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Retail sales slip in Napa
Evidence of national woes at local stores
Sunday, September 07, 2008
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The national business slowdown is finally hitting wine country, with 11 of the city of Napa’s 15 major shopping zones reporting declining sales in the first half of 2008.

Sales dropped 9 percent between January and June compared to 2007 levels, according to the city’s business trend report.
“It’s very obvious that the economy is slowing,” Carole Wilson, the city’s finance director, said Friday. “We are not immune to what’s happening in the state and the nation.”

The best that can be said about the current economic situation is that many communities are suffering much worse, Wilson said.
Sales in the first half of 2008 were up only at Bel Aire Plaza, which saw the debut of Whole Foods supermarket; the Longs-Genova center on Trancas Street; the Grapeyard Center on Jefferson Street and Redwood Plaza, which completed a major makeover.

Sales were down everywhere else, with some of the biggest drops at South Napa Marketplace, Napa Premium Outlets and River Park.
Downtown sales dropped 9.1 percent, just about the citywide average. A much greater drop is expected in coming months with the pending closure of Mervyns, said Cassandra Walker, the city’s economic development manager.

Confidential sales numbers for individual businesses suggest a general softening of the local economy, Walker said. “Most businesses are down slightly,” she said.

Centers with the biggest declines are typically victims of the dramatic slowdown in construction or the opening last September of the Wal-Mart Supercenter in American Canyon, which siphoned off customers, Robin Klingbeil, a city analyst, said.

The drop in housing starts is having a big impact on any business that sells building materials or furnishings, Klingbeil said.

Businesses and centers that meet the everyday needs of Napans seem to be doing reasonably well, Walker said. “It shows me that people are cutting back, but they’re still going out, they’re fixing their cars.”

Citywide sales figures had risen every year since 2001, with 2007 a record year. Sales last year were up 5.3 percent.

“Those were the biggest numbers ever,” Walker said about 2007. “People started tightening up after the fourth quarter ‘07.”

“It’s one of those cycles,” said Kate King, CEO of the Napa Chamber of Commerce. “People are pulling in their horns. I’ve heard of a few layoffs. They create a ripple (effect).”

If families are spending less, King said, it’s even more important that they shop locally and boost the local economy.

The shopping zone with the biggest drop in sales was the Oxbow, down 28 percent. This is attributable to the closure of the Vallerga’s market at First Street and Silverado Trail, Klingbeil said.

The opening of Whole Foods probably softened sales at most other local supermarkets, she said.

Sales along Soscol Avenue, the city’s Auto Row, were down sharply in the first quarter, but rebounded to 2007 levels in the second quarter, city figures show.

State figures show that vehicle sales were off just 3 percent for the first six months, but many of today’s sales are smaller, lower-priced, more fuel-efficient vehicles.

The 12 percent sales decline at Napa Premium Outlets reflects some recent store closures as the center prepares to bring in new merchants, Klingbeil said.

River Park Center, which is now for sale for $31 million and is a candidate for redevelopment, reported a 10.4 percent decline. Six-month sales totaled $11.3 million, the lowest in 10 years.

The city’s trend report incorporates all sales — taxable and non-taxable — reported to the city for business license purposes.

The state’s sales tax report is a better indicator of retail sales, Wilson said, but has not yet been released. She will be reporting Sept. 23 to the City Council on how all of the city’s major revenue streams are doing, she said.
5 comment(s)

JimClark wrote on Sep 7, 2008 12:54 AM:

" As long as the economy remains stagnant and our worthless legislators won't pass a buget, The People and business will suffer. We need to fire Califonia's legislators and thr Governator if he doesn't take executive action and kick some butts. "

jwk wrote on Sep 7, 2008 4:54 AM:

" You would think Downtown would of dropped more with all the Tourist Construction projects and No Parking, But Maybe it's time to Stimulate the economy and DRill Here, Drill Now and create alot of High paying new jobs and revenue that would get the cash flowing big time. Buy American. Move aside Pelosi and the do Nothing Congress!! "

musikluvr wrote on Sep 7, 2008 2:34 PM:

" Why are retail sale such an economic indicator? We don't make anything in America anymore so do we really care that the Chinese stuff is selling or not? I think the answer to it is that retail sales is a sales tax generator and our government officials need more and more sales tax to prop up the state and local governments. I think that it would be a good idea for sales tax revenue to start declining so that we can start cutting government income and therefore government payroll and waste. "

average_jane wrote on Sep 8, 2008 9:40 AM:

" Okay all these figures are misleading. As a statistician and someone who has seen people tell the story they want to tell with data they should consider how they present the information.

First of all. Look at sales in Bel Aire Plaza without Whole Foods. Compare that to 2007....
Look at Oxbow without Vallergas in the old data and compare that!
Look at the before and after so that they are actually comparable.

What you are doing is not comparing apples to apples. YES we want to know the final result but when you start comparing apples to giraffes there is some misleading information. "

marine1/1 wrote on Sep 8, 2008 12:01 PM:

" I'm surprised the numbersb aren't much lower.A good percentage of local Napa people shop out of town. Tourist stores are for tourist people. With the closure of Mervyn's soon, I would expect the downtown area to see a larger decline in the amount of people and sales. Most of my customers I talk to, have to shop at the mall or in Vallejo. I don't feel bad for these tourist stores. "

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