Spirit Halloween's Retail Pivot

A story about how Spirit Halloween started from a women's clothing store owner who discovered an opportunity in seasonal retail.

"In California in the eighties, this guy owned a women's clothing store. In October, traditionally a super slow sales month, he's just sitting there not getting much sales. He looks around, everybody's struggling except for one store - he sees this one Halloween store has a line out the door.

Since he wasn't selling anything anyway, he turned three-fourths of his store into a Halloween store just for the month of October. It was still a women's boutique with women's clothes in a quarter of the store, and three-fourths became Halloween stuff. It really worked.

He did that again the next year - that became his Halloween playbook. But then he thought, forget my store, I'll just open up another store and another store just for the month. That's their model - they find vacant property and say 'Hey landlord, you don't have a lease? I'll lease it for 2 months.'

Initially landlords were like 'A 2-month lease? No thank you.' But they said 'Look, if you don't have a tenant by July, might as well take it - some revenue is better than no revenue.' Especially after the 2008 real estate crash, this became an enticing option for landlords to recoup some money.

They even have a kick-out clause where if the landlord finds a good tenant for a long-term lease, they can just kick Spirit out anytime. They found this no-brainer proposition for landlords and now they have 1,400 stores. Back in 2010 they only had 700 stores."