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For small retailers like Patina, the make-or-break holidays take a year of preparation

By: John Ewoldt  Published: November 29, 2015

KYNDELL HARKNESS, STAR TRIBUNE

Owners of Patina, Christine Ward and Rick Haase stand among the holiday displays at one of their stores in Minneapolis.

There were no "doorbuster deals" and no one busting down the door at the Patina lifestyle store in south Minneapolis on the morning of Black Friday. Shortly before opening, store manager Karin Tappero fired up an extra cash register, turned on the holiday music and straightened the cat toys.

"Most of our employees and shoppers won't roll in until the afternoon," she said. "Unlike Herberger's, where my sister works and had to be in at 4 a.m., there's no pushing and shoving when we open the doors."
Big stores dominate shoppers' attention and make most of the noise during the holiday season, but it's also the make-or-break time of the year for small retailers. At Patina, December alone will account for about 30 percent of the year's sales. What looks like a sprint for the popular lifestyle boutique, which has seven locations across the Twin Cities, is actually a marathon that began more than a year ago.

Indeed, Rick Haase, who, with his wife, Christine Ward, started and owns Patina, is already placing orders for the 2016 holiday season. "We have to order now from suppliers that don't deliver on time," he said.

Most orders for the holidays are placed in January and February and arrive in June or July for placement in stores in October and November. They're one-shot deals where, if the item sells out, there's little chance to reorder before Christmas.

"It's like going to the casino every day," Haase said. "Win big or go home. It's a risk."

The National Retail Federation found that a small retailer's ability to adapt and select items not found in big box stores is key to attracting shoppers. Patina's seven buyers specifically ask suppliers if items they are interested in also will be sold at stores like Target and Wal-Mart. If the answer is yes, they think twice. Patina decided to stay away from "Star Wars" items this holiday, for instance.

"You try to develop relationships with suppliers," Haase said. "But you can't control it if they expand their distribution."

One morning in early October, about 20 people — store managers, merchandisers, buyers, Haase and Ward — met before opening time at the flagship store at 50th and Bryant to discuss the "grid," or store layout, for 37 themed displays they would prepare for the holiday season. The first order of business was the ornaments display, typically the first to go up.

Gwen Westberg, Patina's lead visual merchandiser, the night before had put the finishing touches on the display, a tall, four-sided pedestal with different items on each side. As she explained it, store managers took pictures of it with their iPads. "Every ornament placement is deliberate," Westberg told her colleagues. "Replicate it exactly. Each side has a theme."

Placed near the floor of the display was life-size guinea pig ornament. "It looks better from that vantage point than at eye level," Westberg said.

That move worked: The guinea pig is Patina's top-selling ornament so far this year.

Westberg pointed out in another meeting that the stockings above the entrance display should hang at the same height. "The straight line and repetition puts shoppers at ease in a store where there is a lot to look at," she said.

Haase likened the group's deliberation over the floor plan to the creation of a story. Each display is designed to flow seamlessly to the next, with items of varying sizes, colors, shapes and textures are chosen for each one.

One new display for Patina this holiday is dominated by blue and white hues in blankets, pillows and accessories. A ceramic whale is paired with a book that has a whale on the cover, sitting next to a candle with a sea salt fragrance. "The three do better together than if they were separate," Westberg said.

When an item doesn't sell well, the first thought at Patina is not that customers don't want it but that it's not being marketed correctly. "More than likely, it's not paired with the right items," Tappero said.

Patina's first holiday displays, for the ornaments, went up in mid-October in its seven stores, but represented just a small fraction of the planning. By the first week of November, holiday foods, stocking stuffers, toys and kitchen items replaced the Halloween and Day of the Dead goods.

During that same period, managers started interviewing part-time seasonal help. Patina, which has 170 permanent employees, hires about 10 part-time employees for each store, 70 in all. They start in waves in November and early December.

Each week, Patina's merchandisers and managers moved in small ways to position holiday goods more prominently. At one early morning meeting at the flagship store, Westberg reminded the group of managers to inspect window displays from outside at night. The reason — many Patina shoppers visit after work on weekdays, when it's already dark.

