By Ed Moosbrugger
February 10 -- Going into the 2008 Christmas holiday season, Third Street Promenade merchant Naren Patel said business was the worst he had seen since moving to his present location in 1994.
Unfortunately, things didn’t get any better as Downtown Santa Monica, along with the nation, suffered through a very weak holiday period.
At Patel’s Shiva Imports, sales were down 25 percent in December from a year earlier.
Some other merchants interviewed in November who were revisited in January to see how things ended up also reported sales declines, although one posted a gain.
This reflects the national picture, where sales declined at stores open at least a year, a key measure of retail performance.
U.S. chain store sales dropped 1.7 percent in December on a same store basis, according to the International Council of Shopping Centers (ICSC). November-December sales were off 2.2 percent from 2007.
“This was an extraordinarily difficult holiday season,” Michael P. Niemira, ICSC chief economist and director of research, said in a statement.
“Retailers were forced to slash prices to entice consumers to spend,” he said. “But even that strategy was not enough as the elevated worry about job insecurity and increased job layoff announcements continued to restrain consumers’ willingness and ability to spend.”
That certainly was the case at Shiva, where Patel has been discounting to attract shoppers.
“Sales are down. We are discounting prices. We are practically giving things away,” he said. “We are struggling.”
Several apparel chains with stores in Downtown Santa Monica reported double-digit declines nationally in same-store sales in December.
Although it wasn't a pretty picture, not all merchants were disappointed.
“I was pleased both with tourists and locals,” said Adamm Gritlefeld, owner of Adamm’s Stained Glass & Gallery on Fourth Street, who said business wasn't as bleak as many people had predicted.
His December sales fell short of 2007, which was a very strong year for him, but exceeded 2006.
To help boost sales, Gritlefeld had his first pre-Christmas sale in about 20 years, with “fantastic” results.
Still, sales were down for the year and the store still has plenty of merchandise.
“I will not be buying for a while,” Gritlefeld said.
At Hennessey & Ingalls art and architecture bookstore on Wilshire Boulevard, sales were down about 15 percent in November/December, which was about what owner Mark Hennessey had expected.
Hennessey also opened a new store in Hollywood late in 2008.
|It’s business as usual at the Santa Monica store, which Hennessey said is “not a big believer in discounting.”
Hennessey said he was sorry to see the Borders books and music store on the Third Street Promenade close because “I like being surrounded by other bookstores.”
Borders, which recently named a new chief executive, closed its three-story store in January.
At Carlson's TV & Appliances on Fifth Street, business was off about 9.5 percent for the year, which was better than the industry performed state-wide, said General Manager Mike Nichols.
In the face of an industry sales decline, Nichols noted that suppliers are increasing prices across the board.
With business down, Carlson's trimmed Christmas bonuses but did not lay off employees, Nichols said.
The Candy Baron store on Santa Monica Boulevard was an exception to the rule, posting increased sales, said owner Ron Baron.
Candy Baron also may have benefited from the closure of a candy store in Santa Monica Place as the shopping center shut down temporarily for a major renovation that is still underway.
With the economy in turmoil, Downtown merchants aren't sure what to expect in 2009.
“I guess we won't know for a couple of months,” Nichols said.
Patel wasn’t ready to make a prediction.
“It’s a mystery to everybody,” he said, holding out hope that consumers may spend after getting tax refunds.
Hennessey said he is going to wait until the end of the first quarter to get a better idea of how things will shape up this year.
Nationally, there are predictions of more store closures and bankruptcies in the wake of the worst holiday season in years.
Meanwhile, Gritlefeld said he is talking to some Fourth Street businesses to try to put together cooperative promotions, including a rewards card, with the support of the Bayside District Corporation.
He believes the more merchants do now to improve, the better off they will be when things recover.
