Released: February 28, 2002

Economist Updates Report on Kansas’ Retail Sales Activity

MANHATTAN, Kan. – New data from the Kansas Department of Revenue is helping a Kansas State University economist update and improve his annual measures of retail activity in Kansas.

David Darling, a community development economist with K-State Research and Extension, said that the information is helping him learn the retail impact of such cities as Wichita, which collected more than $237.6 million in sales tax revenue for the State of Kansas in fiscal year 2001.

Darling said the new data allows him to look at communities which do not have a city sales tax. Using the information, he can calculate the community’s city trade pull factor, which is a measure of a community’s balance of retail trade as reflected by per capita sales tax collections.

Pull factors indicate how well a community is attracting and holding onto retail business. A pull factor above 1.00 indicates the community is attracting more business than it is losing.

Darling said Wichita – which has not been included in past years’ reports – has a pull factor of 1.26, which indicates that it serves 430,704 customers.

"That’s 16 percent of the population of Kansas," Darling said. "Also, 80 percent of all retail activity in Sedgwick County occurs in Wichita."

City, county and state governments all rely on sales tax revenue. When revenues decline, Darling said, local and state governments struggle to meet expenses and balance their budgets.

"It takes at least 4,000 customers to support a retail community that can meet the basic need of a community," Darling said.

As an example, Beloit, Kan. has a population of 4,019 and a pull factor of 0.99, meaning that community is struggling to replace "leaked" retail dollars with "captured" retail dollars.

"Unfortunately for cities like Beloit that are not growing, this critical mass of customers (4,000) creeps up every year," Darling said. "Any old timer can tell you about a town that used to have more retail stores in the 1950s than it does now. Big box stores take the place of a number of small, home-owned stores. And now, wholesalers don’t even want to service the small town grocery stores across Kansas."

Darling, who provides information and counseling on community development issues, said that local planners must stay in touch with the latest information so that their communities survive.

"Your town or business may be on track, but if it doesn’t move fast enough, it will be run over," he said.

Darling’s most recent report of city trade pull factors in most Kansas counties is available on-line at http://www.agecon.ksu.edu/ddarling, or interested persons may call Darling at 785-532-1512.

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K-State Research and Extension is a short name for the Kansas State University Agricultural Experiment Station and Cooperative Extension Service, a program designed to generate and distribute useful knowledge for the well-being of Kansans. Supported by county, state, federal and private funds, the program has county Extension offices, experiment fields, area Extension offices and regional research centers statewide. Its headquarters is on the K-State campus, Manhattan.

Story by:
Pat Melgares, News Coordinator
pmelgare@oznet.ksu.edu
K-State Research& Extension News