September 6, 2018 10:54:08 AM
Zack Plair - [email protected]
Columbus City Council has now heard proposals from five retail development firms wanting to do business with the city.
When exactly councilmen will decide on which firm to offer a contract remains unknown, but Ward 3 Councilman Charlie Box said he hopes the vote comes "sooner than later."
"I hope we can get to this pretty quick," said Box, who in August led an effort to divert $100,000 the city had paid the Golden Triangle Development LINK for a decade for economic development services to the professional services fund -- some of which will be used to hire a firm specifically to pursue retail development.
Box has argued, and the majority of the council ultimately agreed, the LINK has not produced optimum results for the city's retail sector.
On Tuesday, four companies -- Next Site in Birmingham, Alabama; Brick + Mortar and The Retail Coach, both based in Tupelo; and Buxton Company from the Dallas-Fort Worth area -- pitched to the council, each trying to differentiate their experience and recruitment philosophies. On Aug. 20, Memphis, Tennessee-based NaviRetail was the first to present to city officials.
"I've been impressed with all of them, and all are doable from a price standpoint," Box said. "It's going to be a hard decision to make. ... I've got one that really sticks out in my mind, but I'm not going to say which one right now because I don't think that would be fair.
"What this has done is reinforce what the council is thinking," he added. "We've been missing out on a lot, as far as retail opportunities go. There's tremendous potential here."
Chuck Branch, who sold his stake in Retail Strategies three years ago to help start Next Site, said his company specializes in aggressively presenting what its clients have to offer to retailers.
He pitched the city a three-year contract for $30,000 each year.
If hired, he said his company would use "third-party, anonymous" mobile phone tracking data to find out how many people are shopping in Columbus and how far they are driving to do it.
Using data from Columbus Walmart shoppers over a short period as an example, Branch showed councilmen a regional trade area of 169,000 potential customers just in North Mississippi.
Branch said Next Site also analyzes "peer cities" of similar population and demographics to help develop a list of realistic targets for retail recruitment. Then, he said, company representatives actively push those retailers to locate with Next Site client cities.
"We don't just do a bunch of research, hand it to you, pat you on the back and say 'good luck,'" he said.
Next Site has brought shopping centers to cities like Foley and Dardanelle in Alabama, Branch said, and the company has "a great relationship" with grocery store chains like Aldi and Publix.
In Mississippi, he said Next Site has worked mainly with communities in the southern part of the state, such as Laurel, Gulfport, Wiggins and Pascagoula.
Brick + Mortar
Brick + Mortar is a young company, with Anthony Michelic only two years at the helm.
But two things set Michelic's company apart, he said, specifically in Columbus: personal touch and the fact Brick + Mortar has already done much of the groundwork for the city.
The Columbus-Lowndes Chamber of Commerce paid Michelic's firm $15,000 earlier this year for a retail analysis -- one that identified $1 billion annually in retail leakage from the city.
Because that report is already complete and available, Michelic is offering his continued service to Columbus for an additional $15,000 for the first year, with a renewal operation for $25,000 per year thereafter.
Michelic said retail development firms are a "dime a dozen," with most using essentially the same data tools to compile the same information (trade area, peer community analysis, etc.).
But Brick + Mortar, he said, works with no more than five client cities at a time to ensure the most personalized service.
"Nobody will work harder for the city than we will," Michelic said. "... We try to provide value to local businesses first, and then we pursue direct recruitment of other retailers."
Michelic didn't offer councilmen specific examples of wins in communities where his company has worked. His major clients right now, he said, are Ruston, Louisiana and Jackson, Alabama. He's conducted short-term research projects for several other cities, like the retail study in Columbus.
If hired, Michelic said, his company would not take on any other clients in the Golden Triangle.
The Retail Coach
Started in 2000, The Retail Coach has worked with 500 communities in 32 states, company representative Will Kline told the council Tuesday.
During that time, he said, the company has brought 3.5 million square feet of new retail development, and more than $600 million in total sales tax revenue, to client communities.
The Retail Coach is offering the city its services for $35,000 for the first year, and $25,000 for each following year.
While his company's methods are similar to those presented by the other firms, Kline emphasized the company's role as a "consultant" to the city.
"When we lay our cards out there, we are an extension of the mayor's office," he said.
Kline said he would divide Columbus into opportunity zones with specific assets and needs -- particularly mentioning finding the "highest and best use" for what he believes is an underutilized Alabama Street corridor. He said he also would focus on high potential properties like the old Gilmer Inn site downtown and the soon-to-be-vacant Kmart on Highway 45.
As far as retail possibilities, Kline and other company representatives indicated Kohl's could be an option, along with grocery stores, restaurants and home goods retailers.
Working with existing businesses, especially those locally owned downtown, would also be a priority.
"They will understand that the city didn't hire someone to put them out of business," Kline said of those stores.
The most data-driven and expensive of the options, Cody Howell presented Buxton as a high-quality, high-results option.
Buxton is offering its services to the city for $50,000 per year.
Howell said Buxton doesn't work as an outsourced third-party of retail recruitment. Instead, the company partners an account executive with client cities that seeks to empower city officials to effectively pursue desired targets based on detailed, realistic data. Likewise, retailers can use the same system to identify target communities.
Buxton's analytics platform, Scout, is available to all its clients -- cities and retailers, alike -- and it digs deeper into demographics and spending habits of potential customers than standard mobile-based data other firms collect.
Companies like Trader Joe's, Marriott and Tuesday Morning rely on Buxton data for site location, Howell said.
"We really get to the doorstep level because we own this data," he said. "We invest millions of dollars a year for data sets. When you hear the term, 'big data,' that's who we are. And the value of big data is that we turn it into big (results)."
Buxton has worked with 850 communities in more than 20 years, Howell said, including Jackson and Biloxi in Mississippi. Some Buxton retail clients, he said, have even located in Columbus over the years.
Howell said Buxton didn't operate with retail area studies and peer community analyses, as other firms do. But just to make a point, he ended his presentation by giving city leaders a packet containing "every deliverable" the other firms could provide the city from a data standpoint, including 20 realistic targets for retail recruitment.
That is the city's to keep, he said, whether it hires Buxton or not. Further, Howell said the Scout system compiled that data in "five or six hours."
Other council reactions
Ward 6 Councilman Bill Gavin responded to each presentation with similar lines of questioning, specifically how involved the companies would be representing the city's interests and how often they would be willing to report to the council.
He told The Dispatch Wednesday he had narrowed his favorites to two firms, though, like Box, he wouldn't identify them. He did hint, however, he favored the personal approach to recruitment over a data-based one.
"I like talking to someone, looking someone in the eye and shaking their hand," Gavin said. "To me, that's key in who we select and how we go about selling Columbus."
For Gavin, retail is about choice. And while he said he would have liked to see some city money continue to fund the LINK -- although he voted with the majority in moving all of that money -- he believes there must be a more effective way to bring more options to the city.
"If a lady wants to buy a blue dress, she has about two stores locally where she can get one," he said. "She can go to Tupelo or Tuscaloosa (Alabama) and find 12 stores (in each place). ... Another thing is we badly need another grocery store in this town."
Stephen Jones, who represents Ward 5 and opposed pulling the city from the LINK, is still skeptical the city needs a dedicated retail development firm.
Two presentations -- Next Site's and Buxton's -- stood out for him, he said, but he's not ready to invest in either.
"I'm not saying we don't need retail, but I don't want to rush into this either," Jones said. "I want to do a little more research and talk to more people before I'm willing to vote."
Zack Plair is the managing editor for The Dispatch.