If Your Fridge Overflows With Leftovers, If Christmas Specials and Chia Pet Ads Clog the Airwaves, You Know It’s Time to Start Talking Shop : Binge & Splurge : Impulse Buyers Keep Specialty Carts on a Roll
For Stephen Harris, the American dream rides on mall pushcarts.
And the Thighmaster.
The 36-year-old former real estate broker and his sister, Nyla, operate seven carts (12 during the Christmas season) with names like “Silver City” and “As Seen on TV” in malls stretching from Santa Rosa to Cerritos.
They specialize in Italian silver jewelry, no-run panty hose and TV-advertised novelties like the Thighmaster. Customers, who don’t always see a surge of activity around the carts, might think these are struggling enterprises. But Harris says his 8-year-old company, called the Ultimate in Carts, “does between $1 million and $2 million a year, depending on how hot the TV item is.”
That should be good news to Larry Wolf, whose gimmick has become a mall mainstay, fueled by what he calls “98% impulse buys.”
In 1976, Wolf and other executives of the Rouse Co., Columbia, Md.-based shopping center developers, were eager to make Boston’s renovated Faneuil Hall and Quincy Market look fully occupied by opening day.
“We were bringing back to life buildings that hadn’t been used for 100 years, so leasing was very difficult,” Wolf recalls. “We sat around trying to figure out how we could make it look more leased.”
Wolf says he hit on European-style pushcarts even though he had never been to Europe. “I remembered seeing them in movies and books.” But with only a month or two to find them, he opened with a hodgepodge of “stalls and carts and some people didn’t have anything, just boxes.”
The merchandise included pumpkins, nuts, flowers, plants, even birdseed. “At that point, we were more interested in an artistic than a commercial success,” he says. “We were looking for merchandise that looked good.”
Today, Rouse owns and leases out about 1,000 carts in 70 malls nationwide, including Fashion Island and Santa Monica Place. The units are made by more than 50 companies and may cost as much as a car.
Size, shape and materials--including steel, plastic, aluminum and wood--vary. A typical design, reminiscent of a European peddler’s cart, is 4 by 8 feet, weighs 800 to 900 pounds, has a canopy overhead and large wheels to make it mobile.
Onboard, flowers and birdseed are a rarity. Instead, the merchandise ranges from condoms to button covers, from ties to T-shirts, from American baby clothes to Russian nesting dolls, from Indian reservation jewelry to African woodcarvings and hats.
What started as a ploy has become a flourishing business. Carts pepper shopping centers nationwide, serving as temporary showcases for trendy merchandise and enlivening once-vacant corners and corridors.
Along with entrepreneurs like Harris, the concept attracts “national chains like Brookstone, Sharper Image and the Nature Company, which use them to promote a special item,” Wolf says. Last year, Sharper Image sold liquid-gel insoles from a cart.
“They want a shot at the exposure,” Wolf explains. And the money. “Particularly at Christmas,” he says, “they can gross $60,000 to $70,000 in six weeks off one pushcart.”
The carts came to Southern California when Horton Plaza opened in San Diego in 1985. Created to match the mall’s architecture, they were added as “decoration, whimsy, fun,” says Bob Dobson, retail licensing director for the Hahn Co. Now, there are 28 pushcarts in Horton Plaza and a total of 300 in Hahn-owned shopping centers across the country, including Fox Hills Mall and Santa Anita Fashion Park.
Managers of malls without pushcarts, such as the Glendale Galleria--where first-quarter sales were down 3% over the same period last year--say they may introduce them. And at Ala-Carte, an Iowa-based cart manufacturer, co-owner Debbie Albright says: “Since the economy has gotten a little worse, our business has almost doubled. I think rather than build a new mall or center, developers are making better use of their current location.”
To some, it’s not a great idea. In one Southern California mall, where permanent tenants face a densely packed corridor of carts, a retail executive, who asked not to be identified, says his complaints start with the merchandise:
“It’s contrary to our mix. They put low-end T-shirts in front of our store’s high-end clothing. Accessories and watches would be better. But, in any case, we hate them because they block our frontage.”
The cart people have their own problems.
One of the biggest is theft--Harris calculates he loses “3% of gross sales every week.” Also, failures are common, as witnessed by Ross Crawford, who manufactures the Jamaica Me Crazy line of button covers and promotes them on a pushcart in Santa Monica Place. For him, the cart business “is a kick. But over the course of a year and a half, I’ve seen probably 30 others come in and fail,” he says.
And then there are all the rules, which cover everything from the cart’s appearance and lease terms (usually 52 weeks maximum) to the employees’ dress (preferably no jeans, no short-shorts, no miniskirts) and conduct (no food, no smoking, no fraternizing with friends, no unattended cart).
Rentals vary from mall to mall, ranging from $1,000 to $7,000 a month, depending on the season and the merchandise. Other expenses may include a business license, liability insurance, cart accessories, mall maintenance and a percentage of the sales.
At the Westside Pavilion, assistant general manager Marla Koosed insists her vendors buy uniform director’s chairs and work with a visual display contractor on the cart’s interior, which costs $500 to $2,500. “We want them to have a really good shot at being successful,” she says.
But Liz Schulman, specialty leasing representative for Topanga Plaza and the Plaza at West Covina, likes a less expensive approach. “This is almost a stage set. There are things you can do with tubes, wallpaper, fabric and baskets. It’s even better if you don’t spend a lot of money because it tends to be more creative and boutique-looking without it.”
Every leasing agent is looking for a cart winner--something eye-catching and trendy that won’t compete with the mall’s long-term tenants. Lynda Mulligan, retail licensing manager for Los Cerritos Center, says she scours swap meets and gift shows for potential cart people, trying to replicate the success she and others have had with sterling silver jewelry.
“Life for a product on a cart is about three to six months. It peaks and then it goes mainstream,” says Mulligan, who rejects more vendors than she accepts, including one who wanted to sell footstools with a powdering device attached. “But silver has been around for three years and it never hits its peak.”
Many mall executives say their goal is to “incubate” cart merchants in the corridors, then move them into stores. Jack Miles, general manager of Montclair Plaza, where there are 12 carts (18 during the Christmas holidays), is one of the few to say: “I don’t buy that. By and large, the cart business has to be narrowly defined, so that what’s on a cart can never make up a store. Typically, I see cart merchants move into a mall, their merchandise runs its life cycle, and then they move onto another mall or into another line of merchandise.”
However, in Fox Hills Mall, “having a big store, to have the whole nine yards, to be in every Broadway and every GHQ,” is the goal of Marlon Singleton, a Santa Monica College student and one of four young owners of Positive Wear.
Their merchandise--message-laden T-shirts and sweat shirts, baseball caps and colorful leather-and-wool jackets--is carried in 35 stores nationwide and has appeared on Fox television’s “In Living Color.”
But with only a Culver City garage as headquarters for the year-old company, Singleton finds the cart a good calling card. And it has made a believer out of him.
Mall management, he says, “told me 60,000 people go through here in a week. I didn’t believe it. Now I agree. In a good week, we do $2,500 to $3,000. Expenses are about $1,000, so we could clear $2,000. It’s more than we had anticipated.
“I think the cart was one of the best marketing things we could have done. Even if people don’t buy, they are going to see Positive Wear and remember the name when our company gets larger. The visibility is great.”
So great that Stephen Harris, who recently opened a jewelry store in Fox Hills Mall after his cart lease expired, isn’t thrilled with the change. “You lose the traffic flow rushing on both sides of you,” he laments. “Cart people are happy to be cart people. What we like to do is add festivity to mall corridors, to make them a more lively, more entertaining marketplace.”
