Lawrence retail sales off to one of the slower starts in the state in 2021; Weaver’s gets national praise from Forbes
photo by: Nick Krug/Journal-World Photo
I’m not at all complaining — or psychoanalyzing — that I got an ear hair trimmer for Christmas. That said, there is some evidence of Grinchlike behavior in Lawrence this holiday shopping season. Sales tax numbers for the key holiday shopping period were down in Lawrence — and more so than they were statewide.
Lawrence City Hall recently received its February sales tax check from the state of Kansas. Because of normal reporting delays, the figures largely represent sales made in December. Lawrence’s sales tax collections were down 2.1% for the month, compared with the same month a year ago.
That’s not particularly surprising, given that we were in the midst of a pandemic in December of 2020 versus being in the midst of blissful ignorance in December 2019. But it is worth noting that Lawrence appeared to have one of the slower holiday shopping seasons of any major retail market in the state.
If you remember, we reported last month that Lawrence posted about a 9% decline in sales tax collections for the November shopping period. Below are the year-to-date sales tax collections for 10 of the bigger retail markets in the state. The numbers are January and February sales tax collections, but because of the normal reporting delays, the numbers are basically a good snapshot of the November and December shopping season.
• Salina: up 1.4%
• Shawnee: up 0.8%
• Lenexa: down 1.8%
• Kansas City: down 1.9%
• Manhattan: down 2.0%
• Topeka: down 2.0%
• Sedgwick County: down 3.0%
• Overland Park: down 5.0%
• Lawrence: down 5.5%
• Olathe: down 8.7%
As you can see, being down was common. Only two of the 10 markets posted gains compared with a year ago. Lawrence, though, was near the bottom of the list. And Lawrence is well below the performance of the state as a whole. Sales tax collections for all the cities and counties combined are down only about 1% thus far.
Being among the lower-performing retail markets is a trend Lawrence has been experiencing for a while now. The state report shows statistics dating back to the July report, which really accounts for sales made in May. In that eight-month period, Lawrence once again is the second-lowest-performing major market in the state. Here’s a look:
• Topeka: up 2.1%
• Shawnee: up 1.6%
• Salina: up 0.9%
• Sedgwick County: down 0.5%
• Olathe: down 1.4%
• Manhattan: down 2.3%
• Kansas City: down 2.5%
• Lenexa: down 3.0%
• Lawrence: down 5.0%
• Overland Park: down 6.3%
Statewide, sales tax collections for all the cities and counties in Kansas during that eight-month period actually were up 0.2%. If you dig deeper into the numbers you will see many smaller communities seemingly are benefiting by people doing a greater amount of their shopping closer to home. For example, Baldwin City’s sales tax collections were up 1.5% during the eight-month period, while fellow Douglas County community Eudora’s were up 4.3%.
This is a good point to remind you that these numbers are a good proxy for retail sales but not a perfect one. Sales tax isn’t just charged on retail sales and holiday shopping. It also is charged on utilities, construction materials, auto parts and many other things. So, these numbers don’t absolutely show us what retail sales did for the period. But retail sales do make up the majority of all taxable sales, so these numbers are a pretty good indicator that retail sales were off.
Another point to remember is that sales tax numbers don’t capture how much people may be buying online rather than at brick-and-mortar retail stores. Instead, “use tax” numbers capture those types of sales. Those numbers continue to be strong in Lawrence and many other markets. In Lawrence, online sales were up about 15% during the November and December shopping season, according to use tax numbers from the state.
All these numbers are important for a couple of reasons. One, the retail industry provides a lot of jobs in Lawrence, and the sales taxes it produces are a big part of the city budget. On that last point, City Hall budget-makers likely have a situation to keep an eye on. Thus far in 2021, sales and use taxes have come in about 1.1% lower than what the city has budgeted to receive. It is early, so that loss could be wiped clean pretty quickly. As Lawrence city commissioners contemplate adding employees and undertaking some other new initiatives, watching whether sales tax collections meet budget will be important.
While we are talking retail, now is a good time to note that one of Lawrence’s oldest retailers got some national love in recent weeks. The Forbes.com website ran a piece about Weaver’s department store in downtown Lawrence.
Michael Lisicky, a Forbes contributor who is often cited as a department store historian, highlighted Weaver’s to show how rare it is for an independent department store to remain in operation. The eye-catching statistic from the article is that 50 years ago there were 22 independently operated department stores in Kansas. Today, there are approximately a half-dozen in the entire country.
Lisicky interviewed Weaver’s president Brady Flannery about the store, which of course is a downtown anchor at Ninth and Massachusetts streets. You can read the full article at bit.ly/2MAoi60.