The State of Main Street 2008

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"Diversity is changing not just entrepreneurship, but Main Street itself… making our places stronger and more vibrant than ever." At the Opening Plenary of the 2008 National Main Streets Conference in Philadelphia, NTMSC Director Doug Loescher discussed the 2007 National Main Streets Trends Survey, reporting on the economic state of Main Street over the past year and offering an in-depth look at the trends that are changing America's commercial districts.

The success of our Main Street programs has always been measured by both numbers and stories.  We all know the power of stories… Yet numbers are sometimes the most compelling argument we can make in our work.

Along with the annual reinvestment statistics [see chart in the PDF], the National Trends Survey provides an economic "snapshot in time" of the emerging trends on Main Streets across the nation. The 2008 survey was our largest response ever: more than 750 communities — that's almost DOUBLE last year's response.

The survey also included neighborhood commercial districts affiliated with the Local Support Initiatives Corporation (LISC), one of our partners this year, broadening the reach of our research. Overall, these were seasoned programs, with more than half being in operation for 10 years or longer!

This year, the economic state of Main Street can be summed up in two words: "No change." According to survey responses, it was apparently a very stable year in our districts. In virtually every category – from business mix to sales volumes, rental rates to number of employees, the majority of survey respondents reported no change. 

The big exception came in the area of investment. Despite a relatively flat growth in businesses
or sales, both public and private investment continued at a good clip in the last year. That means a lot more commercial rehabs and public improvement projects than in previous years. So the numbers for this past year seem to indicate a stable environment, with investment building future capacity for our districts.

Does Main Street Reflect America?

But the real news in this year's survey is what we learned about diversity and entrepreneurship. And what we found was eye-opening. The challenges and opportunities in these trends center around how diversity is changing not just entrepreneurship, but Main Street itself… making our places stronger and more vibrant than ever. That change will compel us to ask some important questions, such as who the emerging stakeholders of Main Street are. This year's survey helped us draw a portrait of our communities' diversity for the first time. But to understand what this means, we need first to consider some ways diversity is measured nationally.

First, the U.S. Census Bureau reports non-majority populations as being 12  percent African American, 13 percent Latino American, 4 percent Asian American, and 1 percent Native American. That equals about 30 percent of the population, with the rest being white or other minority.

The profile of the typical Main Street community, however, is a bit different. To be precise, 54 percent of respondents reported that their communities were less diverse than the national average. Given the size and location of many Main Street programs, that might fit conventional wisdom. What was unexpected was what these towns told us about their local organizations. 

When looking at their own local population, 73 percent reported that their Main Street boards were less diverse than their community's demographics. The faces of Main Street diversity, however, go well beyond the obvious definitions of ethnic, racial, and cultural diversity. There is also diversity of age, gender, sexual orientation, occupation, even personal skills. And for Main Street nationally, there is a diversity of places, regions of the country, size of community, and type of district or program represented. 

So we can certainly celebrate the rich diversity of places and stakeholders that Main Street can claim. At the same time, we can also see that we have room to grow when it comes to fully engaging everyone in our organizations. Fortunately, this year's Trends Survey also revealed some clever ways that Main Street programs are successfully reaching out to attract diverse audiences and volunteers, and not just in big cities:

Just how multi-lingual can a small town of 11,000 people be? "You're Always Welcome in Keokuk… No Matter How You Say It" was splashed across the storefronts, print ads, and radio waves in 11 different languages over the course of a year. The unexpected payoff?  New multi-lingual volunteers!

Further west, Richmond, California, found that local schools and churches were the right portal for reaching and recruiting Spanish-speaking volunteers, when they employed a LISC-funded Americorp outreach coordinator to produce bilingual flyers, and act as a liaison with the Latino community.

And back on the east coast in Delaware, Rehoboth Beach Main Street has a reputation as a family beach town where "everyone is welcomed everywhere"… including a vibrant gay community that has put down roots here, rolled-up their sleeves, and have really become a driving force in downtown initiatives.

In Elgin, Illinois, diversity has created more than just racial balance. It provides a rich source of ideas and energy as well. Diverse, family-centered groups have increased the success of promotional efforts and have also brought new entrepreneurs into downtown. What Main Street has learned from this experience has changed just about every aspect of Elgin's program, from cultural elements of promotion to storefront design, business development, and even volunteer engagement.

All of these examples demonstrate the potential for change, growth, and success by tapping a more diverse community for leadership. This year's trends survey begins to point the way.

