Hard Times Pt. 1: Secondhand Stores' Success in US

♠ Posted by Emmanuel in at 3/05/2008 01:32:00 AM
Are all retailers doing less well now in the USA? No, says CNN/Money in its glumly titled section "Recession Watch 2008." Apparently, stores which sell secondhand children's goods--clothes, toys, and furniture--have been doing better than in recent times and things may get even better yet for them as the US economy slides further down the gutter:
Unlike most retailers who are blaming the economy for their poor sales, one store chain is boldly declaring that an economic downturn can actually be a boon for its business. Taylor Bond, CEO of Children's Orchard, sounds excited about the next 10 months and beyond. The privately held chain, based in Michigan, sells used name-brand children's clothes, toys and furniture at more than 86 franchised locations nationwide.

Last year, the company took in $20 million in sales, up 5% from the previous year. "Our sales are already up 5% so far this year," he said. Bond said the very nature of its business puts the company in a prime position to take advantage of what he calls "a perfect storm that's coming."

"Recycling has become more acceptable today among consumers because of the 'green' trend," Bond said. "A shaky economy is making us attractive to everyone across the income spectrum. We have people pulling up to our stores in Mercedes as well as in trucks."

To his point, the National Association of Resale and Thrift Stores (NARTS), which represents more than 2,500 stores, expects the multi-billion dollar resale market to grow at a robust 5% pace, or more, this year. That compares to a much slower 3.5% projected overall growth for annual retail sales in 2008. "Our industry benefits every time the economy is tight and gas prices and heating bills are high," said Adele Meyer, the association's executive director. "People have to look for alternative ways to shop,"

Bond said Children's Orchard stores sell "gently used" clothing from such kids brands as GAPKIDS, Gymboree, Fubu Kids, Tommy Hilfiger Kids and Ralph Lauren at 40% to 80% less than the actual price. So a $50 Gymboree dress costs as little as $7, and a $500 Peg Perego stroller can be picked up for $125 at a Children's Orchard store.