Animals Suffer from Poor Economy

April 15, 2010 by · Comments Off 

by Katie Simon

The sad, tired eyes of an old chocolate Labrador peer through the bars of the kennel that is now his home. The four-year-old dog’s family recently abandoned him to a local animal shelter because they could no longer afford to care for him. But he doesn’t understand that.  

For many people, the poor state of the economy has taken a significant toll on their ordinary lifestyles. But for those with pets, both the owner and the pet may suffer.

Animal abandonment is no new problem. A family moves, which serves as an excuse to hand their dog over to an already over-capacity no-kill shelter. Or a man realizes he’s allergic to cats after all, so the cat ends up at a city pound where it is most likely to be euthanized.

But families who genuinely love their pets are now handing them over to shelters because they have either lost their jobs or their homes for financial reasons. Shelters, on the other hand, are experiencing a decline in adoptions because people know it is hard enough to care for themselves when they are tight on money. Adding an animal to the equation is simply out of the question.

Mark Cooper, the rescue coordinator for the city of Dallas, says the number of people surrendering pets for economical reasons has increased by 20 percent.

In December 2008, the Collin County Animal Shelter took in 63 pet surrenders from owners. In December 2010, it took in 117.

Owners surrender dogs more than cats. Dog food is expensive, and visits to the vet, especially for big dogs, are generally more expensive.

“People cannot afford the vet bills any longer; so instead, they are surrendering the animal to us in hopes that we can “fix” the animal,” Cooper said.

Tomi Tucker, the volunteer coordinator for the no-kill shelter Operation Kindness in Carrollton, says that they are constantly turning away animals—especially large breed dogs—because of space.

“We get hundreds of calls a day that we can’t take,” Tucker said. “We have to tell them no.”

While some shelters have maintained a steady number of animals, one thing is constant among all of them, say shelter workers: the number of surrenders and fewer adoptions are due to the economy.

Loss of a Home

When a family loses their home, their pet often loses its home and its owners.

“It’s like being separated from one of their own family members,” said Jackie Shapiro, who recently adopted a kitten from KittyCo Cat Rescue in Dallas.

Cats have an advantage in this situation, explains Tucker. If a person or family downgrades from an expensive home to a smaller one, a cat can usually be included in the moving process.

Large dogs, however, usually end up homeless.

“Cats are a little bit easier because more people can take cats than they can take dogs, because dogs require more assistance,” Tucker said.

For pit bull terriers and pit mixes, moving homes is practically an automatic death-sentence.

Pit bulls are considered an aggressive breed and many homeowners or landlords won’t allow their owners to keep them. And when pit bull owners bring their beloved dog to a no-kill shelter, they are often turned away because the shelter knows it is unlikely to be adopted.

Some city shelters, such as Carrollton’s, don’t take in pit bulls at all. Instead, they are immediately put down.

Amy Pelzel, a full-time volunteer for Denton Animal Shelter, says that Denton euthanizes 35 percent of its animals, and of that 35 percent, 70 percent are pit bulls.

“A lot of pit bulls are great with people, but aren’t dog-friendly. A lot of homes won’t allow you to have an aggressive breed,” she explained. “You can’t take it to a dog park, and you can’t find anywhere to live with that dog. It’s a stereotype of what that kind of dog is, so they aren’t accepted by society.”

Owner Surrenders

Before the economic downturn, many animal surrenders were strays people had found. At least that’s what people were telling shelters.

Pelzel believes that then, people were embarrassed to admit that they either could not care for or did not want their pet any longer. Now, however, financial problems have given some people a legitimate reason for handing over their pets, and others a believable excuse.

“People are literally just saying, ‘Oh, it’s because of the economy.’ And it’s almost more of an acceptable excuse to give up an animal,” she said.

Whether the surrenders are genuine or not, though, more people are turning in pets rather than strays.

Many pet owners want the best for their pet, but they don’t always understand how to go about ensuring that their pet ends up in good hands.

“If they turn the dog in as an owner surrender and there is no cage space, it can be directly taken to be put to sleep. Its time is up the second it is released to a shelter,” said Molly Peterson, the president of the Collin County Humane Society.

Peterson recommends that owners tell kill-shelters that the dog is a stray rather than turn the dog in as their own. This way they not only avoid paying the surrender fee, but the animal is automatically ensured a three to six day holding period, which was originally created so that owners could find missing pets. This window of time allows an owner’s pet a greater chance of being adopted rather than euthanized.

A Sad Future

For those animals who are lucky enough not to be turned away to a kill-shelter, a kennel or cage may be their forever-home.

Vikki Honkala, president of City Pet Rescue, says that old pets in particular face a dismal future living in the shelters.