Enriching Main Street Through Entrepreneurism

The 2008 survey also collected great stories of new entrepreneurs setting up shop. What we found were some interesting new themes emerging in green enterprises, wellness-oriented goods and services, micro-business start-ups, and "experience entrepreneurs."  Here are a few examples:

Sustainability is definitely reaching the storefronts of Main Street. In the Adams Morgan Main Street District of  Washington, D.C., green means more than just energy-efficient buildings. In 2001, Laurie Morin, a local law professor, took a sabbatical to test out an idea – that entrepreneurs can be both profitable and good for society. Hoopla DC is the result. By selling hand-made and "fairly traded" products, she is truly committed to what she calls the "triple bottom line of people, planet, and profits."

In Cincinnati's historic Over-the-Rhine neighborhood, Park & Vine offers environmentally friendly merchandise from local producers who minimize the use of natural resources. The shop sells everything from home furnishings to personal care items.

On a somewhat related theme, "wellness" is becoming big business in small places. From yoga studios and spas to wellness practitioners and organic stores, this trend has even found its way into tiny towns, such as Hammond, Louisiana. After completion of a mixed-use rehab project, Organic Planet opened its doors, offering prepared organic foods for shoppers who hope that "buying well = being well."

In Bozeman, Montana, micro-businesses bloomed when multiple business owners decided to share rent, employees, utilities, and even customers. For example, a shop called the Beatnik shares space with a complementary business, called Shoefly – a great example of how to launch new enterprises that could never afford to start up on their own.

For most new businesses, owning a historic renovated building is usually out of the question. But in Lawrenceburg, Indiana, the Main Street program has created a grant program specifically to help business owners do that. Last year, 13 recipients received anywhere from $5,000 to $20,000 to put towards utilities, equipment, or a down payment on a building. Four years into the program, most of these grant recipients are still thriving.

In Portland, Michigan, Julie Clement, who is also the economic restructuring committee chair, opened a for-profit business incubator, with a twist. By creating a place for already established downtown business owners to test out new retail concepts, the program hopes eventually to spin off the fledgling operations to new entrepreneurs who might lack the resources or experience necessary to launch a new
business by themselves.

Finally, the survey provided more evidence that the "experience economy" has arrived. This concept was popularized a few years back when a book by the same name proposed a novel idea – that "work is theatre, and every business a stage."  The book's point: people are no longer looking for just goods and services when shopping; they are seeking an "experience" and they want to be more than entertained; they want to participate. And that is especially true when it comes to food! Here's what that can mean: Successful experience entrepreneurs engage all five senses.

 For example, at a kitchen supply store called A Thyme for Everything in Lee's Summit, Missouri, the owner, Jet Pabst, has added cooking classes to the business, creating a "buzz" of excitement around the products and specialty foods the store sells.

In Kingsport, Tennessee, customers can get involved without working behind the counter. That's because at Discovery Ice Cream, you can program a robot to do it for you! With the aid of a touch-screen, customers can program the world's first – and only – robotics ice cream machine to assemble a six-layer ice cream treat.           

On the same theme – if not menu – one entrepreneur left the big-city life in search of small-town charm and found Historic Kennett Square, Pennsylvania, along the way. It turned out to be the perfect setting for a gourmet food market, called Talula's Table. What makes this a true "food experience" happens when a small group is seated around this farmhouse table some evenings for an Eight Course Chef's Tasting Menu prepared just for them.

So whether it is green businesses, wellness services, micro-enterprises, or experience entrepreneurs, this year's Main Streets Trends Survey shows innovation taking root everywhere. 

Diversity=Entrepreneurship?

The survey points to one final question for Main Street communities to consider: Does diversity grow entrepreneurs? This intriguing possibility emerged as the Main Street Center sorted through the data and uncovered something unexpected. In communities that have more diversity reflected in their population, businesses, and board leaders, guess what else they have? It seems they have more new entrepreneurs, too.

These diverse districts reported the highest growth in independent new businesses, far more than the average of 40 percent nationwide. While several factors may be at play, it does suggest that diversity itself may play a role. Looked at this way, diversity and entrepreneurship are two sides of the same coin. Together they make a powerful case – in economic and social terms – for supporting and joining a Main Street program.

2007 MAIN STREET REINVESTMENT STATISTICS

The cumulative success of the Main Street Approach™ and Main Street programs on the local level has earned a reputation as one of the most powerful economic development tools in the nation. The National Trust Main Street Center annually collects statistical information on economic activity in local Main Street programs nationwide. These statistics are tracked from 1980 to December 2007 and reflect activity in more than 2,150 communities.

Dollars Reinvested:

Total amount of reinvestment in physical improvements from public and private sources: $44.9 Billion

Average reinvestment per community: $11,083,273

Net gain in businesses: 82,909

Net gain in jobs: 370,514

Number of building rehabilitations: 199,519