When a regional chain retailer decided to close its store in Cambridge, Nebraska, the town had an answer. Cambridge would open its own.
A strong sense of community can make a big difference.
Just over a year ago, a small town in Southwest Nebraska had its mettle tested when a chain retailer closed a store that played a significant role in the community’s economy. But, Cambridge, Nebraska refused to accept a bit part in the play about the death of rural America. The town came together to find both a solution and a new life.
The local investor-owned Cambridge General Store took a lot of time, energy and generosity to begin, but the store has thrived in its first seven-plus months of business.
In a time when corporate retailers make decisions based on stock quotes and earnings reports, small towns in rural America rarely move the needle at company headquarters. In fact, chain retailers in small towns have all but disappeared as the corporate world has chased the shifting populations to the cities.
The same was the case in Cambridge, a rural town of just more than 1,000 people located near the Kansas border in far south-central Nebraska.
In late November of 2010, Duckwall-ALCO Stores, Inc. announced “strategic actions to better allocate shareholders’ capital and improve profitability.” The move included closing 43 Duckwalls locations throughout the Midwest, including the store in Cambridge.
The store had been profitable each of the past 12 years, according to long-time manager Scott Orcutt. “We were always profitable,” Orcutt would say later, “so it was difficult for us to understand.”
It didn’t matter. Cambridge wasn’t any different from the other 42 communities that had Duckwalls locations — the company closed them all.
Build Your Own
What made Cambridge different was the response of people in the town.
Twenty-two days after the announcement of the closing, a committee of the Cambridge Economic Development Board held a public meeting before an attentive crowd of 200 people — a fifth of the community — to discuss options for the soon-to-be-vacant Duckwalls building.
Randy Heitmann said that the three-member committee had tried to fill the building with other chain retailers, such as Dollar General. But he said that each phone call either went unanswered or was returned with a negative response.
Instead, the Board suggested an investor-owned variety store that would be owned by the community. Heitmann said that the need was great and time was of the essence.
“There’s an obvious economic impact,” he said. “Five jobs, over $26,000 annually in sales tax, the loss of foot traffic downtown and the stigma that is attached to a business leaving the community.”
He added that the committee didn’t have enough time to complete a cost analysis, but their educated guess was that the community would need $250,000 to reopen a store. There was an attractive feature of having an investor-owned store: The business would be owned and managed from Cambridge, not some corporate office hundreds of miles away.
Two weeks later, the same committee held another meeting that was geared toward potential investors.
The group laid out the plan for how the process of starting a new business would work. The store would be organized as a Nebraska Limited Liability Company with individuals investing a minimum of $500 and further investments in $500 increments. The plan was contingent on raising $250,000, the amount necessary to begin operation.
Committee member Tammy Sexton stressed that the investments were more about the community than making a buck. “Our objective here is to keep a business open,” she said. “There is no guarantee of a return on investment, and no guarantee of a return of investment.”
A risk? Sure. But the money came — and it came quickly.
By the end of the meeting, $45,000 had been invested in the new venture. Ten days later, the new company had raised $112,000 and Cambridge was about halfway to its goal.
When the deadline for investment arrived, there was no announcement of the final amount invested, only that the goal had been achieved. Over 100 people had invested in the store.
“It was nice to see that money continued to come in,” Heitmann said, noting that there was no trouble reaching the goal of $250,000. “It just tells us that we’re doing the right thing and that people want the store back.”
The Next Step
While raising a quarter-of-a-million dollars may have seemed like the toughest step, the most frustrating challenges came next.
By February, vendors were lined up for buying inventory and work had begun to clean and redecorate the building. But time kept ticking away and, still, no opening date was announced.
The process took long enough that some community members worried about keeping the beloved and experienced Scott Orcutt as manager.
Orcutt, who had guided the previous store to profitability and was popular with the regular patrons, had been without a job since Duckwalls officially closed in January.
“Should we also take a collection help to keep Scott around?” Arla Mae Pearson, a regular at the store, asked at one of the public meetings.
Orcutt’s installation as the manager was announced in mid-March.
Heitmann had said at the last public meeting that, with proper investment, the store could possibly be open in six to eight weeks – meaning late March to early April.
Then, in an interview on March 2, Heitmann said, “We don’t have a date yet, but we’ll have one soon — it’ll be in April, I can say that.”
April came and April passed and still no announcement.
The hold up? An ever-growing list of “i’s” to dot and “t’s” to cross. There was a mountain of paperwork — permits, licenses and documentation.
“What I remember most was that things didn’t ever flow as quickly as I had hoped,” Sexton said. “There were times when we asked ourselves, ‘Do we really know what we’re doing?’ I guess ignorance is bliss.”
The moment the entire community waited for finally came when Bill Minnick, the third member of the original committee, announced a Grand Opening for May 18. “We know people are anxious,” Minnick said in April. “We didn’t want to put a product out there that was unworthy of the investors’ money.”
Eight Months Later
Now that the Cambridge General Store is going on its eighth month of business, there has been some time for reflection.
“What really helped us was the assurance from everything that we learned,” Sexton said. “The store was profitable before and we have a community that is very progressive — it knows how to work together and knows how to put together the financial resources to get a job done.”
The project also became popular outside of the community. Ravenna, Nebraska, followed a similar plan to success and opened a variety store to replace their lost Duckwalls store on November 17. Curtis, Nebraska, and Atwood, Kansas, also inquired about the Cambridge General Store process and success, Heitmann said, “but it doesn’t work for everyone.”
As for assessing year one of the business, that will have to wait until there’s a full year to look back on.
“Business has been good,” Sexton said. “But we feel like we need a full year before we do anything in terms of re-evaluating.”
Cody Gerlach is a reporter with the Cambridge Clarion.