Union Square Holiday Market vendors see seasonal customers return amid challenges

Yahoo Finance reporter Dani Romero speaks with various vendors at the Union Square Holiday Market in New York City about this year's shopping season and how sales have rebounded since COVID.

Video transcript

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- It's beginning to look a lot like Christmas here in New York City at Union Square's holiday markets. Small business owners are facing big hurdles including inflation, which is at its highest level in over 40 years. So high will people actually shop through it? Yahoo Finance reporter Dani Romero spoke to some of the smaller shop owners to discuss their outlook on the holiday season. What did you hear?

DANI ROMERO: So this holiday market at Union Square, it's been a tradition for 29 years. And this year it's back in full swing. It's also an opportunity for the small business owners to really end the year making a little bit more than what they started with. Take a look.

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It's a very New Christmas at Union Square. Its annual holiday market has returned and so have the shoppers.

LAUREN BRAUCHI: It's very festive. And it's fun to be outside. And it's really great to be at the market and be supporting local artists and small businesses.

DANI ROMERO: And for some it's been a treat. Brandy Odie visiting from Georgia found a very special Christmas present for her son.

BRANDY ODIE: I'm very excited about this gift, actually. I'm going to put it in our suitcase and as soon as we get home, wrap it and put it under the tree. He won't know what it is. He didn't ask for it.

DANI ROMERO: With more than 180 booths, it's hailed a must visit destination for unique gifts and created by local craftsmen and artists.

JACQUELINE WELLS: I sell everyday jewelry as well as bridal and special occasion. And I basically make everything by hand using hypoallergenic metals and freshwater pearls, baroque pearls, and semi-precious gemstones, as well as Swarovski.

DANI ROMERO: It's this foot traffic and people shopping local at these marketplaces that's kept this small business owner afloat.

JACQUELINE WELLS: I think the brick and mortar it's tough to get foot traffic that these types of markets get. It's one of the best places to sell in the entire world in terms of foot traffic. It's constant.

DANI ROMERO: But this year it has been a bit more challenging.

JACQUELINE WELLS: I've had to put all my prices down, actually, because I want to be able to have things that people can afford. Because my demographic is people from age like probably 22 and up. And a lot of us are young professionals. And we have student loans. We aren't able to buy a $75 pair of earrings. So we like to say our average price here is about probably around $50. And it's a splurge from a lot of people that are just barely making rent, especially in New York where it's literally just the rent, paycheck to paycheck for everyone, even people working in the corporate world.

DANI ROMERO: While some try to weather the storm, others are debuting their products for the first time.

SARAH FELDMAN: This was a pipe dream. I wanted to be here for over 10 years. It's very sentimental. I used to go to Parsons, I graduated in 2010. And so I would come here all the time and look at all these artists.

DANI ROMERO: However, the environment has changed since then. Customers are cutting back on spending amid high inflation.

SARAH FELDMAN: I will say I have noticed that this year people are buying like lower amounts from my space. Instead of spending $100, they're still they're spending maybe $40.

DANI ROMERO: There's good news though. The National Retail Federation estimates retail sales 6% to 8% higher than in 2021, while a Gallup poll shows Americans plan to spend more on gifts than they have in the last three years. That's giving hope for this vendor who's paying a pretty penny to have his booth open at the Holiday Market.

DEVIN KAIN: On average, I'd like to make like over a grand a day, like a couple of grand-- that ballpark.

DANI ROMERO: And you can hear right there that these vendors are really relying on the support and the sales from this holiday season. But also a challenge that they've been facing, particularly this week, is the doom and gloom, it's been kind of rainy these past few days. So they've told me that a challenge that has really impacted and weighed on their sales has been the weather.

- Certainly could be challenging here since we know how critical the holiday shopping season is. Dani, any idea of what some of these small business owners, what their outlook is as we look further out from the holidays and into the new year?

DANI ROMERO: Obviously, they have a lot of optimism still as we go into this new year. But like you heard, one of the small business owners she's had to cut some of her sale prices in order to meet her customers' needs. That just tells you the environment that we're currently in right now. And so another sticker shock that I heard from some of these vendors has been the fact that to have their booth, their pop-up booth open, they pay $18,000. And one of these vendors--

- That's for the season?

DANI ROMERO: That's for this market place.

- For the month, right?

DANI ROMERO: Yes, for the holiday market, yeah. And one of these vendors told me that she needs to make over $30,000 in sales to cover her operating costs.

- Wow. That's very, very expensive.

- Hard to imagine hitting that mark.

- Yeah, exactly. And that's a lot of money for some of these businesses that, clearly, I would guess don't have it at this point.

DANI ROMERO: Yeah, like you heard, the price ranges from $10 to $50.

- So, a lot of sales. All right. Dani Romero, great stuff. Thanks so much.