Economic Impact of a Proposed Aldi Store in Brookings, SD
After being approached by the Brookings Economic Development Corporation, the Dakota Institute published an analysis regarding the market prospects and economic impacts of a new grocery store in the Brookings County area. For much of this study, the Dakota Institute will rely on economic data from the Watertown region to consider how an Aldi location would affect Brookings. In December 2021, an Aldi grocery store opened in Watertown as the first South Dakota Aldi location outside of Sioux Falls. The Dakota Institute believes there are sufficient statistical, geographic, and demographic similarities between Brookings and Watertown to make a reasonable comparison between them.
To complete its analysis, the Dakota Institute used IMPLAN modeling software to produce economic input-output models. The Brookings models are entirely based upon the sales and property tax data from Watertown collected in the time period following the Watertown Aldi opening. From this data, the Dakota Institute estimates that the Watertown Aldi is producing $158,820 in new tax revenue to the region and $7.941 million in new taxable sales.
With the opening of an Aldi location in Brookings, the Dakota Institute estimates an economic impact of up to 38 jobs created, $1.4 million in labor income, $114,000 in property taxes, $661,750 in monthly taxable sales ($13,235 in monthly sales tax), and a total increase in economic output by $4 million. The total new taxable sales will amount to $7.941 million but leakages (i.e., products produced outside of the Brookings area) account for the $3.941 million difference in projected growth to economic output.
The projected Brookings grocery store sales figures in this report have been developed from Placer.ai software. This software is able to provide data showing the number of customer visits to various stores and with what frequency do these customers visit. From this data, the Dakota Institute believes that there is a sufficient market for the Aldi in Brookings and in its peripheral regions.
Taken together, the Dakota Institute believes that there is strong evidence to show that an Aldi within the Brookings market will be a major contributor to the local labor market and tax base. This report helped move the Brookings Aldi past the conceptual stage and towards an official project announcement in December 2024.
Schwan, Jodi. 2024. “Target, Aldi to open locations in Brookings – SiouxFalls.Business.” SiouxFalls.Business. December 24, 2024. https://siouxfalls.business/target-aldi-to-open-locations-in-brookings/.
