AE-09133

ANALYSIS OF RETAIL TRENDS AND TAXABLE SALES FOR LAWTON, OKLAHOMA AND COMANCHE COUNTY

Lara Brooks, Extension Assistant, OSU, Stillwater

(405) 744-4857

Marty New, Ext. Ed. Agr./4-H. and CED, OSU, Lawton (580) 735-2252

Stan Ralstin, Area Community Development Specialist, OSU, Enid

(580) 237-7677

Dave Shideler, Extension Economist, OSU, Stillwater (405) 744-6170

OKLAHOMA COOPERATIVE EXTENSION SERVICE OKLAHOMA STATE UNIVERSITY

December 2009

Analysis of Retail Trends And Taxable Sales For Lawton and Comanche County, Oklahoma

Lara Brooks Dave Shideler Extension Assistant Extension Economist Room 526, Ag. Hall Room 323, Ag. Hall Oklahoma State University Oklahoma State University Stillwater, OK 74078-6026 Stillwater, OK 74078-6026 lara.brooks@okstate.edu dave.shideler@okstate.edu Marty New Stan Ralstin Ext. Ed. Agr./4-H and CED Area Ext. Comm. Dev. Specialist Box 180, 1001 N. Hoy 316 E. Oxford Lawton, OK 73501-4326 Enid OK 73701-1335 marty.new@okstate.edu stan.ralstin@okstate.edu ABSTRACT

The goal of this paper is to provide an analysis of taxable sales for the community of Lawton and Comanche County. Basic data is used to provide estimates of trade area capture and pull factors. Reported sales tax data is also used to analyze trends in the county and area.

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ANALYSIS OF RETAIL TRENDS AND TAXABLE SALES FOR LAWTON, OKLAHOMA AND COMANCHE COUNTY

INTRODUCTION

Oklahoma communities have been concerned with all aspects of economic development

for the past several years. Creating new jobs and additional income is of concern to rural

communities and urban areas alike. Often, retailing is viewed as a "service" sector dependent on

the "basic" sectors such as oil, manufacturing, and agriculture. Export sectors produce goods and

services sold outside the local or regional economy. Service sectors tend to circulate existing

local dollars rather than attracting "new" outside dollars. The retail sector is important, though,

as retail activity reflects the general health of a local economy. Retail sales also produce sales

tax dollars that support municipal service provision. Many local communities are promoting a

"shop at home" campaign to keep local retail dollars in the community. It will not be possible to

stop all out-of-town spending or sales leakage for a local economy. Opportunities for

improvement do frequently exist, however. Key areas can be identified for improvement.

Analysis of retail trends can identify emerging trade centers. Local leaders in Lawton requested

the following taxable sales analysis. The specific objectives of the study are:

1. Utilize reported sales tax data to analyze trends in the county and area.

2. Provide estimates of trade area capture and market attraction.

3. Provide estimates of market attraction, broken out by SIC code.

2

METHODOLOGY AND DATA SOURCES

A trade area analysis model frequently used is "trade area capture." Trade area capture is

calculated by dividing the city's retail sales by state per capita retail sales. The figure is adjusted

by income differences between the state and relevant local area. The specific equation utilized

is:

Where: TACc=Trade Area Capture by city, RSc=Retail Sales by city, RSs=Retail Sales for the state, Ps=State Population, PCIc=Per Capita Income by county, and PCIs=Per Capita Income for the state.

Trade area capture figures incorporate both income and expenditure factors, which may

be influencing retail trade trends. An underlying assumption of the trade area capture estimate is

that local tastes and preferences are similar to that of the state as a whole. If a trade area capture

estimate is larger than city population then two explanations are possible: 1) the city is attracting

customers outside its boundaries or 2) residents of the city are spending more than the state

average.

Trade area capture figures can be utilized to estimate the amount of sales going to outside

consumers. To do this, a pull factor, which is a measure of an economy's retail sales gap, is

derived using trade area capture figures and city population:

Where: PFc=City Pull Factor, and Pc=City Population.

