Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:00):
Now on Colorado's Morning News.
Speaker 2 (00:01):
Why do I always see you?
Speaker 1 (00:09):
Halloween is creeping up on Friday, and as quick as
the spooky holiday comes and goes, so do the stores
that allow the little ghosts and goblins to dress up
for trick or treating.
Speaker 3 (00:19):
Yeah, the bit is business model of Spirit Halloween is
scary successful, renting out large vacant storefronts, filling them with costumes,
hiring temporary workers, and then vanishing like a ghost come November.
Speaker 2 (00:30):
Joining us on the KWA Common Spirit Health.
Speaker 3 (00:32):
Hotline is Associate Professor of Operations and Supply Chain Management
at Colorado State University.
Speaker 2 (00:38):
It's doctor Zach Rogers. Doctor Rogers, thank you so much
for your time this morning.
Speaker 4 (00:42):
Thank you, good morning.
Speaker 3 (00:43):
I love this conversation because we always like to joke
that you hear of an abandoned storefront, abandon business, and
then literally the next day you see the Spirit Halloween
banner plastered up above the doorway. But I'm curious if
you have a little bit of insight of how far
in advance the planning of a location actually goes into play.
When we're talking about these Spirit Halloween locations that are
(01:04):
really only put up for a month.
Speaker 4 (01:07):
Well, it's a year round process. They're actually already planning
for next year now. They're always opportunistic and the benefit
of the short term leases they use is that maybe
we had something planned out for six months and then
oh man, that that kmart just closed. Well, if a
camart closed, I guess would happened ten years ago. If
that office depot just closed, we can slide in there.
(01:30):
And so they can be very opportunistic and they are
willing to pay a little extra to get a space
they really think will work. But generally it's something they
start planning a year in advance.
Speaker 1 (01:40):
I'm curious because staffing as it is is already so difficult.
How does getting employees for a spirit work when they're
only working for eight, maybe ten weeks? And how do
you guarantee they'll do a good job?
Speaker 4 (01:53):
You know what? They actually have an amazing niche in
terms of seasonal hiring. If you think about seasonality, there's
a lot of jobs that only exist in the summer,
maybe you know, at a baseball park or at a
pool or a water park or something like that, and
then there's a lot of other jobs that exist in
the holiday season. You know, before I get back to school.
I worked at Amazon. We would hire one hundred thousand
(02:15):
people starting around the beginning of November to go through
the holiday season for Black Friday and Cyber Monday and everything. Well,
right in between there is that Halloween window, and so
you have folks who sort of go from seasonal job
to seasonal job, and in some ways these Halloween sort
of autumnal jobs provide a great bridge between the more
(02:36):
traditional pockets of sort of temporary hiring that we see
in the summer, and then in Q four with the
holiday season.
Speaker 2 (02:44):
Let's talk profit margins.
Speaker 3 (02:45):
I'm someone who's literally bought my Spirit Halloween costume on
Facebook Marketplace because I pay, you know, a.
Speaker 2 (02:51):
Quarter of what you pay at Spirit Halloween.
Speaker 3 (02:53):
How are they able to sell something or what are
the profit margins when they're selling something that's probably made
dirt chy but greatly inflated prices.
Speaker 4 (03:03):
I mean they're doing great, actually, you know, I mean,
like you said, these costumes are made to be worn once,
so they're not necessarily pitched, you know, stitch with with care.
My students like to call everything cheap, you know, the
temou version of something. It should be the Spirit Halloween,
you know, Spirit Halloween invented team Ou basically, and they
are able to mark things up because usually people maybe
(03:26):
don't have the foresight you did to order ahead. And
you know, I was walking into a Spirit Halloween on
Saturday because I needed purple hair dye for a Halloween
party in an hour. And that's that's usually who they're
praying on. And look, costumes in the United States is
going to be a four billion dollar with a b
four billion dollar industry this fall. And so even if
(03:49):
you're spending a lot of money to stage all of
this stuff with their fourteen hundred stores around the country,
you're making a huge a huge margin on everything.
Speaker 2 (03:58):
Zach Real quick purple hair dye. What do you bean
for Halloween?
Speaker 4 (04:02):
I was I was the dad from Rugrats.
Speaker 2 (04:04):
Ah, that's cute.
Speaker 4 (04:07):
Look for me to play a stressed out frontie guy
with weird hair is actually not a huge stretch, So
it was it wasn't much for me.
Speaker 1 (04:14):
How do they produce costumes given that they are so
trend based, how quickly can they adapt to something that
pops up in the in the pop culture world.
Speaker 4 (04:26):
They can move pretty quickly. You know, they use a
lot of these sort of fast fashion models. You know,
when I was at Spirit Halloween doing a little research yesterday,
I saw they had one one that was the Terraf outfit.
Was just the guy wearing the Terraf board that was
presented in April when we did all of our Liberation
Day stuff. So that that obviously turned around pretty quick
(04:50):
because that was only six months ago. They can probably
do one of these in six six weeks to two months.
