Closed
We’ve heard a fair amount lately about some well-known retail establishments closing their doors, surprising customers and community officials.
Hy-Vee announced last week it was closing underperforming stores in Waterloo, Cedar Rapids and Davenport, giving about five or six weeks’ notice and promising employees jobs at their other stores in the markets. Then as part of a national consolidation as a prelude to bankruptcy, doors to the Red Lobster restaurant in Waterloo were permanently locked.
City officials said they were blindsides by these closures. In some cases, the city had given the grocery chain tax incentives to locate or remodel stores in certain districts…of course, those were granted 20 years ago in some cases and the cities were warned that without them, the stores would not be viable.
Some news coverage has focused on customers who are without transportation and are losing easy access to a neighborhood grocery store, and that is a shame. But the tone of some, saying we all should band together to make the stores stay open, is misguided.
These are for-profit businesses. The stores are not meeting goals, or perhaps losing money. How can government force a business to stay open and lose money?
In the case of Waterloo, city officials worked hard to get Hy-Vee to build a store in that spot…but more recently worked just as hard to have a grocery store open near downtown, just a couple of miles away from the Hy-Vee. I have to think that hurt Hy-Vee’s sales…which again is an example of why capitalism works on its own, and problems come when government puts its thumb on the scale.
City leaders all say they’ll talk with the businesses to see what can be done to change the decision. But if there really was something, like added tax abatements or the like, I’m guessing the businesses would have made the call to the city; after all, given the past economic considerations, they have the phone number.
Personally, as a consumer, I’d prefer my grocery store not spend tons of cash sponsoring concerts and events, or donating cash and food to national charities…instead, lower my prices on the shelf. But they run their business the way they want and I can either shop there or not.
Yes, these are blows to a neighborhood. But those empty parking lots have been a clue for years, despite signs that said “open for business.”