PCIPCIX

PRS

RS=TAC

S

C

S

S

CC

PTAC = PF

C

CC

3

A pull factor of 1.0 means the city is drawing all its customers from within its boundaries

but none from the outside. A pull factor of 1.50 means the city is drawing non-local customers

equal to 50 percent of the city population. A pull factor of less than one means the city is not

capturing the shoppers within its boundaries or they are spending relatively less than the state

average. This is considered leakage of retail sales or a retail sales gap. Additional discussion of

trade area capture and pull factors can be found in the references cited in this report (Barta and

Woods; Harris; Stone and McConnon; Hustedde, Shatter, and Pulver). The Oklahoma

Cooperative Extension Service has been conducting pull factor/gap analysis and sales tax

analysis since 1991 (Woods, 1991).

City pull factors and trade area capture figures are calculated for fiscal years 1980

through 2008. Data used were sales tax returns as reported by the Oklahoma Tax Commission.

These figures do not include all retail sales (only taxable sales) in an area but provide a proxy.

Population data were obtained from the Oklahoma State Data Center and were consistent with

figures from the1980, 1990, and 2000 Census. Income figures were taken from Bureau of

Economic Analysis estimates for counties. Similar income data for cities were not available so

county income was used as a proxy.

IMPORTANT: readers should note that BEA continually updates its estimates—

sometimes for all years back to 1969, which was the case with a recently released data set.

These updates affect the values for trade area capture and pull factors. Because of this, trade

area capture and pull factor values in this report will differ slightly from values previously

published in older versions of this report, if applicable.

4

TAXABLE SALES ANALYSIS

Sales tax returns as reported by the Oklahoma Tax Commission for Lawton are listed in

Table 1 for the fiscal years 1980 to 2008. Sales tax returns are important to a city because they

reflect the general health of a local economy and also represent significant revenue for the city

budget. When considering these numbers, one should keep in mind that sales occurring on Fort

Sill Military Reservation are not subject to state and local sales taxes and are therefore excluded

from this analysis. In FY 2008, Lawton collected over $34 million in sales tax at a tax rate of

3.25% for 8 months and 3.63% for 4 months. This translates into more than $1 billion in retail

sales. This is an increase from 2007 when Lawton collected just over $31 million in sales tax

collections at a rate of 3.25%, meaning $963 million in retail sales. Sales are estimated from the

sales tax returns and the sales tax rate that is reported. Figure 1 plots estimated taxable sales in

both actual dollars and inflation-adjusted dollars. The Consumer Price Index is used to adjust for

inflation. When taxable sales have been adjusted for inflation, Figure 1 shows that “real” sales

have remained fairly constant since 1980. In recent years, 2003 to 2008, “real” sales appear to

be slightly increasing.

Table 2 lists trade area capture figures for Lawton from 1980 to 2008. Lawton’s trade

area capture has ranged from 100,634 in 1993 to 88,179 in 2002. Lawton’s trade area capture for

2008 is 92,390. This means that in 2008 Lawton “captured” the retail sales of 92,390 persons.

Lawton’s trade area capture did slightly decrease from 2007 to 2008 even though the sales tax

collections were higher. This is due to state spending averages. Even though retail sales were

higher in Lawton, the trade area capture was affected by relatively higher growth in statewide

retail expenditures. Figure 2 presents a graphic of these same trade area capture figures. Table 2

also displays population figures for Lawton from 1980 to 2008. There shows a sharp increase in

population from 1999 to 2000. This is due to the annexation of Fort Sill in mid 1998. The

5

portion of Fort Sill that is included in the Lawton population was not included in population

counts until the 2000 Census. Therefore, with the annexation, the population increased nearly

13,000.

Table 3 lists pull factors for Lawton for the years 1980 to 2008. The pull factor for

Lawton ranges from 1.187 in 1997 to 0.980 in 2002. Lawton’s pull factor is currently about

1.009. The interpretation is that Lawton is capturing a number of shoppers that is equal to 1.009

times its own population.

Table 3 also shows pull factors for cities and towns in Comanche County with a reported

sales tax. Figure 3 plots these pull factors. Lawton, Elgin, and Medicine Park all post pull

factors above 1.0 for 2008. However, after considering population and level of retail activity,

Lawton does emerge as the retail trade center of Comanche County. Medicine Park did post the

highest pull factor in 2008 of 1.485. This is the highest pull factor for Medicine Park since 1999.

