clinton was the first place we settled in after truly leaving home and our home county. We found the people there friendly, willing to us take in as one of their own as someone who was not born there, and lastly it was a vibrant market for business in a predominately rural county. We consider Clinton our adopted home town.
Over the next few decades we spend a lot of time in Clinton and Sampson County building up lifelong relationships and business ties that we enjoy even today. In the 1970's and 1980's Clinton was a farmer come to town market with a growing small urban core. Most business was locally owned or based in North Carolina. We remember the predominant retailer at the time being Roses and in the late 1970's that was shook up a bit with the coming of Kmart. Kmart was the Walmart of it's time and the movement into North Carolina the home turf of Roses was a battle royal. Over the years of course those two retailers gave way to Walmart and other niche retailers. Such is the way markets move and adjust to customer buying habits and competition. Three events in the recent weeks make clear this market is becoming more like national markets as slowly the need to be big overwhelms all other concerns.
The big grocery retailer in Clinton in the late 1970's was Piggly Wiggly owned by the Lindsay brothers who were locals who prized their links to Sampson County and Clinton. There were other grocery stores in the area at the time lead by Big Star in Coharie Plaza, which over time left town as did some others like Winn Dixie since competing against The Pig for market share was a losing battle. Customers preferred shopping with someone they knew and would cater to their individual desires even if not as cheap sometimes. We never remember a time when Jesse Lindsay ever made a move that was not customer centric or more importantly against his religious values. People in the area found that comforting. Over time Paramount Foods, the parent of the Piggly Wiggly in Clinton expanded to Roeboro, Newton Grove, and Smithfield. There was talk of expanding into the Triangle area as well. Of course that was then and this is now. Now Clinton has a Walmart with a grocery. Now has a stronger Food Lion that has proved the low price and less space idea to be long lived. But all this goes back to Walmart and the fact that customers are more price concerned and the only way to compete on price is to be able to spread expenses over a larger store base and buy in volume. So this week the Lindsay family announced they were selling their four remaining stores to Promise Foods a larger store chain. Promise Foods, operating as Carlie C;s, has been expanding their store base over the last few years taking up the IGA store Smithfield and even starting at store in a little served area of Raleigh. We are not privy to the Lindsay's decision making but we expect the much harder to compete in grocery environment of today played a part in the decision to sell. Customers in the Clinton area as in almost small markets now are not as loyal to local owned business as they used to be as younger buyers tend to be more price conscience and less loyal in buying habits.
We were there at the birth of Clinton Toyota when Jeff Strickland and Tommy Baker took on the dealership on then Southeast Blvd. in Clinton. Over the next few years they took a weak franchise and dealer plate to heights no one thought possible in a small market. Albert Thornton, who owned the Chevrolet franchise in Clinton at the time, marveled personally to me at their success of Clinton Toyota getting out of town customers to come to Clinton. Intense marketing, narrow than usual profits, and a group of smarter than average people were able to make it happen. The ideas thought up there were taken national by Jim Moran of Southeast Toyota the regional supplier who knew good ideas when he saw them. In the 1970's small individual dealers could survive on selling 25 vehicles a month and thrive on up to a 100. But getting past a hundred or so vehicles sold monthly was tough in a small market and frankly not needed since most dealers owned their local markets via being local owners who invested locally and personally knowing lots of their customers. Auto dealers then could produce more profits with each sale and make enough money to survive. Since the need to get bigger did not exist rarely was their a new automotive dealership with more than one name plate. Thornton Chevrolet, Vann Ford, Clinton Toyota, Roseboro Ford, and Owen Chevrolet were such Sampson County dealers and all one franchise. Over time the Chevrolet dealership was sold to Steve Stefanovich who united the Rose Buick franchise and Clinton Toyota franchise under one dealership. Steve recently sold that combined dealership to Deacon Jones Auto Group of Smithfield NC that itself has over a dozen franchises covering Goldsboro, Smithfield, and now Clinton. Once again we see the change in the marketplace where spreading expenses over a larger dealership base that allows new vehicle dealers to compete on price. There is also the added pressure of the national new vehicle manufacturers demanding local dealers upgrade facilities and most importantly service operations to be very customer friendly. That is a large expense item and is reflected in many dealers moving into new buildings and having larger parts inventories. Hard, but not impossible, for an individual dealer to compete on this scale long and survive especially when in markets like Clinton where unlike just twenty years ago customers will drive to Fayetteville, Goldsboro, and beyond to compete on price. Again we are not privy to the decision making behind the decision to sell Go Automotive but we expect the need to grow larger and invest as required by the manufacturer or move on was part of the thinking. One final note here is the push for auto dealers to improve service operations is having a large effect on tire and automotive service dealers who are losing business to new vehicle service bays and we are just starting to see these places like Goodyear, Firestone, and such grouping up into larger store footprints as well.
Lastly is the move of the Sampson Independent into a new building. This is nothing more than the local newspaper responding to market conditions of the 2010's. When we joined this newspaper in the 1970's the press, the news operation, the entire business operation was under one roof. The newspaper had then just recently been bought by a larger southern US based chain after many years of being owned by a couple of local Sampson County owners. The new owner combined two locally owned weeklies the Sampsonian and The Sampson Independent into one newspaper and went daily. The Independent during the 1970's enlarged the old building site on Elizabeth Street buying a new press and gaining space for distributing more circulars via the home delivered product. Over the years the newspaper was bought by Park Communications and now another large nationwide chain and during those years even more of the operations were centralized in off site locations. Now with many of those jobs and operations off site we expect the decision was made to move to a smaller building. Again we do not know if the decision was made due to the need for less space, but we suspect that is so as is we also would not be surprised if the newspaper is renting the building they now occupy. Renting instead of buying real estate is a way to free up capital both in newspapers and now few national retailers own the building out of which they operate.
Now this is not to say that being small and a local owner is not a business concept that works, the deal to compete is quite simple either be large or be niche. Niche marketing is doing something Walmart or larger retailers do not sell or do not do well. For instance note the concept we just discussed about most businesses not owning the storefront. In that space has emerged several real estate trust firms such as National Retail Properties and Realty Income who specialize in buying up and owning hundreds of retail properties across the country. Larger in real estate means like it does in retail business spreading expenses across more stores and cutting costs. This national intrusion into smaller and smaller markets marches on and there is little local communities can do to stop it as it is part of our new normal. It is as simple as Bojangles moving into smaller towns taking restaurant business away from local competitors. Again the idea is to do a niche well and thrive.
There are small business niches too such as locally owned pharmacies who compete successfully against Walmart and CVS providing personal customer care and advice where knowing the pharmacist personally is valuable to many buyers. Small locally owned restaurants can still do well doing steakhouses that serve as social centers of the community. Local small banks can provide lending to citizens when a larger bank will not take the risk on a small business. Clothing alteration shops do business that big market retailers have avoided and generally do not want. Used car lots provide access to transportation by providing loans to those who can not get lending elsewhere. Local bakeries provide fresh items to local customers big retailers can not do. Hair salons provide services to women who can be fickle in their choices. I remain a believer in the future of the small entrepreneur and small business always doing something better than big business, but the influx of bigger is better in large markets and now small markets means this ain't your Daddy's Clinton NC anymore.
