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Thursday, October 01, 2009

Downtown shops struggle despite increase in tourism dollars

The downturn appears to be loosening its hold on the Flagstaff economy. However, even as national vend sales begin to rebound; many Flagstaff businesses in the downtown area are considering a much slower recovery.

The U.S. Census Bureau reported that, nationwide, retail sales improved 2.7 percent in August from the previous month. However, sales still lagged behind last year's numbers, with August sales 5.3 percent below August 2008 figures. Despite encouraging national trends, many downtown business owners in Flagstaff maintain that they still haven't seen enough local recovery to bolster their sales.

Jonathan S. Day, the owner of Indian Arts and Antiquities on North San Francisco Street, says that business at his store has been very incompatible since the recession hit. "July is my best month of the year. This July was my worst month in 10 years," said Day. He attributes his slow business to the fact that the items in his shop are not necessities for most people. "I don't sell things anyone needs. When the economy goes down the toilet, people's discretionary income is the first thing that goes," he said.

Carolyn Young, owner of the West of the Moon Gallery in downtown Flagstaff, has experienced a similar drop in business over the last year-and-a-half. She hasn't seen any relief, as her biggest customers are locals, and people in Flagstaff are still suffering from the effects of the recession. "They say we're out of [the recession], but I'm not so sure," she said.

The stores in the downtown area that have fared best in the economic storm of the past year are those that cater to people on a tight budget, offering low cost alternatives to the more expensive gift shops like Indian Arts and Antiquities and the West of the Moon Gallery. These stores have thrived where other stores have suffered.

Animas Beads has actually seen an increase in business. Carrie Ann DeConte, the assistant manager, said that, "If anything, we're more busy." She attributes the store's success to their base of regular local customers. Also, because Animas Beads sells cheap supplies to make gifts rather than pre-made and more expensive products, DeConte believes that their store offers exactly what people are looking for in tough economic times.

Animas Beads moved to a new, larger location two years ago and has been able to maintain momentum through the economic downturn.

The Flagstaff Chamber of Commerce sees signs that local businesses are rebounding thanks to a recent increase in tourism, even if the effects are yet to be felt by some parts of the local economy.

"Tourism is up," said Julie Pastrick, President and CEO of the Flagstaff Chamber of Commerce. The Chamber found that all of the hotels they spoke with were filled beyond capacity when the Arizona Cardinals training camp was in town this summer, bringing millions of dollars into Flagstaff. It is estimated that between 3,000-4,000 people attended just one practice during the team's stay and poured $2.3 million into the Flagstaff economy.

Pastrick sees no indication of the positive tourism trend reversing and expects another big boost to local businesses when Snowbowl opens later this year, bringing visitors from Phoenix and Tucson back to the area.

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