In smaller communities, small fluctuations in population or retail sales result in large fluctuations

in the pull factor. Elgin follows with a pull factor of 1.040. Elgin also experienced an increase

from 2007. Fletcher posted a pull factor of 0.482 in 2008. This is a decrease from 2007. Cache

and Chattanooga both posted a pull factor above 0.30. Both communities experienced a decrease

in their pull factors from 2007. Sterling and Indiahoma both posted pull factors below 0.30 in

2008; however, Sterling experienced a slight increase in their pull factor from 2007. Geronimo

posted a pull factor of 0.172 for 2008. Its pull factor has declined since 2005.

Figure 4 shows pull factors for 460+ cities that have sales tax return information

available. The pull factors are presented as a group average by city size. The highest pull factors

fall in the size categories 10,001 to 25,000 and 25,001 to 50,000 in population with the category

of 5,000-10,000 close behind. The smallest pull factors fall in the range for cities less than 1,000

in population. Figure 5 plots Lawton’s pull factor compared to other cities with population of

6

greater than 50,000. Lawton posts pull factors that are consistent with the average for other

cities of similar size.

7

Table 1 Tax Returns, Lawton, Oklahoma, FY 1980-2008

Year Collections Tax Rate Taxable Sales 1980 $6,343,831.00 2.00% $ 317,191,550.00 1981 $6,740,102.00 2.00% $ 337,005,100.00 1982 $7,797,859.00 2.00% $ 389,892,950.00

*1983 $5,939,860.00 (8) 2.00% $ 296,993,000.00 *1983 $4,049,703.00 (4) 3.00% $134,990,100.00

1984 $14,095,660.00 3.00% $ 469,855,333.33 1985 $14,817,003.00 3.00% $ 493,900,100.00 1986 $15,130,619.00 3.00% $ 504,353,966.67 1987 $15,034,547.00 3.00% $ 501,151,566.67 1988 $15,214,454.00 3.00% $ 507,148,466.67 1989 $15,089,581.00 3.00% $ 502,986,033.33 1990 $15,383,875.00 3.00% $ 512,795,833.33 1991 $15,565,975.00 3.00% $ 518,865,833.33 1992 $17,546,304.00 3.00% $ 584,876,800.00 1993 $18,297,859.00 3.00% $ 609,928,633.33

*1994 $12,678,955.00 (8) 3.00% $ 422,631,833.33 *1994 $3,941,998.00 (4) 2.00% $197,099,900.00 *1995 $8,523,347.00 (8) 2.00% $ 426,167,350.00 *1995 $6,180,688.00 (4) 3.25% $190,175,015.38

1996 $21,374,885.00 3.25% $ 657,688,769.23 1997 $21,556,609.00 3.25% $ 663,280,276.92 1998 $21,943,414.00 3.25% $ 675,181,969.23 1999 $23,013,590.00 3.25% $ 708,110,461.54 2000 $23,748,371.00 3.25% $ 730,719,107.69 2001 $24,764,442.00 3.25% $ 761,982,830.77 2002 $24,691,151.00 3.25% $ 759,727,723.08 2003 $25,544,450.00 3.25% $ 785,983,076.92 2004 $27,574,925.00 3.25% $ 848,459,230.77 2005 $28,420,945.00 3.25% $ 874,490,615.38 2006 $29,895,223.00 3.25% $ 919,853,015.38 2007 $31,298,984.00 3.25% $ 963,045,661.54

*2008 $21,950,436.00 (8) 3.25% $ 675,398,030.77 *2008 $12,236,184.00 (4) 3.63% $337,549,903.45

(*)

Data are for months of the year indicated in parentheses.

9

$0.00

$200,000,000.00

$400,000,000.00

$600,000,000.00

$800,000,000.00

$1,000,000,000.00

$1,200,000,000.00

Figure 1. Estimated Retail Sales for Lawton, OK, FY 1980-2008: Actual and Inflation-Adjusted

Actual Inflation-Adjusted

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Table 2 Trade Area Capture Lawton, OK, in Comanche County

