Arrival of Wal-Mart a boon to some, a bust to others

One in an occasional series chronicling how the opening of a new Wal-Mart affects a small Virginia town.

KILMARNOCK, Va. — David Rose feels like he could be sitting on a gold mine.

Wal-Mart Stores Inc. is about four months away from opening a supercenter next door to Rose’s Crab House & Raw Bar, his restaurant on the northern end of this quiet coastal town just two hours south of the Capital Beltway.

Mr. Rose says he is concerned Wal-Mart could change the town’s character, but he recognizes it as a business opportunity.

“If the Northern Neck has to have a Wal-Mart, I’d rather have it in my parking lot,” he says as Wal-Mart finished constructing the walls of its nearly 150,000-square-foot store last month.

You’d think Mr. Rose has it made. If history is any judge, Wal-Mart is going to bring hordes of people past his restaurant, and at least some of them will crowd into Rose’s after a day at the discount store.

But as soon as he heard Wal-Mart was coming, Mr. Rose focused his energy away from the crab house and on opening a second restaurant, a steak house in the town’s downtown.

He realized that suddenly the land Rose’s Crab House sits on is hot property. His landlord could get a sweetheart deal and sell the land, forcing the crab house to close. And if the crab house stays open, the 1.5-hour wait on the weekends will likely swell with Wal-Mart shoppers.

So Mr. Rose opened Rose’s Steak House & Saloon, which will be a place to direct the crab house’s overflow business. And just in case the crab house has to close, Mr. Rose will still own a restaurant, he explained during the steak house’s second night in business last month.

In a 1,200-person town, the world’s largest retailer doesn’t just affect the land where it builds a store. Nearly the entire business community has had to make changes, whether large or small, to counter what it expects will be strong competition from Wal-Mart. Even those who stand to benefit from Wal-Mart, such as Mr. Rose, are taking steps to protect themselves.

“[Business owners] have to be what they originally were: entrepreneurs,” says Shawn Donahue, who owns a number of small shops in Kilmarnock.

He expects Wal-Mart will “erode” business at his toy store, Christian book store, gift shop and furniture store, among his other shops in the town.

“If you happen to be buying food at Wal-Mart and you stop to buy a toy, that’s erosion,” Mr. Donahue says. “How much erosion can a small business take?”

While many business owners fear the Bentonville, Ark., retailer will siphon sales, many Kilmarnock residents welcome Wal-Mart for its low prices and convenience. Many shoppers already make a 30-minute trek to the chain’s stores in Tappahannock or Gloucester. But some residents are concerned Wal-Mart and the development that is starting to follow it will make Kilmarnock more like the big cities they avoid.

Feeling the pinch

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