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Venice's Velvet Gypsy Clings to Business Despite Economic Outlook

Erin Richards |
February 10, 2011 | 5:18 p.m. PST

Staff Reporter

On a clear Sunday afternoon, visitors and locals crowd the Venice Beach boardwalk. In a small store, just off the boardwalk, some of those visitors wander into The Velvet Gypsy, a belly dance supply store and specialty boutique. Although dozens of people stroll through, some even eyeing jewelry and trying on clothing, Rahana, the store owner, has only sold two pairs of earrings, earning about $16. 

From the Velvet Gypsy
From the Velvet Gypsy

“There are days where we make nothing,” said Rahana. “For that day I am upside down, because I still have to pay the rent. It’s costing me money to keep the store open.”

Even though retailers are showing increased sales, for specialty boutiques like The Velvet Gypsy the economic reality hasn’t improved. Although analysts and economists have pointed to these improved figures, small business owners like Rahana are still worried.

“Where people are spending are at the giant retailers, where they can offer discounts,” she said. “People are asking for discounts here more than ever, and on things that I’ve already marked down, so much that I would sell it less than what I paid for it. I just can’t compete like that.”

In 2007, when Rahana bought the existing business, sales were booming and the market for belly dance costumes, accessories, music and apparel was growing. According to Jaynie Aydin, a dancer and Middle Eastern dance anthropologist at UCLA, the belly-dance community in the greater Los Angeles area has grown to more than 10,000 dancers. But with the collapse of the economy, Rahana saw a collapse of her sales. Having taken out an equity line from her condo, which she owns, she now owes more than the cost of her original loan to buy her business.

“I haven’t been able to pay a dime back of that loan,” said Rahana.

Cutting costs has also cost Rahana business and peace of mind. She has had to dramatically reduce the amount of new stock in her store as well as slash prices to attract reluctant buyers. Within the last two months, she also had to lay off her two regular part-time employees. She is the only person who mans the store, seven days a week. She also works other jobs, as a part-time bookkeeper and event coordinator, just to be able to pay the rent for her store.

“I make ends meet, but honestly, just barely,” she said. “I run up all my credit cards and I have more than $50,000 in credit card debt.”

Other fluctuations affect Rahana’s business as well as general economic woes. Since her store is on a main artery of Los Angeles tourism, foot traffic and sales are linked with travelers to Los Angeles and the Venice Boardwalk. Less spending money means fewer people traveling and less foot traffic for The Velvet Gypsy. Weather also affects visits to the store, and as days of rain drenched Los Angeles, Rahana’s sales suffered at a time when other major retailers saw a boost of sales from holiday shopping.

In the months of November and December, Rahana’s sales only made about 13 percent of what she needed to sell to break even on her rent. More than five of those days, she sold nothing. With a hole to fill, she cannot even replenish her stock or purchase new items to attract sales.

For Rahana, her business has become her life. She has poured blood, sweat and tears into it, and cannot see letting it go, although she admits her struggle with what seems like a game of roulette.

“I don’t like to give up, although I probably should,” said Rahana shrugging. “If you had talked to me a week ago, I was in tears. It’s really hard to know how to go on. Is it going to be another year? Another five years?”

Her deep ties to her business have caused her to craft more creative and innovative ways to bring dancers, locals and visitors to her store. Along with rearranging her store to have more items outside to bring in customers, she has also made flyers and plans to implement what she calls “guerrilla marketing.” She plans to have a dancer offer quick workshops at the store to visitors on the boardwalk.

“Something like, $5 for five easy belly dance moves,” said Rahana, hopefully.

Her plan would bring in more people to the store and introduce people to both dance, which she teaches, and her store, which outfits them.

Although she hasn’t seen any increase in sales from these techniques yet, she is still hopeful that her marketing innovations and improvements in the economy will equal more business for The Velvet Gypsy.

“The economy is not getting worse. I see it stable and it’s inching its way to being better,” said Rahana. “You have to give 120 percent now, but I still have hopes.”

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