1980-2008

Year Trade Area Capture

Population

1980 88,587 80,054 1981 80,507 82,850 1982 89,567 85,650 1983 96,661 86,550 1984 93,381 86,800 1985 95,523 86,400 1986 98,031 84,300 1987 94,715 85,100 1988 95,800 85,250 1989 92,574 81,850 1990 91,493 80,881 1991 89,355 80,626 1992 97,155 86,482 1993 100,634 85,095 1994 99,661 84,700 1995 94,179 82,869 1996 96,778 82,571 1997 97,048 81,742 1998 95,564 81,199 1999 97,187 79,927 2000 94,349 92,563 2001 92,140 90,341 2002 88,179 89,975 2003 90,161 88,385 2004 96,811 91,354 2005 95,922 89,651 2006 91,791 90,517 2007 94,628 91,568 2008† 92,390 91,568

†

Values for 2008 should be considered preliminary since they rely on 2007 BEA data.

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0

20,000

40,000

60,000

80,000

100,000

120,000

Figure 2. Trade Area Capture for Lawton, OK, FY 1980-2008

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Table 3

Pull Factors for Cities and Towns in Comanche County, FY 1980-2008

Year Cache Chattanooga Elgin Fletcher Geronimo Indiahoma Lawton Medicine Park Sterling 1980 0.388 0.492 1.018 0.523 0.182 0.296 1.107 -- 0.390 1981 0.298 0.401 1.015 0.465 0.191 0.291 0.972 -- 0.366 1982 0.333 0.433 0.967 0.666 0.187 0.285 1.046 -- 0.516 1983 0.308 0.503 0.974 0.726 0.218 0.287 1.117 -- 0.597 1984 0.291 0.429 0.790 0.558 0.200 0.215 1.076 0.171 0.426 1985 0.317 0.622 0.874 0.475 0.221 0.244 1.106 0.237 0.418 1986 0.269 0.630 0.824 0.464 0.226 0.252 1.163 0.244 0.404 1987 0.244 0.550 0.803 0.395 0.218 0.266 1.113 0.220 0.384 1988 0.224 0.644 0.826 0.389 0.221 0.229 1.124 0.226 0.302 1989 0.226 0.611 0.744 0.404 0.228 0.301 1.131 0.215 0.345 1990 0.234 0.626 0.958 0.518 0.231 0.226 1.131 0.454 0.511 1991 0.235 0.540 1.021 0.545 0.203 0.222 1.108 0.436 0.457 1992 0.217 0.453 0.964 0.469 0.152 0.224 1.123 0.360 0.477 1993 0.225 0.756 1.094 0.492 0.173 0.203 1.183 0.472 0.439 1994 0.241 0.474 0.940 0.573 0.169 0.187 1.177 0.501 0.460 1995 0.230 0.564 1.023 0.563 0.160 0.221 1.136 2.331 0.445 1996 0.253 0.430 1.013 0.567 0.165 0.275 1.172 0.869 0.437 1997 0.259 0.431 1.036 0.603 0.157 0.221 1.187 1.029 0.461 1998 0.256 0.465 1.004 0.567 0.149 0.243 1.177 1.675 0.495 1999 0.260 0.349 1.015 0.618 0.151 0.222 1.216 1.617 0.442 2000 0.285 0.486 0.818 0.550 0.146 0.197 1.019 1.132 0.327 2001 0.263 0.472 0.926 0.601 0.174 0.239 1.020 1.020 0.348 2002 0.246 0.434 0.994 0.512 0.180 0.226 0.980 1.087 0.286 2003 0.306 0.366 0.963 0.520 0.177 0.248 1.020 1.070 0.290 2004 0.383 0.345 1.001 0.538 0.190 0.286 1.060 1.020 0.306 2005 0.403 0.380 0.961 0.628 0.221 0.278 1.070 1.331 0.283 2006 0.399 0.392 0.994 0.535 0.217 0.282 1.014 1.391 0.291 2007 0.397 0.369 0.993 0.533 0.214 0.320 1.033 1.421 0.260 2008 0.368 0.337 1.040 0.482 0.172 0.245 1.009 1.485 0.283

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0.000

0.500

1.000

1.500

2.000

2.500

Figure 3. Pull Factors for Cities and Towns in Comanche County, FY 1980-2008

Lawton Cache Chattanooga Elgin FletcherGeronimo Indiahoma Medicine Park Sterling

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0.00

0.20

0.40

0.60

0.80

1.00

1.20

1.40

1.60Average Pull Factor by City Size, 1980-2008

Less than 1,000 1,000-5,000 5,000-10,00010,000-25,000 25,000-50,000 Greater than 50,000

