Halloween scares up $8B annually for retailers

Halloween isn’t just for kids anymore. The consumer holiday has become an $8 billion industry for U.S. retailers, creating thousands of temporary jobs and bringing vacant storefronts back from the dead with “pop-up” Halloween shops that operate from August through October.

Halloween revenues are being driven by a growing market for adult costumes, haunted houses and elaborate holiday decorations, retail experts said.

“Halloween is not a holiday, it’s a celebration, and it has been growing every single year,” said Lisa Barr, a spokeswoman for Spirit Halloween, the nation’s largest seasonal Halloween retailer.

Spirit Halloween will open more than 1,050 stores this year in the U.S. and Canada, including 34 stores in Ohio, Barr said. Founded in 1983, Spirit Halloween had 63 stores in 1999 when it was acquired by Spencer Gifts. The company hires about 20,000 full- and part-time employees to operate its pop-up stores, she said.

Halloween City, a Michigan-based seasonal retailer with area stores this year in Mason, Troy and Sugarcreek Twp., plans to hire up to 10,000 new employees nationwide to fill temporary management and store associate positions, company officials said. Each store location will hire more than 24 associates, officials said.

The National Retail Federation estimated that Americans spent $8 billion on Halloween gear last year, when a record 17o million people were expected to celebrate the holiday. The average American spent nearly $80 last year on Halloween decorations, costumes and candy, according to the federation’s annual Halloween consumer spending survey. Estimates for 2013 were not yet available.

“Though Halloween isn’t quite the highest-grossing consumer holiday, it falls during the biggest time of the year for retailers, guaranteeing their shoppers will be checking out pumpkins and holiday merchandise at the same time,” said Kathy Grannis, a federation spokeswoman.

Product manufacturers and major retail chains are seeking to cash in on the spooky season.

For example, General Mills has brought back its classic 1970s monster cereals, including Count Chocula, Franken Berry and Fruit Brute, for a limited time for Halloween.

Target has teamed with fashion and costume designer Chris March, a former “Project Runway” contestant, for an exclusive line of larger-than-life Halloween foam wigs.

“Halloween is an important consumer holiday and it is a big seasonal occasion for our guests,” said Stefanie Mohr, a spokeswoman for Target stores.

Target’s Chris March wig collection reflects a growing trend for do-it-yourself adult costumes, Mohr said. The retailer also has seen a growing trend in outdoor decor, with consumers spending more time decorating both the inside and outside of their homes, she said.

Halloween pop-up stores continue to come back because they prove to be successful for the retailer, Grannis said.

Seasonal pop-up stores such as Spirit Halloween, Halloween City and Halloween Express typically operate in vacant retail spaces through short-term lease agreements. “Even though it might be temporary, we still are helping communities through occupying territories and employing people,” Barr said.

Pop-up retail stores such as the Halloween City location at 6106 Wilmington Pike in Sugarcreek Twp. typically sign a four-month lease and then close after the Halloween season, said Cara Tilford, the township’s director of planning and zoning.

The temporary retailers fill a need at this time of year and also benefit nearby businesses, Tilford said. “Any time that you are bringing traffic into the plaza it’s good for all of the tenants,” she said.

Halloween-themed stores last year represented more than 68 percent of the nation’s estimated 2,380 pop-up shops, according to market research firm IBISWorld.

Pop-up shops in general experienced their strongest growth in 2010, rising an estimated 7.8 percent from 2009, because of “the high number of retail vacancies following bankruptcies of large retailers like Mervyns and Circuit City,” said Savannah Haspel, an IBISWorld spokeswoman.

Experts said the demise of those “big box” retailers has benefited temporary Halloween retailers, who often receive sharply discounted rent for short-term leases on commercial space. However, transient retail sites are becoming harder to find as occupancy rates rise amid the improving economy. Halloween-themed pop-up store growth was flat from 2011 to 2012, according to IBISWorld data.

Many of the seasonal Halloween retailers also operate online retail commerce sites for off-season costume and merchandise sales.

Halloween Express this year introduced a buy online, pick up in-store program. The Owenton, Ky.-based company this year has area stores in Cincinnati and Moraine.

Spirit Halloween, a privately-held company based in Egg Harbor Twp., N.J., employs some workers year-round, including real estate, marketing and other staff, Barr said. She declined to disclose annual revenues. The company this year has area pop-up stores in Cincinnati, Dayton, Miamisburg, Piqua and Troy.

“We do work year-round on Halloween. We are already thinking about 2014,” Barr said.

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