San Francisco to Chain Stores: Get Out!
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“Whether you’re on the road or just cruising around town, your favorite McDonald’s menu items are never far away.” So boasts the McDonald’s Restaurant Locator, and a glance at a distribution map of franchises in the United States proves the point. Population centers burn brightly with the Golden Arches; even the sparsely populated Western states are adequately supplied by the nation’s 14,000-plus fleet of McDonald’s.
That reach is astounding, but not exceptional. Four out of five Americans live within 20 miles of our 11,000 Starbucks; 30 percent of American grocery shopping occurs at our 4,500 Wal-Marts. The most familiar element of the American landscape — excepting green highway signs and certain brands of automobiles — might be Subway, which has over 25,000 U.S. locations.
You could be forgiven for thinking, as Simon and Garfunkel sang, “Each town looks the same to me.” From Juneau to Jacksonville, we Americans share, as much as anything, a common commercial experience, a fractal pattern of retail at once comforting and mind-numbing. It stretches the powers of the imagination to think that eating and shopping options in the American city were once as distinct as fingerprints. The shift from mom-and-pops to chains has been one of the defining shifts in American cultural life, and counter-protests have been largely futile, with opponents pegged as sentimentalists standing in the way of progress and low prices.
That is changing. Dozens of American municipalities, mostly small towns with tourism in mind, have passed laws restricting the entry of chain stores. The biggest city to do so is San Francisco: in incremental steps punctuated by a ballot initiative in 2006, the California city famous for liberal activism has enacted the most influential anti-chain legislation in the United States.
You might not realize, walking the streets of Nob Hill, that you are experiencing an urban economy governed by the tightest big-city regulations on “formula retail” in the country. That’s because the San Francisco’s anti-chain net, while unique among large cities, is fairly permeable: three out of four chains that apply for permission to operate in one of the city’s protected zones are approved. Sure, San Francisco is quirky and diverse, true to its reputation, and bursting with independent bookstores, cafes, restaurants and boutiques. But the city isn’t an oasis: as in any other large U.S. city, there are dozens of Starbucks and Subway shops here too.
Supporters say the 75 percent approval rate does not do justice to the system’s efficacy. Seeking authorization forces chains to make concessions to neighborhood interests, and the deterrent effect — Qdoba might not even attempt to open across from a favorite local burrito joint — is impossible to quantify. Two recent high-profile cases – the rejection of Starbucks and Chipotle earlier this year – have fueled the sense that neighborhoods wield real power. In the case of Starbucks, 453 signatures were submitted in support; 4,200 signatures in opposition.
The impact of the law has grown over time. When first adopted in 2004 by the San Francisco Board of Supervisors, the ordinance offered neighborhoods options ranging from “notifications” — letters mailed to nearby residents upon a chain’s arrival — to an outright ban. In 2006, voters chose to implement a more widespread solution: “conditional use authorizations,” in all of the city’s 17 NCDs. Every Gap, CVS, and AMC that wants to move into one of the city’s small-scale commercial streets must be approved by the Planning Commission. In total, hundreds of blocks require formula retail to obtain authorization, while dozens more operate under a categorical ban.
On the verge of the ordinance’s tenth anniversary, with nearly a dozen pending modifications proposed by city supervisors, the San Francisco Planning Commission has undertaken an economic study to evaluate the effects of its formula retail controls. In discussing the goals and shortcomings of the law, the city has gotten right to the heart of America’s love-hate relationship with the chain.