15

0.000

0.200

0.400

0.600

0.800

1.000

1.200

1.400

Figure 5. Pull Factors for Lawton, OK and Other Towns with Population Greater than 50,000

Lawton Greater than 50,000

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SALES GAP ANALYSIS FOR LAWTON, OK

For purposes of this study, a sales gap analysis refers to a pull factor study that has been analyzed

by SIC code for the 8 retail sectors. Sales gap coefficients may be interpreted in exactly the same

manner as are pull factors. Gap coefficients and trade area capture values will also vary from previous

years due to updated BEA and Census data. See Table 4 for Lawton’s sales gap analysis. Table 5

provides a detailed description of the 8 retail SIC categories. The reader is reminded that sales at the

Post Exchange are not included in these figures, even though the military personnel at Fort Sill are

counted in Lawton’s population.

For Lawton’s Building and Gardening Materials (SIC 52), the number of shoppers has overall

increased since 2003. The number was highest in 2004 at 99,869. Lawton’s current gap coefficient is

1.053 (see bottom half of Table 4). This is an increase from 2007. Lawton's population is about 91,568;

thus, in 2008, this sector was capturing a number of shoppers that was about 1.053 times the local

population. Lawton does have both a Lowe’s and Home Depot that possibly account for the large

number of annual shoppers in this sector.

The category of General Merchandise (SIC 53) tends to be dominated by Wal-Mart. Wal-Mart

reports all its sales under this category (even though it sells clothing, grocery items, etc. as well). In

general, towns that have a Wal-Mart will post sales gap coefficients that are greater than 1.0 for this

category, and those that do not have a Wal-Mart will post sales gap coefficients that are less than 1.0.

Lawton has two Wal-Mart Supercenters. It is not surprising, then, that Lawton had a sales gap

coefficient of 1.359 if FY 2008, though it has been declining since 2004.

Grocery stores (SIC 54) in Lawton had a gap coefficient of 0.582 in 2008. Consumers tend to

appreciate the convenience of shopping for groceries close to home; consequently, it is typical to find

that even very small towns post high gap coefficients (over 1.0) for this sector. However, since Lawton

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has 2 Wal-Mart Supercenters and the Post Exchange outlets, it is accurate to assume that many grocery

expenditures are either be counted in SIC 53 or excluded from analysis.

SIC category 55 is difficult to interpret because motor vehicle and gasoline sales are exempt from

municipal sales tax in Oklahoma. Most of the sales tax collection reported under this category appears

to stem from auto parts stores and other retail sales from gas stations. For instance, most gas stations

sell snack items, tires, some auto parts, oil, anti-freeze, etc. Sales tax collections for Lawton in this

category indicate that these types of businesses attracted a number of shoppers equal to about 72.5% of

the local population. This number experienced a constant increase since 2007.

Apparel sales are reported under SIC 56. Many small towns have nearly zero sales in this

category, and it is common to see sales gap coefficients that are less than 0.10 in these towns. Cities

with large malls tend to be the most successful at capturing the market. However, Lawton is a

metropolitan area with a mall, so it is not surprising to see Lawton post a gap coefficient of 1.265 in

2008. This coefficient has decreased since 2004.

SIC 57 reports Furniture and Home Furnishings. Also included are appliance and electronics

stores, drapery and floor covering stores, and music stores. This category is often viewed from the

perspective that many furniture purchases are made in either Tulsa or Oklahoma City. Oklahoma City,

for example, has a large cluster of retail furniture stores centralized in one geographic area. Lawton area

residents do appear to purchase a large amount of furniture in Lawton. In 2008, Lawton posted a gap

coefficient of 0.779. While this is a slight decrease from 2007, this sector appears to have increased

since 2003. It can also be assumed that many residents still might be making some of their furniture

purchases in Oklahoma City or Texas.

Eating and Drinking Places, SIC 58, is one of the most straightforward retail sectors. It contains

restaurants and bars. Restaurants and bars in Lawton captured 93,584 customers in FY 2008.