“When you see the confused look in the eyes of a 10-year-old dog that has been left at a shelter by its owners, it’s awful. Who wants to adopt a senior dog or an old cat?” Honkala said.

Because older animals usually experience more health problems, which equal more expensive veterinarian bills, most of them live out the rest of their lives behind a caged door.

Maura Davies, the senior director of communications at SPCA of Texas, said the number of adoptions occurring within the SPCA has plummeted in recent months.

Last year, the SPCA adopted out around 750 pets a month, or about 25 a day. However, those numbers have significantly decreased lately.

“Adoptions went from 750 a month to 500. We have gone down from about 25 a day to around 16 a day,” Davies said.

Operation Kindness has seen the same decrease in adoptions. They usually adopt out between 60 and 75 animals per week. Recently, though, they experienced a week where only six animals were adopted out between Monday and Thursday.

For the animals, living in the shelter is a complete shift from their lives in homes with families. Most are sad and scared.

“You can’t tell them, ‘It’s going to be okay, you’re going to find somebody.’ They don’t understand why they are where they are,” Pelzel said.

Responsible Ownership

Operation Kindness and other shelters say it is better to adopt a pet from a shelter rather than buying from a breeder, because breeders add to the problem of animal overpopulation.

“I think it’s really important to adopt. It helps the animals, and a lot of times the animals that you can adopt are absolutely wonderful. From what I’ve heard, a lot of times they make better pets,” Shapiro said.

However, breeders stress that adoption is not for everyone.

While many families can’t help losing a job and the subsequent inability to pay for their pets, there are still others who adopt a pet without considering the costs and responsibilities associated with doing so, say shelter officials.

Tucker said that Operation Kindness has very strict requirements for adoption, and does its best to educate potential new pet owners of the responsibilities a pet entails.

Tucker recalled a family of five who bought a poodle they had bought from a breeder for $1,500, then turned it over to Operation Kindness when they realized it was required too much trouble and time.

“We asked, ‘Ok, is it housetrained?’ And they said, ‘We don’t know. We just keep it in the bathroom,” recalled Tucker.  

Many shelters also frequently experience animal returns because the owner realized he or she didn’t have enough money to afford her pet.

“We try to educate people when they adopt them that this is a commitment,” Tucker said.

Adoptions by college students are also strongly discouraged. Operation Kindness receives many animal surrenders from recent college graduates moving away for their jobs.

Shelters strongly recommend that owners prevent the problem of homeless animals by spaying and neutering their pets, because poor economy or not, the number of animals in shelters is astounding.

“The only way that every animal in the U.S. could have a home is if every man, woman and child adopted seven animals a day every day for the rest of their lives,” Davies said.

GameStop Q-4 Analysis

April 29, 2009 by · Comments Off 

By Katherine Helms

In a time when most companies are feeling the heat of the deep recession, GameStop Corporation is one of the few to benefit from the downturn. The company is reporting sharply higher sales and earnings for its fiscal fourth quarter, which ended on Jan. 31.

GameStop, the world’s largest video game and entertainment software retailer is thriving as penny-pinching consumers see staying at home and playing video games as a cheaper alternative to going out.

Headquartered in Grapevine, Texas, the company has 6,207 retail stores worldwide. GameStop sells both new and used game software, as well as video game equipment and accessories from Nintendo, Microsoft and Sony. With the coming of new games such as Rock Band Beatles, company executives believe sales in the next quarters could see similar improvements.

GameStop’s sales increased 21.9 percent to $3.5 billion compared to $2.9 billion in the fiscal fourth quarter of 2007. The company’s net earnings jumped 22.4 percent to $232.3 million this quarter

“”We are seeing a very, very strong demand in our pre-sale reservations for both the Guitar Hero Metallica and the Rock Band Beatles. So, there is still a lot of new exciting things coming out in the music genres this year,” said David Carlson, the company’s chief financial officer, in an earnings conference call.

New hardware sales grew 13 percent, which the company attributes to Nintendo’s Wii and Microsoft’s Xbox 360. The new software sales grew 23 percent thanks to new games like World at War and Wii Fit.

GameStop stores can be found across the United States and in Australia, Austria, Canada, Denmark, Finland, Germany, Ireland, Italy, New Zealand, Norway Spain and Sweden. By the end of 2008, GameStop opened or acquired 1,002 new stores, and according to Daniel DeMatteo, GameStop’s chief executive officer, stores will continue to open in the United States and abroad this year.

The company’s top competitors include, Toys “R” Us, and Best Buy. While those competitors are much bigger than GameStop, they sell many other products; Gamestop focuses entirely on video games.

