There’s no question that this less than stellar business cycle we’re in has put a hurt on many parts of our economy but with the news media proclaiming nothing less than the economic version of the apocalpyse it’s tough to get a handle on what is real and what is media induced hysteria. I am in no way trying to make light of some very serious troubles but if we’re going to be part of the solution we’ve got to understand the problem clearly, and I’m having a hard time reading the tea leaves on this one. I’ve read that consumer confidence is down but consumer spending is up in some areas. Go figure. The Gap is hurting but Aeropastale is setting same store sales records. So is the whole economy sour or just some sectors and just some stores? This stuff matters because as the economy goes so goes the viability of our City government. Then throw in a community goal of revitalizing downtown Kent and the state of retail takes on an important local dimension.
The City of Kent is not a mall or plaza owner but there is an expectation that the City is a player in the retail game. When retail falls short City Hall hears about it. Retail has become a tangible intangible under the umbrella of quality of life that consistently shows up on city surveys as an expectation of citizens for the community they choose to live, do business and play — and citizen expectations are what we’re in business to satisfy.
Actually, believe it or not some cities have taken the retail leap themselves and have opened small retail shops to sell city related merchandise. I’m not ready to get into the discount retail world but I have to admit it’s a creative way to raise funds for city operations. And as the New York City store proudly claims: 100% of all proceeds benefit The City of New York.
Here’s a quick tour of some of the more interesting city sponsored retail outlets:
Albuquerque, New Mexico, sells t-shirts, police ballcaps, fire memorabilia, historic photos, computer mouse pads, golf shirts, key chains and mugs.
Grand Rapids, Michigan, sells the same types of clothing and memorabilia including golf balls, umbrellas, and winter hats.
New York City, New York, sells some unique gifts like manhole cover coasters, tote bags, water bottles, reports and publications, magnets, posters, city trucks, home accents, holiday ornaments, stationary and puzzles.
Again, we’re not planning (or even talking about) opening our own shop to sell used manhole covers for use in your home as door jams here in Kent but you have to admire these cities’ creativity and direct intervention in digging their way out of economic doldrums. If you check out the NYC store they actually have the official squirrel mascot stuffed animal — maybe it’s time to put our black squirrel on the market too.
In the meantime, I’ll keep trying to reconcile the mixed signals we’ve been getting about the Kent retail trade area. One the one hand the Phoenix project had so much interest that all three phases for construction were basically being done together because of pent up retail demand for quality retail space downtown. On the other hand some of our older strip malls struggle to survive and some of the old stand by retail chains have closed up shop for good.
I’m not sure how it will all turn out but here’s a short list of stores that are beating the odds.
|Surprising Success: 10 Retailers Continue to Grow in Tough Times
By Christina Zarrello
|Bucking the economic downturn, 10 retailers have found the recipe for success. Although many others are feeling the pinch, Aeropostale, Target, DSW and The Buckle have posted stellar financial results. These retailers and the others on the list have ambitious plans to open new stores throughout the remainder of 2008 and well into 2009. RIS News highlights 10 surprisingly successful retailers that are beating the odds and winning in the toughest economy in years.
Target: On October 12, the superstore announced ambitious plans to open 45 new stores, launched its first store in Alaska and debuted its 2009 prototype stores. Target’s new general-merchandise stores will be roughly 6,000 square feet larger than the current model. The new SuperTarget stores will be approximately 12,000 square feet larger than existing locations and pushes closer to the average size of Wal-Mart’s Supercenters.
Aeropostale: A favorite among teens and tweens, the apparel retailer plans to open 100 stores during the next 18 months. Aeropostale announced that its same-store sales rose 5 percent in September. Year-to-date, same-store sales rose 24.9 percent and total sales rose 32 percent to $480.4 million. The apparel retailer currently operates 565 locations nationwide, with average stores occupying spaces of 3,300 to 3,800 square feet in malls.
The Buckle: Month after month, this teen apparel chain posts impressive same-store sales increases. Despite operating 377 stores in 39 states, it gets little attention from the industry because of its relatively small market cap ($1.5 billion). In September, same-store sales rose 19.7 percent and for the five-week period ended October 4, total sales rose a healthy 26 percent to $72.8 million.
Family Dollar: The discount chain plans to open approximately 200 new stores in fiscal year 2009, which began in September. The company also plans to renovate 200 more units to its “concept renewal” format and plans to upgrade technology in about 1,300 stores. The discounter’s fourth quarter sales in fiscal 2008, which included the summer months when gasoline was at record highs and food costs soared, jumped 8.2 percent from the previous year to $1.8 billion.
RadioShack: Digital television converter boxes as well as AT&T post-paid wireless upgrade services may have given the electronics chain an edge with profits growing 8.4 percent in the third quarter ended September 30. In addition, sales rose 6.4 percent to $1.02 billion, while same store sales grew 7.7 percent. The retailer also posts solid sales of GPS navigation systems, video games and laptop computers.
DSW Shoes: The footwear retailer plans to open 10 locations across the country in October. The retailer’s plans are in line with its projected goal of 35 new locations in 2008. The 17-year-old chain operates 288 stores and supplies inventory to 381 leased locations including Stein Mart, Gordmans, Frugal Fannie’s and Filene’s Basement, as well as its Web site.
Unified Grocers: The largest wholesale grocery distributor in the western United States announced that it has reached a significant milestone by surpassing $4 billion in revenues for its fiscal year ended September 27, 2008. The company attributed 25.7 percent of its sales growth to customer business gained in the Pacific Northwest from the transaction with Associated Grocers.
Tractor Supply: The farm and ranch equipment retailer announced double-digit increases in its third quarter ended September 27, citing a 13.1 percent increase in sales of animal and pet products, seasonal heating equipment and emergency response equipment related to hurricanes. Sales grew 16.6 percent to $733.9 million, while same store sales grew 6.2 percent. The retailer opened 70 new stores in the first nine months and anticipates 21 new store openings for the remainder of 2008.
Ulta Salon Cosmetics & Fragrance: The beauty products retailer plans to add 180 stores over the next two years. The chain plans to open 80 stores in 2009, 100 in 2010 and expects to be a 1,000-store chain in 2017. Ulta currently operates 283 stores. The typical Ulta store is 10,000 square feet and located in lifestyle centers.
PriceSmart: The warehouse club announces that its same-store sales for September 2008 rose 15.3 percent. Net sales climbed more than 19.8 percent to $93.6 million in September from $78.1 million reported last September. PriceSmart had 25 warehouse clubs operating at the end of September, compared to 23 warehouse clubs at the same time last year.