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Retail businesses face many obstacles

Running a successful retail store or stores, even in the best of economic times, has never been easy. So many things can go wrong. Something as simple as bad weather (or even good weather) can affect many a retail business.

Running a successful retail store or stores, even in the best of economic times, has never been easy.

So many things can go wrong.

Something as simple as bad weather (or even good weather) can affect many a retail business. People don't think about buying summer fashions when it is 15 degrees and raining in July, like it was this year. And if the weather is too nice, who wants to be inside a store?

Then there's the economy - it still isn't in the best of shape, although we're better than south of the border.

And don't forget the competition. Not just from local retailers, but increasingly from outside Canada. Zara, H&M and Forever 21, just to name a few, are international chains, and they are all highly successful. All are trendy and inexpensive. They can quickly bring you the latest styles and move them out just as fast, making room for yet more up-to-date fashion.

And now Target is looming on the horizon. To say nothing of the increasing rise of Internet shopping. Poor retailer!

The HST has encouraged people to keep their wallets in their pockets, especially in the restaurant business, although Premier Christy Clark is trying to make it a little more palatable. And let's face it, it will be an administrative nightmare and expense to reintroduce the provincial sales tax if the HST gets "extinguished" in the referendum.

The recent changes to the drinking and driving laws are hitting restaurants where it hurts, too.

Cross-border shopping is also taking dollars away from Canadian retailers. I saw a cartoon the other day that was a little too close to the truth to be funny. A woman was telling her friend about the bargains she had found in Bellingham. In the background was a row of closed Canadian stores.

Actually, a number of small to mid-size Canadian retail chains have already closed, and several well-known names are operating under receivership, so it wasn't really much of a joke.

Realistically, with the number of sales in Lower Mainland stores, the price differential between here and Washington State has been shrinking, but a trip to Bellis Fair is as much a social outing as a shopping trip.

And no one can deny that there's a bigger selection in the U.S. With 10 times the population, that is inevitable.

The result is that many local stores have a high inventory of unsold goods, and the cost of carrying that inventory is killing many of them. In an effort to recoup their expenses, many stores are forced to discount deeply, selling at little over cost. Just take a stroll through any shopping centre and look at the number of stores with a "sale" sign in the window.

And yet, there's money out there, and some stores (even if you don't count the big multi-nationals) are doing well. Look at the success of Victoria's Secret, the Apple Store, Coach and Lululemon.

So what's the secret? Actually, it is the same secret that has powered retail since the beginning of trading. Successful stores have product that people want - whether it be the latest iPad, a crafted handbag, trendy casual wear, or competitively priced fashion-forward clothing from Zara or H&M.

If you have that, customers will buy.

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Doug MacDougall is the general manager of Metropolis at Metrotown.