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Following a grant-funded retail analysis to find sales tax revenue options for Centralia, the Economic Alliance of Lewis County discovered that the city is in need of some furniture stores, sporting goods stores, full-service restaurants and art galleries, among other businesses, in its downtown corridor.
The organization, which presented its findings to the Centralia City Council Tuesday night, also found that there is a leakage of gift, novelty and souvenir stores; jewelry, luggage and leather goods stores; and lodging opportunities.
Eric Sonnenberg, Economic Alliance of Lewis County external relations manager, and Todd Chaput, initiative program manager, have spent the past couple of months meeting with city staff, the Centralia Downtown Association and property owners to learn more about the city’s downtown business district. They worked with Arnett Muldrow & Associates for the analysis and marketing strategy presented.
Their primary findings stemmed from a retail gap analysis, which studied leakages and surpluses. When local spending exceeds local sales, money is leaking out, indicating unmet demand and opportunity, according to the alliance. When sales exceed spending, there’s a surplus, suggesting the area draws shoppers from outside. The alliance found that downtown and suburban Centralia each show unique patterns, revealing distinct opportunities for growth based on estimates using sales tax revenue information and census bureau data.
In their retail leakage analysis, the alliance broke down their retail sales and consumer expenditure data into drivetimes from downtown and from the suburban area, which Sonnenberg said includes the outlets. Centralia has market gains across 10-minute, 15-minute and 20-minute drivetimes from downtown and suburban areas, meaning consumers are traveling from outside the city to spend money.
Sonnenberg said the lack of furniture stores presents one of the biggest leakages for the city, meaning consumers are having to leave Centralia to purchase furniture. There is a $5.24 million existing leakage within a 15-minute drivetime with a projected five-year demand growth of $1.87 million, according to the data. However, an opportunity for an outlet furniture store such as a Crate & Barrel or a Pottery Barn exists, Sonnenberg said.
Another significant leakage is in sporting goods stores, with a $6.33 million existing leakage within a 15-minute drivetime and a $0.7 million projected five-year demand growth. The alliance found that there is opportunity for one to two sporting goods stores or outlets.
Both the alliance and the city council were surprised to learn that there is a $9.3 million existing leakage in full-service restaurants within a 20-minute drivetime.
“This was actually shocking to me. I thought Centralia was pretty well-equipped with full-service restaurants,” Sonnenberg said, adding that the city could bear to add four to six restaurants, cafes or dining establishments.
Chaput said a lot of leakage is contributed to the lack of hotels, particularly with people coming to the community from the sports hub. He told the council that the alliance’s numbers show that roughly 15% of people that attend events at the sports hub make it downtown.
“You’re seeing some of that leakage here, and then they’re leaking into Tumwater because that’s where they’re staying and that’s where they’re eating,” he said. “As we continue to grow the hotel market, which is another thing we’re tasked to do, you’re going to start to see some of that income come back into our community because right now, they’re coming here for one thing and they’re leaving to stay and eat.”
Sonnenberg reported that there is a record store that currently has interest in moving into downtown Centralia while presenting the data’s findings that the city could use gift, novelty and souvenir stores. He added there are certainly opportunities for these voids and leakages to be filled by homegrown and local business owners rather than recognized brands.
Councilor Max Vogt asked the alliance team the best way to get the information out that Centralia is in need of these different businesses.
Chaput said trade shows or a business symposium would help connect them with interested building owners and entrepreneurs.
