When Cyrus Hassankola moved to Dallas a couple of years ago, after successfully going out of business in several locales, he decided to settle down and go out of business permanently.
"The response was good from Day One," the carpet salesman says.
Customers rooting through the stacks of Oriental rugs in the store he opened on a busy road in North Dallas would sometimes say how sorry they were that he was going out of business. "We're not," Hassankola told them. "It's just the name of the store."
A business literally called Going Out of Business didn't sit well in some quarters, one of them the Texas Attorney General's Office. So Hassankola -- for a limited time only -- has stopped going out of business.
Now he's running regular "total liquidations" that "beat every going-out-of-business price." In his vocation, this is established practice. But the arrival of hard times has thrown the survival of the going-out-of-business model into doubt. Everybody else is slashing prices as if there's no tomorrow. Old-line going-out-of-business businesses are lost in the crowd.
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And their best customer -- the American trained to pay the advertised price -- has taken to haggling. America's Research Group, a South Carolina polling company, says 72% of 1,000 consumers interviewed in February had haggled in the past year (31% is the historical average), and they reported getting deals 80% of the time. Last year, only half the retailers they took a shot at caved in. Hassankola spots the trend whenever he rolls out a rug.
"That's pretty -- let's take it," a woman named Mary was saying to her husband, Jerry, on a Saturday afternoon in the store. They were studying a $4,200 hand-knotted carpet selling for $2,179. "I definitely don't like that price," said Jerry. Mary whispered, "See if he can make you happy."
Hassankola's helper, Hamid Moradi, tapped a calculator to set the "liquidation" price: $1,526. Jerry jiggled his keys. Moradi said, "Make it $1,000. If you love it, take it home." Jerry stared.
"I think you have to pay for it," Mary whispered. Jerry said, "No, we don't."
And they didn't. Moradi let them take the rug home, to see whether it matched their furniture.
As they left, Hassankola brimmed with optimism for a quick rebound in distressed sales. A slender man, 43 years old, he speaks with candor. "At last, they're bargaining," he said. "Now we must wake them up. Come back! Buy again! They think they're playing a game. I know. I'm part of this game. If I say no, I'm a liar."
Where Hassankola comes from -- Tehran -- the game is played without price tags, a style common in carpet bazaars from Delhi to Marrakech. In the West, an astronomical price tag is often a fiction; slashing it is a way to let buyers believe they're getting a discount. Price tag or not, the sellers are the ones who know where a rug comes from, how old it is, how good it is and how much it cost them.
Except for connoisseurs, most buyers know only what they "love." A seller can size up a buyer and decide what he's likely to pay. In business school, it's called "price discrimination." Hassankola has learned that lesson: He went to business school in Switzerland. When he finished, in 1991, he took a job in a Zurich rug warehouse.
The smell -- barnyard and mothballs -- stirred memories of his grandfather's rug store. That was all he knew of the trade, but he had studied the beauties of going bust. Zurich was known as a trading post for wealth escaping Iran in the guise of carpets, which were piling up in fixed-price shops. Hassankola hooked up with one of them, packed it with stock and advertised an emergency shutdown.
The place stayed open for months and "made tons of money," he says, adding: "If a store is closing forever, people believe they can squeeze you. It is the power of words."
Hassankola says he reprised his act in Zurich four times, then opened a store of his own there and went out of business in 1999.
In 2000, he flew to the U.S., found a green-card sponsor and hit the road. He recounts steering rug stores out of business in Maryland, Tennessee, South Carolina, North Carolina and Georgia. Tired of traveling, Hassankola moved to Dallas and in late 2007 opened his extended-stay rug store. When he registered its name as Going Out of Business, he doesn't recall any tax clerk or bank officer blinking. But when David Beasley caught sight of the sign, his eyes popped.
Beasley, 26, works for the Better Business Bureau. One recent morning, he was cruising around Dallas in his Chevy Cavalier on a preposterous-sales hunt. The banner on an apartment complex read, "Free rent." On a bedding showroom: "Nobody beats our prices." On a furniture outlet: "Bankruptcy liquidation."
"I understand the desire to stay in business," Beasley said as he drove along. "But you can't do it by going out of business."
Many localities do have rules against such claims. New York City asks stores to get licenses for angst-inspired specials, from "fire sale" to "lost our lease." Texas asks the same. But with blowouts on every corner, there's been no burst in enforcement. Texas has issued 49 such licenses since 2001 -- and prosecuted one used-car dealer in Austin.
Hassankola doubts Texas would have bugged him either, if Beasley hadn't gotten a TV station to show his shop's sign on the local news. When the Attorney General's Office phoned to scold him, he dropped his just-the-name-of-the-store routine without a peep and regrouped.
He replaced the sign with "Cyrus Rug Gallery," and, last fall, let fly with a flier: "Due to the impending demolition and redevelopment of our premises, we are forced to sell out at auction. Let our loss be your gain." The demolition crisis went on for months. The wreckers didn't arrive.
Lately, Hassankola has been hanging a "liquidation sale" banner out front. On a Saturday in June, he ran a four-page color ad in The Dallas Morning News pitching rugs at "60-90% off list." It was "first-come-first-served," but nobody came until 2 p.m. Only four sets of customers came at all. One couple paid $1,900 for a rug they wanted to use as a bathmat. It was the day's only sale.
Near closing time, Bill and Elaine Griffin walked in. "I'm ready to sell you rugs," Hassankola crooned. Elaine Griffin said, "I need an education." She got one, including the history of an 80-year-old, $29,000 rug going -- today only -- for $11,000.
"I am blessed," Hassankola told her. "My grandfather bought this rug."
Griffin folded her arms. "It looks brand-new to me," she said. As the couple headed for the door, Hassankola called out, "I have to tell you, this sale won't last much longer."
But Hassankola has more to come. He has heard that his building soon may finally be torn down. He's already scouting for new locations -- and making plans for a grand-opening sale.