How Does "Spirit Halloween" Still Survive Till Every Halloween Season?

This is sort of a special Halloween post, so I hope you enjoy it!

“Spirit Halloween” is a retail store that is known for selling Halloween decorations, popular costumes, and accessories. I remember when I was younger, my parent’s would take us every year to get costumes and shriek at the animatronics. However, this store is not opened year-round. It’s commonly known that this store is a “pop-up shop”. This means they set up their shop for a few months, typically 10 to 12 weeks, in older retail buildings. Often times, in the case of “Spirit Halloween”, they are opened at the end of August till the end of November. This can vary on location and product as well. According to Spirit Halloween themselves, there is currently 1,525 stores opened in the United States. Yet, these stores do not stay open all year round, and the Halloween season doesn’t last all year. So, how does “Spirit Halloween” stay in business till the following year? How has this company lasted? That is what I’m trying to find out. 

As I already introduced, “Spirit Halloween” uses temporary leases. A temporary lease is a rental agreement that lasts for a short period of time, which is typically less than a year. This is, in other words, a short-term lease. An example of this could be when businesses are trying out new locations. A shop could be seeing if the location is a good spot to set up a permanent shop, or if consumers rarely ever stop by. Another example could be when businesses are moving locations, especially corporate offices. A lease, like a temporary lease, allows businesses to have a place to continue working or selling product while they finalize a place to permanently set up shop. “Spirit Halloween” uses these temporary leases since their shops are only seasonal. They would only need a space for a short period, which they scout for all year, even in the beginning of January. According to their website, it reads as follows, “Spirit is looking for temporary 3 MONTH leases that include a kick-out clause (should the landlord secure a permanent deal by June). This means that “Spirit Halloween” never rents out a shop for the whole year. They may often go back to similar landlords year-after-year, but they never rent the space out till next Halloween. 

Another reason “Spirit Halloween” has lasted is because they have Minimal Inventory Carryover. Inventory Carryover is the amount of inventory a shop has at the end of it’s selling season for that particular inventory, which can often be carried over into the next season. Minimal Inventory Carryover would be the lowest amount ov inventory that could be left over at the end of the season, as possible, to avoid losing profit. One popular example could be seen in grocery stores. These inventory mangers use multiple techniques and strategies to make sure that each store has minimal discarded or discounted products. They study what is popular among viewers and what is in high demand, that way they can maximize the product they sell and get the most out of it. “Spirit Halloween” uses Minimal Inventory Carryover by not releasing a lot of product each season. They often put out only really popular products, that way there is a higher chance that all the product will sell. They also take any leftover product, that is in good condition, and save it for the next year. By making sure they have minimal product leftover, the company makes sure that they don’t lose major amounts of profit. 

Additionally, “Spirit Halloween” uses Consignment. This is tied into the last reason as well. Consignment is when a retailer or company makes and arrangement where whatever items that they have left over a third party is able to sell them. This usually results in a cut in profit for the original seller, but they will get rid of the product faster than just holding onto it. As well, the third party handles the sales, storage, and inventory management, so that’s one thing the original seller doesn’t have to worry about. There is multiple examples of stores that use consignment online and in-person shopping. For online, websites like Poshmark and ThredUp use consignment. These websites allow listers to put up listings of clothing they don’t want anymore, and sell it to someone. It’s all in the app so it makes it very accessible for everyone. For in-person, Plato’s Closet is a really good example. You can take clothing to one of the locations, and they will buy the clothes from you. So, you can get instant cash instead of waiting around for someone to buy it from you personally. However, they may not take everything from you though, so some of your clothes may not be worth buying to them. Now, “Spirit Halloween” uses consignment by giving a seller products to sell during the Halloween season, which is when these stores are open. This seller controls all the expenses, and only pays “Spirit Halloween” for what they sold. Spirit then takes back all the unsold products. Basically, they send sellers product for them to sell, so they don’t have to do it themselves, and the seller controls the expenses then sends the money for sold product back to Spirit. This allows “Spirit Halloween” to not have to directly use their resources to have shops to sell them in. 

Finally, “Spirit Halloween uses Year-Round Operations. Year-Round operations are businesses that are operating the whole calendar year. This would be like your typical retail store. Although Spirit does not have physical stores open all year, their website is running 365 days a year. If you have a random costume party, or need to get an outfit for a concert, “Spirit Halloween” is still open online for you to order random outfit accessories or temporary hair dye. I think it’s also vital to mention that Spirit has a “Parent Company”, Spencer Spirit Holdings. For those who don’t know, a “Parent Company” is a corporation that controls another company by owning majority of it’s stock. Spencer Spirit Holdings, the company that owns “Spirit Halloween” and owns “Spencer’s”. Since “Spencer’s” is a company that is open year-round, and not dependent on a season like Spirit, the corporation (Spencer Spirit Holdings) is able to stay in business all year. To sum up, it’s most likely that “Spirit Halloween” is able to stay in business till the next Halloween season because people are still able to buy product on their website and Spirit is owned by a corporation that also owns another year-round store, not dependent on a holiday. 

To wrap this up, “Spirit Halloween” has been able to stay open because of the multiple business strategies they adopted. Temporary leases allow the season stores to be open for a couple months, and not waste money on renting or owning a space of land all year. Minimal Inventory Carryover allows Spirit limit the amount of profit they could lose because they don’t put out a lot product nor keep a lot of product. Consignment lets the extra product that they don’t sell go to other stores, which allows Spirit not have to hold onto old product. Year-round operations allows Spirit to still make some profit by still selling product throughout the year on their website. All of these business models keeps “Spirit Halloween” open to every Halloween season.

 I think it’s pretty interesting which models that Spirit decides to use. I mean, I knew that they rented places only around the Halloween season. Yet, I didn’t understand the depth of the contracts and planning that goes into getting the contracts for rentals and selling their product. I didn’t know that they spend a lot of time planning what product they will have to ensure that it sells by the end of the Halloween season. I didn’t know they sign contracts to have third-party businesses sell the carryover product, that way they don’t have to worry about selling it. In the end, I guess I never thought about the amount of effort that goes into a Halloween store that comes around for only a couple months. I think it’s pretty cool, and it was really cool to understand how they last till the next Halloween season.

*** I do not own this photo!! It belongs to IndyStar!!