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Business & Tech

The Cost of Doing Business in Haddonfield: Part II

In the second installment of the series, Haddonfield Patch looks at the budget for the Partnership for Haddonfield and how its dollars are spent to advance commerce in the borough.

(Editor's Note: This is the second installment of a two-part series examining the relationship between Haddonfield's retail district and the Partnership for Haddonfield, the nonprofit corporation created to provide support for local businesses. Part I is available .)

On paper, “Haddonfield is the envy of all,” says Susan Adelizzi-Schmidt of Suasion Communications Group, the Egg Harbor Township-based public relations agency contracted by the Partnership for Haddonfield (PFH).

“You have a 95 percent occupancy rate; it’s a number that is just stellar,” she says.

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In 2004, the borough established the Haddonfield Business Improvement District, a commercial zoning area within which additional taxes are levied on property owners to fund townwide shopping and cross-promotional efforts.

At the same time, Haddonfield also established a management corporation, the Partnership for Haddonfield, to oversee the use of these funds. In 2010, the PFH tax totaled a quarter of a million dollars, or 65 percent of its budget. Another $101,357, appropriated from its 2009 budget surplus, accounted for 26 percent of the 2010 budget.

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(To view a copy of the Partnership for Haddonfield's IRS filing for 2009, the most recent year available, click on the PDF above.)

Figures provided by PFH list a $67,000 advertising budget in 2010 that does not include $28,800 in fees to Suasion, nor an additional $6,500 paid to Mel Fendt of Accent Studio to develop marketing materials for PFH and townwide events.

Lisa Hurd, retail coordinator for the Partnership for Haddonfield, draws a yearly salary approaching $45,000, plus a $7,000 travel and recruitment budget.

Hurd contends that the TV and media placement of 78 Suasion-authored stories in 2010 is equivalent to an estimated ad value of almost $800,000. Furthermore, she says that the 63 stories the firm has released thus far in 2011 are worth almost $500,000 in terms of media exposure.

Adelizzi-Schmidt says that one of the big pushes her firm has made under the direction of PFH is outreach to Philadelphia hotel concierges and regional media to help raise the visibility of Haddonfield as a shopping destination for non-local consumers. She points to a recent story in the Philadelphia Business Journal as another placement that was carefully cultivated with this audience in mind.

“I have anecdotally heard from several of the business owners in town that their shoppers came from Philadelphia, that they were directed by their concierges to come, and how impressed they were,” Adelizzi-Schmidt says, although she could not point to any quantitative assessment by which to measure this impact.

Both insist that PFH always solicits feedback from Haddonfield retailers on its marketing operations and PR strategies, and that interested parties should attend its meetings, which are held the first Wednesday of every month at 8:30 a.m.

Hurd and Adelizzi-Schmidt also both concede, however, that the PFH monthly meetings are generally sparsely attended.

Steve Duross, co-owner of Duross and Langel soapmakers, suggested that in part of the reason for this is the hour at which they're scheduled.

"At 8:30 in the morning, I have a workshop that has to heat up. There’s an entire chorus of work that begins at eight in the morning and goes on until we close at night," he says.

Duross added that aside from being held at an inconvenient time, his fellow retailers confided in him that the meetings were not really productive in terms of moving forward with new ideas.

“Why aren’t the merchants gathered together?” he asks. “I’m amazed at how many people in Haddonfield who have businesses refuse to speak up.”

“I'm the president of the Midtown Village Merchants Association (in Philadelphia),” Duross says. “I work with people like myself who are a pain. Somehow we summon the humanity to sit down in the same room and at the same board and make decisions in the best interests of our businesses.

“Doing business is about doing business. It’s not about personalities and liking somebody or not liking somebody," he says.

Hurd counters that PFH networking initiatives, including its coffee-and-conversation events, are especially popular with business professionals in town. PFH also sponsors a pair of annual development seminars for Haddonfield business owners, for which it budgets $10,000.

Hurdles: Parking and Retail Hours

“The borough has spent so much money on consultants to figure out what was needed and they all come back and say parking, but nothing ever happens,” says Ken Scott, who from 2000 to 2007 operated Nakona, an apparel shop on Kings Highway that sold boutique brand clothing and footwear.

“It’s been the same things people have been talking about for the last 10 to 15 years,” he says.

