Skeleton Crew
They pop up in September like toadstools and vanish about two months later. But in that brief time, specialty Halloween stores scare up excellent profits with a brew of costumes, accessories, makeup and assorted ghoulish treasures.
Between scouting locations, buying merchandise and hiring workers, running these short-lived seasonal shops is a full-time business.
“We start looking at leases in April or May,” said Bruce Gold, Southern California regional manager of Spirit Halloween Superstores, which operates a chain of 100 stand-alone Halloween stores, including shops in Canoga Park and Burbank. “It’s a long process.”
The success of seasonal stores “is one of the greatest indicators of how popular this holiday is and how concentrated,” said Mary Helen Sprecher of the Halloween Assn., a trade group based in Maryland.
Halloween sales are projected to reach nearly $6.8 billion this year, up from $5 billion last year, according to the National Retail Federation, a Washington, D.C.-based trade association.
Candy sales alone will account for nearly $2 billion, the federation reported, followed by $1.5 billion in costume sales. The rest will come from decorations, party goods, pumpkin-related items, greeting cards and the like.
Although no one can say what percentage of the Halloween boom comes from seasonal stores, increased trade show attendance may be one indication, noted Mark Passis, vice president of Transworld Exhibits, which puts on the National Halloween, Costume and Party Show in Chicago and Las Vegas.
The March 2001 show, he said, will have 750 participating companies and 2,000 booths, compared with 675 companies and 1,700 booths this year. About 13,000 people are expected to attend, 1,000 more than this year.
“If the industry wasn’t growing, we wouldn’t see greater numbers,” Passis said, noting that three or four stand-alone stores seem to spring up each year.
Gold, whose Spirit chain operates a 12,000-square-foot store in the Fallbrook Mall and an 11,000-square-foot shop in a former Blockbuster outlet in Burbank, said competition in Southern California is definitely increasing. In addition to the stand-alone stores, chains like Kmart, Target and Wal-Mart have increased their stock of Halloween goodies.
“The market is probably a little more diluted now because more people are in it,” said Gold, who oversees 11 Southern California stores. “Will our figures still be good this year? Probably. Would they be better if there wasn’t so much competition? Probably.”
Joe Marver, Spirit founder and divisional vice president, said locating near larger chains could actually be a boon because “we feed off of their advertising.”
A specialty store, he added, has a bigger selection, knowledgeable staff and “offers a fun experience.”
Buying begins as early as February, when Halloween merchandise is first shown at the New York Toy Show, followed in March by the Chicago event. Merchandise is ordered and either shipped to warehouses or scheduled to arrive when the store opens.
Shipping woes can add to a store’s challenges, added Rick Villata, a full-time Los Angeles city firefighter who uses his October vacation month to help run his family-owned Halloween Unlimited. The company hires 11 employees to run shops in Moorpark and Simi Valley. “You have a small window of sales opportunity and if something happens at the dock and you don’t get your product, you’ve literally missed the boat,” he said.
The biggest challenge for seasonal shops is finding short-term store rentals, especially when you have to start looking early in the year. Landlords often won’t commit to a short-term rental in case a longer lease comes in.
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A good location is vital to a store’s success, store operators agreed. Since sites usually change from year to year, stores must be highly visible. Part-time seasonal employees, most earning minimum wage, are often recruited from local high schools and colleges.
Good managers are important, because Halloween is such an intense holiday with a lot of business in a short time span, Gold said.
They must be adept at juggling staff during the hectic 10 days before Halloween, when stores stay open later than usual to accommodate often frantic shoppers.
This is where experience counts, agreed Albert Hassinger, manager at Spirit’s store in the Fallbrook Mall, in the space formerly occupied by a Discovery Zone.
Hassinger, whose other seasonal jobs include working renaissance fairs and a Hickory Farms Christmas store, said employees need to know how to help customers put together the whole look.
“If they want to be a vampire, you need to help them find fangs, blood, a cape, etc.,” he explained. “You might even need to know which makeup will cover eyebrows or how to make fake blood.”
Most stores have half-price sales on Nov. 1, then workers shut the store, take inventory, pack and ship leftovers to warehouses, do any necessary building repair and are out by Nov. 15, said Gold.
Spirit’s Marver said he knew Halloween was big business 16 years ago, when he had a small women’s apparel store in Castro Valley, across the street from a year-round costume shop.
“I used to drool at the business he’d do at Halloween,” said Marver.
When the costume shop closed, he decided to fill the niche the next Halloween. He scraped together $18,000 from family and friends to buy merchandise at a spring trade show and in mid-September moved his women’s clothing to make way for Halloween gear.
“It was the best October I ever had in the women’s apparel business,” he said. The next year, when he opened a Halloween store in a local mall, “they laughed at me and put me in a corner hidden behind an old restaurant. When I did $100,000 in 30 days they were astounded and I realized I had something.’ ‘
He kept expanding, almost doubling his locations ever year. “We borrowed money from everyone to get through the seasons,” he said. “But they always got a nice return for their investment.”
After six years, he left the malls in favor of 8,000- to 10,000-square-foot free-standing shops. By his 15th year he had grown to 63 stores, with about $20 million worth of inventory and “we were courted by two large companies.”
Marver sold the chain last year to Spencer Gifts, a division of Universal Studios.
One of the larger local chains is Canoga Park-based Halloween Adventure, which operates 30 stores in Southern California, including stores in Woodland Hills, Granada Hills, Northridge and Tarzana, according to Jim McDevitt, personnel manager.
The chain is owned by Leonard and Julie Goldman, who were arrested last October on charges of filing fraudulent tax returns to avoid paying $191,691 in state income taxes.
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Last May, Leonard Goldman was sentenced to two years in prison after pleading no contest to filing false income and sales tax returns, according to the state Franchise Tax Board.
The sentence was suspended to allow him to pay back taxes and penalties, the tax board said, while charges against Julie Goldman were dropped as part of a plea agreement.
The Goldmans did not return calls for comment.
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SCARY BUSINESS
Haunted-house attractions, once humble fund-raisers, have become big, slick moneymakers. C1
