1

The sky is cloudy as Erin Klaus sits at her desk in downtown Eau Claire, frantically typing an email. Erin serves as the executive director of DECI (Downtown Eau Claire Inc.), promoting community engagement in the downtown area. This, however, is not her primary job, and it's a position she took up fairly recently, more out of need than necessity. As she continues to work in her office, her mind is on the shop she owns on South Barstow Street. The store is empty. It’s the reason she is here at DECI.

Erin Klaus founded her business, Tangled Up in Hew, alongside her best friend sixteen years ago. Like every brick-and-mortar shop in the United States, Erin has had moments of great success and instances of strife and challenge. She and her business partner, however, managed to overcome these challenges. That is, until now.

Ever since the end of the COVID-19 pandemic, Erin’s profits have shrunk year after year. Her revenue from 2024 was down thirty-five percent from the previous year, the lowest it has been so far. The holiday season that was supposed to bring in some much-needed revenue to end the quarter was a bust for Erin. She has faced many challenges before, but nothing like this.

She has now begun to wonder how long this can go on before she is forced to close for good. The future of her business is a worry that never leaves her mind. The possibility that sixteen years of hard work could fade soon weighs on her. It was that uncertainty that led Erin to seek a second source of income.

Her position at DECI provides her with a weekly paycheck that she says has helped to provide a small sense of relief and financial security. However, the fear of being forced to close is ever-present. It’s becoming more difficult to pay her relatively small staff. The cost of operating keeps increasing. The rent keeps increasing. The only thing that doesn’t seem to increase is her profits. The job at DECI can only make up the lost income for so long.

(Erin Klaus types at her desk at the DECI office in downtown Eau Claire. The work she does for DECI helps to stabilize the financial state of her business.

While working at DECI Erin met other brick-and-mortar shop owners and experienced similar concerns and frustrations. “Plenty of others I have talked to have seen a steady decline”, she said. “It’s got many of us worried about our future and the future of local retail here”.

In February, the Conference Board’s Consumer Confidence Index reported the largest monthly decline in consumer confidence since August 2021. Many American consumers are looking at the economy with great concern and skepticism. Their confidence in the economy and the businesses that inhabit it is decreasing. It seems their buying patterns reflect those concerns.

Rising inflation and stagnant wages across the board have impacted how Americans view their dollars and what they are willing to spend their income on. Consumers are more often looking for the cheapest and most convenient way to buy something.

Luke Hanson, executive director of the Eau Claire Economic Corporation, has been observing shopping trends, both local and national, for years. “People understand that their dollar doesn’t go as far as it did in the past and they want to make the most of it.” As such, buying patterns have changed, which has created unique challenges for brick-and-mortar retail shops.

“Everyone has a bottom line, like a business,” Erin said. “They have their priorities to take care of, and when money is tight, our cash flow becomes tight.” For business owners like Erin, consumers having less disposable income is bad news, as people’s disposable income is where money is made. "We need that constant cash flow from people spending their extra dollars to stay afloat"

Luke Hanson claims the best way to bring people in during these times is by offering deals. “We observe that shops that can offer deals or the occasional discount receive much more foot traffic,” Hanson stated. “People are looking for a bargain, and they will go to the place that can give that.”

Unfortunately, for many independent brick-and-mortar retail stores, the challenge of offering those sweet deals can be tough for the small retail businesses of Eau Claire. “It cuts into their profits,” explains Luke. “When they order product, they aren’t ordering in bulk and getting a bulk discount like the large retailers can. Doing price matching and discounts really becomes challenging.”

This trend has not discriminated between young entrepreneurs and veteran business owners who have many years of success. Jane Wolf has been operating her business, Silver Feather, for thirty-eight years, making jewelry based on Native American art and craftsmanship. Over those years, she has built up a sizable customer base as well as deep connections with local Native Americans in western Wisconsin who supply her with silver and other materials for the works she sells.

She smiles as she recounts her days of business before COVID. “Years ago, when there was a lot of road construction happening downtown, I had people climb over dirt hills outside to get into the store.” These days, however, her store is mostly empty, a far cry from years past.

Despite it being a warm Friday afternoon, the only person in the store is her. Even her longtime loyal customers have begun to rarely stop by. The money being brought in is shrinking. The cost of operating has increased, as has the price of silver used to make the items she sells. “I have never seen anything like it.” The uncertainty is starting to creep in. Is her journey with the shop, which she has spent years building up and maintaining, coming to an end? Jane has seen a lot during her three decades in business, but this feels different.

