The Bottom Line: Two locally owned businesses, and their struggles under the threat of corporatism

As I write this, downtown River Falls is lit up with Christmas lights, and the snow has finally started to stick to the ground. With this year being in the middle of the holiday season, new movies have been released in full force. Titles such as Napoleon, Trolls 3, and Five Nights at Freddy's are being released back to back. To see a new film, I went to the Falls Theatre on Main Street. The theater’s marquee sign was brightly lit, showing the two movies that were playing. The theater has two auditoriums. One is large, with a few hundred seats. This one usually shows the larger blockbusters and Marvel movies on its screen. The second is a smaller room about a third of the size of the first. There it almost feels as if you are watching the movie with the people around you, and not just having strangers by your side.

I walked into the theater with a small notebook in hand, hoping to get more contact information for this story. Michelle Maher, the owner of the Falls Theatre was hastily giving out tickets to the crowd entering. Behind the concession stand, Michael Maher, her son, was dishing out fresh popcorn, and pretzels to the audience. In the small showroom, I watched a spin-off movie on the origin of the Hunger Games villain.

According to its website, The Falls Theatre was built 96 years ago. Its first film was Painting The Town, a silent comedy. Michelle’s father bought the theater in 1972. After his passing in 2002, Michelle Maher has run the theater.

Just outside of River Falls is the city of Hudson. Hudson’s downtown has many local businesses on the riverside of the St. Croix. However, commercial Hudson looms over it. Multiple 20-foot tall pylon signs surround the highway and blot out the green hills behind it. An all too common sight in corporate America. Only 14 minutes away from The Falls Theatre lies its competition, the Hudson 12 Theatre. Owned by CEC Theatres, who boast on their website about having 150 theaters in the Midwest.

Maher Said, “I drive over sixty-thousand people to our main street every year. And that is incredibly important to our main street. . . The Falls Theater has anchored so many of our downtown businesses for decades. Main streets die off because the downtown theater is gone. And then what happens, is maybe another eight years go by and the whole downtown is just dead. And the community gets together and says, ‘We have got to get this theater open.’ Like for example, in Little Falls Minnesota, they just finally got their movie theater reopened. A beautiful Main Street theater. Little Falls is where that famous pilot is from. . . his son was kidnapped. Lindberg. Charles Lindberg is from Little Falls, Minnesota. And that downtown theater closed, because the owner before was not owner operating, and it was getting visually rundown, and he shut when COVID hit. It stayed shut, and the local doctor, and his wife, have gone into their main street, and have bought businesses, and gotten them reopened again. They did buy the Little Falls Theater. . . and got that theater open. And so now they’re open up again. Their competition is further than I have, which is right in our backyard. If they lost people who go to Little Falls they go to St. Cloud to see movies.”

Local businesses in the past few years have seemed to struggle immensely in the last few years. According to the Federal Reserve, over 700,000 businesses shut down within the first 90 days of the year 2020. Within the entertainment business, AI technology has also threatened people’s livelihoods, which sparked the SAG-AFTRA strikes, which ended earlier this year. Within the last decade, the largest threat specifically to local theaters is arguably the increase in streaming services.

I optimistically told Michelle Maher that I hoped that people are starting to buy more locally, and appreciate local businesses more. In response, she said, “I think people are more unconscious than ever, to be honest with you, Riley. Too many people are buying on Amazon. How many people are consuming these streaming services that own every aspect of the media that we are taking in? And I don’t mean to say that I don’t order on Amazon, and I stream. I mean, it would be hypocritical to say that I don’t. We’re living in a world where things are so much more centralized. From the healthcare that we get to the media that we can consume. And people don’t realize, well maybe they do, but that in itself is a huge problem. It just is. So, Disney owns ABC, and Fox, you know? And they’re controlling what we perceive about our world.”

