With the holiday season receding in the rear-view window, Maine retailers are reporting a mixed bag of shopping results even as they look forward to a new year that’s gotten off to a slow start.
Gardiner found some success with its effort to boost downtown foot traffic by offering new businesses free rent for November and December. Three businesses moved in as a result of the Gardiner Main Street project, and one business stayed.
Clare Marron, owner of Monkitree in downtown Gardiner, said the increased foot traffic helped her business greatly, doubling holiday sales compared to the year before.
She said the store, which has a mix of home goods and other products from local artisans, also benefited from a seasonal pottery store that opened across the street for the month of December.
The owner of one of the pop-up stores, earth bound, however, said she was hoping for more sales at her clothing store in Gardiner.
“I think people were putting on the brakes a little bit, and hopefully that will relax a little later,” Jennifer Bergeron said. “We’ll see.”
Bergeron said all her women’s clothing boutiques, with permanent locations in Hallowell and Waterville, had a slow holiday season.
Retail sales overall in Maine dipped during January after a strong start. Michael Allen, associate finance commissioner for tax policy, attributed the decline to the Jan. 1 expiration of a 2 percent payroll cut and to rising gasoline prices.
“I’d be surprised if we saw a rebound in January sales,” he said. “I’d guess they’re going to be in tough shape, too. That’s kind of what we’ve been hearing nationally.”
Overall, Maine retail sales during the past holiday shopping season fell short of expectations in terms of sales tax collected by the state.
General merchandise sales in December were down 3.4 percent compared to the previous year, while sales in November and December were down 1.5 percent, according to revenue reports from the Office of the State Controller.
Allen said it appears retailers that target middle class shoppers struggled the most, while bargain-priced stores and higher-end retailers fared better.
Sales tax revenue from all purchases in December missed state projections by 3.8 percent, or $3.7 million, he said.
Allen doesn’t think anyone in the state anticipated holiday sales dropping so much.
“It’s a little disappointing,” Allen said. “We haven’t had time to fully digest it yet, but we certainly weren’t expecting anything like this, this type of weakness in the numbers.”
But in Augusta, the head of the downtown promotional organization said the majority of businesses reported having holiday sales around the same or better than last year.
“I heard some really good reports from restaurants and clubs,” Augusta Downtown Alliance President Larry Fleury said. “A couple of retail places were off and a couple were doing good.”
Augusta has many service-type businesses downtown, such as beauty salons and fitness studios, and Fleury said they reported doing quite well during and after the holiday season.
He said the perception of Augusta has improved among consumers and business owners thanks to a few new restaurants and efforts to improve the look of the downtown during the holiday season with planters, wreaths and fresh greens.
“Attitude seems to be way up on Water Street,” he said.
Fleury said the weekly cash mobs they held during the holiday season also provided a boost for the businesses visited each time.
Unlevel playing field?
Nationwide, holiday sales were up 3 percent from last year but below the 4.1 percent increase projected, according to the National Retail Federation, the world’s largest retail trade association.
Curtis Pickard, executive director of the Retail Association of Maine, said he heard positive results from major retailers such as Kittery Trading Post and Marden’s department stores, but thinks retail stores suffered from a surge in online shopping during the holiday season.
Online retail sales from Oct. 29 through Dec. 25 increased more than 15 percent from last year, according to the Chase Holiday Pulse, which tracks online payment from 50 of Chase’s largest e-commerce merchants.
“It kind of emphasized what we’ve been saying, that there’s an unlevel playing field between online and brick-and-mortar,” Pickard said.
Pickard said some uncontrollable factors tilted the scales positively for retailers. Having the maximum number of days possible between Thanksgiving and Christmas and not having any major weekend storms helped out retailers in the holiday season.
“Any year where you see year-over-year growth is a good sign,” he said.
Going into the holiday season, some speculated that the presidential election in November and talk of the fiscal cliff would distract holiday shoppers and stymie sales.
NRF President and CEO Matthew Shay said in the holiday sales report released in January that fiscal cliff worries and economic uncertainty had a visible impact on holiday sales.
But Pickard isn’t buying it. He said he doesn’t think the national discussions had a significant effect on individuals’ shopping decisions.
Pickard did say that superstorm Sandy, which left more than 8 million people without power in late October, hurt holiday sales in parts of the Northeast hit by the storm, although not necessarily in Maine.
State retail chains
At least one Maine retailer benefited from the storm that left battered and soaked stores in its path.
Marden’s, the surplus and salvage retailer with locations from Sanford, to Waterville, to Madawaska and Calais, saw its largest December sales revenues in four years, in part because of more product-buying opportunities from stores hit by Superstorm Sandy.
General Manager Craig Burgess said November shipments of merchandise from big box stores along the Eastern Seaboard gave Marden’s a stronger inventory than in previous years.
He said clothing, shoes, household goods and high-end electronics, such as flat-screen TVs, did particularly well because of the stores’ selections.
“We did not see a major increase in customer count,” Burgess said. “What we did see is the customers were coming in and buying more. That’s because we had the great values.”
Being a bargain retailer also helped boost holiday sales since many shoppers looked for deals during the season, he said.
“Everyone wants to give their loved ones a good gift” but not everyone can afford to spend a lot when financially struggling, Burgess said. “That’s where Marden’s comes in.”
Restaurants and most stores in the Augusta Marketplace reported holiday sales increases of 1 to 4 percent compared to the last season, according to Ellyne Fleshner, general manager for WS Development, the management company that owns the retail property. Some retailers reported flat sales, she said.
The head of Freeport’s promotional organization said most businesses felt good about holiday season sales, which were higher than in recent years for many retailers there.
“I think the reason people are feeling positive is it’s exceeding expectations,” FreeportUSA Executive Director Janet Dutson said. “I think people have had low expectations for a while.”
Dutson said she thinks the increased holiday sales might be a result of shoppers feeling more comfortable in the economy.
She said stores in Freeport also may have fended off losing sales to the growing trend of online shopping since people visit for other reasons besides just checking someone off their list.
“When they want to have a shopping experience, they come to Freeport,” she said. “I think that’s possibly why we might do better than your local downtown mall.”
Paul Koenig — 621-5663