Services for people in rural areas

"Neighbourhood Shop 2000": improving the provision of services in rural communities

document type: article
keywords: Services to the population
source: LEADER magazine n° 9
publication date: summer 1995

The "Nachbarschaftsladen 2000" (Neighbourhood Shop 2000) concept, developed for the German Federal Ministry of Regional Planning, Construction and Urban Development is intended to combine small services within one shop: e.g. groceries, post office, mail order services, catering, etc.

Since 1992, the Ministry has been supporting 12 projects: 8 are located in the new Länder, two are operated by citizens' "action groups" and 10 are privately owned and operated. An independent consultant was engaged to identify, initiate, support and monitor them. (*)

Existing shops have thus been transformed into "neighbourhood shops". The physical layout and fittings have been rearranged to include additional services.

The following criteria were applied when selecting the pilot projects:

• they should be located in villages with less than 1 000 inhabitants;
• there should be no other existing shop within 5 kilometres;
• it should have an available or potential shop space of at least 80 m² to allow the merchandise and services to be presented attractively;
• limited investment should be needed for its conversion;
• there should be a highly motivated owner or manager.

For the concept to be viable, the obsolete, perhaps negative image of the traditional corner shop (known in Germany as the "Auntie Emma shop") had to be overcome, allowing the introduction of more aggressive marketing and better accounting systems to improve profit margins.

The first results of the experiment would seem to show that this type of shop can operate privately without permanent funding, provided that:

• the investment costs are kept low (or are met from public funding);
• wholesalers can be persuaded to supply the shop at competitive prices;
• other institutions and businesses can be persuaded to include their services (this is particularly true of postal services and mail order services);
• The retailer shows sufficient initiative.

The initial investment to improve the appearance of the shops has to be met from public funding. The grants (generally of DEM 30 000 - around ECU 13 000) can be justified by the social impact of the investment; it improves the quality of life in a sector where private initiative would not be sufficient.

Training support for the owner is required, particularly in managing new services, accounting systems and marketing.

Discussions between the promoters of the project during the final part of the training between the shop owners have proved very valuable.

Wholesalers proved very willing to supply the shops when they were confident of the business's continued success. The pilot projects demonstrated their potential, which helped to create this confidence.

The creation of umbrella associations for these shops could also increase their viability: it would facilitate bulk orders and negotiations with wholesalers, in addition to providing economies of scale for administration.

Dr. Holger Platz,

Planco Consulting, GmbH,

"Nachbarschafsladen 2 000" Technical Assistance Office

For further information:

Planco Consulting, GmBH, Lilienstr. 44, D-45133 Essen