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Are Malls Killing
Israel's Small Business?
NECHEMIA MEYERS
Special to The Jewish News
R
ehovot — Herzl Street, the
center of what used to be
Rehovot's downtown, is a
disaster area. Nearly half the
shops are empty, and those still open
report a decline in sales of from 25 to
50 percent.
A series of factors is responsible for
this development, which is duplicated
in many other cities. The most impor-
tant is the mushrooming of modern
shopping areas outside the old down-
town.
In Rehovot, for example, a handsome
new air-conditioned mall is attracting
thousands of shoppers not only because
of the wide variety of goods on sale, but
also because it is a pleasant place to be
on a hot summer day, of which there are
all too many in this country. It also
offers a plethora of fast-food outlets,
ample free parking, play areas for kids
and a multi-screen cinema.
The opening of the mall was bad
enough where Herzl Street merchants
were concerned, but worse yet was the
inauguration of two new shopping com-
plexes just outside the city limits. And
unlike their counterparts in Rehovot
itself, they are open on Shabbat.
This isn't strictly legal — there is a
law prohibiting the employment of Jews
in non-essential occupations on the
Sabbath. But attempts by Israel's
Orthodox minister of the interior to
enforce the law — by sending out his
Druze inspectors Saturday after
Saturday to fine the Jewish offenders —
have not been effective, largely because
the general public supports the "law-
breakers."
Recent developments are a rerun of
what happened in Israel some three
decades ago when the first supermarkets
were opened. There were noisy and
sometimes even violent demonstrations
by grocery store owners, who com-
plained that they would be driven out
of business by the new enterprises. But
the protests were of no avail and super-
markets soon began operating all over
the country.
Now, ironically enough, those same
supermarkets are finding it difficult to
compete with huge warehouse-type out-
lets, where prices are 10 percent lower
than in the old-style supermarkets. The
Small Merchants Association is calling
for stricter enforcement of the Shabbat
law and for government assistance to its
members in their unequal struggle
against the giants. But it is unlikely to
be successful in either effort.
To the extent that smaller enter-
prises will survive, it will only be by
finding niches where they have some
advantage over their competitors.
Even on Herzl Street, for example,
hole-in-the wall shops selling cheap
shmattas are holding their own
because the malls — where rents are
high — don't generally house purvey-
ors of such merchandise.
And there are even a fair number of
successful corner groceries in operation.
The reason: people who do their major
shopping at the supermarkets or the
warehouses don't bother to drive there
when all they need are a couple of
loaves of bread, a few cartons of cottage
cheese and some low-Et milk.
Instead they walk to their neighbor-
hood grocery, where they will probably
also stock up on a few additional items.
The current recession is hurting all busi-
nesses. But the big chains in the shop-
ping centers are better able to weather
the storm than are the small shops along
Herzl Street.❑
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Detroit Jewish News
8/7
1998
113