Retailer research often overlooks impact of cross-border shoppers in El Paso

El Paso’s economy is trending in the right direction and The Borderplex Alliance, an organization focused on economic development in the region, firmly believes the success of El Paso’s economy is linked to the success of Las Cruces and Ciudad Juarez.

An economic indicator report released by the Federal Reserve Bank of Dallas in September shows El Paso’s unemployment rate is at 4 percent — the lowest its been since 1990.

“When we talk about the 2.7 million individuals living in this region, that captures peoples’ attention,” Borderplex CEO Jon Barela said. “Very often, they see El Paso, and the US side of the border, and they don’t see it as one integrated economy.”

With the economy trending in the right direction, some believe it’s only a matter of time before El Paso can begin to lure major retailers and businesses.

“El Paso and Ciudad Juarez are places with untapped potential,” UTEP economics professor Tom Fullerton said. “Without the shoppers from Mexico, the retail sector would shrink substantially. Right now, El Paso has a bigger retail sector in percentage terms than most other cities of comparable size in the United States.”

The Borderplex Alliance estimates total retail sales in the El Paso area are close to $10 billion a year. More than $2 billion of that comes from Mexican shoppers.

“A lot of the retailers don’t have the data, or take into account the financial impact that the Mexican consumer brings to the market, and they don’t include that data in their research,” River Oaks Properties president Adam Frank said. “It is an unknown advantage.”

River Oaks was able to successfully lure Cabela’s, a Nebraska-based sporting goods, store to the West Side earlier this year.

“The retailers that are here are very, very successful, but attracting them to the market is a very difficult task. Their first choice is to go to the large markets that experience a lot of population growth and new job growth,” Frank said. “It’s a lot of hard work, and you hope that one or two hit and Cabela’s did.”

Bob Ayuoub is the chief public relations officer of MIMCO Inc, a shopping center developer that’s always looking to lure out-of-town businesses to El Paso.

“In years past when we started marketing El Paso, first we had the perception that El Paso was near Dallas. You have to get them to understand where El Paso is located, the impact of the border, and the size of the population,” Ayoub said.

So what will it take for companies like In-n-Out Burger or Trader Joe’s to take break into the Borderland?

“New job growth brings new retailers and new businesses. Until we see some major job announcements, I don’t think you’ll see many new, large retail announcements,” Frank said.

Ayoub said he thinks it’s just a matter of time.

“Once we hit a million population, we hit another level of being on the radar of different retailers,” Ayoub said. “It’s going to be an exciting time.”

The State Demographer’s Office estimates El Paso County will hit that threshold by the year 2034.

When you take into account Southern New Mexico, El Paso and Ciudad Juarez, we’ve already reached that threshold.

“It’s our job at the Borderplex to rescript that narrative and to let people know how important this region is — not only to us, but to the entire country,” Barela said.