Along St. Pete’s Central Avenue, signs of a troubling holiday shopping season

Inflation is hitting consumers at a time when small businesses need to make the most of their sales.
A woman with shopping bags walks past The Merchant, downtown on Central Avenue in St. Petersburg, on Nov. 24, 2020. Retail was recovering the past two years from the pandemic, but now some businesses say it's falling flat.
A woman with shopping bags walks past The Merchant, downtown on Central Avenue in St. Petersburg, on Nov. 24, 2020. Retail was recovering the past two years from the pandemic, but now some businesses say it's falling flat. [ MARTHA ASENCIO RHINE | Times ]
Published Dec. 20, 2022|Updated Dec. 20, 2022

Leading up to Black Friday, Sara Stonecipher was busy preparing at her store, Misred Outfitters Boutique. She worked on advertising campaigns, special promotions and boosting staff from her storefront on Central Avenue in St. Petersburg ahead of what is supposed to be the busiest shopping season of the year.

But that big rush Stonecipher and other local business owners rely on at this time of year never came. She said her store was empty for long stretches of time during Black Friday and Small Business Saturday. That’s when she realized she needed to change course.

“It was a telltale sign of what was coming for the season,” Stonecipher, 40, said.

Some St. Petersburg small businesses are starting to worry as the holiday shopping season seems to be flat, putting them in a tight financial position during a period when they usually earn the bulk of their sales.

Related: How Tampa Bay’s high inflation could affect holiday shopping this year

U.S. monthly retail sales fell 0.6% in November, according to the U.S. Census Bureau. Nationwide, shoppers spent less on clothing, hobby items like sports or musical instruments, furniture and electronics last month, showing how holiday gifts are taking a hit from inflation while spending increases on essentials like groceries and eating out.

Tampa Bay also is among the hardest-hit metropolitan areas in the U.S. from inflation, with prices up 9.6% from last year. While inflation is slowing from summer highs, consumers are feeling the pinch and buying less. On the 600 block of Central Avenue, foot traffic during Thanksgiving week decreased 14% from 2021 though it was still busier than pre-pandemic times, according to data from Tampa commercial real estate firm Franklin Street.

“I’ve been here 13 years and I honestly don’t remember a holiday season that ever felt like this. The energy is just very low,” Stonecipher said.

Stonecipher said she canceled orders for the shop’s inventory and turned a room into a discount section to help offload extra product as sales dropped more than 20% at her store into December. She’s also spending more time promoting Misred Outfitters online to get people into the store.

“I am basically a full-time social media manager now,” Stonecipher said. “It’s the only thing you can do.”

While this year’s holiday season was expected to be slower compared to last year’s booming pandemic rebound, Stonecipher said she was shocked by how underwhelming the Black Friday and Small Business Saturday weekend went.

“Consumers are not spending as much this holiday season because they don’t have as much disposable income. But when they are spending, they’re looking for bigger deals and bigger discounts and only the major retailers can really offer that,” Stonecipher said. “I can’t basically pay people to take it away. It’s just been very hard to compete.”

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People kept spending on gas and food when prices jumped because they still needed to drive and eat, said Paul Rutledge, Tampa senior vice president of retail at commercial real estate firm JLL. That’s taking a chunk from spending on Christmas gifts.

“About 60% or 70% of the economy is feeling the impact of inflation and that has got to show up somewhere,” Rutledge said. “Impulse and non-necessity retail has to take the first hit.”

Economists are predicting a recession could hit the U.S. as the housing market slowed and consumer confidence dropped in the tail end of 2022. Many retailers make most of their profits during the last quarter of the year, making this holiday season important for businesses to weather any possible economic turmoil. Local businesses along Central Avenue are also facing rising rents from Tampa Bay’s hot real estate market.

Related: Small businesses helped Tampa Bay grow. Can they afford to stay?

“You cannot fail during that time of the season,” Rutledge said. “They need those sales in that last quarter. It’s critical.”

The National Retail Federation expects U.S. shoppers to spend up to $960 billion during the months of November and December, up more than 6% from last year. On Dec. 15, after federal data showed a drop in sales from October, the trade organization said consumers are staying “resilient” and there are no signs of a recession yet because retail sales are still up 6.5% from November 2021.

While crowds gathered at Shopapalooza at Vinoy Park over the Black Friday weekend, a little over a mile away, gift shop and cafe owner Jennifer Schultz said Central Avenue felt no different from the usual weekend traffic a month prior.

“It was really like a weekend in October, which is not how the biggest shopping weekend of the year really should be,” said Schultz, 47, who owns The Merchant and Crislip Cafe.

The slowing trend continued into December for the Central Avenue storefronts, she said, and her customers have pointed toward high inflation as to why they’re pulling back.

“Anyone that’s been in my shop has said, ‘We’re buying gifts but we’re not going as big as we did in previous years,’” Schultz said. “They’re being a little more frugal.”

The slowdown pushed Schultz and other Central Avenue brick-and-mortar stores to meet with The Greenhouse, an organization of the city of St. Petersburg’s Chamber of Commerce dedicated to fostering local small businesses. Earlier this month, the group met to discuss how to better promote the city’s shops, not only for Small Business Saturday but year-round — especially as more development spreads, rents rise and recession fears grow.

But any immediate action from the group will have to wait for after the holiday season, Schultz said. For now, she’s focusing on pushing social media marketing to boost sales.

“This is usually a really good time of year,” Schultz said. “Now everyone’s super worried about what January or February is gonna look like.”