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Middle-class retailers are being squeezed out of the shopping scene

By   /   Friday, November 30th, 2012  /   Comments Off

A pre-holiday walk up and down State Street in Santa Barbara gives a pretty good cross section of what’s happening in retail stores across the nation.

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A pre-holiday walk up and down State Street in Santa Barbara gives a pretty good cross section of what’s happening in retail stores across the nation. Cheap chic is in, stores and retail concepts tailoring strictly to baby boomers are out, and luxury still rules.

But it takes a trip to Ventura’s west side to really understand what it takes to win.

Let me explain.

Just a few years ago, a big chunk of the region’s cache in retail was tied up in area brands that had gone global with their appeal to baby boomers coming into affluence. Two of them, Territory Ahead and Magellan’s, built global franchises based on catering to yuppies with newfound disposable income to support a lifestyle that included travel and leisure. In San Luis Obispo, Copeland’s built a regional chain of sporting goods stores that also capitalized on big boomer trends — golf, hiking and a passion for the outdoors.

But look around today and you see a different world. Territory Ahead’s flagship store on lower State Street is empty and looking for a new tenant. Most of Magellans’ staff has moved to Colorado, the result of a sale to a Denver-based retailer that specializes in  luggage and travel.

Colorado Bag’n Baggage has a number of brick and mortar locations but it does not have a strong catalog business, one of Magellan’s key strengths.

Meanwhile, the Copelands were smart enough to see the coming of the day when specialty athletics would no longer be the cash cow it was for decades — they sold out years ago and escaped the retail ravages of the Great Recession.

Significantly, the former location of Copelands’ Santa Barbara branch is now the home of Old Navy. H&M, where plenty of stuff can be bought for a fresh $20 billion, is one of the hottest new places around.  Forever 21 has a major presence, as does a relatively new Marshalls.

But in a world where the middle class is getting squeezed and the one percent is getting wealthier, upscale retailers have found their way as well. Saks Fifth Avenue continues to anchor the corner of State and Carrillo Streets, right around the corner from the Business Times offices — and next to a thriving Subway franchise.

Rooms and Gardens, a locally-owned home furnishings store that has migrated to the upscale over the years, also seems to be doing well.

But to really understand things, a trip to Great Pacific Ironworks, the Ventura home of Patagonia, is in order. The company is exploding with sales growth because it does everything that it does with a “best in class” approach.

It has a deeply ingrained philosophy of taking care of the planet that appeals heavily to younger and eco-conscious consumers, and it wears its environmental politics quite openly. But that’s not all Patagonia is about — it is also about building the best, lightest, most durable and most attractively-designed gear.

In a world of H&M throw-aways, that will take you a long way.

A long journey

Speaking of thriving in a tough economy, you have to give credit to the 40-member team at Santa Barbara Travel Bureau, an agency that began operations 65 years ago. It  has successfully navigated enormous changes in the travel industry.

On Nov. 28, the Travel Bureau was officially recognized by Virtuoso luxury travel network on reaching its milestone.

I’ll extend personal owner-to-owner  congratulations to David de L’Arbre, and his brother Charles, who operate the largest locally-owned travel agency in the Tri-Counties. David and I often exchange views about the economy, business and California on the short walk from the parking garage to our respective offices. I always learn something from those chats.

• Contact Editor Henry Dubroff at hdubroff@pacbiztimes.com.

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