ROCK SPRINGS – Local leaders want economic diversity in Sweetwater County and the road to diversity, local leaders say, is by creating a more vibrant retail market in categories where it’s needed.
The Rock Springs Chamber of Commerce and the Sweetwater Economic Development Coalition (SEDC) now have a tool that will help—the Retail Gap Assessment.
Rock Springs Chamber of Commerce CEO Dave Hanks said the need for market analysis data became apparent a couple years ago.
Sales tax revenue was dropping because people were moving toward online shopping.
Sweetwater County has a rather young population—the second youngest in the state and well below national average, according to Hanks.
“They are much more apt to use online ordering, Amazon Prime, those type of things. If you really don’t have what they want, they are going to use online ordering even more,” said Hanks.
Sales tax is the lifeblood of our local government, which provides all the services in our community, said Hanks.
When people shop online, that sales tax revenue was not being recaptured – at least before legislature passed laws requiring the collection of Wyoming sales tax in online sales.
“Wyoming has one of the highest credit card online order rates of any state in the nation based on population,” said Hanks.
That is one of the reasons for the budget cuts, because that decline over the past 4 years.
The staff at the Rock Springs Chamber of Commerce began shopping around to find hard data with which to attract the right mix of retail in Sweetwater County.
The Retail Gap Assessment is a deep set of information based on market trend models, based on the region, and based on 5,000 different retail categories.
“They did a projection on what sales should be, then went to Department of Revenue and collected what the sales actually are. Either you have a surplus or a gap,” said Hanks.
This makes it so that they can now tell potential businesses, large and small, what their potential sales could be in the area based on hard data.
It’s going to be an ace in the pocket for filling empty retail spaces like the ones left by Kmart, Payless Shoes, Sports Authority, and buildings downtown.
“If we know we have a segment where we have a large gap, where we know things are being purchased outside the area, we can direct them to recruit those particular businesses that will fit into our community. Say we have $10 million in sales going out of this category because it’s not covered. That’s the kind of business we should be bringing her,” said Hanks.
Using Local Resources
The Retail Gap Analysis is a boatload of market analysis data from the University of Wyoming’s Market Research Center.
Business Development Manager Kayla McDonald described the data as, “Spreadsheets upon spreadsheets. For days.”
They hired an intern out of the Office Information Systems degree program at Western Wyoming Community College, who spent three months making the block of data into a user-friendly, searchable database.
Initial projections on the cost of getting that data was around $50,000 when it was researched, but that wasn’t especially feasible during budget cuts.
Market research isn’t a high priority to receive money from the Wyoming Business Council, even when they think it’s a good idea.
“In the end, a $50,000 project because we utilized resources that were available to us, cost us $1500,” said Hanks.
The Next Steps
When 80% of startup businesses fail, said Hanks, it can be for many reasons. Sometimes they are trying to see a product or service in an already crowded market.
“There is no reason to be selling something that 10 other people are doing. You are probably not going to be successful. So it’s to get an idea how to help those startups and help our existing businesses expand their sales, product offerings, or services,” said Hanks. “Now not only can we tell them if it’s a good idea or not, but we can tell them potential sales in this field and drill down. We can tell them what is the potential growth rate based on our current population and what you can expect in the next 5 years.”
The next step is recruiting businesses to use empty spaces, help expand existing businesses, and find those retail outlets people will use so they shop online a little less.
“Now we have the data. We are armed and dangerous,” said Hanks.