Big Fish, Small Sea: Big Companies in Small Towns

64 Pages Posted: 2 Sep 2016

See all articles by Christyne Vachon

Christyne Vachon

University of Massachusetts School of Law at Dartmouth

Date Written: August 16, 2016

Abstract

Sharks are fish, big fish that are apex predators; yet, people and smaller fish still swim in the sea. “As the most powerful type of nongovernmental organization in the United States today and as the most dynamic form of organization in the world, the large corporation has enormous potential to affect communities for better or for worse.” What does this mean for small communities when a large company comes to town? The common dialogue when a large company comes to a small town involves a cost benefit analysis regarding their presence. The introduction of a big superstore or big company headquarters implicates questions regarding: the impact of having the business as a community member (a neighbor, so to speak); the effect on local people (merchants, employees, children, etc.); the repercussions for local businesses, the changes to local law, rules, and regulations; the influence on the use of local resources (including environmental); managing allocation of funding; and the list continues. “Big box stores can be a blessing in that they often act as an anchor for further commercial development. However, some planners also criticize them for diminishing the unique feel of small towns.” These considerations are all important, and as meaningful aspects of local business governance decisions, this article addresses the issues. So often local governments and private-sector decision makers do not factor in the benefits of establishing a development plan to respond to economic, social, and environmental concerns. Acting individually or as a united guild in this planning process improves outcomes. This article addresses the benefits of stakeholders making the governance decision to work together, and proactively recognizing the importance of the employees and consumers working in concert and making a proactive plan. Similarly, local government actors may have a narrowed vision, focusing only on concerns of appearance, aesthetics, and generating taxes. When these types of development plans are analyzed, the analysis usually does not include reference to more than the power of the community at large or the individual local businesses. This article will provide information about big businesses and the impacts they have on small communities, with an emphasis on the Wal-Mart effect and makes recommendations for governance decisions from the perspective of the small business owner in the small community. Most notably, this article emphasizes that one key governance tool that has been ignored, and should be an integral part of management’s and the board’s informed decision making, is the power of the employees who will work in the large company and the consumers who will shop there. From this perspective, this article digs into the relevant details of the Market Basket Supermarket events from summer 2013. These events clearly, and some say shockingly, demonstrate the power flexed by the non-unionized employees and its customers. In light of the strength of the impact of the actions of the other stakeholders, including employees, customers, and the community, this article will conclude with an examination of the inter-related interests of these various stakeholder actions in a small community.

Keywords: big business, small business, governance, business ethics, Wal-Mart effect, labor law, busineses law

JEL Classification: B22, D71, H70, J00, k20, k22, L21

Suggested Citation

Vachon, Christyne, Big Fish, Small Sea: Big Companies in Small Towns (August 16, 2016). Available at SSRN: https://ssrn.com/abstract=2824436 or http://dx.doi.org/10.2139/ssrn.2824436

Christyne Vachon (Contact Author)

University of Massachusetts School of Law at Dartmouth ( email )

333 Faunce Corner Road
North Dartmouth, MA 02747-1252
United States

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