A parking and access committee established eight years ago has made “incremental progress” in “chipping away to try to add more spaces at the core,” says Hurd. Its biggest success was negotiating with PATCO to leave the gate up at the Hi-Speedline parking lot on weekends to accommodate overflow traffic.

Hurd believes that any prospects of a dedicated parking facility coming into town would be contingent upon interest from an outside developer. She believes it would take the construction of a mixed-use facility to justify the expense.

“There’s no likelihood in the immediate future that the borough’s going to be laying out money for structured parking,” she says.

Another big issue in the Haddonfield retail sector is the inconsistency of its stores in keeping regular, daily hours, Scott says.

“There’s some percentage of shops in town that are just hobbies: people who are either retired or housewives, whatever, who just want something to do. They either get in it and don’t realize how much work it is, or they get a minimal amount of money, and think, ‘Why do I want to work for this money?’”

Scott recalls one Christmas shopping season where his store was swamped at 6 p.m. on a Saturday evening, Dec. 23, because every other shop in town was closed.

“And then as fast as it happened, it all went away,” he says. “The people just left because nobody was open. How can you not extend your hours a few days before Christmas? It’s not going to be there Tuesday.”

Hurd says that she shares Scott’s frustrations, but that neither the Partnership nor the borough can regulate store hours or they “would insist that businesses stay open seven days a week and at least a couple of evenings.”

“We are constantly encouraging our businesses to band together and stay open later,” Hurd says. “We tie our incentive and retention grants to businesses that stay open seven days; we ask the landlords to add that in the lease,” she says.

Hurd says that among the various reasons businesses close, the “biggest single factor is being under-capitalized.”

“You’ve got to be open. You’ve got to have the right manager. You’ve got to have good window display. You’ve got to advertise your business. You’ve got to flex with the times, especially in this type of economic environment,” she says.

Duross adds that there are "half a dozen shining examples of exceptional businesses on Kings Highway that I would love to have as my neighbors here in Center City," and that Haddonfield is "a great little town."

"It just wasn’t a good fit for us," he says. "I needed to get out while I still had my shirt and my dignity intact."

Retention Efforts

PFH operates a pair of matching grant programs as incentives for business retention and recruitment in Haddonfield. The heftier of the two offers qualifying retailers two months of free rent (capped at $10,000) and 25 percent of fit-out costs (capped at $20,000), but Hurd says that not many businesses are eligible for the program—it has only funded 11 in the past eight years.

“We don’t give out many grants,” says Hurd. “It’s not something that we do lightly.”

PFH has found many more takers (29 businesses) for its physical improvement matching grants, which have a $1,000 cap and may be re-earned annually. To qualify, businesses must have been open for six months and offer daily hours of operation. Hurd says that PFH has provided $22,000 across 35 grants, which ties “our incentive and retention funding to the kind of store hours that we would like to see in town.”

Duross says that his business could have qualified for PFH funding except that his landlord, E. Guy Elzey, does not participate in Partnership activities.

"When we extend a grant or a fit-out subsidy or a grant rent to a prospective tenant, the landlord has to provide copies of the lease and co-sign the contract with the tenant," says Hurd. "Mr. Elzey has made it clear that we are not to offer his tenants the funding."

She would not elaborate on why Elzey chose to abstain from PFH, but described his attitude as inconsistent with her experiences working with Haddonfield landlords overall.

Hurd also cited the PFH gift certificate program, whereby townwide gift certificates are available at a 10 percent discount that the Partnership absorbs, as another retention strategy that is “a direct investment in our business.”

The PFH gift certificate budget is $11,000 for 2011; by comparison, the corporation paid $18,600 to locally based Raphael Webscapes in 2010 for the maintenance and upkeep of its websites: shophaddonfield.com, haddonfieldbride.com, and haddonfieldprofessionals.org

“You look at retention a lot of different ways,” Hurd says. “One of the key things that the Partnership does to help our businesses succeed is bring people into town; (businesses) have the responsibility to get them in their door.”

As the grant programs mostly dealt with capital expenditures, Scott says Nakona “never had the need because all our expenditures were inventory.” Nevertheless, he believes the majority of the responsibility for businesses closing lies with the business owners themselves.

“It’s their businesses,” he says. “They’ve got to fight for what they want.”

“Unfortunately,” he adds, “you’re running a shop and you don’t have time to fight City Hall.”

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