Is Downtown worth it?
I've had a few competitors over the years move downtown. With one of them, I took the time to walk the circuit of the core, and tried to explain how seasonal it all was, how one shouldn't be fooled by the crowds that are there when the crowds are there.
Instead, I urged, try to visualize the emptiness when the crowds aren't there.
I tried to explain parking, and how hard it was for drivers to see your store, and how long it took for people to actually find you, if ever.
He went in anyway. And lasted less than a year.
His store had previously been in a mall, and he simply didn't understand that the foot traffic downtown was simply not as steady as a mall, no matter how it looked.
The second competitor had a store that would have been the perfect "destination" store; that is, as long as he located in a reasonably noticeable main street, most of his customers would have found him. If one has viable product, word of mouth is strong. But he chose downtown, instead; he was basically paying twice as much rent downtown, because of the perceived "foot traffic."
But he was such a niche business, the foot traffic added little if any to his bottomline, I believe.
The third competitor started off downtown, as well, then moved to a much bigger spot in a prime location -- but from what I understand, also more than doubled his rent. I think this was O.K. for him as long as he concentrated on making his store attractive to outsiders, but the minute he stopped paying attention, the fanboys became his main customers and his rent became unwieldy.
(By the way, I still think rents are high downtown, despite the perception that things have gotten cheaper. Nor do I think that will change, as long as there always seems to be someone in line to fill the vacancies...)
So why am I downtown?
Well, we've been in this location for 28 years or so. We have generation(s) of customers who know we are here. I've just watched to many examples of stores moving, and losing their customers. Hell, the Book Barn merely moved across the street, and I still had people coming in years later asking where it went!
Plus my store is so packed, that moving would be a huge job. The smaller than ideal size of my store has forced me to be very creative in merchandising. Necessity being the mother of invention. (I've also arranged with my landlord to use some of the downstairs space for storage, which has been a blessing.)
I've designed my store to fit the changing landscape of downtown. New and used books, mainstream type toys, boardgames, pop culture items, and so on.
There is also the fact that, other than the Old Mill, which is suited more for Banana Republic and The Gap than a funky pop culture store, there is almost no place left in Bend where you can get ANY foot traffic.
Finally, and this is something that my competitors didn't see or understand -- my store once was a destination store, pretty much off the beaten track. Sure, I was downtown, but for most of my existence, I wasn't in a part of downtown that was frequented by shoppers.
That all changed, and so the foot traffic is so dramatically higher for my store in particular, that I have seen the benefit.
Would I locate my store in downtown if I was starting out today?
Probably not. My store is probably more than 50% a destination store. So as long as I was visible on a main street somewhere else, that would do the job. If I could trade twice the space for half the rent, I'd probably do it.
But I'm ensconced where I am, now. I like my store. But, still, I'd advise my competitors not to read too much of my success downtown as a reason to come downtown. Don't do as I do, do as I say. ..
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8 comments:
Didn't you have a store in a mall once and that didn't work out? Or am I thinking of somebody else?
I really think places like downtown and the Old Mill District (which tries to replicate the ambiance of a downtown) are the future of retail, or at least bricks-and-mortar retail. Even the old malls have tried to transform themselves into something downtown-like, although they haven't succeeded.
Our mall store was still profitable when we sold it.
We were so deep in debt from the comic and sport card bubble collapses, that we sold it for the money.
At the time, I felt the mall store got TONS more notice than our downtown store...
I haven't done any formal surveys or anything, but every time I went inside either of Bend's two malls (back in the days when they were enclosed) they seemed really dead. And kind of seedy.
When did you close your mall store? It might have been during the period before downtown really revived.
The Mountain View Mall was doing O.K. until about 1992-3. It was deceiving in that I think they had made so many deals to fill the mall (and then selling) that the banks put their foot down.
But, yeah. The malls never really got going. They were finished just as the Reagan recession started and for Bend that lasted through the 80's.
Downtown was recovering during the same time, so that by the early 90's, as far as I'm concerned, it had reached it's funky town zenith. (No chain stores...)
The malls started dying off about the same time.
Both the malls could FEEL empty even when they had more people on average than downtown. The car traffic is what gives downtown its zest, which is why I think the 'close the street' people are so misguided.
What happens when someone first moves to town? They check out the malls. They think nothing of walking the entire mall.
That doesn't happen, for some reason, downtown. Downtown, it's catch as catch can.
So many more people seemed to find us in the mall than found us downtown.
To this day, I get people who think that was our only store and we closed.
Oh, we sold the store in 1997, but the next owner NEVER replaced the sign, for over a year -- and let it run down. Then a former employee of mine took it off for a wing and a song and it became a different store for a few years.
If you have to ask, then the premium is not worth it.
Plywood will return soon to downtown, as we have all long predicted.
I still think our downtown is one of the more charming examples of a small town core. There's an ambiance that can't be duplicated at a mall, no matter how hard you try (e.g., The Grove in LA). That said, I think downtown rents are mostly still expensive for the return, even if many – not all – landlords have reduced rents these days. Some would rather have empty spaces than lower the rent. You can put quotes around that one.
And taking just 25¢ or 50¢ off the average per square foot figure because you're on a 'periphery' area of downtown really doesn't make sense either, because you might as well be in Siberia. I remember some really, really awful July days back when we had our store at the end of Minnesota Ave. at Lava (pre-parking garage, Firehouse, and hotel), when tumbleweeds outnumbered tourists by five to one. We knew that corner would change dramatically, but most of us in the 'hood couldn't put our businesses on hold until the magic turnaround. Loved the space, miss the store, needed so much more traffic to make the numbers work.
These days, I'm much happier with way lowered expectations. We've always done everything on a shoestring, now, even more so. It's the only way to survive, if you're going to make a (very) basic living of it.
The rents are still too high. They haven't gone down as much as people think, because the vacancy rate is still low.
Technically, what the market will bear.
Except with the turnover rate it's only bearing it on the surface...
sigh.
You're right about the periphery. Should probably drop in half outside the core.
Foot traffic did go up tremendously on the east side of Minnesota, but I think it's mostly been a wash for me --higher foot traffic paying for the higher rent.
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