Although many industries have felt substantial hits during this economic downturn, GameStop has continued to flourish. Games serve as a cheap form of entertainment compared to movie tickets, which sell for around $10 each; games are slightly more expensive, but can be used over and over again. For example, Mario Power Tennis sells for $29.99, so instead of spending $40.00 to take your kids to the movie, games may seem like a more reasonable solution.

“In spite of the recession games are viewed as cheap entertainment and we see software sales growing 5% to 10% in the US as they already grew about 10% in both January and February,” said DeMatteo in the earnings conference call.

The company had a good quarter, but Bob Dudley, managing director and broker for Morgan Keegan and Company in Little Rock, Arkansas, says he would be wary of buying GameStop stock and keeping it long term. He explains that from an investment standpoint there are too many long-term hurdles that the company will face. For instance, Dudley raises the question of how many people actually go to the mall with the intention of going to GameStop. The company has multiple stores located in malls, and Dudley questions whether the high rent is worth the traffic and the long-term effect this will have on GameStop.

“There are so many other solid long term opportunities in this market, I would have nothing to do with this company,” said Dudley.

Zale Corp. Records a 90 Percent Quarterly Drop

March 25, 2009 by · Comments Off 

By Erin Campbell

zalelogo Zale Corp. has joined the parade of local companies in cutting corporate costs through staff reductions. In a recent earnings release, the Irving-based jeweler announced the elimination of 245 employee positions, part of a strategic plan to cut costs in response to plunging sales and profits during the holiday season. For the three months ending January 31, 2009, Zale’s earnings fell 90 percent to $5.1 million, not including special charges, on revenues of $679 million, down 18 percent from the previous January.

These 245 job cuts will save Zale Corp. $21 million and will come primarily in Dallas, said Cynthia T. Gordon, interim chief financial officer in the company’s February earnings release. “The additional savings will consist of $34 million of cost reductions from the closure of underperforming stores, where financial hurdles are not being met,” she said.

The job losses will add to the unemployment in Dallas, Ft. Worth and Arlington metropolitan areas with a rate reported as of December 2008 at 5.8 percent, according to the Bureau of Labor Statistics.

In response to the steepening recession, Zale has formulated a multi-step strategic plan to reduce corporate costs, going beyond reductions in employee wage expense. In Wednesday’s earnings release, Zale revealed the closing of 115 underperforming stores, tightening up on in-store efficiency at a savings of $10 million and a further reduction of $75 million in inventory. The second stage of inventory cost reductions will result in $140 million savings for fiscal 2009, adding to the $175 million from 2008.

“We are clearing out non-obsolete inventory…older inventory that wasn’t part of our going forward,” said Rhett Butler, Vice President of Investor Relations.

The second stage of inventory cost reductions also included the reallocation of underperforming inventory to stores where it would sell. “We call it allocating [inventory] appropriately to whatever store [sells the product] best,” said Butler.

Zale is also cutting costs to compensate for its over 50 percent increase in long-term debt. The increase partly resulted from an attempt to increase per share earnings by repurchasing $469.9 million in stock. Other reasons for the increase were not disclosed. The purchase was recorded as long-term debt.

“Come 2009 it should go back down…it’s primarily because of our stock buy back to increase per share earnings…if the environment would not have crumbled then there wouldn’t have been a dramatic increase,” said Butler.

All of the Zale cost cutting reductions are a reaction to its $148 million decrease in sales. Zale attributes the sales decrease to its aggressive holiday store-wide price cuts that were an attempt to increase consumer traffic, despite the current economic crisis.

“Sales decreased because of aggressive promotional stance…those were retail stores giving discounts to promote traffic…gross margin then [went] down,” said Butler.

After watching holiday promotions underperform, Zale’s 2009 promotion strategy goes back to pre-holiday item-specific promotions rather than store-wide.

“We returned back to a strategy that emphasized… a promotional posture that is item specific…with comparable store sales improvement,” said Chief Executive Officer Neal Goldberg in the earnings press release.

Big D Blog: Guns For Groceries

March 3, 2009 by · Comments Off 

Posted by Christina Geyer

How about this: I’ll give you my gun, if you give me a $50 grocery store gift card. Apparently several Dallas gun owners were partaking in this great game of quid-pro-quo this weekend.

Deputy Mayor Pro Tem Dwaine Caraway’s gun exchange program, held at Reunion Arena, brought in 147 rifles, shotguns and handguns. All this was in exchange for some Kroger cash. I guess in this recession, food takes priority over guns.

A diverse crowd brought in their guns for a 20 minute inspection before being rewarded their gift cards. All they had to show was their driver’s license.

Some participants credited their donation to lack of gun use and family safety. But I have to imagine that a week’s worth of groceries, in a dicey economic climate, would prompt many to trade in their useless firearms.

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