Gilt Peels Off Elite Lifestyles : Economy: Even rich residents of the Westside have cut back on spending, and that’s bad news for those who supply them with luxuries and frills.
The shiitake mushroom is not yet endangered and the Mercedes still roam, but even on the Westside times are tough.
Indeed, the recession has changed David Stephens’ life, including the way he plays golf.
Last year, the 31-year-old vice president of a Westside catering company had an ocean-view apartment in Marina del Rey. He didn’t hesitate to spend $35 for a haircut or $125 to have his car detailed. And weekends he regularly plunked down $65 to play 18 holes of golf.
No longer. Business at the high-end catering firm of California Creations is off 10% to 20%--although grilled citrus salmon on a bed of spinach at $45 a serving continues to be the firm’s No. 1 seller. And although the new austerity hasn’t cost Stephens his job, it has made him rethink the way he spends.
Uncertain of the raises and year-end bonuses he could count on in the past, Stephens recently cut his rent from $1,000-plus a month to “considerably less than $700” by moving to a cottage near the beach in El Segundo, where he did repairs and remodeling in exchange for a rent reduction. He switched from his pricey hair stylist to Supercuts. And he bought the requisite brushes so he could detail his own car.
“It’s not that I can’t afford it,” he says. “It’s just that it’s ridiculous to spend my money on that.”
And now, instead of queuing up at the golf course on weekends, he tees off early weekday mornings, when nine holes costs only $6 and there are no lines.
Stephens says the recession has changed many people’s priorities, not just his own. With thousands out of work, nobody wants to come off like Marie Antoinette.
“You don’t hear people boasting about what they’re spending,” Stephens says. “Values have shifted. People are going back to basics. It’s OK to be driving a Ford Taurus instead of a Mercedes.”
That may be going too far, but the recession does seem to have wrought major changes in the way Westsiders spend. “It’s a chain reaction,” says Jillian Twigger, 31, an actress and a server at Cutter’s restaurant in Santa Monica. “I’ve seen it affect everyone I know, no matter what their station in life.”
Twigger says lunch business at the restaurant is down more than 10% and that customers are ordering less, including fewer drinks. Mashed potatoes are in. Oysters on the half shell are out.
According to Twigger, more people are eschewing entrees for soup and salad and more are sharing food. “At night people bring in their own tea packets and their own wine,” she says. (Cutter’s recently started charging a corkage fee.) People are also tipping less, tending to round down instead of up.
As a result of an estimated 15% drop in her tips, Twigger and her graphic designer husband, who live in Palms, have cut back on their own dining out and theater going--from several times a week to no more than once. They are also winging off to Hawaii and England less often.
Cutter’s colleague Kurt Hessler, 27, has been even harder hit. Last year, Hessler lost his $30,000-plus-a-year job as the personnel manager of a Hollywood post-production house. Hessler was unable to find another industry position and soon discovered that even a job waiting tables was hard to come by.
Now Hessler worries about his aging car (“it’s burning oil,” he says with a shudder) and whether he can keep up his health insurance (he’s two months behind in his premiums). He has already cut his personal spending to the bone. “My main meal is here,” he says of the restaurant. “I’ll have something like a baked potato for dinner, which is a 75-cent meal.”
The one thing he won’t give up is his health club membership. Hessler works out for several hours five days a week at the Sports Connection in West Hollywood. “Keeping fit makes me feel a lot better,” he says.
Also feeling the pinch is Daniel Demers, 32, who owns Paradise Avenue florists in Marina del Rey and Santa Monica. Demers estimates that business is down at least 20% over last year and that his overhead has risen at least 5% over the same period.
Even on the Westside, where fresh flowers are de rigueur, people are spending less. Demers says he has customers who have pared their flower budgets from $200 a week to $50. And people are choosing more traditional flowers instead of the costly tropicals that were once the rage. “I used to sell Casablanca lilies at $19.99 a stem, and now people are going with regular day lilies at $2.99 a stem,” he says.
Demers has responded by marketing more aggressively. “I’m offering specials that I never used to do,” he says. For example, he recently offered $11.99 bunches of tulips for $7.99 to customers who brought in a coupon he ran in a local paper. “It’s just to get people to come in,” he says.
As for his own spending, Demers estimates that he has halved it over the last year. He no longer takes a long weekend in Palm Springs or San Francisco every month. Every three months is now his norm. And he no longer shops up a storm in Beverly Hills or on Montana Avenue in Santa Monica. “I used to spend $2,000 a pop for clothes and jewelry,” he confesses. “I don’t do that anymore.”
Westsiders have also cut back on household help. Ness Twina, who runs the Housekeeper’s Agency, with offices in Beverly Hills, Sherman Oaks and Pasadena, says business fell 50% last year, although it now seems to be improving slightly.
According to Twina, one result of the recession is that clients are unwilling to pay as much for a good housekeeper or nanny as they were in the past. “I had a lady who fired somebody she was paying $450 a week and then called me and said she needed somebody cheaper,” he says. “I’ve had several ladies like that.”
There have been other changes, apparently recession-related, in his business as well. “One other thing I see is that, for the first time, people have tried to cheat me out of my fee,” he says. That’s happened three times in the last four months, says Twina, who charges the client 10% of the cook’s or nanny’s annual salary for making a placement.
But, you ask, are times so hard that they are affecting Santa Monica’s Shar-Peis and other Westside pets?
