Big brands key to small-town jobs

New Zealand’s small towns rely on big brands to sustain a healthy economy and workforce, a retail expert says.

Yesterday, after backlash about retailer The Warehouse’s decision to up sticks from Kaikohe over problems with the property’s lease, the retailer announced it would stay open after the landlord changed tack.

Retail was one of the biggest employers in the country and it was important for big businesses to set up shop in regions to boost the economy, First Retail Group managing director Chris Wilkinson said.

‘‘The big companies are the ones that have the capacity and resources to provide job opportunities and support staff with training,’’ Wilkinson said.

The Warehouse’s decision to stay has secured 33 full- and parttime jobs in the Northland town.

Northland still has the highest unemployment of any region, despite a sharp fall in the number of jobless in 2016. The region’s unemployment rate is 7.2 per cent, compared with the national rate of 4.5 per cent.

Wilkinson said a company like The Warehouse, that built its brand with a focus on the community, had a strong social responsibility.

‘‘The company will now have to work closely with the local council, because whatever The Warehouse does will be fundamental to the redevelopment of the town.’’

Regional Development Minister Shane Jones said The Warehouse ran the risk of turning Kaikohe into a zombie town if it had decided to close the store.

‘‘We’ve got a big job ahead of us in terms of bringing unemployment levels up, especially by training our young people and getting them into jobs,’’ Jones said.

First Union national coordinator for The Warehouse Kate Davis said she hoped the company had had a cultural shift.

‘‘The Warehouse is a large employer in the area and the shop itself plays an important function in the community. A closure would have been a real hit for an area already struggling with exceptionally high unemployment,’’ Davis said.

Northland Chamber of Commerce chief executive Tony Collins said when a big company decided to enter a market or stay in a market, it improved the community’s confidence.

‘‘It’s not only great for employment but it gives the community a vote of confidence that they are worth investing in.’’

But on the flipside, Collins said big brands entering small towns also hurt local businesses.

‘‘It should not be overlooked that when large-format retail establish themselves in smaller rural centres it normally results in the displacement of existing locally owned, often family businesses. The departure of The Warehouse could have given local businesses a second chance. But the world is moving towards this. Small businesses need to find their niche and unique point of difference to compete.’’

Collins said having stores in Northland, where many lived on low incomes, was important.

‘‘Online shopping is rising but in-store shopping is still important, especially in the regions.

‘‘It’s glib to think when you’re in a big city, where you’re earning more, you can afford to shop online whenever you want. But here people have limited incomes and buy when they get paid. They need to be catered for better-value goods.’’