Retailers worry about soft sales over the holidays
| Saturday, Nov 21 2009 12:00 PM
Last Updated Saturday, Nov 21 2009 02:27 PM
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Felix Adamo / The Californian Tony Russo of Russo's Books with some great holiday reading.
This time of year, Into the Forest is typically bustling with customers rifling through Christmas ornaments, holiday decorations, candles and dolls.
But lately, the gift shop on H Street is dead.
"I'm very concerned," said owner Shirley Valov. "I don't know where they're shopping, if they've gone online or just aren't buying at all. But this is unusual for us. October, November, December, we're usually swamped."
Valov isn't the only local retailer worried about soft sales this holiday season.
It's hard to predict which way things will go when there are conflicting economic indicators. The stock market is up, but so are gas prices. Plus, consumer confidence is plummeting and Kern County's unemployment rate was 14.5 percent as of October.
Nationally, consumer spending fell in September and incomes were flat, according to the latest data from the U.S. Department of Commerce.
"We haven't had a good month for 15 months now," said George Whalin of Retail Management Consultants in Carlsbad. "No shoppers are going gangbusters this year.
"Retailers will do whatever they can. Pull out all the stops and offer deep discounts, but people just don't feel good about spending," he said.
As a result, stores, by and large, are being very cautious about stocking shelves.
"Last Christmas, nobody was ready for what happened," Whalin said. "All of their merchandise had been ordered and bought and sometimes even delivered. They had to discount before the holidays, during the holidays and after to get rid of it all."
Local shoppers will find less quantity and selection this year because retailers don't want to have to liquidate unsold inventory again.
"We did order a little bit less this year," said Tony Russo, owner of Russo's Books. "And we changed the mix a little. We increased our hot sellers, and decreased the number of titles that weren't moving as quickly. We still carry them, but not as many copies.
"Fortunately we can get 80 percent of our inventory the next day if we have to, so we'll be able to respond quickly to special orders."
Tangerine, a high-end clothing boutique in downtown Bakersfield, is also holding back a little.
"We're buying very precisely this year," said owner Josie Bowman. "As we always do, we went out and selected the best the season has to offer, but this time it's even more narrow. If you see something you like, buy it because we have not overstocked."
The store has also delayed putting out cold weather merchandise. Heavier sweaters and such just came out this month, whereas normally they would have been on the floor in October.
"On the one hand you want to have the longest holiday shopping season you can, but also you have to have people buying, so it's been this juggling act of how much and what and at what price point?" Bowman said.
A few stores, though, remain bullish.
"We bought more. The more we have, the more we sell," said Shari Cunningham, owner of Sugardaddy's, a high-end clothing boutique in the southwest.
It helps, she said, that her customers generally aren't buying gifts, but shopping for themselves. Sugardaddy's is busier in spring and summer than in the last quarter, so Christmas sales aren't as critical for Sugardaddy's as for some stores, Cunningham said.
There is a little bit of a bright side. The downturn has given retailers a little more leeway to haggle with vendors, and vendors with affordable goods are gaining access to new sales venues because of demand for bargains.
"Newer designers are having the opportunity to get in the door and work out things like consignment," Bowman said. "We have a jeweler doing that."
The other side, though, is suppliers are skittish.
"Pretty much every vendor I have, even people I've worked with for years, are demanding cash up front," said Deanna Hoyt, owner New Age book and gift store Enchanted Cottage, on H Street.
"I guess they've had so many companies go out of business on them that they're afraid," Hoyt said.