Yes and no, says Susan Beer, owner of Bowser Boutique in West Hollywood. Beer reports that spending “on frivolous things such as doggie sweaters and fancy bowls” is down 20% to 25% from last year. But Westside animal lovers continue to pay premium prices for gourmet pet food and to have their animals bathed and fluffed.
Beer charges $25 and up to beautify a dog (she has charged as much as $150 to untangle a badly matted old English sheep dog). The only time her grooming business fell off was during the Persian Gulf War, she reports.
Since then, business has snapped back, although, she notes, “people’s cash flow is not what it was. People are resorting to their credit cards more. And there are many more bounced checks, that are made good, but these are from customers who have been coming here for years.”
Caterers speculate that they are the first to go when people are deciding what services they can do without in hard times. But that dubious honor probably goes to closet planners.
When times are tough, you tend to ask yourself, do I really need to pay someone to keep my shoes from piling up unattractively on the floor of my closet? And the answer is likely to be no.
Marxine Ordesky, a Beverly Hills space planner, says she is getting as many big jobs as ever before, designing storage for new homes and tear-downs, but her more modest remodels, which cost $1,000 to $2,000 per closet, are down 30% from last year.
The interior design business as a whole has been clobbered. Bobbie Everts, who runs Designer Previews in Marina del Rey, charges clients $100 to help them choose among 65 participating designers and architects. Business has been woeful, she says, down at least 50% from last year.
“My bread-and-butter client--the person who has $35,000 to $75,000 to spend--began to disappear in 1990,” Everts says. “I was still seeing some $100,000-plus clients. Now the middle-class client is beginning to come back, but slowly.”
Like Stephens, Everts thinks there has been a dramatic shift in people’s values. The conspicuous consumption of the 1980s may be over forever, she says. In the current climate, spending too much on too little seems just a wee bit tacky.
“Even if you have money now, when everybody else is hurting it’s not OK to show it,” she says.
In case the decorating business never fully recovers, Everts has started a sideline business--handcrafting and selling Christmas ornaments.
Business is good at first-run movie houses, just as it was during the Depression. The exception is Westwood, where movie ticket sales are down 15% to 20% over last year, probably because of increased competition and negative, riot-related press.
Nonetheless, many Westsiders say they spend more evenings in front of their VCRs. But this hasn’t necessarily translated into a bonanza for those who rent videos.
“We have more active customers, but they’re renting less,” says Patricia Polinger, co-owner of Vidiots in Santa Monica. She isn’t sure that the economy is to blame, however. Polinger suspects that the video rental business may have slowed down as it “matured” and the novelty wore off.
For whatever reason, the same people who used to rent two titles are now settling for one, even on two-for-one days. “People’s eyes used to be bigger than their viewing time,” she says. “I think people found they were paying late fees on movies they had never seen.”
The anecdotal evidence is that the recession has changed the Westside in many ways, from making caterers and other service businesses readier to bargain with customers to increasing the number of people on the streets driving without insurance. But not everyone is feeling the pinch.
Some businesses are apparently recession-proof. Sales are brisk at Rhino Records in Westwood, according to store manager David Crouch. Even during the Persian Gulf War, the store was packed.
“People didn’t want to deal with it,” Crouch speculates. “Records are an escape.” He says Rhino’s customers see music as a good value in hard times. “If people only have a little money to spend, they want something tangible for it,” he says. “An endive salad and a side of baby carrots is $20, and you can get two CDs for that.”
And some Westside institutions, especially those that cater to the very rich, seem impervious.
Brown’s Cleaners on Montana Avenue in Santa Monica reports that business is virtually unchanged, although the dry cleaning industry as a whole has dipped 15% to 40%.
Fabled for its careful hand cleaning of luxury garments, Brown’s is the most expensive cleaner in California, charging $3 to launder a man’s shirt and $60 to $200 to clean a beaded evening gown.
Recession or no, owner Lois von Morganroth says she continues to have a loyal local following as well as a national clientele. One Pittsburgh woman sends 40 of her husband’s shirts to Brown’s every two weeks to be washed in cold water and pressed by hand. The gentleman disdains sizing (and Brown’s disdains starch).
Le Petit Ermitage is also doing nicely, thank you. The “post-operative retreat” in Beverly Hills offers the ambience of a luxury hotel to individuals who want to quietly recover from their face lifts and other surgical exigencies of life in La-La Land.
For $350 to $500 a night (meals included), clients can rest in automatic beds beneath original works of art, with 24-hour access to registered nurses and such non-clinical amenities as an underground entrance far from prying eyes and a chauffeur to drive them to the doctor’s office.
Jayne Levant, general manager of Hotel L’Hermitage, which runs the retreat, says business is actually up 4% over last year. That increase, she says, may be due less to the health of the cosmetic-surgery industry than to more aggressive marketing on the retreat’s part.
In December, the facility began advertising for the first time. It also began reaching out, via direct mail, to specialists in fields other than cosmetic surgery, such as orthopedic surgeons. If business continues to improve, Levant says, the retreat may double its capacity to 28 beds.
Also unbowed by bad times is Victoria’s Secret, the popular purveyors of lingerie. “There’s a recession?” asked the manager of one Westside store, where sales are up and growing. And as long as Westsiders continue to love silk, she speculates, there’s no chance of the bottom falling out of the teddy business.