Around 6 companies own about 90% of the media in the United States. This accounts for both news media, as well as entertainment media. Locally owned media businesses are some of the few independent media outlets that are not owned by the Big 6 companies. Their impact is often much greater on their communities. The effect that larger corporations have on small businesses is excruciatingly negative, and sometimes detrimental to the well-being of local business owners.

People tend to go to what is popular, to what they know. Small businesses do not have nearly as many advertisement opportunities as corporations do. Having money makes it more possible for a business to make more money. Maher Said, “People just unconsciously go to Hudson. Every year I work harder to sustain that business and watch people make those kinds of choices. It gets forever more discouraging. It truly does. We love what we do, but you know, the whole market has changed, and there are fewer people seeing movies in general. . . There was a time, and you don’t remember this Riley, but I do, that there was nothing to watch on TV so you went to the theater, you know? And then our younger families that are moving to town, the only thing that they have ever known, and what they grew up with is a multiplex, and anonymous, and they sit in a recliner. Therefore they think ‘That’s what a theater experience is.’ They have no value for my theater. They walk in and their kids go ‘Well I like Hudson better.’ It’s like somebody walking into your home and saying, ‘I like so-and-so’s house better because it’s bigger.’ I don’t know Riley, that is–that’s heartbreaking. It breaks my heart. . . You get educated in college about it, but you don’t do a damn thing about it, because you’re buying on Amazon, and you’re streaming. You don’t realize how powerful your choices are, you don’t. I see it because I live on the other end of it. So, it matters. It matters to stay local, it matters now to go to your local coffee shops because we got Starbucks coming to town. And who doesn’t love Starbucks? I mean they’re great, but the impact that’s gonna have is going to be felt.”

Within the last year, Dunkin’ Donuts has opened up in River Falls. It was built out of the old Burger King that was abandoned for over a year. Its presence has most likely put a strain on local coffee shops and cafes. The construction of the new Starbucks will also likely hurt these local businesses as well.

Waystone Coffee Company is a locally owned coffee shop just off of Main St. in downtown River Falls. It is only a two-minute walk from the Falls Theatre. A metal sign hangs above its door, representing a coffee cup, and a twenty-sided dice popularized by Dungeons and Dragons. The entire shop is fantasy-themed. One of its green walls is painted to look as if it is made of dragon scales. The bathroom sign has outlines of a centaur, and a mermaid, instead of the shapes of men and women. Even the drinks are fantasy-themed and are named after fantasy classes. My go-to drink is a “Rogue,” which is a vanilla chai latte. I’m also a fan of the chocolatey “Barbarian,” and the “Wizard’s Fog.” black tea.

Olivia Barwick is the young owner of Waystone Coffee. She is often seen making drinks behind the booth for the waves of people who visit her shop. Coffee grinders and locals chattering are common sounds to be heard there. Barwick was able to write to me via email to talk about her experience as a small business owner.

Barwick expressed that–while overwhelming–she loves being able to own and run her business. She wrote, “I have been in business since March of 2022. I worried for months that we would never open, and when we did finally have our grand opening, I was so overwhelmed by the outpouring of love from the community that I had a panic attack, worried I would never be able to rise to the expectations of what Waystone should be for our community...Thankfully, I was wrong, and though we still have growing to do, I’m happy to see my regulars come in each day. I love that I’ve had the chance to meet so many members of my community. Simply, I love being a small business owner.”

Waystone already had the competition of Caribou Coffee inside the Family Fresh in town. Suddenly last year, Dunkin’ Donuts opened, quickly followed by the construction of a Starbucks. Barwick fears that she will not be able to compete with the popularity that corporate coffee businesses have that people are familiar with. It is similar to Maher’s Frustration when consumers choose the corporate Hudson 12 Theater instead of The Falls Theatre, on popularity alone. According to Statista.com in 2022 Starbucks spent 416.7 million dollars on advertising. Barwick wrote, “Though we have our audience of locals that will always stick with us over the chains, we do also get a big amount of revenue from out-of-towners coming in for sporting events or festivals. When they want coffee, they look up what’s available in the area. If they see a large chain that they know, one that has a drive-thru and familiar drinks and goods, I fear they will choose that option over trying out a new shop.” The sheer fact that the names of these brands are so common, contributes to the power that they hold over smaller businesses. How often do people look up directions for a Starbucks, and it doesn’t even cross their mind to look for a small business?

