The impact of big box retailing on the future of rural SME retail businesses: a case study of the South Taranaki district
Many rural districts are facing economic decline because of a range of factors such as demographic change, changing socio-economic development patterns, farm amalgamations, the entry of large retail businesses, the so called ‘Big Box Retailing’ (BBRs), and a decline in rural infrastructure investment. These factors in turn affect the viability of many small-to-medium sized enterprises (SMEs), which are the primary employers and the engines for economic growth and employment in rural districts. The combined effect of these processes is that many rural districts struggle to keep young people, maintain economic and social diversity and attract new settlers and investment.
This thesis seeks to answer the question as to how large scale retail businesses, rural farm amalgamations and declining rural populations impact on the viability of SME retail businesses in rural areas. In order to answer this question, this study identifies the key factors, which affect the future viability of small-to-medium sized retail businesses in sparsely populated rural districts using the South Taranaki District as a case study. The role of economic development agencies and district councils is also examined using case studies of small towns in rural districts of Australia and the United States of America (USA).
This study found a number of factors affect the future viability of small-to-medium sized retail businesses in sparsely populated rural districts. For the South Taranaki district, these factors include the arrival of large-scale supermarkets, followed by large scale retail chains such as The Warehouse. These factors, combined with changing rural population structures and economic ‘spikes’ relating to sporadic energy development, have significant implications for the long term viability of many SMEs in the district. Case studies of similar rural districts in the USA and Australia provided examples of strategies that could be used to manage these impacts. This thesis recommends policies, initiatives and strategies that may be considered by territorial local authorities, regional councils and central governments to help address the economic development challenges facing rural districts.