Trees, Santa Suits, Eggs and Phone Calls : The Business of Christmas Has Its Ups and Downs
Real Christmas trees are green, but can the same be said for the Christmas tree business?
Although the jury is still out on this season, there are signs that 1985 will not be a year to remember for those who provide the 4 million Christmas trees sold in California annually. A late Thanksgiving and bad weather in the Pacific Northwest, which delayed shipments and then caused a sudden oversupply in Southern California, have kept prices flat this year and threaten to leave a lot of retailers with unsold evergreens.
“It’s probably going to end up pretty bad,” said Bud Lyon, a Rosemead tree farmer who is president of the California Christmas Tree Growers Assn. “To me, it looks like there’s an awful lot of trees left for this time of year.”
At the corner of Victory Boulevard and Winnetka Avenue in Woodland Hills, where Frank Toohey was managing a tree lot for Oregon Family Christmas Trees, the product was moving more slowly than in past years. But he said that much depends on regular customers who come back year after year.
Prices Flat
Lyon said the trees are not commanding very good prices. “I think the prices are probably going to be down by the time . . . you average it all out,” he said.
The average is about $30 for a six- or seven-footer, said Sharon Burke, the growers association’s executive director.
“There’s a definite oversupply of Christmas trees,” said William Miller, vice president of Miller & Sons, a Mission Hills company that may be the biggest Christmas tree retailer on the West Coast. “It’s a buyer’s market.”
But his father, company president Stuart Miller, insisted that, although there is an oversupply at the wholesale level, retailers did not buy too many trees. He also contended that most retail prices have been up about 5% over last year, although Miller’s prices are unchanged from last Christmas.
28 Tree Lots
Founded in 1961, Miller & Sons now has 28 lots from Sacramento to San Diego and sells 120,000 trees annually at about $25 each, the Millers said. The family doesn’t disclose figures, but the company’s volume and prices imply revenue of about $3 million, and most of Miller’s trees are grown by the family in Oregon.
“We’ve McDonaldized the tree business,” Stuart Miller said.
Retailers who had trees on hand early this season--and the Millers were among them--apparently were in luck, because unusually heavy snows in the Pacific Northwest kept many trees from getting through until later, Lyon said.
When the weather cleared up, a great many trees apparently came south at once.
And Lyon said that indicators point toward a nationwide tree glut for the rest of the decade.
Nobody’s quite sure why, but Santa Claus is coming to town in larger numbers in the San Fernando Valley this year.
“We’re up in Santa Claus suits,” said Michael Tolin, manager of the North Hollywood Norcostco store, one of a nationwide chain of costume shops.
Tolin said he rented only 23 Santa suits all last season, but he equaled that mark by Dec. 16 this year. And the heaviest part of the season is yet to come, he said. Others reported similar surges in rentals.
Magic World Costuming in Chatsworth, whose 80 Santa suits may be the most kept by any shop in the Valley, said it expects to make 200 such rentals by the season’s end, up from 163 last year. Noblitt’s Costumes in North Hollywood said its Santa-suit business also is up.
Next to Halloween, the storekeepers said, Christmas is the biggest time of year for costume rentals.
Santa suit rentals aren’t the only things up this year. So are egg prices.
What with all the baking, entertaining and egg nog, the period from Thanksgiving to New Year’s Day is the most important of all for the egg business. Egg distributors in the Valley say prices are higher this year.
Major supermarkets are charging 8 to 10 cents more a dozen this year than last, according to Federal-State Market News, a joint agricultural reporting service. Large white eggs have been selling locally for about $1.09 to $1.25 a dozen during most of December.
Why the increase? Opinions differ.
Eggs Plentiful
“Greed,” said Pete Ruiz, who owns Sunset Ranch Wholesale Egg Co. in Van Nuys. He noted that egg supplies are plentiful, unlike 1983, when poultry flu wiped out millions of hens in Pennsylvania and New Jersey.
“There’s no shortage of eggs,” acknowledged Paul Faber, the state officer in charge at Market News. “Due to some distortion in the local market, we’ve been seeing higher prices than the rest of the country.”
Federal-State Market News said wholesale prices were 74 to 77 cents a dozen in New York during December and 71 to 74 cents in Chicago. They were 84 to 86 cents a dozen in Los Angeles.
Faber blamed the higher local prices partly on an increased demand for eggs in Southern California. He said prices should come down after New Year’s Day. He also noted that, although there are plenty of eggs around, production is down 3% to 5% from last year in Southern California and off 2% to 3% nationwide.
Don Bell, a poultry specialist with the University of California, Riverside, said that people keep buying eggs even when prices increase, especially around Christmas.
Com Systems, a Van Nuys long-distance telephone service company, apparently has found a way to add Christmas cheer to its bottom line by selling discounted phone calls.
Mainly a business provider, Com Systems’ costly switching equipment was going largely unused after 5 p.m. and on holidays. So it started offering those hours to residential users at the price of $48 for eight hours, or 10 cents a minute, anywhere in the United States, through Feb. 28.
“That’s probably as good a price as you’re going to find in the industry, or close to it,” said MCI spokesman Gary Tobin. “That’s what competition is all about.”
1,460 New Customers
Most of the extra revenue--1,460 customers already have signed up, Com Systems said--goes right to the company’s bottom line because all the needed equipment is in place.
The special promotion is also a way of getting residential customers to try the service, which is less known than its competitors’, including AT & T, MCI and Sprint. Com Systems will try to persuade participants to stay on when the special prices end.