This autumn's warmer-than-usual weather also shaped the store's planning. Haase and West told the group they didn't want customers seeing an abundance of Christmas when temperatures were in the 60s and 70s in October and earlier this month. As a result, Patina stores weren't fully decorated for the holidays until late November.

Even then, Patina's shelves were trimmed with less tinsel and glitter than in the past. One reason is that Haase wanted shoppers to pay more attention to goods on the shelves. The other reason, he said, "People don't have as much time to decorate their homes and we want to reflect that."

Tina Wilcox, CEO and creative director at Black, a retail branding agency in Minneapolis, described Patina as one of the best gift shops in the country, partly for its ability to adapt quickly. "They're doing a lot of things right. They buy in smaller quantities that make people buy before items sell out," she said.

Patina last year discontinued online sales, a move unthinkable to many retailers now. Wilcox thinks it was smart. "Patina has so much to look at that it's hard to replicate online," she said.

Haase and Ward started the store in 1993 and, with its constantly changing products, describe Patina on its website as an "art project in process." It has grown to about $14 million in annual sales and the couple project this year's holiday sales to rise 5 to 7 percent. "I'm feeling very optimistic," Haase said. "Barring bad weather, we should have a solid year."

Ward said that, for her, the season is more about creating an experience for shoppers. "The energy and the hustle and bustle of our customers makes us want to do better," she said.

The couple make it a practice to stay out of their stores on Thanksgiving weekend, leaving them to the managers and specialty teams. "We're crazy busy for the rest of the year," Haase said.

When Carly Goodlund, 24, and Samantha Nestaval, 23, walked into the Patina at 50th and Bryant Friday morning, they had it to themselves. "I'd rather be in a place where I'm not fighting the crowds today," Goodlund said as they picked up stocking stuffers.

"Look at this," Nestaval said, pointing to a painted wooden crèche. "You can't find any of this at Target. That's what I like."

Are Outlet Malls Really A Better Deal? WCCO Went Shopping To Find Out

By: Liz Collin  Published: November 27, 2013

MINNEAPOLIS (WCCO) — Along with many malls and big box retailers, dozens of stores at outlet malls in Minnesota will also be open come eight o'clock Thursday night, but we wondered are outlet malls really a better deal?

Beyond Albertville, shoppers can also check out deals in Medford and come next summer an outlet mall in Eagan will open its doors.

But before you start crossing items off of your Christmas shopping list at the outlets, we checked out five popular stores.

Taking the 40 minute drive from the Twin Cities gives shoppers even more time to get excited about their trip. The billboards offer a steady reminder of all they'll save on the latest styles.

Albertville Premium Outlets is Minnesota's largest outlet mall with 100 stores, a mix of designer names, housewares and specialty items.

"There's lots of great sales here," one shopper told us. "Always."

Sure, there are sales but do outlets really offer the lowest price?

"I don't know. I really don't know," another shopper said.

We went shopping at five popular stores: Columbia, Gap, Banana Republic, Carter's, and Coach.

At Columbia, there seemed to be steep discounts on most racks of merchandise. We ended up with a women's winter coat. We paid $169.90 at the outlet. The same coat was selling in a regular Columbia store for $60 more, but when we checked online, we found the same style selling for $10 less than the outlet price.

Tina Wilcox is the CEO of Black, a retail brand agency.

"You shouldn't ever assume it's the lowest price," Wilcox said.

She doesn't want shoppers to be deceived by the reduced price tags at the outlets. And when it comes to what's inside, Wilcox says we should know it's not usually a fair price comparison.

"I think outlet shopping can be really great for people if they know what they're looking for and what they're looking at," Wilcox said.

Like what we found on our trip to the Coach outlet. Eighty percent of what you find in there is made specifically for those stores. Meaning, you won't find most of it a regular retailer. To be able to sell bags, wallets, and accessories at such a discount, Wilcox says manufactures use less expensive material or cut corners on extra detailing.

With a 50 percent off coupon they were passing out at the door at the outlet, we paid $40.05 for a wallet and $143.55 for a leather tote. We found similar items at a Coach store in the mall priced at nearly twice as much, $78 for the wallet and $298 for the purse. But, again, they are not the same.

