Business District Development and Competition: An Exploration of Structural Evolution in the Retail Districts of Denton, Texas

Abstract

A substantial literature has established the competitive impacts of retail chain development on single location retail businesses. This study explores the characteristics of these impacts at the local level through analysis of the structure of five distinctive retail districts in Denton, Texas. The analysis focuses on Denton’s central business district (CBD), a traditional retail strip, a special retail district, an enclosed shopping mall, and a power retail center. The empirical foundation for the investigation is a business database covering the years 1997 to 2010. This database captures location, industry, and firm status (single versus chain location) for each business operating in the city. Through the study period, the single versus chain location relationship did not substantially change within any of the districts. However, all five retail districts experienced decreasing retail diversity, indicating a greater focus on specific business types. Denton’s power retail center focused on chain restaurants and big box stores, while the CBD shifted from low-end retail to local food and drinking establishments. Both of these leading districts appear to have developed unique competitive advantages, In the CBD’s case this is especially instructive given the many other cities where chains have out-competed local retailers and associated business clusters.