Shoppers searching for holiday gifts won’t be able to spend their money this year at the now-defunct Borders chain.
There are three fewer BJ’s Wholesale Clubs in metro Atlanta, two fewer J.C. Penney stores, and an entire mall — Union Station — that went dark last November. One Sears store there remains, but it, too, will close by year’s end.
The closures, though, don’t mean a dearth of shopping options for metro Atlanta gift-givers.
Since the last holiday season — as with every holiday season — there are new retailers in town, vying for a piece of consumers’ wallets.
The department store Von Maur opened its first Atlanta outpost. Clothing chains like Love Culture, 20 Below and L.K. Bennett have moved into the metro area. New places to buy furniture, sporting goods and computers opened their doors. And some retailers that have seen success with their first Atlanta shops have taken the leap to add more.
But in a retail environment such as Atlanta’s, where unemployment is higher than the national average and experts generally agree that there are too many stores, why decide to open a new one?
“In tougher times, it’s easier to win,” said Britt Beemer, chairman and founder of America’s Research Group. “It focuses attention on those retailers.”
Beemer said the rare new retailer can excite a community and bring shoppers out in a big way.
More people are shopping online, but they still buy in stores, said Randy Stuart, assistant marketing professor at Kennesaw State University. Shopping has always been a social experience, but Stuart said that is becoming an increasing focus. Even as people research their purchases more online, she said they are going to malls to be with other people, which can benefit new retailers there.
When to open
If a retailer knows what it is doing, any time is a good time to open, Stuart said. Before the holiday shopping season is an ideal time to do so, as malls and shopping centers are filled with gift-seekers who might not otherwise know a new retailer had entered the market.
Additionally, Stuart said, the bad economy means rents have stayed low, increasing Atlanta’s appeal to businesses that were considering expanding here.
Arhaus Furniture, a chain with 39 locations in 16 states, opened its first Georgia store in Phipps Plaza on Oct. 7. The senior vice president of merchandising, Gary Babcock, said the company has been looking in Atlanta for three or four years.
He said there is a market for furniture even in a bad economy, as shoppers who may have built an addition in flush times instead look to upgrade their decor. Sales are up for the company across the board, Babcock said, and the response to the Phipps Plaza store has been strong.
“It’s been doing awesome,” he said. “I expect it to be one of our top-performing stores.”
Opening before the holiday season gives the company higher mall foot traffic, which means free advertising to shoppers who don’t know the name, Babcock said. Von Maur, the new department store opening at North Point Mall this weekend, is also taking advantage of the pre-holiday rush to get its name out.
“We have always opened our stores in the fall, going into the holiday season,” chief operating officer Melody Westendorf said. “Everybody’s shopping.”
That company had been looking to expand into the Southeast for five years, Westendorf said, and Saturday’s opening was more than 18 months in the making. Westendorf said she is optimistic about the amount of excitement the new store has garnered, even as the economic recovery has stayed slow.
“You don’t know what the economy is going to be like when you open the doors,” she said. “You don’t do a lot of manipulating of the opening date.”
In addition to more favorable lease rates and a ready workforce, a new store that opens when the economy is troubled can benefit by establishing itself when there are few new names in the market, said Ken Bernhardt, a marketing professor at Georgia State University’s Robinson College of Business.
The Atlanta market
Where possible, he said, retailers are still expanding in the Sun Belt, and Atlanta remains a desirable market because of its history of growth.
“The economy isn’t going to stay poor forever,” he said. “There are a lot of reasons to come in now.”
Academy Sports + Outdoors entered the metro Atlanta market in April and now has three stores here and a total of six in the state. The company had been looking in the area for a while, and spokesman Eric Herrera said Atlanta is a “very exciting market” for the company to grow in. He said sporting goods stores did not experience as big a downturn as other retailers, making expansion promising.
Microsoft selected Atlanta for its first store on the East Coast, which opened at Lenox Square mall in May. Marietta Davis, general manager for Microsoft Corp.’s greater Southeast district, said the company did a lot of research before making the move. In part, Atlanta was selected because of the relationships the company has with large corporations, such as Home Depot. But Davis said she thinks the market for the Microsoft store is strong regardless of corporate customers.
“It’s one of the best shopping locations in the country,” she said.
Davis said the projections for the Atlanta store — which was at least two years in the making — are on target. But things are going slow for Paper Source, which opened its second metro Atlanta location at Shops Around Lenox in October.
The company opened its first Georgia store in Virginia-Highland in 2008. CEO Sally Pofcher is confident about the prospects for the second location, but said Atlanta has been a challenging market. She looked in Buckhead for four years before deciding on a space.
Pofcher said the 30-year-old stationery chain could have several more Atlanta locations in time, if demand remains. Same-store sales are strong company-wide, Pofcher said, and she expects a good holiday season.
The chain, she said, will continue opening in new markets regardless of outside conditions.
“It’s not necessarily the economy. It’s do we have a brand that’s under-penetrated,” Pofcher said. “You can only control what you can control. You can’t control the economy.”
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