If you do find something that seems to be similar at the outlets, Wilcox suggests taking a close look at the outlet product since it could have flaws.

When it comes to what items you'll consistently save on, it's best to keep it basic. Wilcox believes socks, underwear and T-shirts are a safe bet. At Gap, we bought a 6-pack of athletic socks for $6.49. For the same amount at a mall store we'd pay $17 more.

At Banana Republic, we bought a basic men's brown shoe at the outlet for $82.49. We would have paid $57.50 more at the mall for the same pair.

When we went looking for baby clothes at Albertville, we learned another lesson in outlet shopping.

At Carter's, we found discounts all over but when we to a regular store, we found the exact same prices.

The same boys outfit sold for 60 percent off at both stores and the same girls sweater for 25 percent off.

Wilcox says it's because the clothes are inexpensive to begin with.

"There's a pretty tight margin when it comes to manufacturing infant wear, and so you're not going to see as big of a difference when you go to the outlet," Wilcox said.

Altogether, national studies have shown shoppers will save an average of 38 percent at the outlet mall, but Wilcox says shoppers shouldn't succumb to sticker joy.

"Just because it might be a lesser price, it doesn't necessarily mean that it's a good deal," Wilcox said.

Just because you take the drive doesn't mean you have to buy.

Wilcox told Liz that the outlet mall industry is growing considerably. Just one traditional mall has been built in the US in the last seven years, while nine outlets will open next year across the country. That includes the one in Eagan.

Below are answers to some outlet shopping questions:

Should I shop early or late on Black Friday?

— Determine if you are in the market for anything featured as an early bird special or doorbuster deal and come out early (before stores open) to ensure you get those before they're gone.

— If you can wait, consider coming out toward the end of Black Friday when the crowds have died down but the deals are still available.

— Plan your trip. A center map and store list are available online. Albertville Premium Outlets is large and it's best to pre-plan your route so you make sure you hit all the stores on your list as efficiently as possible.

— Buy what you love now. Don't wait – it will be gone tomorrow. Merchandise in the outlets sells fast and once they're gone, the item may never be sold again.

— Check the return policy before making a purchase. Most stores have traditional return policies but it's best to check.

How can I find out about deals early?

— Sales and special deals are being added constantly to the Premium Outlets Deal of the Day calendar. Check back frequently to view the latest sale information at Albertville Premium Outlets.

How can I save even more?

— Sign up for the VIP Shopper Club for FREE at www.premiumoutlets.com/vip to receive special mailings with added savings. Immediately upon signing up, you will receive a voucher for a VIP coupon book worth hundreds of dollars of additional savings at any Premium Outlets center; have access to exclusive online coupons, insider news and info, shopping tips and more.

New furniture stores on the mend

The home furnishings market in the Twin Cities is showing signs of strength, especially for stores that are able to carve a niche.

By: John Ewoldt Published: October 21, 2012, startribune.com

As the Twin Cities housing market mounts a comeback, it's bringing home furnishings along for the ride.

The number of residential building permits through September is 30 percent higher than in 2011, according to the Builders Association of the Twin Cities (BATC). At the same time a spate of new home furnishings stores have opened or will soon, including Parmida in St. Louis Park's West End and Arhaus, Andrew Martin, and a new Pottery Barn prototype in Edina's Galleria.
The rebound in home furnishings started in Uptown when CB2 made its Twin Cities debut last year and designer Jonathan Adler opened a new store there in May.

"That was a big coup for the Twin Cities," said Tina Wilcox, CEO and creative director at Black, a retail branding agency in Minneapolis. "A lot of new retail is opening in the Twin Cities home market."

The Twin Cities has seen a year-over-year gain of about 8 percent in the furniture market, which is well above retail as a whole, said Dave Brennan, University of St. Thomas professor and co-director of the school's Institute for Retailing Excellence.

One of the strongest areas of growth is in Edina, which leads the metro area in remodeling and teardowns. The number of permits for teardowns year to date in Edina, 64, is more than double the number for all of 2011, according to the BATC.