They can turn something around quickly because only a small
per percentage of the costumes in there are new stuff,
you know, I mean, it's it's I grabbing, like, oh,
the you know, the Barbie movies big, So we'll put
Barbie movies in, or we'll put a tariff guy in,
(05:11):
or we'll always have a rubber mask whoever's running for presidents.
But ninety percent of what they're selling is, you know,
a princess or a witch or spider man or something
like that. In those costumes they keep all year round
in they have a giant warehouse in North Carolina. They
do something called hoteling where you know, people will still
(05:32):
want to be Batman next year, I'm sure. And so
if we don't sell those, we'll put them, we'll put
them back in the in the big warehouse in North Carolina,
and so it's really only like ten percent of the
stuff that's going to be brand new and trendy.
Speaker 3 (05:45):
Okay, So with all that being said, it sounds like
Spirit Halloween is diving a little bit more into the
Christmas market with some Christmas pop up stores.
Speaker 2 (05:53):
How profitable or possible are those?
Speaker 3 (05:55):
When it comes to Spirit Halloween almost has a little
bit more of a niche and then everybody sells chris
As products around Christmas time or honestly as soon as
Halloween ends.
Speaker 4 (06:05):
Well yep, that is true, So it's called Spirit Christmas.
I think you can see the logical leap that took
there was it was a bit of a success last year.
So last year they rolled it out in mostly on
the East Coast, and I think they did, you know,
five or six stores. This year's going to be thirty.
(06:27):
So clearly they see there's some sort of opening for them.
I mean, they must have been relatively successful last year.
They're going from from you know, seven stores to thirty stores.
And mostly where they focus there is like on the
decor and it's cheap little stuff. I really think they're
aiming for people getting ready for their work Christmas party
(06:48):
or you know, like my thirteen year old daughter when
she wants to put Christmas decorations around her room. It's
not again the highest quality Creighton barrel style Christmas merge,
but it is growing now. They're not going to ever
compete with the Walmarts, the Amazons or Target or something
like that in terms of holiday sales. The reason that
(07:10):
they're so dominant in Halloween is because they started in
nineteen eighty two, when most costs in nineteen eighty two
is your mom cutting holes in a sheet so you
could be a ghost. I mean, they were really a
first mover, and so they have a huge advantage in Halloween.
They're not going to become this dominant in Christmas, but
the fact that they are basically quadrupling their footprint this
(07:31):
year tells you that they do see some potential.
Speaker 1 (07:34):
Zach, thanks for this fun look inside Spirit Halloween.
Speaker 4 (07:39):
Oh thank you so much. This is fun.
Speaker 1 (07:41):
That's CSU supply chain expert Zach Rogers
Now on Colorado's Morning News.
Speaker 2 (00:01):
Why do I always see you?
Speaker 1 (00:09):
Halloween is creeping up on Friday, and as quick as
the spooky holiday comes and goes, so do the stores
that allow the little ghosts and goblins to dress up
for trick or treating.
Speaker 3 (00:19):
Yeah, the bit is business model of Spirit Halloween is
scary successful, renting out large vacant storefronts, filling them with costumes,
hiring temporary workers, and then vanishing like a ghost come November.
Speaker 2 (00:30):
Joining us on the KWA Common Spirit Health.
Speaker 3 (00:32):
Hotline is Associate Professor of Operations and Supply Chain Management
at Colorado State University.
Speaker 2 (00:38):
It's doctor Zach Rogers. Doctor Rogers, thank you so much
for your time this morning.
Speaker 4 (00:42):
Thank you, good morning.
Speaker 3 (00:43):
I love this conversation because we always like to joke
that you hear of an abandoned storefront, abandon business, and
then literally the next day you see the Spirit Halloween
banner plastered up above the doorway. But I'm curious if
you have a little bit of insight of how far
in advance the planning of a location actually goes into play.
When we're talking about these Spirit Halloween locations that are
(01:04):
really only put up for a month.
Speaker 4 (01:07):
Well, it's a year round process. They're actually already planning
for next year now. They're always opportunistic and the benefit
of the short term leases they use is that maybe
we had something planned out for six months and then
oh man, that that kmart just closed. Well, if a
camart closed, I guess would happened ten years ago. If
that office depot just closed, we can slide in there.
(01:30):
And so they can be very opportunistic and they are
willing to pay a little extra to get a space
they really think will work. But generally it's something they
start planning a year in advance.
Speaker 1 (01:40):
I'm curious because staffing as it is is already so difficult.
How does getting employees for a spirit work when they're
only working for eight, maybe ten weeks? And how do
you guarantee they'll do a good job?
Speaker 4 (01:53):
You know what? They actually have an amazing niche in
terms of seasonal hiring. If you think about seasonality, there's
a lot of jobs that only exist in the summer,
maybe you know, at a baseball park or at a
pool or a water park or something like that, and
then there's a lot of other jobs that exist in
the holiday season. You know, before I get back to school.
I worked at Amazon. We would hire one hundred thousand
(02:15):
people starting around the beginning of November to go through
the holiday season for Black Friday and Cyber Monday and everything. Well,
right in between there is that Halloween window, and so
you have folks who sort of go from seasonal job
to seasonal job, and in some ways these Halloween sort
of autumnal jobs provide a great bridge between the more
(02:36):
traditional pockets of sort of temporary hiring that we see
in the summer, and then in Q four with the
holiday season.
