Small re­tail­ers strate­gize with hope of suc­cess­ful hol­i­days

Kuwait Times - - WEEKENDER -

Small and in­de­pen­dent re­tail­ers are strate­giz­ing to try to make the most of an un­cer­tain hol­i­day sea­son. The last three months of the year are crit­i­cal for many re­tail­ers, who may get half their an­nual rev­enue dur­ing that time. But con­sumers who may be hes­i­tant to splurge have led re­tail­ers to be in­creas­ingly cre­ative about spe­cial pro­mo­tions and dis­counts, and also prompted many to use tech­nol­ogy to help de­ter­mine what cus­tomers want.

“We’ve had such a pro­tracted, slug­gish econ­omy that I as­sume that’s the way it’s go­ing to be,” says Brian Rear­don, owner of Mon­ster Mu­sic, which sells mu­si­cal in­stru­ments and pro­vides mu­sic lessons in Le­vit­town, New York. Rear­don has found it harder to get more peo­ple to buy lessons - while the store has 600 stu­dents, that’s lit­tle changed over the past two years. To en­cour­age prospec­tive stu­dents or their par­ents to sign up, he gives away an acous­tic guitar when they pay for six months of lessons that cost $600.

In­no­va­tion and qual­ity

Al­though over­all spend­ing at re­tail­ers across the coun­try rose in Septem­ber and Novem­ber, it re­mains weak at many stores that get much of their rev­enue from the hol­i­days. Sales at de­part­ment stores fell more than 5 per­cent the first 10 months of the year, ac­cord­ing to the Com­merce De­part­ment. At elec­tron­ics stores, they were off more than 3 per­cent, and they edged up just 0.4 per­cent at cloth­ing stores. Fore­cast­ers gen­er­ally have pre­dicted re­tail­ers will see hol­i­day sales in­crease a de­cent 3 per­cent to 4 per­cent.

“They’re go­ing to have to pro­vide some level of added value, in­no­va­tion and qual­ity,” says Joe Brusue­las, chief econ­o­mist with RSM US, a con­sult­ing firm whose clients in­clude re­tail­ers. Tra­di­tional brick-and-mor­tal stores have lost busi­ness not only to the in­ter­net but also to con­sumers’ grow­ing pref­er­ence for travel and other ex­pe­ri­ences over pos­ses­sions, he says.

Mark Asel­s­tine’s wine club and gift bas­ket sales growth has been flat. So he’s plan­ning to give cus­tomers more op­tions when they or­der from Un­corked Ven­tures; along­side the com­pany’s $150 bas­kets will be some priced $115, with cheaper ship­ping. The bas­kets can be pre­s­e­lected or cus­tom­ized. “The mar­ket quite hon­estly sim­ply hasn’t moved in our di­rec­tion as much as we’d hoped over the past few years,” says Asel­s­tine, whose com­pany is based in Berke­ley, Cal­i­for­nia.

Some of his cus­tomers are look­ing for good bot­tles but at lower prices. He’s see­ing more in­ter­est in pinot noir from New Zealand, which costs half of what the Cal­i­for­nia ver­sion does. Choices like that have brought down the price of bas­kets the com­pany sells - while two years ago the av­er­age price was $322, now it’s $45 to $50 less.

Even com­pa­nies that seem like they might not have to worry dur­ing the hol­i­days are of­fer­ing deals. Jac­ques Tor­res, who sells his high-end choco­late and other food at nine lo­ca­tions in New York and on­line, has a spe­cial pro­mo­tion with a sand­wich, bev­er­age and ice cream for $10 at his cafe in Grand Cen­tral Ter­mi­nal. Tor­res, whose choco­lates re­tail for nearly $40 a pound, has a lot of com­pe­ti­tion and ris­ing expenses like rent and wages. “We never used to dis­count any­thing. Now we do, be­cause we need the sales, we need the ad­ver­tis­ing, we need the buzz,” he says. Still, re­tail­ers can’t as­sume shop­pers will opt for the cheap­est gifts. Cus­tomers of Dad­dies Board Shop are ea­ger to buy skate­boards and snow­boards with price tags that run into the hun­dreds of dol­lars, but are choosy about lower-priced sta­ples, pres­i­dent Daron Hor­witz says.—AP

In this file photo, Jac­ques Tor­res, who sells his well-known and high-end choco­late and other food at eight lo­ca­tions in New York and on­line, as­sem­bles a gift bas­ket at his flag­ship store in New York.—AP

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