The workforce, wages, and inflation, are all extremely relevant topics in 2023. There have been proclaimed work shortages across the country. As well as unions being able to form. Corporations have often been accused of poor workplace conditions in comparison to other types of businesses. Barwick seems to strive to try to make her business as ethical as possible for her employees, while also realizing that she cannot compete with the wages these corporations offer their employees. She wrote, “These chains overwork their employees and give little sympathy for requests for time off. People complain about the lack of people wanting to work, but when you treat people like objects and not human beings with lives outside of work, of course, they don’t want those jobs. I care about my staff and cover their shifts if something unexpected comes up, because we’re all human, and deserve to be treated as such. Unfortunately, we as small businesses can’t afford to pay chain wages or for insurance, and in today’s economy, that means our local workforce has no choice but to go to these chains, and I can’t fault them for that.”

Barwick also added that there is nothing that the city can do and that River Falls itself is not to blame. This highlights how there are very few regulations when it comes to any business opening wherever it wants to. This field of The United States’ ‘free market’ can sometimes be very negative towards locally owned businesses. Barwick wrote, “I should point out that the city is not at fault for these chains coming in. The land is private property and can be sold to anyone. If they zone the property and building to code, the city can do nothing about these chains coming in. These businesses look at housing developments coming into our city and assume we need these chains, not considering that we as small businesses are already here serving our community. These chains open and make more money in one weekend than we could hope to make in one month.”

With the three chain coffee shops in River Falls, Waystone is struggling. Barwick herself has not taken a paycheck from the business that she owns. She fears that eventually Waystone may be shut down. Barwick wrote, “We have continued to have a steady growth in revenue as members of the community find us and make us a regular stop during their day. However, with the current additions of three chain coffee shops in River Falls within a year, I worry that the work I’ve done will be for naught.” She added, “I love my community, and I love my business, more than anything. It’s the one thing I’ve done with my life that I am proud of. However, I can’t help but worry that I will have to close my doors because competing with these chains is going to set back all the growth we’ve made in the last year. I have not been able to take a paycheck from my shop yet, despite working on the business every day for the last two years. I’m in my late twenties. I would like to start building a family. That’s hard to do when I have to worry about whether the shop is making enough money to survive.”

The simple fact that corporations will set up a business in the backyard of a locally owned business means that they will uproot people’s lives. The Hudson 12 Theater opened months after the death of Michelle Maher’s father who was the previous owner of The Falls Theatre. As well as two major corporate coffee shops opened within two years of Waystone’s opening. To a corporation, these decisions are just economics. They are just ways for them to experience business competition. For local business owners, these decisions are impactful toward their entire livelihood. According to Harvard Business School’s website hbs.edu, this is called ‘clustering.’ The website states “Clusters affect competition in three broad ways: first, by increasing the productivity of companies based in the area; second, by driving the direction and pace of innovation; and third, by stimulating the formation of new businesses within the cluster.” However, there is a fourth effect that is not mentioned, and that is the detrimental impact it may have on local businesses.

Greed is something that often comes to mind when corporations are discussed. That they can shut down small businesses, and destroy livelihoods just with their presence. Waystone Coffee Company and The Falls Theatre are two businesses that have faced the threat of corporations. Maher said, “Business is dirty Riley, business is ugly. . . You know what? Greed turns people into terrible- it’s a driving force. It’s what capitalism is. If you don’t balance that with the satisfaction of the love of what you do, the only thing that matters is how much money you can make from your business. Now that’s the bottom line.”