With significant job growth this past year, Clark County retailers could see a strong holiday season, but consumer spending may be tempered by increasing energy and fuel prices.
The last two months of the year are the most important for many retailers and can mean the difference between a year in the black or the red.
The National Retail Federation estimates 20 percent of retail industry sales occur during the holiday shopping season. And for Clark County department stores, for instance, taxable retail sales for the fourth quarter of 2004 accounted for 34 percent of total sales for the year.
NRF predicts 2005 holiday retail sales will grow 5 percent to $435.3 billion, versus increases of 6.7 percent in 2004 and 5.2 percent in 2003.
"Employment growth right now is really strong in the county," said Scott Bailey, regional economist. "This is the best year since 1998."
The addition of Legacy Salmon Creek Hospital and the Hilton Vancouver Hotel, the growth in retail and a continued strong construction market have fueled the area’s job growth.
Bailey said he would lean towards an optimistic holiday spending outlook, but remains guarded considering other factors impacting consumers.
"I don’t know that wage growth has been that strong. And factor in a higher cost of housing and gas prices, and it is taking a chunk out of people’s paychecks," he said.
In September, the Consumer Confidence Index dropped sharply in the wake of Hurricane Katrina and soaring gasoline prices. The index dipped to its lowest level since October 2003. However, an NRF survey estimates the average consumer will spend $738.11 this holiday season, an increase of 5.1 percent.
At Westfield Vancouver shopping center, traffic and sales counts are up compared with last year.
"We are anticipating a strong holiday shopping season," said Kelli Box, general manager of Westfield Vancouver. "Sales have been great and we expect that trend to continue into the holidays."
Marketing Director Kimberly Blue said the mall’s holiday campaign kicks off Nov. 13 with their annual fundraiser Westfield Works Wonders. New this year is a carousel and train attraction.
Since last year, the mall has added national retailers Torrid and CJ Banks, and American Eagle has expanded its space.
Aside from increasing prices at the gas pump, Southwest Washington retailers have to contend with sales-tax-free Oregon. However, Deborah Ewing, vice president and reatil specialist with commercial real estate agency Eric Fuller & Associates, said consumer spending is driven more by time, variety and convenience.
"It isn’t that people just shop in Portland to save on the sales tax, it has a lot do with, in my opinion, variety," said Ewing. "And the more variety that we have over here, it will be the catalyst to stay over here."
National big box retailers are adding new stores or entering the market for the first time at a fast rate. Just in time for the holiday season, Hazel Dell Towne Center adds seven new retail stores, including PETCO, Office Depot and Famous Footwear in nearly 80,000 square feet. However, with a number of developments planned to come on line next year, the 2006 holiday shopping season could be one of the best for Clark County.
According to Ewing, 1.5 million square feet of retail construction is planned for 2006. In particular, Vancouver’s Columbia Crossing located between 164th Avenue and Southeast 192nd Avenue will be the most significant. Home Depot is already open on the 45-acre development. Additional tenants include a Wal-Mart Supercenter, Kohl’s, Cost Plus World Market, Pier 1 Imports, Bed Bath & Beyond and Best Buy. Kohl’s is making its first entrance into the market, and Best Buy opening a location at Columbia Crossing represents the first national home electronic retailer to locate in Clark County.
"Next year, Columbia Crossing will provide amazing new retail options in our community," said Ewing.