The area benefits from a cluster of home furnishings retailers, including Room & Board, Macy's Home Store, West Elm, the Container Store and a newly reopened Cost Plus World Market in Bloomington. It's also home to the Galleria with its power draws Crate & Barrel, Restoration Hardware and Gabberts, an original anchor.

The newest addition, PBTeen, will open as a pop-up store in November. Under the Williams-Sonoma umbrella, Pottery Barn is one of the only home retailers to focus exclusively on teen and tween furnishings for their bedrooms, study and lounge spaces.

For the Galleria, home furnishings is one of the most important parts of the retail mix, making up about a third of the Galleria's 400,000 square feet, said Jill Noack, general manager. "Those stores guarantee that a customer will visit more than once," she said. "Home remodeling projects usually require two or three visits. They eat, shop and come back. Home furnishings is a major commitment for us."

Uneven recovery

While new stores are popping up, some local experts say things are improving for many but not for all. A lot of the new retailers are corporate sponsored stores with deeper pockets, not small, locally owned retailers, said Lori Anderson, owner of EuroNest in St. Louis Park, which she recently closed.

Anderson thinks the market for the higher-quality, more expensive furniture that she sold is no longer on trend. "People want a certain look, even if it's not of long-lasting quality," she said.

John Stedman, owner of Roam contemporary furniture in Uptown, saw the trend for lower-priced goods coming and in 2010 closed his high-end Ligne Roset store next to International Market Square in Minneapolis.

He moved his moderately priced sister store Roam to Uptown in search of more traffic. Business has picked at the new location, and he's even brought in some higher-end furniture. "I'm cautiously optimistic, but we still have a long way to go to get back to 2007 levels," he said.

Even extensive resources with multiple locations don't guarantee customers. Big-box retail stores are still struggling, said Pat Fleetham, former owner of a furniture outlet in Bloomington. Such successful stores as Arhaus and Andrew Martin have carved out a niche that no one else has. "They're increasing the markup and marketing themselves well," he said.

That's worked at ID-Inside Design in Minneapolis, which has had its biggest year ever this year. Owner Greg Walsh attributes some of the store's success to people feeling more comfortable about spending but also to brands that are found only at his store, including Missoni Home. Uniqueness helps you survive in this market, Walsh said.

"If you're good at a niche, you've got a built-in captive market," he said. "That's why we're seeing so many signature stores opening here instead of an expansion of traditional big-box stores."

IN THE NEWS: Talking with Advertising Age about the Evolution of Private Brands

Private Brands Evolve From Generics to Must-Haves

Discount Giants Paved the Way With Owned Lines That Rival National Names

By: Alexandra Bruell Published: March 19, 2012, adage.com

In 2010, private and exclusive brands accounted for a third of total sales at Target, and today they claim over half of Kohl's product portfolio.

The private-brand concept has been a consistent driver of sales for discount retail giants for decades, but over the years it has been adapted to suit shifting consumer demands. Today, private brands have evolved from generic value products into must-have exclusives at many discounters, and marketing budgets played a big role in that evolution.

It started with that wardrobe staple: jeans, or as they used to be called, dungarees. In the "60s and "70s, private brands were essentially private-label generics, many of which started in the denim category. Value gave retailers an edge — that is, until every store began to offer the same value brands at the same prices. In the "90s, however, the concept of new and exclusive private brands took off when retailers learned that "value" can also be defined as having distinct products that serve as differentiators, driving store traffic and loyalty.

Regarding the transition from developing "copy-cats" of national products to more exclusive products in the "90s, Tina Wilcox, CEO and creative director of retail branding shop Black, said, "The retailers started [private brands] in an era where there wasn't the kind of keen focus there is today on national brands. The more consumers started to embrace the whole notion of brand loyalties, the more it started to weaken those [generic] private-label brands and assortments."

Zain Raj, CEO of agency network Hyper Marketing, noted that when retailers realized that national brands were gaining clout, "they created newer brands that would stand side-by-side with national brands and be credible."

Target's Archer Farms and Walmart's Sam's American Choice line are just two examples. Today, private brands have become so prevalent and popular that they're "forcing the national brands to fundamentally find other ways beyond product and price to differentiate," Mr. Raj said.

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