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Restaurants in Lawton tend to attract a number of shoppers that is equal to about 1.055 times the town’s

population. The sales gap coefficient for this sector has declined since 2005.

SIC 59, or Miscellaneous Retail, contains a host of retail activity, including pharmacies, florists,

liquor stores, and antique stores. These are often the downtown or “Main Street” merchants. In 2008,

Lawton attracted 84,960 shoppers in this category for a gap coefficient of 0.928. This is a slight

decrease from 2007.

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Table 4 Retail Sales Gap Analysis by Standard Industrial

Classification (SIC) Code for Lawton, OK: Fiscal 2003-2008* FY

TRADE AREA CAPTURE 2003 FY

2004 FY

2005 FY

2006 FY

2007 FY

2008 Building, Gardening & Merchandise (52) 60,095 99,869 99,375 91,735 90,270 96,420 General Merchandise (53) 138,524 143,713 140,761 137,984 135,873 124,438 Food Stores (54) 58,596 50,617 43,722 52,408 52,721 53,333 Automobile Dealers & Gas Stations (55) 85,918 84,254 76,651 72,283 74,633 66,384 Apparel & Accessory Stores (56) 107,180 128,341 116,828 121,555 123,201 115,802 Furniture & Home Furnishings (57) 62,238 63,002 58,385 72,737 73,563 71,356 Eating & Drinking Places (58) 101,692 103,967 107,375 95,733 97,619 96,584 Miscellaneous Retail (59) 87,013 87,768 85,100 77,193 88,393 84,960

FY SALES GAP COEFFICIENT † 2003

FY 2004

FY 2005

FY 2006

FY 2007

FY 2008

Building, Gardening & Merchandise (52) 0.680 1.093 1.108 1.013 0.986 1.053 General Merchandise (53) 1.567 1.573 1.570 1.524 1.484 1.359 Food Stores (54) 0.663 0.554 0.488 0.579 0.576 0.582 Automobile Dealers & Gas Stations (55) 0.972 0.922 0.855 0.799 0.815 0.725 Apparel & Accessory Stores (56) 1.213 1.405 1.303 1.343 1.345 1.265 Furniture & Home Furnishings (57) 0.704 0.690 0.651 0.804 0.803 0.779 Eating & Drinking Places (58) 1.151 1.138 1.198 1.058 1.066 1.055 Miscellaneous Retail (59) 0.984 0.961 0.949 0.853 0.965 0.928

* Trade area capture and gap coefficients can vary from previous years due to

updated BEA and Census data available.

† For purposes of this paper, when analyzed by SIC code, the pull factor is referred to as the sales gap coefficient.

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TABLE 5 TYPES OF BUSINESSES

DESCRIBED BY THE RETAIL SIC CODES 52 Building Materials

Lumber yards including home centers 58 Eating and Drinking Places

Paint and wallpaper stores Glass stores Hardware stores Drug and proprietary stores

59 Miscellaneous Retail

Retail Nurseries Liquor Stores Lawn and garden supply stores Used merchandise stores including antique Mobile Home dealers stores and pawn shops

Sporting goods stores 53 General Merchandise Stores

Variety stores Stationary stores Book stores

Department stores Jewelry stores Warehouse clubs Hobby, toy, and game shops General combination merchandise stores Camera and photographic supplies stores

Gifts, novelties and souvenirs 54 Food Stores

Grocery stores (Supermarkets) Sewing, needlework, and piece goods stores Luggage and leather goods stores

Convenience stores both with and without gasoline Catalog and mail order sales (includes e- Meat and fish markets commerce stores) Fruit and vegetable markets Vending machine operators and direct selling Candy, nut and confectionery stores establishments Dairy stores Fuel oil dealers Retail Bakeries Bottled gas dealers

Florists 55 Automotive Dealers and Gasoline Service Stations

Motor vehicle dealers (new and used) Newsstands Tobacco Stores

Tire stores Optical goods stores Auto supply stores Cosmetic stores Gasoline stations Pet and pet supply stores Boat dealers Hearing aid and artificial limb stores RV dealers Art dealers Motorcycle dealers Telephone and typewriter stores

Men and boys apparel 56 Apparel and Accessory Stores

Women’s apparel and accessories Children and infant’s wear Family apparel Shoe stores Custom tailor and seamstresses

Furniture stores 57 Furniture and Home Furnishings Stores

Floor covering stores Drapery, curtains and upholstery stores Pottery and crafts made and sold on site Household appliance stores Radio and TV and consumer electronics stores Computer and computer software stores Record and prerecorded tapes stores Musical instruments stores

.