Speaker 2 (02:44):
Let's talk profit margins.
Speaker 3 (02:45):
I'm someone who's literally bought my Spirit Halloween costume on
Facebook Marketplace because I pay, you know, a.
Speaker 2 (02:51):
Quarter of what you pay at Spirit Halloween.
Speaker 3 (02:53):
How are they able to sell something or what are
the profit margins when they're selling something that's probably made
dirt chy but greatly inflated prices.
Speaker 4 (03:03):
I mean they're doing great, actually, you know, I mean,
like you said, these costumes are made to be worn once,
so they're not necessarily pitched, you know, stitch with with care.
My students like to call everything cheap, you know, the
temou version of something. It should be the Spirit Halloween,
you know, Spirit Halloween invented team Ou basically, and they
are able to mark things up because usually people maybe
(03:26):
don't have the foresight you did to order ahead. And
you know, I was walking into a Spirit Halloween on
Saturday because I needed purple hair dye for a Halloween
party in an hour. And that's that's usually who they're
praying on. And look, costumes in the United States is
going to be a four billion dollar with a b
four billion dollar industry this fall. And so even if
(03:49):
you're spending a lot of money to stage all of
this stuff with their fourteen hundred stores around the country,
you're making a huge a huge margin on everything.
Speaker 2 (03:58):
Zach Real quick purple hair dye. What do you bean
for Halloween?
Speaker 4 (04:02):
I was I was the dad from Rugrats.
Speaker 2 (04:04):
Ah, that's cute.
Speaker 4 (04:07):
Look for me to play a stressed out frontie guy
with weird hair is actually not a huge stretch, So
it was it wasn't much for me.
Speaker 1 (04:14):
How do they produce costumes given that they are so
trend based, how quickly can they adapt to something that
pops up in the in the pop culture world.
Speaker 4 (04:26):
They can move pretty quickly. You know, they use a
lot of these sort of fast fashion models. You know,
when I was at Spirit Halloween doing a little research yesterday,
I saw they had one one that was the Terraf outfit.
Was just the guy wearing the Terraf board that was
presented in April when we did all of our Liberation
Day stuff. So that that obviously turned around pretty quick
(04:50):
because that was only six months ago. They can probably
do one of these in six six weeks to two months.
They can turn something around quickly because only a small
per percentage of the costumes in there are new stuff,
you know, I mean, it's it's I grabbing, like, oh,
the you know, the Barbie movies big, So we'll put
Barbie movies in, or we'll put a tariff guy in,
(05:11):
or we'll always have a rubber mask whoever's running for presidents.
But ninety percent of what they're selling is, you know,
a princess or a witch or spider man or something
like that. In those costumes they keep all year round
in they have a giant warehouse in North Carolina. They
do something called hoteling where you know, people will still
(05:32):
want to be Batman next year, I'm sure. And so
if we don't sell those, we'll put them, we'll put
them back in the in the big warehouse in North Carolina,
and so it's really only like ten percent of the
stuff that's going to be brand new and trendy.
Speaker 3 (05:45):
Okay, So with all that being said, it sounds like
Spirit Halloween is diving a little bit more into the
Christmas market with some Christmas pop up stores.
Speaker 2 (05:53):
How profitable or possible are those?
Speaker 3 (05:55):
When it comes to Spirit Halloween almost has a little
bit more of a niche and then everybody sells chris
As products around Christmas time or honestly as soon as
Halloween ends.
Speaker 4 (06:05):
Well yep, that is true, So it's called Spirit Christmas.
I think you can see the logical leap that took
there was it was a bit of a success last year.
So last year they rolled it out in mostly on
the East Coast, and I think they did, you know,
five or six stores. This year's going to be thirty.
(06:27):
So clearly they see there's some sort of opening for them.
I mean, they must have been relatively successful last year.
They're going from from you know, seven stores to thirty stores.
And mostly where they focus there is like on the
decor and it's cheap little stuff. I really think they're
aiming for people getting ready for their work Christmas party
(06:48):
or you know, like my thirteen year old daughter when
she wants to put Christmas decorations around her room. It's
not again the highest quality Creighton barrel style Christmas merge,
but it is growing now. They're not going to ever
compete with the Walmarts, the Amazons or Target or something
like that in terms of holiday sales. The reason that
(07:10):
they're so dominant in Halloween is because they started in
nineteen eighty two, when most costs in nineteen eighty two
is your mom cutting holes in a sheet so you
could be a ghost. I mean, they were really a
first mover, and so they have a huge advantage in Halloween.
They're not going to become this dominant in Christmas, but
the fact that they are basically quadrupling their footprint this
(07:31):
year tells you that they do see some potential.
Speaker 1 (07:34):
Zach, thanks for this fun look inside Spirit Halloween.
Speaker 4 (07:39):
Oh thank you so much. This is fun.
Speaker 1 (07:41):
That's CSU supply chain expert Zach Rogers
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