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Recession-Proof Businesses in South Orange?

Stores that sell "sin products" tend to fare well during bad economic times.

Trying to browse the snack rack at the Garden State News & Village Smoke Shop on a weekday afternoon is no easy task. In just five minutes, more than a dozen customers stream through the doors of this narrow downtown store. Students, workers and moms out for a stroll are buying lottery tickets, cigarettes, magazines and snacks.

The Village Smoke Shop is among the few in town that is so far escaping the effects of the economic recession. Business has "stayed steady," says Steve Mavropoulos, manager of the shop for nearly 20 years. "It hasn't changed a great deal. There's been no real shift, and people are buying the same stuff that they always buy."

Economists say stores that sell "sin products" such as alcohol and tobacco often fare best when the economy takes a turn for the worst. The greatest change they tend to see is that "people may buy the house brand of wine rather than an expensive imported one," says Scott Rothbort, a finance professor at the Stillman School of Business at Seton Hall University. He adds that nothing is completely recession proof, and for stores offering these products, "it can go either way."

Local liquor store owners say Rothbort hit the nail right on the head. At Wine Emporium at 25 Valley St., manager Luke McMahon says, "The weekends have been really busy, with the usual crowd. It's been normal, with no increase or decrease." He has noticed, though, that "beer sales have been up, because it's cheaper and you get more for your buck."

Sanjay Chawla, owner of A&D Deli and Liquor at 396 Valley St., laughs when asked if his store is recession proof. "The recession affects everyone," he says, but admits he is still seeing the same number of customers. The difference is in what they buy. "People that bought last year, they are not all buying the same this year. If last year they would've spent $50 on a bottle of wine, this year they are buying $20 bottles, because they can buy three bottles for the same money," he says.

Another industry defying the odds is weddings. A new downtown boutique, Designer Loft West, opened its doors just last week. Owners Paulette Cleghorn and Liz Sellassie say they are "taking a leap of faith" opening a new store in the middle of a recession, but aren't nervous because "brides still want to look gorgeous as they walk down the aisle," according to Cleghorn, and despite being "more budget-minded, the dress is not something they are going to skimp on."

The pair has owned Designer Loft in Manhattan for eight years. The new boutique will have a designer in-house, and offer world-famous designer labels that they cannot carry in their flagship store because of competing stores in the city. Sellassie says they have customers flying in from "all over the country and the world," and expects their business to continue growing. "There have been more weddings than usual," Cleghorn says. "We're busier than ever."

Up the street at the Village Smoke Shop, Mavropoulos continues ringing up items for his steady stream of customers. One after another, customers ask him to throw in a lottery ticket. "Maybe today's my lucky day. Wouldn't it be nice to win that jackpot?" a customer asks.

But if you ask any of the struggling downtown business owners, they'd likely say the seemingly recession-proof Smoke Shop has already hit the jackpot.

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