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BUSINESS DEVELOPMENT STRATEGIES

Retail trade trends reflect the overall health of a local economy. All out shopping or sales

leakage cannot be stopped. Often, larger economic trends (State-National-Global) overwhelm

retail opportunities. There are programs and actions that can assist retail trade activities,

however.

Concerned leaders and business persons can focus on business development by forming a

business assistance committee to begin implementing some of the assistance activities or

working with the existing chamber of commerce. The following activities were in part of a retail

trade improvement program. These activities can improve the climate for business and show the

community's commitment to support local business.

1. Analyze the local business sector to identify needs and opportunities to be pursued by the

program

In addition to economic analysis, information is needed on the needs or problems of

individual businesses and of the business district as a whole. As needs are identified, action

can be taken to improve the situation. For example, a business may need help in preparing a

business plan to qualify for financing. Perhaps the appearance of buildings and vacant lots

is detrimental to attracting people to be business district, or perhaps poorly coordinated store

hours are a hindrance. Once these needs are identified, a business development program can

. Businesses often do not have the resources to study the economy (local, regional,

and national) and how they fit in. They need practical data and analysis that will help in

their individual business decision-making. In particular, economic analysis can identify

voids in the local or regional market that can possibly be filled by expanding or new

business. Examples of analysis include the pull factor analysis reported here and consumer

surveys to identify needs and opportunities.

22

initiate action. A periodic survey of local business needs can form the basis of a business

development program's work plan.

2. Provide management assistance and counseling to improve the efficiency and profitability of

local businesses

3.

. Many local businesses are owner-operated, earn low profits, and have

difficulty in obtaining financing. Businessmen often need additional education and training

in improving business management skills like accounting, finance, planning, marketing,

customer, relations, merchandising, personnel management, or tax procedures. This

assistance and counseling can be provided through seminars and one-to-one aid. Sources of

assistance include the Service Corps of Retired Executives (SCORE), Small Business

Development Center program sponsored by the Small Business Administration,

Universities, Technology Centers, Oklahoma Department of Commerce, and the

Cooperative Extension Service. The intent is to aid small businesses in becoming more

competitive.

Assist new business start-up and entrepreneurial activity

4.

by analyzing potential markets and

local skills and matching entrepreneurs with technical and financial resources. Establishing

a business incubator is another way to assist new businesses. An incubator is a building

with shed space or service requirements that reduce start-up costs for new businesses.

Incubators have been successful in many locations but are not the right answer for every

town. A successful incubator must have long-range planning, specific goals, and good

management in order to identify markets and entrepreneurs.

Promote the development of home-based enterprises. Home-based work by individuals is

increasing because of the flexibility offered and because in some areas, it may be the most

realistic alternative. Home-based enterprises can include a great variety of full or part-time

occupations such as food processing, quilting, weaving, crafts, clothing assembly, mail order

processing, or assembling various goods.

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5. Provide assistance in identifying and obtaining financing

6.

. Small businesses often have

difficulty obtaining long-term bank financing for expansion because they lack assets to

mortgage, cannot obtain affordable terms or rates, or cannot present a strong business plan.

A business development program can identify public loan programs and package them with

private loans to make projects feasible.

Provide assistance in undertaking joint projects such as

• improved appearance

:

• improved management of the commercial area

• building renovation

• preparation of design standards

• joint promotions and marketing

• organizing independent merchants

• special activities and events

• fund raising

• improved customer relations

• uniform hours of operation

Undertaking these projects requires cooperation, good organization, and efficient

management. These projects can improve a business district's competitive position and

attract new customers. The Oklahoma Main Street Program provides many good examples

of towns working together for economic revitalization. The Main Street Program developed

by the National Trust for Historic Preservation, is build around the four points of

organization, design, promotion, and economic restructuring.

24

7. Develop a one-stop permit center

8.

