SDSU publication discusses retail thresholds
Contact: Mike McCurry
Phone: (605) 688-4899
Tuesday, December 23, 2008
A new publication from South Dakota State University discusses the population thresholds needed to support an enterprise such as a church, a bar or a computer store in rural South Dakota.
SDSU Extension Extra 9003, “Threshold levels for selected rural South Dakota retail and service businesses,” is available online at this link: http://agbiopubs.sdstate.edu/articles/ExEx9003.pdf . Or ask at your county Extension office.
The report focuses only on South Dakota’s 35 most rural counties. Both entrepreneurs and community leaders can use retail threshold calculations to identify the businesses most likely to succeed in rural areas, SDSU Extension Rural Sociologist Mike McCurry said.
“The population required to support different businesses varies greatly. Full-service restaurants and insurance agencies have relatively low thresholds, while businesses such as home centers, floor covering stores, and household appliance stores have high population thresholds,” McCurry said. “A sporting goods store, with a threshold level of 23,027, will probably be more successful if it is located along a highly traveled interstate highway. On the other hand, a full-service restaurant, with a threshold of 953, can succeed in a town with a population below 1,000.”
McCurry wrote the publication along with researchers Saileza Khatiwada and Trevor Brooks of the SDSU Rural Life and Census Data Center.
McCurry cautioned that thresholds are only one consideration and said the study doesn’t consider other factors that contribute to the success and failure of businesses such as business size, access to a highway, or demographic considerations. But the report does provide some information about what types of enterprises are hardiest.
“Churches and full-service restaurants, with relatively low thresholds, are most resistant to population decline. On average, it takes 953 residents to support a full-service restaurant in rural South Dakota,” McCurry said. “While our calculated thresholds for a religious organization suggest a precise threshold of 759 rural South Dakotans per church, we suspect that the figure is influenced by some 6,000 rural Hutterites who attend over 60 Hutterite churches. It likely takes over 759 people to sustain a rural church.”
Ph.D. student Salieza Khatiwada’s research was funded by a grant from Four Bands Community Fund, Inc., of Eagle Butte. For more information about threshold levels for business enterprises not included in this document, contact Mike McCurry or Trevor Brooks at (605) 688-4899, or by e-mail at sdsudata@sdstate.edu.
Learn more about South Dakota demographics and other topics at the Rural Life Date Center Web site, http://sdrurallife.sdstate.edu.
AgBio Communications Unit
South Dakota State University
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Brookings, SD 57007
Telephone: (605) 688-4653
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