Jane believes the rising cost of living has had a significant impact on her business. “I sell a lot of things that are pricey,” Jane said. “Even if the quality is not as good, people will buy it for cheaper if they can.”

However, Jane is around the age of retirement. She no longer runs her business out of need to financially provide for herself, but rather because she wants to. “I feel like I was supposed to settle down a while ago, and it’s getting more difficult to keep the store open.” However, she can’t even imagine closing down, she says. Her thoughts are firmly on her customers and the ones who provide her with her materials.

While some businesses have struggled to adapt to this new environment, others have been able to weather the storm. Billy Seglal has been running his music record shop, Revival Records, since 2009. Despite seeing drops in revenue during COVID, he has largely been able to bounce back and remain stable.

Billy attributes this to his commitment to the atmosphere he built at Revival Records. “Everything in the store is meant to make you feel like you are in a ’70s record store. Everything is catered to the customer, for the customer.”

His other big success was creating a delivery system for his business during COVID-19 that operates in a fashion similar to DoorDash, where people can order a record from their website and have that record delivered to their residence that day. He says that he has built up a strong customer base that wishes to spend their hard-earned dollars to support his business.

A customer searches for a record at Revival Records. Billy claims he has created a culture that keeps consumers coming back

Despite how well he seems to have done, he confessed that he fears for the future of small retail in Eau Claire and the United States as a whole. “The future of shopping is online, and I wouldn’t be surprised if the majority of shoppers move online in the next few years,” Billy says.

“It’s just so easy and convenient. I sometimes have to stop myself from shopping online. I try not to because I know how that hurts local retail shops, but I find myself doing it from time to time.” The convenience provided by online shopping is something that, for many small retail shops in Eau Claire and beyond, is difficult to match, especially for those in downtown Eau Claire. It’s that convenience factor that Billy claims will severely hurt mom-and-pop shops like his.

Billy Seglal expresses his fears for the future of local retail.mp3

Billy Seglal expresses his fear for the future of local retail

It’s becoming clearer that how, where, and what people spend their money on has shifted, says Luke Hanson. “The biggest change we have seen is the rise of online shopping, and I don't think that will change anytime soon.

Since 2020, online retail purchases have increased significantly all across the country, with the U.S. Census Bureau reporting that e-commerce sales made up 16.4 percent of total sales in the fourth quarter of 2024. As each year passes, more people take to the digital marketplace for their retail shopping experience.

“We find that businesses who can make that transition end up doing well for themselves,” Luke explains. “But it’s a whole new process and division of their business. Setting up an e-commerce sales portal, as well as dealing with packaging and shipping, can be difficult and expensive." For businesses like Erin’s, who are already strapped for cash, that is a cost they cannot afford.

Data from the U.S. Census Bureau showing what percentage of all retail purchases in the U.S. were e-commerce

As the end of the day rolls around, Erin closes her computer as she wraps up her work. As she is packing up her laptop, she looks out her window overlooking the downtown area. She will be bringing home another paycheck. However, with a family to help provide for and a business to maintain, she knows that it’s a paycheck she will have to stretch out.

As she walks by her store, she sees no one inside other than her friend managing the counter. It was another slow day, something that is increasingly becoming the norm. Her mind continues to fill with worry. She says she sometimes wonders what she did wrong. “Whenever a person’s business is struggling, it’s common for them to blame themselves, and I get that feeling sometimes too. It hurts,” she says.

Erin Klaus states her fears concerning her business.mp3

Erin Klaus states her fears concerning her business

She doesn’t want to close the store, not just for her own sake, but for the sake of her business partner and the staff who work for her. However, she acknowledges that she possibly may have no other choice. “It’s one of the worst feelings when you close, not because you want to, but because you have to.”

As the sun sets and the lights of her store dim, Erin ponders what the future will hold. While Erin, Billy, Jane, and many other business owners have all experienced and reacted to these new consumer trends differently, the uniting feeling is a sense of uncertainty. What the future holds is difficult to predict, but Erin, Jane, and Billy have no plans to give up on the dreams they built. Holding on to the hope that people will walk through their doors to keep them going.