By  on November 10, 2004

LOS ANGELES — Retailing in Southern California is benefiting from powerful economic forces that are aligned to boost development.

In fact, if the business climate here was likened to a school prom — with a mix of desirable partners, ones to stay clear of and wallflowers — then “retail is definitely the most popular kid at the dance right now,” said Jack Kyser, chief economist for the Los Angeles County Economic Development Corp. “Retail is red hot because you can easily find investors and tenants, and cities favor it because of the sales tax it generates.”

As of the third quarter of 2003, the most recent figures available, year-to-year increases in taxable retail sales, which do not include grocery products, showed 8.3 percent growth in Los Angeles County, 10.6 percent in Orange County, 14.9 percent in Riverside County, 12.2 percent in San Bernardino and 11 percent in Ventura.

While once it might have paid to play it safe, retailers now are finding that it pays to be on one end of the spectrum or the other. Those that find themselves in the middle — such as Mervyn’s, Kohl’s and even Wet Seal — are having the hardest time defining their niche and reaching today’s savvy customer, who knows the market and is either demanding luxury and uniqueness or stellar value.

Discount

Wal-Mart’s third Supercenter has opened in Riverside County. The retailer, which wants to build 40 superstores in California in the next several years, has come under fire from state residents who say the 200,000-square-foot Supercenters, which combine a traditional Wal-Mart store with a supermarket, hurt small businesses and that the retailer pays unfair wages, causes more crime and traffic and discriminates against women.

In April, voters in Inglewood, Calif., an L.A. suburb, voted to reject a ballot initiative that would have allowed construction of a 60-acre Wal-Mart. However, Wal-Mart in September won permission to build a Supercenter in Rosemead, Calif., about 12 miles east of downtown L.A., where the city council approved the project in a 5 to 0 vote.

“All the stores are doing much better than the company ever anticipated, and we’re moving forward to open up more Supercenters to meet the needs of the customers,” said Wal-Mart spokesman Pete Kanelos.

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