TALKING SHOPS: Defiant optimism is evident among Athlone retailers, but customer promotions are vital, writes Laura Slattery
RETAIL THERAPY is not something you hear people talking about much these days. Recession has forced us to embrace cheaper solaces. But Rosie Boles's year has been dominated by retail therapy – or, more precisely, Retail Therapy, a new RTÉ store makeover show due to air in 2010. It's Mary Queen of Shops, except with Feargal Quinn as your guru.
“We had six months of cameras popping in and popping up,” says Boles, the owner-manager of Burgess of Athlone, which lays claim to the title of oldest department store in Ireland.
Burgess has endured tough times before – indeed, it survived the famine. It has traded from the same site on Athlone’s Church Street since 1839 and, once upon a time, they even made coffins here. Downstairs it used to be dungeons; now it’s where you’ll find home wares.
Boles, whose father Ian bought the store in the 1950s, decided earlier this year that Burgess was in need of modernisation.
“We hadn’t dispelled the image of ‘my mammy or my granny shops there’,” she says. When the promise of prime-time before-and-after exposure came, Boles said “yes please”.
During the boom years, Burgess was never into “frivolous fashion”, she admits. And now? “Now the buzzword is investment pieces. People are expecting more from their clothes: the same dress has to do the wedding, the day at the races, the Christmas party.”
And men just stopped buying, she says. According to research by Retail Excellence Ireland, menswear has been the worst affected retail category in this recession. Perhaps it’s because job losses have sprung predominantly from male-dominated sectors, or maybe it’s because fashion-shy men are more inclined to see new clothes as a luxury, but menswear sales are down 24 per cent over the last year.
Still, Boles is optimistic. “I’m hoping for a bumper Christmas for menswear because wives and girlfriends must be sick of what they’re wearing by now. Hopefully, they’ll be kitting them out,” she says.
“If you want bathing clothes out of season, you can get it in Burgess,” says Siobhán Bigley, chief executive of the Athlone Chamber of Commerce. The retailers that are closing down are “the inexperienced ones”, she believes.
“The question on everyone’s lips is what’s going to happen in January,” says her colleague, Carmel Connolly, the incoming chamber president.
“While trading conditions are probably tougher now, what you will find is that the good retailers are in a better position because they are carrying less stock and have fewer overheads.”
Everyone I meet in Athlone talks about the importance of marketing like crazy. Boles’s office is strewn with literature for promotional customer events. For its part, the chamber has signed up 55 local retailers to an Athlone gift voucher scheme, designed to curb outward spending.
Just out of town in an industrial estate on the Moydrum Road, Sinéad Denby, owner of SBA Home Ideas, is pleased to have got one of her sofas into a spread in House & Home. With her turnover down around 60 per cent and no budget for advertising, the free PR is a godsend. "I had a call from the North today about our kids' furniture," she tells me – a welcome reversal of the usual direction of cross-Border trade.
Denby’s store is stuffed with modern, keenly priced furniture – not Ikea-nasty in terms of quality, but Ikea-nice in terms of design. I really wanted her curved magenta sofa and monochrome rugs. The problem is, I can’t afford to buy big-ticket items right now and neither, it seems, can most people: Denby’s 1,800sq m store is empty on the day I meet her in a lonely glass-walled office (albeit it is a rainy Tuesday evening).
SBA Home Ideas officially opened in March 2007 right at the point that the housing market turned. In the beginning, it was so busy that Denby didn’t want to commit to an exact day on deliveries. She slaps her face now when I ask how the housing bust has hit her.
Finally opening in late 2007, the Athlone Town Centre had its own brush with bad timing. “We had two months of the Celtic Tiger, then it all stopped,” says Neil Bannon, head of the centre’s managing agents, Bannon Commercial. Bannon was involved with seven of the debt-financed shopping centres that opened in 2007; most are now going into the National Asset Management Agency, he cheerfully admits.
“It’s unlikely that there will be that much competition built in the next 10 years,” he says, looking on the bright side. “And when you look at the tenant mix, we probably exceeded our expectations.”
Indeed, the 300,000sq ft centre has H&M and Zara, neither of which is in Galway.
Any further delays and these brands might have decided to bypass the centre that markets itself as “the Grafton Street of the Midlands”.
Bannon wants to let the former Barratts shoe shop, which as of last week was sitting empty, to a hairdressing salon. But it costs money to fit out a hairdressers, and it’s hard to get finance for shop fit-outs, he says. This week, the store was transformed into a flood relief advice centre for the town instead.
Although the second phase of the centre has been postponed “until market conditions change”, Bannon is sanguine about Athlone’s future.
“The economy goes up, the economy goes down, but there are still 350,000 people in the midlands looking for fashion items.”
I meet Bigley and Connolly in the lobby of the Sheraton Hotel, linked to the Athlone Town Centre via a basement passageway. They, too, believe Athlone’s economic pain could have been a lot worse than it has been. Its big employers – Elan, Ericsson, Covidien – have had some redundancies, but it’s been “a slow trickle”, according to Bigley, while there have been new jobs at Georgia Tech, KCI Medical and Teleflex.
Although Athlone was part of a three-pronged gateway with Mullingar and Tullamore in the National Spatial Strategy, it didn’t make the list of decentralisation options; perhaps because it already had the Department of Education and the Army. The chance to form a single strong economic centre midway between Dublin and Galway was lost.
“Yes, decentralisation would have been welcome, but political sense is not the same as logical sense, is it?” says Bigley. “Athlone has created its own economy,” she adds. “We don’t have ghost estates, we don’t have a series of shoeboxes. We’re too far from Dublin to have a big commuter population. We’re not Mullingar.”
Prices slashed
A PRE-CHRISTMAS sale used to be a sign that a retailer was in trouble.
Then the market turned, and suddenly everyone was at it. The phenomenon of "guerrilla sales", or "one-day spectaculars" as certain stores call them, spread from the likes of Debenhams to previously steadfast retailers like Marks Spencer.
Now the retail sector has settled into a third phase: perma-sale. As Neil Bannon of Athlone Town Centre agents Bannon Commercial puts it: "The difference this year is that no one has really been out of sale."
With disposable incomes shrinking like a dryclean-only dress in a washing machine, the only way is down for retail prices. Consumers have been caught up in their own personal debt-deflation spiral – whereby the real value of their debts increases as their incomes deflate – and they have come to expect further price falls.
"You've got your sale price up and people say 'okay, but what's your best price', and I'm saying 'there's 70 per cent off!' I'm cringing putting in the price," says Sinéad Denby, owner of Athlone furniture store SBA Home Ideas.
Retailers say sale prices are unsustainable, especially as fixed costs such as rent and rates are not coming down.
But some economists have noted that retail margins were generally wide going into the recession: in that context, consumers could be forgiven for viewing a "discount" as simply a "more realistic price" in an economy where every business has had to rediscover long-lost marketing skills.
Among retailers who import their goods from the UK, such as the British clothing brands, many of the "sale prices" are simply a more accurate reflection of the weaker sterling rate.
– LAURA SLATTERY
IN NUMBERS
1933– the year in which consumer prices in Ireland were last plunging as sharply as they are now
12.8%– percentage decline in the price of clothing and footwear in the year to October, according to the Central Statistics Office.
€30 million– announced value of the discounts marketed by Debenhams in its Irish stores over a six-week pre-Christmas period.
Monday: the series continues in Limerick
