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A Case Study of the South Taranaki District

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A Case Study of the South Taranaki District The Impact of Big Box Retailing on the Future of Rural SME Retail Businesses: A Case Study of the South Taranaki District Donald McGregor Stockwell A thesis submitted to Auckland University of Technology in fulfilment of the requirements for the degree of Master of Philosophy 2009 Institute of Public Policy Primary Supervisor Dr Love Chile TABLE OF CONTENTS Page ATTESTATION OF AUTHORSHIP ........................................................................ 7 ACKNOWLEDGEMENT ............................................................................................ 8 ABSTRACT ................................................................................................................... 9 CHAPTER ONE: INTRODUCTION AND BACKGROUND TO THE STUDY ................................ 10 CHAPTER TWO: GEOGRAPHICAL AND HISTORICAL BACKGROUND TO THE TARANAKI REGION................................................................................................ 16 2.1 Location and Geographical Features of the Taranaki Region ............................. 16 2.2 A Brief Historical Background to the Taranaki Region ...................................... 22 CHAPTER THREE: MAJOR DRIVERS OF THE SOUTH TARANAKI ECONOMY ......................... 24 3.1 Introduction ......................................................................................................... 24 3.2 The Processing Sector Associated with the Dairy Industry ................................ 25 3.3 Oil and Gas Industry in the South Taranaki District ........................................... 29 3.3.1 Historical Overview ............................................................................. 31 3.3.2 South Taranaki District Infrastructure: ................................................. 32 3.3.3 The Impacts of Oil and Gas on the Local Economy of South Taranaki.34 CHAPTER FOUR: THE IMPACT OF BBRs ON SME RURAL RETAIL BUSINESSES: A REVIEW OF LITERATURE ................................................................................ 37 4.1 Introduction ......................................................................................................... 38 4.2 Company Mergers and Farm Amalgamation ...................................................... 52 2 CHAPTER FIVE: RESEARCH METHODOLOGY AND METHODS OF DATA COLLECTION .......................................................................................................... 60 5.1 Research Methodology ........................................................................................ 60 5.2 Case Studies ........................................................................................................ 61 5.3 Background Research and Interviews ................................................................. 63 CHAPTER SIX: IMPACT OF BBR ON RETAIL BUSINESSES IN SOUTH TARANAKI ........... 66 6.1 Introduction ......................................................................................................... 66 6.2 Hawera Ghostboxes ............................................................................................. 75 6.3 Short Term Future of SMEs ................................................................................ 77 6.4 Business Succession ............................................................................................ 79 6.5 Retail Leakage, Sponge Cities and Reilly’s Law of Retail Gravitation .............. 85 6.6 Economic Reform ................................................................................................ 87 6.7 Kaponga Case Study............................................................................................ 90 CHAPTER SEVEN: SOUTH TARANAKI IN THE CONTEXT OF THE EXPERIENCE OF OTHER NEW ZEALAND RURAL DISTRICTS ............................................. 95 7.0 Introduction ......................................................................................................... 95 7.1 A comparison of the Tararua and South Taranaki Rural Districts ..................... 95 7.1.1 The Economy ................................................................................... 95 7.1.2 Retail Similarities ........................................................................... 101 CHAPTER EIGHT: SOUTH TARANAKI IN THE CONTEXT OF INTERNATIONAL EXPERIENCE ....................................................................... 107 8.1 Durango, Colorado: .......................................................................................... 107 8.1.1 The Durango CBD .......................................................................... 108 8.1.2 Event Marketing and Use .............................................................. 115 8.2 The Town of Taos, New Mexico ....................................................................... 116 8.2.1 The Arrival of BBR in the Town of Taos ....................................... 118 3 8.3 Silver City, New Mexico ................................................................................... 123 8.3.1 The arrival of BBR in Silver City .................................................. 124 8.4 Donald, Victoria ............................................................................................... 129 CHAPTER NINE: STRATEGIES FOR ENHANCING THE FUTURE VIABILITY OF RURAL SME RETAIL BUSINESSES ........................................................... 133 9.1 Introduction ....................................................................................................... 133 9.2 The New Zealand Experience ........................................................................... 136 9.3 The Case for Incentive Use in South Taranaki .................................................. 138 CHAPTER TEN: CONCLUSIONS AND RECOMMENDATIONS 10.1 Introduction ....................................................................................................... 141 10.2 The Changing Urban Population ....................................................................... 141 10.2.1 The Changing Structure of the Rural Population .................................. 142 10.3 The Impact of Large Scale Retail Operations on SME Retail Businesses ........ 143 10.4 Economic Impact of Sporadic Energy Exploration and Development ............. 144 10.5 The Use of Local EDAs .................................................................................... 146 10.5.1 District Council ....................................................................................... 146 10.5.2 Regional and Central Government .......................................................... 147 10.6 Recommendations………………………………………………………………147 10.7 Future Research………………………………………………………………...153 LIST OF REFERENCES................................................................................……..154 APPENDICES 1. Comparative Practice by Other Local Governments in New Zealand……….........177 2. Table of South Taranaki Dairy Processing Sites............……………......................179 3. Oil and Gas Fields, Taranaki...........…………….....................................................180 4 LIST OF FIGURES Page Figure 1: Total Employment by Enterprise Size in New Zealand, February 2007 ... 10 Figure 2: Position and Location of the Taranaki Region ........................................... 16 Figure 3: Map of the Taranaki Region ...................................................................... 18 Figure 4: Taranaki Mean Annual Rainfall ................................................................. 20 Figure 5: Landscape and Pattern of Land Use around Mount Taranaki .................... 21 Figure 6: Map of South Taranaki: Large Processors Site Location .......................... 27 Figure 7: Map of Hawera Engineering Density......................................................... 28 Figure 8: Map of South Taranaki District Dairy Factory Closures, 1960–1989 ....... 53 Figure 9: Numbers of New Zealand Dairy Herds, 1974-2007/8 ............................... 58 Figure 10: Average Cow Numbers Per Herd in New Zealand. ................................... 58 Figure 11: Hawera CBD Retail Butcher Closures, 1965-2000 ................................... 67 Figure 12: Age Range of Hawera Business Owners, 2006 ......................................... 78 Figure 13: Age Range of Opunake Business Owners, 2006 ....................................... 79 Figure 14: Opunake Retailers’ Years in Business ....................................................... 84 Figure 15: Hawera Retailers’ Years in Business ........................................................ 85 Figure 16: Reilly’s Law of Retail Gravitation ............................................................. 85 Figure 17: Patea’s Population Decline, 1976-2006 .................................................... 90 Figure 18: Kaponga’s Population Change, 1961-2006 ............................................... 93 Figure 19: Kaponga’s Population Change by Age Group, 1991-2006........................ 93 Figure 20: Hawera’s Two CBDs and BBR Location ................................................ 103 Figure 21: Hawera CBD Empty Shops (1 October 2006 to 20 September 2008) ..... 104 Figure 22: Silver City Unemployment Rates by Percentage, 1990-2008 ................. 123 5 LIST OF TABLES Page Table 1: Population of Main Urban Centres in the Taranaki region ........................ 17 Table 2: South Taranaki Engineering Companies .................................................... 29 Table 3: South Taranaki Engineering and Suppliers to the Kupe Gas Site, 2008 .... 35 Table 4:
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