Jack Spade

City Hall Set to Close Chain Store Loophole

The San Francisco Board of Supervisors is set to vote next week on whether or not to increase regulations on chain stores opening in San Francisco. The measure, which Supervisor Mar expects to pass unanimously, seeks to expand existing regulations on which stores fall under the category of formula retail.

The Examiner reports:

San Francisco’s first restrictions on chain stores, defined as having 11 or more store locations in the Untied States, was enacted in 2004 with an outright ban for Hayes Valley. North Beach followed suit. […]

Since then, new concerns have emerged in communities related to formula retail stores finding loopholes in the existing law. One example was when GANT Rugger opened in Hayes Valley last year. Though the company had more than 11 locations, eight were in the U.S. and the rest in Europe, and therefore it did not fall under The City’s chain store law.

Under Mar’s proposal, the definition of a chain store would change to 11 or more locations worldwide, no longer just in the Untied States. The types of businesses captured by the restrictions would also expand to include check cashing, massage parlors, tobacco sales and fitness gyms.

With even pro-business Supervisor Wiener saying that the new regulations “will provide an even stronger and better process than we already have,” it appears that passage is all but guaranteed.

Comments (11)

the Untied States.

I might have to start using this.

I realize this is one of the things that ostensibly makes SF expensive, but I’m happy for this legislation. It’s nice living in a place that doesn’t feel like every other place.

My understanding is the 16th Street merchants wanted Jack Spade, but the richer and more powerful Valencia Street merchants blocked it.

This is true, many businesses on 16th wanted Jack Spade, but the business that didn’t were on Valencia, and the ones on Valencia won.

SF business retail rents are exhorbitant.  Who does Mar think will be able to rent a storefront at this point?  Just start ups?

Exactly! That is why there are so many empty store fronts in town, most significantly HOME on Market and Church and up and down Market Street. No one can afford the exorbanant rent except chain stores, which are forbidden. There has no be some kind of compromise

Vacant storefronts are MUCH better

Well, the owners _could_ lower rents if they can’t find a tenant at the current rate. That is kind of how a market operates, y’know.

You must be new to the city.  That has never happened.  And will never happen unless the economy drops.  But that isn’t going to happen for a long long time.

Yes it does. Rents went down in 2008. It wasn’t a long-lived trend, but it happened. And most owners don’t want to fritter away property tax year after year on commercial real estate that goes unused - except ones who have owned the place since the early 80s and pay squat in tax, perhaps.

An operating market finds a price through voluntary trade between individuals; when a corporation is involved, individual managers make decisions on behalf of the group.  It takes a mutual agreement on price between both the producer and the consumer for trade to occur.  The producer doesn’t need to sell to any one consumer, however, he just needs to find enough consumers that will pay his price; a consumer conversely doesn’t need to buy from any one producer, just one that sells at price that is worth it to the consumer.  Key is  that both sides are needed for a functioning market and for economic price calculation.

To suggest that you have an operating market when you artificially constrict one side of the equation or the other is completely intellectually dishonest, or incredibly naive.  This is not how a market operates, y’know?  The fact is, by favoring inefficient businesses (on any count, economies of scale, etc) you end up with businesses that must charge higher prices in order to be profitable, this flows through to property owners who maintain their properties here, too,  just as it does to any consumer.  You cannot have cheaper inefficiency.  It does not matter if you artificially constrain their customer base… if they can’t themselves make a profit on their property, then there’s no point in owning it.  Eventually you just end up with decay when costs exceed rewards.

I appreciate that many native San Franciscans are wholly immoral when it comes to protecting the individual rights of its citizens, including those that own property, but don’t tell the lie that this has anything to do with market operations.