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Shopping Centers Today -> December 2003
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CHINATOWN TO SOHO
Pearl River department store moves into posher digs
BY IAN RITTER
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| Photo: Ian Ritter |
Most department stores boast a heritage of grandiose retail palaces patronized by the elegant and the wealthy, but not New York City’s Pearl River Mart.
In the early 1970s a group of Chinese-American university students, upset over a U.S. ban on merchandise from Communist China, set up a storefront in Chinatown to sell copies of Mao Zedong’s Little Red Book and other items from the Chinese mainland. In 1978 the company they established, Chinese Native Products, opened Pearl River Mart, also in Chinatown, while continuing to operate the original storefront.
Today Pearl River Mart, which is named after a Chinese tributary, has moved beyond little red books to offer a smorgasbord of things Asian from not only China, but also from India, Indonesia, Japan, Thailand and other countries. The goods range from clothing to food and from housewares to musical instruments, novelty items and more. Best-sellers are Asian slippers, ceramics and lampshades, according to Ching Yeh Chen, Pearl River’s president, whose husband was among the company’s founders.
Nine months ago the store, long considered one of New York City’s best-kept secrets (or worst-kept, depending on how one looks at it) came out of hiding. Pearl River Mart has moved out of Chinatown to a bigger and brighter site in downtown Manhattan’s chic SoHo, where it occupies the site of a former factory on Broadway.
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| Its founders started out selling copies of Mao Zedong’s Little Red Book. The offerings have broadened somewhat since then. |
The current 20,000-square-foot incarnation is a big improvement from the old store on Canal Street, Chinatown’s bustling thoroughfare, where all the merchandise was crammed into a 13,000-square-foot, second-level space. Customers entering the new store are greeted by a waterfall at the head of a staircase leading to the basement. A mezzanine-level tea bar and café overlook the main floor.
Gone is the anonymity of the old location. That second-level store on a busy corner wasn’t likely to draw customers who didn’t already know about it. Many customers, says Chen, didn’t want the store overexposed, so they wouldn’t tell their friends about it — even though those friends were probably doing exactly the same thing. But while the new space may have taken away some of that allure, business has gone up, Chen says. The new Pearl River Mart is on track to generate $10 million in sales annually, a 60 percent increase.
The secret is surely out now. Movie actress Julia Stiles was at the new store’s grand opening in March, and a September feature article in The New York Times hasn’t hurt either, Chen says.
Pearl River Mart’s move signifies more than a shift to more-spacious quarters, says David Bassuk, principal at New York City-based consulting firm Kurt Salmon Associates.
“There’s such a boring sameness with your traditional retailers,” Bassuk said. “It’s a great time to do something like this when consumers are looking for uniqueness.”
Pearl River Mart’s long march to its current fame began in 1986, when Chinese Native Products moved the store from its first Chinatown location to another, on the corner of Canal and Broadway. The store started selling products from other countries (though Chinese-made items still constitute about half of Pearl River’s sales, Chen says). Chinese Native Products also operates a smaller store called Pearl River Emporium, which opened in Chinatown in 1988 and sells similar goods.
In the early 1980s people from SoHo, which was quickly becoming one of the world’s fashion hubs, began trickling down to Pearl River Mart to shop. That’s why the new SoHo site was the first choice for relocation, Chen says.
“We’ve grown up with the neighborhood,” she said. “We have a feeling we belong to SoHo. It’s natural for us to go from there to here.”
Though Pearl River Mart shoppers include tourists and out-of-towners, the majority of customers still come from the New York metropolitan area, Chen says. The store has tried to draw in a larger audience, though, first with a glossy, color catalog it created in 1995 and then with an e-commerce Web site launched in 1997. Most of the store’s advertising is on local Chinese-language radio, but the company has branched out to print advertisement in visitors’ guides.
The company has no plans to open a store in midtown Manhattan or in other cities.
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“We’re not like Chanel,” Chen said. She has already turned away brokers offering to find locations in cities such as Boston, which also has a large Chinatown. The company is not convinced that a Pearl River Mart could make it away from New York City’s vast and diverse population.
“It’s the only place in the world that has a population that would be interested in this store,” she said. “For the customers who can’t reach us, we try and do a better job on our Web site.”
But Bassuk says Pearl River Mart could expand to other cities, because there is a market for something different in the retail industry.
“If you look at other retailers that have done this type of thing, it’s extremely scalable to other urban markets,” he said. Bassuk compares Pearl River Mart to Anthropologie, Urban Outfitters and other specialty retailers, saying the store could realize sales per square foot of $800.
Chen has also turned away local Asian merchants looking to sublease space in the SoHo space. One company, for example, wanted to put a small bakery in the store.
“They’d like to take advantage of the traffic,” she said. But she isn’t about to share her traffic with anyone.
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