Wal-Mart opens on new turf

When J.C. Penney closed its Kellogg store eight years ago, residents of Idaho’s Silver Valley were left without a department store. Buying basics such as socks, jeans and underwear required a 100-mile round trip into Coeur d’Alene or Post Falls.

Starting today, the valley’s 13,000 residents will be able to spend their money closer to home.

Wal-Mart is opening a 99,000-square-foot supercenter in Smelterville. The store will stock about 100,000 items, some of which previously required a trip over the Fourth of July Pass.

June McCloskey is looking forward to the convenience.

“I went to the hardware store yesterday, looking for an oscillating fan. They didn’t have it. I know that Wal-Mart will,” said McCloskey, a postal worker who lives in Kingston.

She’s already a frequent customer at the Post Falls Wal-Mart, but “as you know, they’re superbusy all the time.”

Wal-Mart is the first big-box retailer to open in the Silver Valley – a string of mining towns along Interstate 90. For decades, the valley’s been a Main Street kind of place, where residents patronized mom-and-pop retailers. Many businesses have long-standing ties to the area. They weathered past boom-and-bust cycles in the local mining economy with the help of loyal customers.

Competing with the world’s largest retailer is an entirely different kind of challenge. Wal-Mart reported more than $200 billion in annual sales last year. The Smelterville store is one of 70 new Wal-Marts opening across the nation this month, enticing consumers with 24-hour shopping, low prices and wide selection.

“I’m in a moral dilemma here,” said Jon Ruggles, who lives in Wallace and teaches political science classes online for North Idaho College.

Ruggles describes himself as a faithful “Main Street” shopper, who’s only darkened the doors of Wal-Mart twice. He prefers to patronize local business, even if prices are higher and the selection is smaller. “There’s still a small town atmosphere here that I treasure,” Ruggles said.

His wife, however, can’t buy brand-name nylons in the Silver Valley and her friend can’t buy thread. Ruggles can’t find the organic vegetable soups that he’s favored since tongue cancer made it difficult for him to swallow.

Ruggles and his wife currently schedule a big shopping excursion to Kootenai County about once a month. Wal-Mart is likely to carry many of the items on their list.

No doubt about it, Wal-Mart will hurt local retailers, said Dale Lavigne, who founded Lavigne Drug Group in 1958. The chain has three stores in the Silver Valley and one in Rathdrum.

When Wal-Mart opened its Post Falls store in 2002, business suffered at Lavigne Drug’s Rathdrum store four miles to the north. Sales later rebounded as Rathdrum’s population grew.

Unlike Rathdrum, however, the Silver Valley’s population hasn’t grown by 35 percent in the last six years, Lavigne noted. In fact, the net population has actually dropped by 600 since the 2000 census.

“I’m just shaking my head,” said Lavigne, who wonders why Wal-Mart chose to build in Smelterville. A 99,000-square-foot store, he thinks, would be better sized to a community of 50,000.

The answer, according to Wal-Mart, is “leakage” – retail lingo for sales that occur outside the area. By opening a store in Smelterville, Wal-Mart will capture some of the dollars flowing to retailers in Coeur d’Alene and Post Falls, said Karianne Fallow, a Wal-Mart spokeswoman. Wal-Mart also expects to attract business from I-90 travelers.

Leakage makes it difficult to anticipate how much of an impact Wal-Mart will have on the valley’s independent retailers. As he waited to have a key made at True Value Hardware in Wallace this week, the city’s mayor, Ron Garitone said people who will patronize the Smelterville store probably shop at Wal-Mart now.

“They’re already driving to the Wal-Mart in Post Falls,” Garitone said. “They’ve probably been going there for years.”

Independent grocers might face the most competition from Wal-Mart. Locals speculate that Wal-Mart’s food section could put at least one of the valley’s five grocery stores out of business.

At Stein’s IGA, managers have put quite a bit of thought into operating in Wal-Mart’s shadow.

“We really live by the banner of IGA – that we are hometown proud,” said Larry Stein, company president.

Stein’s IGA employs 55 people at its Kellogg and Wallace stores. The stores donate to virtually every charitable cause in the community, from service clubs to church youth groups to sports teams.

Stein is third generation in a family of grocers. Faded photos in his office show the Kellogg butcher shop that his grandfather bought at the start of the Great Depression, and his father delivering groceries in 1938.

But Stein’s IGA isn’t counting on tradition to carry it forward, Stein said. Over the last three years, the stores have gone through multiple upgrades, such as expanding the selection of organic produce and deli items. The Kellogg store also added a postal counter. And it’s kept its custom meat departments, where shoppers can purchase the exact number of steaks they want.

Stein checks his prices weekly against grocery stores in Kootenai County to ensure that his prices remain competitive. The Kellogg store recently added online grocery shopping with delivery and pickup options – a convenience for busy professionals, seniors and tourists staying at Silver Mountain’s ski condos. “We want to be around,” Stein said, “for another 75 years.”

That’s also the goal of Tabor’s, a historic Wallace business that is now part of Lavigne Drug Group. The store carries a bit of everything. On the main floor, you can buy a box of chocolates, an extension cord, a phone, a baby layette, lipstick, or men’s or women’s long underwear. The upstairs is devoted to toys; the basement to office supplies.

“This is like a miniature Wal-Mart,” said sales associate Trinity Menees. “The only thing we don’t have is pet supplies and food.”