Scrooge
Visits Downtown Merchants |
By Ed Moosbrugger
December 10 -- It isn’t a pretty picture for Downtown
Santa Monica retailers as they try to envision what holiday sales
will end up looking like.
Things have definitely not been great in 2008 for retailers, and
the wave of bad economic news recently has heightened concerns.
“It’s terrible,” said Naren Patel, owner of Shiva
Imports on the Third Street Promenade. “It’s the worst
I’ve seen it since I’ve been on the Promenade.”
The store has been at its present location since 1994.
The local situation reflects the weak national picture, although
Santa Monica has been helped by its important international visitor
business.
Also, retailers aren’t giving up on the holiday season,
and some retailers say they are well stocked to meet consumer demand.
“The October retail environment was simply awful,” said
Michael P. Niemira, chief economist and director of research for
the International Council of Shopping Centers, in a statement. The
ICSC cut its holiday sales forecast to a gain of only 1 percent.
Chain store sales for October fell 0.9 percent from a year earlier
at stores open at least a year. The economic pain has been felt
in Downtown.
“We just finished our annual sales week, and we were down
considerably,” said Mark Hennessey, owner of the large Hennessey
& Ingalls art and architecture bookstore on Wilshire Boulevard.
The whole year has been very flat, but the pattern has been puzzling,
he said in mid November.
“I’ve had some of the worst days in 30 years,”
said Hennessey, adding that on other days sales have been good.
Like many retailers, Hennessey has no idea what the holidays will
bring, but he thinks things will be slow.
Despite the tough environment, Hennessey expects to be around a
long time. Indeed, he opened a new store in November at Sunset and
Cahuenga in Hollywood, across from Amoeba Music.
Todd Swift, partner in Taos Indian Trading Co. on Santa Monica Boulevard,
said he doesn’t know what to expect this Christmas season,
but is prepared to do business.
“I have good stock. I’m ready,” he said. “If
you don’t have it you can’t sell it.”
As of mid November, sales at Taos were up slightly for the year,
aided by tourists.
“There were a lot of Europeans in town this year,” especially
during the summer, Swift noted.
Santa Monica hotels had strong occupancy rates in July and August.
The local hotels posted occupancy rates of 89.7 percent in July
(up 4.5 percent from a year earlier) and 92.3 percent in August
(up 1.2 percent), according to PKF Consulting. Rates also were up,
rising 2.6 percent in July to $332.93 and 3.7 percent in August
to $319.32.
Santa Monica had the highest occupancy rate in both months among
Los Angeles County markets tracked by PKF.
At his import store, “Summer was fine,” Patel said.
But things took a turn for the worse in September and October.
But the pattern was uneven. Hennessey reported that summer sales
were off about 20 percent.
Downtown retailers also received a boost from the American Film
Market in early November. “They are the ones spending money,”
Patel said. “This is helping Santa Monica a lot.”
A total of 7,903 people attended the eight-day AFM this year, down
from the record high of 8,343 last year. There were buyers from
65 countries.
Some retailers report that business has picked up a bit recently
despite the bad economic news.
Business has increased the last two months, although sales are down
for the year, said Adamm Gritlefeld, owner of Adamm’s Stained
Glass & Gallery on Fourth Street, in mid November.
He has been doing more to attract tourists and said business from
locals picked up after August.
Following a strategy that worked well last Christmas, Gritlefeld
said he is well stocked for the holiday season.
Patel of Shiva said he is stocked up and has put things on sale
to encourage people to buy.
At Carlson’s TV and Appliances on Fifth Street, General Manager
Mike Nichols has been taking advantage of some exceptional buys
to offer deals to customers.
“There’s a lot of turmoil out there,” Nichols
said. “There have been some really unusual opportunities.”
Sales are probably down about 9 percent this year, but Nichols reported
in mid November that he was having a pretty good month.
With all the bad economic news, consumers probably need a treat
to relieve the pressure. That seems to be the case at Candy Baron
on Santa Monica Boulevard, where sales are up about 10 percent,
according to owner Ron Baron.
“I’m pleased,” Baron said. “I know we’re
in the minority.”
Indeed, sales have increased at three of Baron’s five stores,
including Laguna Beach and San Francisco.
“They say candy is recession proof,” Baron said.
Perhaps it’s also a tension reliever for other retailers facing
a tough market.
“I’m eating more candy than ever before,” Hennessey
noted.
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