Wal-Mart rolls back cost of livingTechnorati Tags: wal-mart walmart
Horry County ranks lower than national average
Horry County's cost of living has dropped substantially in recent years, and you don't have to look any farther than the Wal-Mart Supercenter for someone to thank.
The proliferation of Supercenter openings in Horry County - five of them since 1996 - has put pressure on retail competitors to lower prices for a wide range of household goods, according to economists.
The falling prices have contributed to the drop in Horry County's cost of living, according to a quarterly index compiled by the American Chamber of Commerce Researchers Association.
Horry County scored a 93.4 on the latest index, compiled during the last quarter of 2005. A score of 100 is the national average. That means it costs 6.6 percent less to live in Horry County than it does to live in the average U.S. community.
The latest score is down from 99.9 in 1996, when this area's first Supercenter opened in Surfside Beach.
Horry County's shopping landscape has boomed in the past decade, with dozens of new chain retailers entering the market. As in most U.S. markets, area retailers take their cues - and price points - from Wal-Mart.
"As Myrtle Beach has continued to grow over the last decade, more and more services and retail establishments are coming into the area, and that has brought a lot of competition that didn't exist before," said Robert Martin, an economist with the S.C. Office of Research and Statistics. "That competition has brought down prices."
The cost of groceries and household goods makes up about half of the index score, and Wal-Mart is by far this area's biggest seller of those items.
A report by Trade Dimensions, a retail research group, shows Wal-Mart accounts for about 41 percent of grocery sales in Horry County.
Another report by that group shows Wal-Mart and its Sam's Club subsidiary account for about half of all sales at Horry County general merchandise stores.
In addition to Wal-Mart's importance to Horry County's $5 billion-a-year retail industry, the company is this area's second-largest employer with 1,792 workers. Developer Burroughs & Chapin Co. Inc. is No. 1 with 2,214 employees, many of them seasonal tourism workers.
Britt Beemer, founder of America's Research Group in Charleston, said Wal-Mart typically accounts for a 10 percent to 15 percent drop in retail prices in markets where it operates. That amount is higher in middle-income markets such as Myrtle Beach, he said.
"You could make a strong case that Wal-Mart has single-handedly kept inflation down nationwide these past five years," Beemer said. "With Wal-Mart, other retailers are much more conscious of what they can charge their customers."
The county's low cost of living is also influenced by what normally is considered a negative economic statistic - low wages. A federal study shows Horry County workers make an average of $24,672 per year, the fourth-lowest average annual wage in the nation.
"There's less disposable income in the Myrtle Beach area than in some other areas, and that means there's not as much pressure for prices to increase," Martin said.
American Chamber of Commerce Researchers Association counts on its members in more than 300 metro areas to gather prices on the same days every three months for 57 consumer goods and services.
The "shopping list" includes such items as: a pound of bananas, a two-liter bottle of Coke, a bottle of Alberto VO5 shampoo, a box of Kleenex and a McDonald's Quarter-Pounder with cheese.
Services such as dry cleaning and haircuts are added, as well as average housing, utility, medical and transportation costs.
The prices are sent via the Internet to American Chamber of Commerce Researchers Association, which enters them into a database that calculates the cost-of-living index for each metro area based on the national average cost for the combined goods and services.
The index is similar to the Consumer Price Index compiled by the federal government. The association's research is used in the U.S. Statistical Abstract published by the U.S. Census Bureau.
The Horry County prices are compiled by Wendy Bernstein, marketing research manager for the Myrtle Beach Area Chamber of Commerce. Bernstein said she visits stores throughout the county, from Loris to Surfside Beach, to get an accurate sampling of costs.
"It's a three-day process each quarter," Bernstein said.
The chamber of commerce uses the index to see how Myrtle Beach stacks up with competing tourism markets, such as Virginia Beach, Va., and Orlando, Fla., both of which exceed the national cost-of-living average.
Bernstein said the chamber also provides cost-of-living information to people who are thinking of relocating to this area from more expensive markets in the Northeast.
Housing costs are among the toughest prices to nail down, Bernstein said. American Chamber of Commerce Researchers Association asks its members to provide the average cost of a new, 2,400-square-foot home. That figure varies widely here depending on whether the home is near the beach or in western Horry County.
"I get the price of five different homes throughout the county and send it to them," Bernstein said.
The average new-home price was $239,900 in Horry County during the last quarter of 2005, according to the research association. That is 82 percent more than the $131,800 average in 1996.
Even so, Horry County housing costs are about 20 percent lower than the national average, according to the association.
Transportation costs, which include gasoline and automobile maintenance, are about 5 percent higher than the national average. Tourism markets such as Myrtle Beach typically have higher-than-average gas prices, according to AAA Carolinas.
Other goods and services also have fallen victim to inflation since 1996. A half-gallon of milk, for example, cost $2.19 in 2005 and $1.73 in 1996 - a 26.5 percent increase. A routine medical examination costs 57.9 percent more - $75 in 2005 and $47.50 in 1996.
There are still some bargains. The cost of a dozen eggs has dropped nine cents since 1996, to $1.05 from $1.14. Horry County is a bargain compared with most other S.C. metro areas.
Only Spartanburg, at 90.9, and Sumter, at 91.9, have lower index scores than this area. Hilton Head Island is the most expensive metro area, with a 101.8 index score.
Thursday, June 29, 2006
Still Want Proof Wal-Mart Improves the Standard of Living?
Then read this article from the May 7, 2006 edition of the The Sun News (Myrtle Beach, SC):