Local businesses optimistic about holiday shopping season as recession threat looms

Kamelah Adams’ Mimi’s Fresh Tees, a T-shirt and apparel line promoting social justice causes, drove significant sales during the 2020 and 2021 National Racial Justice Campaign.

This year has been tougher, she said.

“I’m trying to be optimistic because I know it’s a bit difficult right now with inflation and rising costs for a lot of people,” she said. “That’s why I want to make sure I have the right price range. Everything here is already very reasonable.”

Small businesses in the Portland area are gearing up for another holiday season in the COVID-19 era, this time with inflation and a recession top of mind for consumers.

This traditionally busy time is important for retailers, who want to reach customers while they’re still spending — and empty their wallets ahead of a possible recession, even a mild one.

Adams, who recently moved her store from Old Town to a storefront in downtown Portland near SW 10th Avenue and Morrison Street, has invited a number of other women-owned businesses to display and sell their wares. The “holiday pop-up” will feature guest merchandise, including Essance Skincare, Crystal Ball Botanicals and Vietnamese sauces from Tân Tân in Beaverton.

“We really want to support other women-owned businesses with a focus on BIPOC women-owned businesses because some of them don’t have retail space,” Adams said. “It’s important, especially around the holidays, for women in general, to have a permanent place to sell their wares. Because that’s true equality.”

To entice shoppers, Adams is hosting Black Friday and Small Business Saturday deals.

The City of Portland is also getting involved, handing out $150,000 in publicly funded gift cards redeemable at participating Central City businesses, including Mimi’s Fresh Tees, during the Nov. 11 Pioneer Courthouse Square tree lighting event. 25.

But spending could be more subdued this year after two relatively strong holiday shopping seasons. Last year’s strong labor market, rising wages and government stimulus gave consumers more discretionary income to spend on holiday gifts, according to Lake Oswego retail analyst Julie Bryan.

Bryan said many retailers had ordered inventory ahead of the holiday season to avoid the supply chain nights they experienced over the past two holidays.

Many businesses are also trying to get an early start on sales by offering promotions ahead of Black Friday, she said.

“Every retailer wants to capture as much of the consumer’s wallet as possible,” Bryan said. “A lot of businesses this year want to see more people shopping in person, and we’ve seen that. People go out and shop.”

Deena Spang, who manages The Arrangement in northeast Portland, said the clothing and home furnishings store has experienced supply chain issues and labor shortages over the past two years. But this year, she said, the supply chain problems are less severe and there are more employees.

Spang said holiday sales make up a significant portion of the store’s annual revenue, making it a critical time for business.

Deena Spang, manager and buyer at The Arrangement on Northeast Fremont Street, adjusts ornaments and decorations on a tree on Nov. 11.  15th, 2022.

Deena Spang, manager and buyer at The Arrangement on Northeast Fremont Street, adjusts ornaments and decorations on a tree on Nov. 11. 15th, 2022.christina de leon

“We typically start planning a vacation in January and start getting orders early in the year,” she said. “We put a lot of effort into finding new things that we think customers will want. Inventory stays fresh and offers new surprises so people want to keep coming back.”

During the pandemic, the store launched an online website to stay afloat, but this year, they’re banking on more in-person sales, she said.

“It’s been an interesting couple of years, to say the least. I think what Portland has allowed us to survive and get through is that local mentality,” Spong said. “I think the community is really trying to support local businesses, so I’m pretty confident this holiday season … and I think more people will be shopping in person.”

Some analysts expect shoppers to continue spending freely this holiday season despite inflation eating into shoppers’ disposable income and forecasts of a looming recession.

“We expect year-end spending to be the last cheer for households,” said Shannon Seery, an economist at Wells Fargo in New York. “They have some room to continue spending in the short term, but it’s not sustainable.”

In a holiday spending report, Wells Fargo said the cash hoards U.S. households have built up over the past two years have begun to decline, “which may indicate that consumer staying power is starting to wane.”

“We’re gradually seeing households pull back on items and purchases. It’s been a little bit slower than we expected,” Seery said. “But basically, households are going to keep spending through the holidays. It’s really the most normal holiday they’ve had in three years.”

Hannah Price displayed The Union, a retail store of family-owned Dana Herbert Accessories on Northeast Broadway, in her shop on Nov. 12.  15th, 2022.

Hannah Price displayed The Union, a retail store of family-owned Dana Herbert Accessories on Northeast Broadway, in her shop on Nov. 12. 15th, 2022.christina de leon

For Hannah Price, who runs The Union, a family-owned Dana Herbert Accessories retail store on Northeast Broadway, the return to normal this year has brought more traffic to her store.

“When the pandemic hit, we were fortunate enough to turn to making masks,” she said of the family business. “We don’t have stores open at all. All of our retail is done online.”

The retail store reopened this year and quickly pivoted to in-store sales since then, Price said.

The family-owned business has also resumed its annual holiday sample sale. The family has rented the ballroom and tennis courts at the Irvington Club for a one-day holiday sale every year since 1998 — until the pandemic forced a two-year hiatus.

“It’s something we’ve been doing for a long time leading up to Christmas,” Price said. “It’s usually our busiest sales day … so we’re excited to be back at that time.”

—Kristine DeLeon; kdeleon@oregonian.com

Correction: This article has been edited to correct the location of Mimi’s Fresh Tees to SW Morrison Street.

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