Retailers, Shoppers Cautious This Holiday Season
ANDREA SEABROOK, host:
From NPR News, it's All Things Considered. I'm Andrea Seabrook. The current and future presidents have spent the weekend battling the financial crisis on separate fronts. Barack Obama will introduce his economic team at a news conference tomorrow. And George W. Bush has been in Peru with a different team - leaders of China, Japan, and other Pacific Rim countries. That group of 21 nations issued a statement today that the financial waters can be calmed in a year and a half.
Then again, some retailers in this country can't wait that long. Already, a number have shut down or downsized. I went out to a mall in Annapolis, Maryland, to get a firsthand look at the retail situation. First impressions: fewer shoppers and sign after sign touting sales - 25 percent off, 50 percent off, 40 percent off - all along the main corridors of this mall. It makes me wonder whether shoppers are doing anything different this year. And I'm going to ask them.
SEABROOK: Hey, do you have a second to talk?
Carlos Graddy(ph) is at a kiosk in the middle of the mall, playing a video game. This Christmas, he says, will be different.
Mr. CARLOS GRADDY: We told all the kids they can get to pick two things. And before, we'd just go out and buy a lot of stuff. You can't do that now. So, I guess there's sort of like a budget.
SEABROOK: It's different then, this year, huh?
Mr. GRADDY: Yeah, yeah, it is different this year.
SEABROOK: Oh, here's a family. Let's go talk to them. Tell me your name.
Ms. CARA JACOBS(ph): Cara Jacobs.
SEABROOK: And your name?
Mr. CHRIS JACOBS(ph): Chris Jacobs.
SEABROOK: And who are these guys here?
Mr. JACOBS: This is Harper Jacobs(ph) and Rory Jacobs(ph).
Ms. JACOBS: Can you say hi? No, you're shy?
Mr. JACOBS: Too shy.
SEABROOK: Hi, guys. We're going around asking people what's different. Is anything different in your lives going into this holiday season than a year ago?
Ms. JACOBS: I think we're definitely going to be more cost conscious this year, try to do little things a little smaller, but more meaningful.
Mr. JACOBS: No wasteful spending. No spending on toys that we don't need. You know, the kids have a million toys. They don't need that. We need clothes, you know. We need food and clothing. That's going to be it for the most part, you know. For, I think, the rest of the family, yes, smaller things. Not those big ticket items, per se, unless the sale is really good. You know, big.
SEABROOK: That's why all those stores are trumpeting their sales here. And when shoppers feel nervous, business owners really feel it. Just off the main drag of this mall is a jewelry boutique. It's called Blanca Flor. Donna De Garcia owns this store and another in downtown Annapolis. She specializes in silver jewelry and gifts from Mexico. De Garcia says it was back in September that it first started to sink in just how bad this crisis could be.
Ms. DONNA DE GARCIA (Proprietor, Blanca Flor): I was in Mexico in September buying up half the town, you know, and on a road trip to replenish my decorative arts. I came back to the surprise that the downtown store had sold something like 41 percent less as compared to the year before.
Ms. DE GARCIA: So, that was a really terrible month. And that scared me. And luckily the numbers went back up a little bit. But it's pretty slow right now. So, you know, there's been some scary months and some scary weeks.
SEABROOK: As I look around the store, the back shelves are packed full of these beautiful platters and dishes and decorative items. And the cases, the glass cases, are full of jewelry. I mean, you have a lot of product in this store.
Ms. DE GARCIA: And let's hope somebody comes and buys it this holiday, or I'm going to be up the creek in January.
SEABROOK: You're crossing your fingers, right?
Ms. DE GARCIA: I am crossing both my fingers.
SEABROOK: How much of a cushion do you have? What happens if this holiday season is really bad?
Ms. DE GARCIA: You know, I hate to say it, but I don't have a lot of a cushion. You know, it's very stressful.
SEABROOK: If this is a really bad Christmas, what will it mean for your business? What would you have to go do?
Ms. DE GARCIA: Oh, I probably would have to not go to the show in New York in January to buy for spring and just sell jewelry that I have left over, and keep working on selling the things that I bought that I was supposed to sell over the holidays.
SEABROOK: That makes me think that the wholesalers then wouldn't get your business?
Ms. DE GARCIA: The wholesalers are suffering. I got a letter from one of my jewelry designers company, fairly large company, today saying that they had a lot of - over 500 items ten percent off and over a thousand items 20 percent off. So when you get letters like that, you know that they're hurting. And I also was going to cancel two orders from two companies, and they told me take it, take it, send me back what you don't sell. So I know that, you know, that's where the chain starts, is with the wholesalers. They're already suffering.
SEABROOK: Yeah. Is there a difference for you? What have you done to prepare yourself for this season that's different than last season? Have you hired the same number of people to work it? Are you...
Ms. DE GARCIA: We've cut down on our payroll a few times this year. You know, cut down on the number of people that were in the store at certain times of the day. But to prepare for this season, unfortunately, what I did is go out and buy too much.
(Soundbite of laughter)
Ms. DE GARCIA: So...
Ms. DE GARCIA: I wasn't expecting as sudden of a dramatic economic crisis. I think everybody knew that, you know, the mortgage thing had already started, the real estate thing was starting to fall. But most people weren't prepared for the drama that we've just experienced. But I'm hopeful. It's not the end of the world. If I have a fairly good Christmas, I'll get by. What I'm more worried about is if things don't improve and we see nobody shopping for months like January, February, March, April. And that's what I'm a little bit concerned about, is making it through the winter.
SEABROOK: Donna De Garcia the owner of Blanca Flor. This is a boutique here that specializes in silver jewelry and gifts. Thank you so much for letting us talk to you.
Ms. DE GARCIA: Well, thank you for coming. It's nice to see you.