PRINT THIS STORY:

CHANGE TEXT SIZE:

TEXANS GO TO THE SAM MOON AND BACK FOR THEIR DEALS

By Steve McLinden

On a Monday morning early in the fall at the Sam Moon Trading Co., in Dallas, every one of the store’s 20 cash registers is humming merrily. About 200 shoppers are poring through racks of off-price jewelry, scarves, perfume, designer purses and more in a frenzy akin to the bargain-mad skirmishing one sees along New York City’s Canal Street. Shelves are emptied as fast as they are stacked, but only when the shoppers are not pouncing on new boxes the instant they are carted out.

The main Sam Moon Center parking lot is jammed, so the late-arriving cars, buses and RVs, many with out-of-state license plates, spill over to the rear lots. Shoppers duck in and out of the neighboring Sam Moon Home Decor and Sam Moon Luggage & Gifts stores and have lunch at Dave’s Deli or Moonlight Coffee, both of which are owned by Dallas-based Sam Moon Group. They are also drawn to the 20-plus other stores in the 125,000-square-foot center that the group developed, owns and leases.

Haggar Factory Store, Jones New York, L’Patricia, Nine West and other national tenants, as well as local specialty shops, benefit from the synergy. “Sam Moon has really become an icon,” said Eddie Liebman, senior vice president of Dallas-based Weitzman Investment Properties, who brokered sales for Sam Moon stores in Dallas and neighboring Frisco. “There’s a whole culture that follows them. People literally come from miles and miles around.”

Volume is high, but margins are slim. “Personally, I think they sell stuff too cheap,” said Patrick Murphy, real estate director at Sam Moon Group. “But to the Moons, it’s not all about making money. They just want to do right by the customer and sell a good product at a good price.” Murphy, who has managed Dallas’ Mockingbird Station and other malls and centers, sees more out-of-state vehicles per capita at Sam Moon than at any other retail venue. “Here you rarely see anyone leaving without a sackful.”

Company president Sam Moon, son of founder David, was working across the street from the Dallas store in the company warehouse that early-fall morning, helping load a truck bound for Houston and the first store the company is opening outside north Texas. This is the first of several new stores the company will be launching over the next few years, a leap of faith for a retailer that has operated as a mom-and-pop for over 20 years.

After a store opens in Fort Worth, Texas, next year, Oklahoma and Arkansas may be next. But the chain will never saturate a market, because it needs to remain a unique destination, says Moon. The stores are likely to work best in densely populated cities on which out-of-market shoppers can descend en masse for day trips, says consumer psychologist Kit Yarrow, a professor at San Francisco’s Golden Gate University.

Products often go from Paris runways to the Sam Moon stores in 60 days, versus six months at most large department stores. “We can make decisions pretty quickly,” said Moon. “We don’t have to go through several committees.” The company seldom buys something that does not sell well, says Murphy.

The Sam Moon Group business model of bypassing the middleman remains successful, says Liebman. “Most people are either developers or retailers, but Sam realized that if he was going to create this synergy, why shouldn’t he have the control? And if there’s something he doesn’t know, he surrounds himself with smart people who do.”

The accounting, real estate, buying and administration functions all share the modest office-warehouse building of the company’s online operation, just behind the Dallas store. Currently, this dot-com operation offers just 10 percent of the items available in the stores, so there is significant room for growth, Murphy says.

Typically, Sam Moon Trading stores measure about 25,000 square feet. The luggage and home-decor concepts require 15,000 square feet and 12,000 square feet, respectively. Together the three sell a total of about 100,000 items.

What is behind the company’s rise? “They know how to create a chaotic and infectious shopping environment that gets shoppers in an impulsive state,” said Yarrow. He speculates that about half of the Sam Moon shoppers end up spending more than they had planned to. “No one really needs another handbag or a piece of luggage with red polka dots, but they have all these really fun items with amazing price points, and they’re hard to ignore.”

Shopper Nancy Inman, a Dallas resident who got together recently for a daylong shopping binge with some friends from Kansas City and Oklahoma, says the prices, the selection and the treasure-hunt environment have won her continued patronage. “You walk in and they’re unloading boxes, and you can’t wait to see what’s coming next,” she said.

Murphy says the stores cross all economic levels. “A low-income person is going to get the best purse for her money here, while a higher-income person who doesn’t want to spend $200 on a designer purse is going to get practically the same thing for $40 at Sam Moon,” he said.

But Sam Moon products aren’t knockoffs, says Moon. “There are similarities and differences,” Moon said. “We are known more for a designer look.”

Both Sam Moon Tradings’ flagship Dallas center and its 156,000-square-foot Frisco complex were 100 percent leased before any stores had even opened there. Sam Moon Trading does not carry shoes or dresses, so the company leases to those that do, says Murphy.

Moon would not divulge sales figures, but he says volume this year is off a bit from a stellar 2005. “Our business is very trendy, and last year was a great one for trends,” he said. “This year has been horrible for trends.” He says he expects a reversal come the spring.

Next year the company will develop a center next to Hillwood Properties’ Alliance Town Center, in north Fort Worth. The site will benefit from a neighboring JCPenney and Belk, anchors in a center jointly developed by Hillwood Properties and another Fort Worth-based firm, Trademark Property Co. “Sam Moon and the number of patrons they provide will bring a lot of power to Alliance Town Center,” said William Burton, a Hillwood senior vice president. “They have evolved over time, and they really energize shoppers. They will help us, and we will help them.”

Founder David Moon is a self-made man. He came to Washington, D.C., in 1971 from Seoul, South Korea, and took a job as a wig salesman. Moon soon brought his newfound trade knowledge to Memphis, Tenn., where he opened 10 wig shops, which he sold off to relatives as they came over. In 1983 Moon moved to Dallas and opened the original Sam Moon wholesale operation in an Asian trade district along Harry Hines Boulevard. He converted the business to retail years later. His sons, Sam and Daniel, cut their teeth in the business there. The Moons are devout Christians and recruit many of their Dallas-area workers from the Dallas Baptist church they attend. These workers, predominantly Korean, are loyal and collegial, the company says, and the stores incur little shrinkage. The employee base at the Houston stores is more diverse ethnically and equally reliable, company officials say. There’s no night crew; stores close by 7 p.m. so workers can go home and enjoy family time, says Moon. Further, the stores are closed on Sundays, to allow for worship.

Shoppers should not mistake a Sam Moon center for an outlet mall, says Murphy, despite the exterior resemblance. There are no seconds or leftovers at any shop in the complex. “We feel that every store in our center,” he said, “is a reflection of us.”