The Halloween Business: Life After Oct. 31

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For one month a year, New York Costumes is the busiest shop in Manhattan, with crowds flooding out the doors and around the block. It’s a situation any retail store would kill for, but come Nov. 1, the business looks more like a ghost town, due to a sharp, though predictable downturn in sales.

“At least 60% of our annual business comes during September and October,” said Justin Nelson, the Office Manager for New York Costumes, located in Greenwich Village. Nelson confesses this puts a lot of pressure on sales during this two-month period.

Other Halloween shops follow the same trend. According to one estimate, Halloween retailers make as much as 70%-80% of their income during September and October.

But the most successful shops find other products to sell to keep customers coming back during the off season. New York Costumes manages to stay open thanks to other holidays like Christmas, where people buy Santa costumes, and Purim, which Nelson calls “the Jewish Halloween.” And Ricky’s, a popular chain, sells beauty products year round.

Landes Costumes by Rachel, located in Indianapolis, is one year away from celebrating its 100th anniversary. They’ve weathered the Great Depression and are doing just fine in the current economic downturn by renting out costumes year-round. So what’s their secret?

“We rent out to theater productions, commercial shoots and film production,” said Rachel Godollei Johnson, the owner. “The big difference for us between Halloween and the other 364 days of the year is the number of people actually in the store.” Throughout the rest of the year, Godollei mostly receives measurement cards in the mail from interested parties, but during Halloween, children and their parents flock to the store to peruse its famous selection.

“This year, vampires and zombie costumes are the big thing because of all the movies,” she said. To help with this influx of customers, Godollei reaches out to acquaintances – relatives, friends, former students – all prepared for the call to man the store. Still, even Landes Costumes by Rachel depends on the Halloween season for a third of its sales.

This seasonal sales pattern leads many Halloween shops to utilize temporary storefronts. Halloween Express, a chain of stores centered in Wisconsin, opens Sept. 1 and closes shop on Oct. 31. According to the founder, Jon Majdoch, each of these stores do very well, averaging at least $300,000 in sales for these two months alone. But the big difficulty is finding good temporary locations.

Due to the economic downturn, this year more stores are filing for bankruptcy, which in turn means that there are plenty of spots for temporary stores to inhabit. Spirit Halloween, another chain, has taken full advantage of this, seizing dozens of former Circuit City locations.

Spirit Halloween stores open and close in the blink of an eye, lasting less than a month. One store opened on Oct. 6 in an extinct Circuit City location on Broadway and 80th Street in Manhattan. According to Sandie Cummings, the assistant manager, it takes just four days for contractors to redesign the space and for the store to stock up on merchandise. The hiring process takes another week.

Just as quickly, the store closes again. “On Nov. 1, everything goes on sale for three days,” she said. “Then, we pack everything up in boxes and ship it off to warehouses in North Carolina.” She doesn’t know what happens to the items after that.

New York Costumes originally started as a seasonal store called Halloween Adventures. But sales on Halloween were so strong, they made the transition to become a year-round shop.

However, this year, many feared that the recession would cause poorer sales and jeopardize many of the more fragile Halloween businesses. But so far, just the opposite seems to be true. Each of the shop owners we interviewed reported stronger sales (though of course they may be trying to save face). New estimates show sales may actually increase compared to last year by 3%.

“People still need to have a little fun and spend on costumes, without feeling too guilty,” Godollei reasoned.  “When you think about it, Halloween is a time for adults to get silly and goofy to let off steam.”

Another positive sales factor is that Halloween falls on a Saturday this year, while makes the day easier to celebrate, and therefore may boost business. In fact, Spirit Halloween is actually lobbying to make Halloween permanently on the last Saturday of every October, rather than end up on weekdays most years, so people can get their fill of trick or treating, and stores can meet their quotas. Sounds good to us.

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