If you love collecting loyalty card reward points and refilling your prescriptions, there is a lot to like about Toronto’s retail business climate in 2017.
If, however, you’re a fan of smaller shops, restaurants and music venues, things start to look a little less than optimum.
We learned this week that the Hard Rock Café at Yonge-Dundas Square will soon close. Unconfirmed reports say it will be replaced with a Shoppers Drug Mart.
And while I find it hard to shed many tears over any single closure, it’s part of a worrying trend as unique commercial spaces are disappearing and often replaced with franchises.
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Over the last few months Toronto has seen seven prominent music venues announce plans to close. And even as condo buildings continue to pop up, the frequent tenants of their ground-level retail spaces are all too predictable: a Subway sandwich franchise, a Shoppers, maybe a dentist.
Don’t call it a crisis, but the warning signs are there: is the city becoming boring, one franchise location at a time?
Thankfully, if history is our guide, there are things Toronto City Council can do to get in front of this.
In 2005, council was facing a different kind of business challenge. The '90s saw the city shed 100,000 jobs while the 905 boomed, adding 700,000 new gigs.
City hall’s response was to implement a plan to gradually lower commercial property taxes, which were about four times higher than taxes paid by homeowners.
More than a decade later, the city has achieved its targets, lowering the primary commercial rate so that it is now 2.5 times higher than residential. The strategy helped – vacancy rates are down, while overall employment numbers are up. Mission accomplished.
But the recent trend of wealthy corporate franchises supplanting smaller businesses suggests a need for a new strategy.
There’s the question, for example, of whether there’s a way to structure city taxes to specifically lower costs for small businesses.
Potential solutions include levying taxes based on square footage, the number of parking spaces or overall retail sales, instead of the status quo of taxing based on the assessed value of property.
Those types of fixes could work to transfer more of the burden to large businesses and taking some of the heat off small businesses who are seeing costs rise solely because land values are skyrocketing.
With things like Toronto’s Music City Strategy and the recent move to eliminate the city’s outdated vacant unit rebate, there are hopeful signs that city hall gets the importance of a strategy to strengthen small business.
But I’d like to see a more comprehensive strategy to send a message that our unique, historic and sometimes weird local businesses are a priority. To preserve our small businesses, Toronto has to think big.
This post was originally published at http://www.metronews.ca/news/toronto/2017/03/16/small-business-think-big-matt-elliott.html on 2017-03-16T00:00:00.000Z