By Ed Moosbrugger

June 14, 2010 -- Struggling to recover from a tough 2009, Downtown Santa Monica merchants are still coping with cautious consumers who worry the economy hasn't bounced back yet.

And the wary attitude from shoppers shows. Although some stores are posting sales increases this year, others are down. The local scene reflects a national trend that has seen sales generally go up, while retail chains post widely varying sales results.

Santa Monica merchants are looking forward to the reopening of Santa Monica Place in August, saying the closure of the regional mall for an extensive remodeling has hurt business Downtown.

They also are hoping for a rebound in the visitor industry, which is vital to many Downtown retailers. Fortunately, there are signs of improvement there.

But for now, stores are still reporting mixed results.

“I think it has definitely picked up from last year,” said Lonnie Paser, general manager of Clarks Shoes in the 1200 block of Third Street Promenade. “Things are good. I'm up for the whole year.”

In a still difficult economic environment, customer service can make or break a sale, shop owners said. “People really need to get back to service if they want people to come back,” Paser said.

Sales are also up this year at Carlson's TV and Appliances in the 1300 block of Fifth Street, but General Manager Mike Nichols isn't exactly celebrating. “I'm up for the year, but so what,” he said, noting that last year was unusually bad.

Although the store is still in the black, profits are way down from three or four years ago, Nichols said. “I'm still worried,” he said. “Do I feel comfortable? No.”

Carlson's has done better than many appliance stores because many customers are apartment owners who provide relative stability, Nichols said. Still, even that part of the market has been affected due to increased apartment vacancies.

Other retailers are feeling the pinch. "It's not good. People aren't spending the way they spent before,” said veteran clothing retailer Kay Miller, owner of the Mudra boutique in the Market Pavilion in the 1400 block of the Promenade. Business was better last year.

Shoppers at Mudra are definitely more cautious. In the past, if they couldn't decide between two items, they might buy both, but now they are just taking one.

Miller, who has been on the Promenade since 1991 after moving from Main Street, recently started a children's line after realizing she liked to buy things for her granddaughter and other shoppers might feel the same way.

Miller reported a good response to the children's line. A visitor from France recently bought six items for a grandchild and another visitor bought four children's T-shirts, she said.

Mudra has been able to weather the storm partly because Miller put money away when things were good to provide a cushion for difficult times.

At Dellarobbia Design Studio & Flower Market in the 1500 block of Fourth Street, co-owner Jolene Reynolds says, “We're really busy because we do a lot of business for USC.”

But corporate business Downtown, such as parties, has been cut way back. “We're surviving,” Reynolds said. “We are supported a lot by our neighbors.”

Michael Segal, managing partner of Fred Segal Santa Monica, a collection of boutiques and eating places at Broadway and Fifth Street, said he's optimistic. The new Umami Burger -- created by Adam Fleischman, co-founder of BottleRock and Vinoteque in Culver City -- is doing very well, he said.

Looking ahead, both Mudra and Dellarobbia expect to see sales improve when Santa Monica Place reopens August 6.

Construction work has hurt business by making it more difficult to get to the floral store, and shoppers have been going to other areas because of the lack of anchor department stores Downtown, Reynolds said.

With the reopening of Santa Monica Place, “I'm assuming that this fall and Christmas will be very good,” she said.

Miller believes that when Bloomingdale's and Nordstrom open in the newly remodeled mall, they will draw the type of customers who also may shop at Mudra. But other merchants worry the new competition could siphon away business.

Merchants also are keeping an eye on the tourism business in Santa Monica, which brings an influx of new clientele. Paser of Clarks noted that tourists typically account for about 60 percent of her business.

There are some encouraging signs on the tourism front. PKF Consulting recently increased its forecast for the Santa Monica hotel industry. Santa Monica hotel occupancy is now expected to hit 78.1 percent for 2010, said Jeffry Lugosi, senior vice president of PKF, at the Santa Monica Travel & Tourism Summit in May sponsored by the Santa Monica Convention & Visitors Bureau. Previously, PKF had forecast a 76.8 percent occupancy for 2010.