Tax-free weekend kicks off
David Kaplan / Houston Chronicle
Cynthia DeLeon describes herself as “a smart shopper.” On her work break Friday she zipped through the Palais Royal at 4438 North Freeway, picking out back-to-school clothes for her daughter and grandson.
She was taking advantage of the tax-free holiday, and she brought coupons.
DeLeon, a Houston Community College receptionist, was resisting the urge to buy anything for herself.
“It’s them first – I’m last,” she said.
Retailers hope other shoppers will feel more self-indulgent this weekend. Many stores are putting on promotions to entice shoppers to buy more than just the necessities.
The tax-free holiday is not as effective as it was in years past, in the view of some retailers, but is still a solid sales generator.
Texas’s 13th annual tax-free holiday started Friday and continues through Sunday. Clothing and other merchandise priced under $100 are exempt from state and local sales tax, which in Houston is a combined 8.25 percent.
At the SuperTarget on South Main, the tax-free holiday is not as strong as it was a few years ago, said Dave Sussow, a store executive team leader.
Previously it was the second biggest weekend behind only Christmas, Sussow said: “But it definitely still drives business for us.”
Back-to-school shopping, in general, has gotten more spread out in recent years, said Andy Hall, president and CEO of Houston-based Stage Stores, the parent company of Palais Royal. Some shop earlier in the summer, feeling that the tax-free holiday is too close to the start of school, he said. Still others don’t shop until after school starts.
Plenty of kids first want to see what other students are wearing, said Hall, who expects September to be a better month for back-to-school shopping than August.
Still, Hall said, many parents will be in stores “on a mission” this weekend. Palais Royal is offering up to 50 percent discounts during the weekend, he said.
Overall, this year’s back-to-school season should be about the same as last year’s, said Suzanne Long, retail practice leader at SSA & Co., a New York-based business operations consulting firm.
Last year’s back-to-school season was decent, she said.
“It was at a more reasonable level coming out of the recession,” Long said, “but not where retailers would like to see it.”
The back-to-school season is a good time for department stores, she said, because those retailers can cater to teens and children and benefit from deals they can negotiate with vendors, putting them in a better position than, say, kid-focused specialty stores.
Some retailers optimistic
Some categories of retail are outperforming others this back-to-school season, noted Jeff Green, president of Jeff Green Partners, retail feasibility consultants based in Phoenix.
Consumer electronics sales are strong, Green said, while apparel sales are mixed. Women’s apparel sales have been relatively weak, while children’s, teen and men’s apparel sales are stronger. Men’s apparel has traditionally been a weak performer this time of year, but that seems to be changing, he said.
On the first day of the tax-free holiday, some local retailers said they felt encouraged.
At Houston Premium Outlets in Cypress on Friday afternoon, the center’s general manager Steve Jeanis said customer traffic was higher than it was at the same time last year. Some stores opened earlier than originally planned because of the lines of people waiting to enter, he said.
“We’re pleased with the traffic in our stores on the first day,” said Macy’s spokeswoman Melissa Goff. Macy’s customers were combining the savings from associated sales with the tax-free event, she said.
At Academy Sports + Outdoors, “early reports are positive as customers have waited to do their back-to-school shopping closer to the school year to take advantage of tax-free savings,” said Robert Frennea, Academy’s executive vice president, general merchandise manager. The Houston-based retailer is seeing strong sales for school uniforms, backpacks, kid’s casual apparel, athletic apparel and footwear, Frennea said.