. There is great deal of red tape involved in starting a

business including registering a name, choosing a legal form, and determining what licenses,

permits, or bonds are needed. Other concerns include internal revenue service requirements,

unemployment insurance, sales tax permits, and state withholding taxes. Having this type of

information available in one location will make life easier for potential businesses.

Involve active organizations and the media. Groups such as the chamber of commerce, civic

clubs, etc. can encourage a healthy business climate. The local media can also support small

business and aid in developing awareness of the importance of local business.

25

SUMMARY

This report has presented an analysis of taxable sales trends for the city of Lawton and Comanche

County. The level of taxable sales in Lawton has significantly increased in nominal terms since 1980.

After correcting for inflation, taxable sales have remained fairly constant. The value for inflation-

adjusted sales since 2003, however, appears to be increasing.

Lawton is the county seat of Comanche County. Therefore, Lawton does emerge as the center of

trade for Comanche County. Lawton is a metropolitan statistical area in southwestern Oklahoma. It is

also home to Fort Sill Military Reservation. Therefore, Lawton does have a larger population and a

substantial amount of retail activity. Lawton’s pull factor has consistently been above 1.0 since 2002.

Since Lawton has a larger population, fluctuations in the pull factor are not as common as it is with

smaller communities in Comanche County. Overall, Lawton’s pull factor is fairly consistent with cities

of similar size.

Lawton does have both Lowe’s and Home Depot stores; therefore, it is expected for the gap

coefficient in this sector (SIC 52) to be above 1. Lawton also has 2 Wal-Mart Supercenters, so it is

expected for Lawton to have a gap coefficient greater than 1 for SIC 53. The presence of the 2 Wal-

Mart Supercenters and Post Exchange affects the gap coefficient of grocery stores in Lawton. Lawton

does have a mall; therefore, apparel sales post a gap coefficient of above 1 as well. Eating and Drinking

places (SIC 58) attract many customers with a gap coefficient above 1.

Lawton does have a unique situation in terms of retail trade. Since Lawton is home to Fort Sill

Military Reservation, there is the possibility of many sales taking place on post at the Post Exchange that

are not included in this analysis because these sales are not subject to state and local sales taxes.

Therefore, community leaders will need to account for sales completed on post when examining retail

26

opportunities. Lawton is like other cities in terms of the possibility of out-shopping to larger cities such

as Oklahoma City and even cities in Texas.

27

REFERENCES

Barta, S.D. and M.D. Woods. Gap Analysis as a Tool for Community Economic Development WF 917, Oklahoma Cooperative Extension Service, Oklahoma State University,

<

.

http://agweb.okstate.edu/pearl/agecon/resource/wf-917.pdf>, 2000. Harris, Thomas R. "Commercial Sector Development in Rural Communities: Trade Area Analysis."

Hard Times: Communities in Transition

. Western Rural Development Center, WREP 90, September 1985.

Hustedde, R., R. Shatter, and G. Pulver, Community Economic Analysis: A How To Manual

. Ames, Iowa. North Central Regional Center for Rural Development, 1984.

Oklahoma Department of Commerce, Research and Planning Division. Population Estimates for State, Counties, and Cities, Oklahoma: April 1, 1980-July 1, 1989

. December 1990.

Oklahoma Tax Commission City Sales Tax Collections Returned to Cities and Towns in Fiscal, 1980 to 2006

. (Fiscal Year End-June 30)

Stone, K. and J.C. McConnon, Jr. "Trade Area Analysis Extension Program: A Catalyst for Community Development," Proceedings of Realizing Your Potential as an Agricultural Economist in Extension

. Ithaca, New York, August 1984.

Tennessee Valley Authority. "Focus on the Future," Workbook provided at RedArk Development Authority Symposium on Economic Development Leadership, Shawnee, Oklahoma, June 1986.

U.S. Department of Commerce Bureau of The Census. Resident Population by County, 1990 to 2005

. http://www.census.gov/populations/extimates/county/ (July 2006)

U.S. Department of Commerce, Bureau of Economic Analysis. "Personal Income by Major Source and Earnings by Major Industry," Regional Economic Information System, 1980 to 2004.

Woods, Mike D. Retail Sales Analysis in Oklahoma By County, 1977, 1982, 1987

. Bulletin B-801, Agricultural Experiment Station, Oklahoma State University, October 1991.