Protecting small businesses in Spain

By Gerry Hadden

In the heart of Barcelona an abandoned bull ring has just been reborn. Las Arenas is a huge brick coliseum-style structure where once man squared off against beast. Now shoppers line up to buy toasters and blue jeans. In the weeks since the new mega-mall opened tens of thousands of people have been flocking in.

On the rooftop observation deck, a shopper named Carmen Villen was taking in the view of the surrounding city.

“I’ve lived in this neighborhood for many years,” she said. “And this is stupendous! When I was born the bullring was still open, but otherwise the neighborhood was blighted. Then the bullring was abandoned. I think the mall has taken good advantage of the old structure.”

Most visitors here marvel at the feat of engineering that’s left the facade intact but packed the inside with chain stores and restaurants. But some question whether the cost was too high – not the cost of construction, but to the hundreds of small, local shops that stand to lose business. Villen’s friend, Mariangels Sanz said she has mixed
feelings about Las Arenas.
Too many malls

“We have too many malls now,” Sanz said. “And with the crisis, it’s even worse. A lot of small businesses are closing. People are not suddenly going to buy three shirts instead of just the one they need just because there are more stores to shop in.”

Small business owners in Barcelona agree. Until now they’ve had strong local laws to protect them against places like Las Arenas. But one key argument local officials have used to keep the big players out has just been declared illegal – in Brussels. The European Union’s Court of Justice has ruled that you can’t keep a mega store or mall out just because it will siphon off business from existing shops.

One such shop is a curtain and sheets boutique called Fantastic. It’s located on a quiet side-street practically in the shadow of Las Arenas. On a recent afternoon, Fantastic’s owner, a woman named Niko said she’s not just worried about her business, but about the way of life her business represents.

“The big stores are very impersonal,’ Niko said. “Here we treat the people with familiarity. We go to their house to hang curtains. We take measurements, we give advice.”

Catalonian stores are already suffering, according to the regional association of small and medium sized businesses. Since the economic crisis began three years ago, tens of thousands of small businesses have closed for good. But Barcelona economist Lluis Renart said businesses have been evolving and adapting to the marketplace at least since the world’s first department store opened in the mid 19th Century, in Paris. He said models that work better shouldn’t be punished.

“I would tend to think that unfortunately in Catalonia we have over regulated commerce,” he said. “We should give a little bit more of breathing space for companies to establish themselves and offer their wares to the public.”
Defining local culture

Renart said he doesn’t believe that business models — small store, big store — have much of a role in defining local culture. But at the Fantastic curtain shop, customer Montse Blanco said he was mistaken.

“I’m sick of incompetent sales people in the big stores,” Blanco said. “I’ve reached an age where I don’t have time for inexperienced young sales people who don’t know what they’re selling … or how to sell it. If I need to buy an appliance and the sales girl can’t explain how it works I’ll just purchase it online.”

Of course, more and more people are doing that too. But in the end what may likely save Catalonia’s best small shops isn’t only the customer service. It’s medieval urban planning. The region’s towns and cities tend to have lots of small winding streets — streets where really big stores simply can’t fit.