Business owners try to ride choppy waters


You wouldn't know there's a retail recession by looking at the cash register at this McCaulou's Store in Lafayette. Even as Mervyn's closes, the nine McCaulou's stores in the Bay Area seem to be thriving.

"We've been in business a long time," said David McCaulou, a department store owner.

David McCaulou credits his success to finding a niche and sticking with it. His stores are all situated in small-town shopping districts, not big malls.

"We concentrate on what the people around us are doing and wanting to buy. And we're small enough to be able to do that," said McCaulou.

McCaulous Department Stores have succeeded where so many others have failed, in part because they cater to the wishes of local shoppers.

"It's easy to find things and the employees are very, very helpful," said Nancy Rude, a shopper.

Besides the service, shoppers told ABC7 they like the low prices. Indeed, those who study shopper behavior say there's only one way to entice them, during a down economy--deep discounts.

"Retailers have to be incredibly sharp in meeting consumer needs. It's intensely competitive because there's a smaller amount of discretionary dollars out there. Only the best are going to survive," said Kit Yarrow Ph.D., a consumer Psychologist from Golden Gate University.

"This tells me these are nice, clear clean diamonds," said Ernest Ricco, a Concord jeweler.

Ricco wants to lighten up his shoppers about the economy. So he has a sign in his window that reads, "Concord Jewelers is staying in business and without a government bailout!"

"Everyone is very nervous, business is bad, you hear a lot of the negatives. But every once in a while, someone has to stand up and say "Hey, I can see the sun coming up,'" said Ricco.

Ricco and other retailers better hope the sun does come up in time for Christmas.

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