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Boo! The billion-dollar Halloween industry

merchants prepare to scare, stocking up on candy and costumes for second-largest commercial ‘holiday

Posted: September 29, 2010 6:46 p.m.
Updated: September 30, 2010 4:30 a.m.

The mummy in a coffin is one of the many props sold at the Spirit Halloween store at 23036 Soledad Canyon Road in Santa Clarita. The store sells Halloween costumes and accessories and features an interactive theater for shoppers.

 



A good old-fashioned heart-pounding fright isn’t just a fun end-of-October ritual; it also scares up billions up dollars in sales annually.

Analysts report that between $5 million and $6 million are spent on costumes, props and candy for the second-largest commercial “holiday” in the United States — Halloween.

Ron Erb, manager, of a local Spirit Halloween store, says people definitely come into the store looking for holiday costumes, but they are also looking for props and accessories to design haunted houses or to expand their spooky displays in front yards and garages.

“We even have people come in to buy props and costumes for photo shoots,” Erb said.

Huge industry
The annual fall event — not actually a holiday — has spurred the formation of industry associations, trade shows and magazines. The Halloween Industry Association, a trade organization begun in 2005, represents businesses involved in the manufacture, importation or distribution of Halloween-related products.

TransWorld Exhibits sponsors one of the longest-running trade shows, now in its 27th year. The next exhibit is to be held in St. Louis in March 2011.

Known as the HCPShow — for Halloween, Costume and Party Show — the event features costumes, décor, giftware, party goods, haunted-house props and spooky services among other holiday-related merchandise.

“The haunt industry is still in its infancy,” Jennifer Braverman, executive vice president of TransWorld Exhibits, said in an interview with greetingsmagazine.com. “We’re just seeing the tip of the iceberg as opportunities continue to grow for Halloween.”

Despite shoppers spending carefully during the current recession, Halloween is still celebrated as old-fashioned fun. A survey by the National Retail Federation reports the single largest expense will be on costumes.

Top-selling costumes often are inspired by celebrities and movie characters. Among the costumes expected to be in demand this season are likenesses of Lady Gaga, Michael Jackson and Avatar.

“As for props, Spirit Halloween is expecting its line of Spirit Zombie babies to be hit this season,” said Erb.

The movie industry has also capitalized on Halloween by often releasing fright films right before the holiday period. These films, made for a fraction of the cost of most traditional movies, gross high profit margins.

Among the top-grossing spooky movies are “Paranormal Activity,” “The Blair Witch Project,” “Night of the Living Dead,” “Halloween,” “Friday the 13th” and “Saw.”

All but one movie was made for less than $1 million, but all generated revenue in the multimillion-dollar range. The highest film gross, reported to be $248 million for “The Blair Witch Project,” was reportedly made on a budget of $600,000.

Haunted House Association hosts an online information source for the haunted house industry at www.hauntedhouseassociation.org. The association was established to assist and advance the haunted-house industry.

HHA estimates more than 2,000 haunted attractions charge admission fees each year, along with more than 300 amusement parks hosting themed entertainment events and at least 1,000 charity attractions that open in October.

The seasonal industry creates thousands of jobs annually around the country. With the economy still ailing, dedicated Halloween stores are reporting a flood of job seekers.

“I probably talk to a dozen people every day,” Erb said of the applicants coming into his store seeking work.

Specialty Retailers
While most large retail chains offer Halloween costumes, props or candy each year, there are several specialty retailers operating online who also open seasonal stores, for limited periods, in time for Halloween each year.

Always a good year-round local source for higher-quality costumes, A Chorus Line stocks its store each year with imaginative costumes often not found in the aisles of the typical retailer’s Halloween section.

“We get costumes from smaller companies that don’t deal with the big-box stores,” said Jana Einaudi, manager of A Chorus Line in Valencia.

Einaudi said her store works with smaller companies that supply the theater industry or specifically support small retailers.

The retailer receives a lot of custom orders in early September and can often piece together costumes from existing inventory because it stocks dance wear year round.

Spirit Halloween, owned by Spencer Gifts LLC, has been in business for 25 years. The store at the corner of Soledad and Bouquet canyon roads opened for business Sept. 8 and closes its doors Nov. 1.

The retailer offers hundreds of costume options and accessories, including many higher-end props for those shoppers who really get into the spirit of Halloween.

Halloween Express, in business since 1990, opens seasonal stores and also hosts an online shopping service.

Another specialty operator, Halloween City, opens seasonal stores but has a very limited online presence and does not sell costumes over the Internet. Established in 1977, the retailer sought to recruit 10,000 people throughout the country this year. The average store hires 20-25 employees.

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