Press Release

FOR IMMEDIATE RELEASE
October 22, 2009
Contact: Adele R. Meyer, Executive Director
586.294.6700 or adele@narts.org

Resale Continues to Thrive in a Slow Economy
St. Clair Shores, MI — The resale industry is one of the few recession proof segments of retailing. Not only does it survive during economic downturns but it grows and thrives... shining with promise. The appeal is twofold... consumers are attracted to buying quality merchandise at a fraction of the original cost and there is a financial incentive to sell, consign or donate their unused or unwanted items.

With food and energy costs increasing, housing expenses rising, retirement accounts shrinking and the stock market still a major concern, it is no wonder consumers are feeling cash and credit constrained. As they run out of purchasing power, they cut back on discretionary spending and change the way they shop—but don't be mistaken, people will still shop! Some people shop because it makes them feel better, others shop out of need... professionals still have to look good, children outgrow their clothes, teens need prom dresses and newlyweds have new homes to furnish. Recessions present the opportunity for resale shops to attract new customers. Even people who never worried much about saving money before are now feeling the pinch and cutting back. In this uncertain economy—when people are shopping cautiously and focused on getting more value for their money—resale is the natural choice. The industry offers the best of both worlds... the chance to SHOP & SAVE!  With the economy posing a challenge and the fact that many people have an overabundance of possessions, savvy shoppers and sellers are realizing a real need to recycle perfectly good merchandise.

Resale attracts a new demographic of both suppliers and customers during difficult economic times. "People who previously gave away clothing, household goods and furniture are seeking other ways to dispose of unwanted items during an economic pinch." says Adele Meyer, Executive Director, "Some donate merchandise to a Not For Profit thrift shop and take advantage of the tax deductions while helping a charity raise money. Others may choose to sell or consign merchandise at a local resale shop... turning their 'no longer needed' articles into CASH!"

Consumers have caught the resale bug as they look for resourceful and creative ways to cut back on spending, particularly for clothing and furniture. "The slumping economy may draw people in, but once they visit a resale shop for the first time they are pleasantly surprised with the high quality of merchandise and are forever hooked on a new way of smart spending," says Chris Cowman, NARTS Immediate Past President and owner of one more time in Columbus, OH. "The popularity of resale has never waned, and we believe our members will come out of this recession in a stronger position—with a larger customer base—as a broader section of consumers explore the many options the resale industry has to offer."

NARTS members have reported significant increases in both sales and incoming inventory as consumers tighten their spending and search for sources of extra income. NARTS recently surveyed their membership to determine how 3rd quarter 2009 sales figures compared to those of the same time period in 2008. Of the 333 stores that responded, 67.4% said sales increased (with an average increase of approximately 35%), 11.4% said sales were about the same and 21.2% had a decrease in sales.  Many respondents who experienced a decrease in sales indicated it was because they sold children's products and were negatively affected by the CPSIA.              

Contrary to some media reports of decreased suppliers (consignors/sellers/donors), the survey revealed:  69.2% experienced an increase in the VOLUME of inventory coming in their stores—with approximately one third reporting an increase of more than 25%.  20% said supply volume remained  the same with only 10.8% experiencing a small decrease.  When asked about the QUALITY of incoming merchandise: 32.6% are receiving higher quality items, 58.1% about the same and only 9.3% felt quality had decreased. 

While other segments of retailing are cutting back on advertising and promotions and are trimming inventory and staff, resale professionals are taking the opposite approach. NARTS member shops have been very aggressive in their advertising and marketing programs aimed at attracting a new demographic of customers and suppliers—those who may not have taken advantage of the benefits of resale before a decline in the economy. By maintaining their staff, resale shops are able to offer personalized service generally not found in the large department and discount stores. NARTS members pride themselves on their high level of customer service.

"We are using this time to 'shine' to EVERY new customer who walks through our doors ... so that later on when the economy improves WE WILL still be part of their USUAL clothing shopping route." says Amanda Rosen, owner of Victoria's Consignments in Mount Pleasant, SC.

Tracy True Dismukes, owner of Collage Designer Consignment in Birmingham, AL and NARTS Past President, said "Business is INCREDIBLE!!," noting that only belt-tightening but the renewed emphasis on recycling and going green is contributing to her stores' success. "Consumers can maintain the high standard of living they have become accustomed to on a fraction of what they used to spend, and they can also sell items they aren't using and get cash or store credit to use on items they want or need," states Dismukes. "With less money to spend, they still want to dress well and send their children to school in new clothes and also continue to furnish and decorate their homes. When they shop consignment, they can still have those things they want without the guilt."

Sue McCarthy, NARTS Secretary and owner of Women's Closet Exchange in St. Louis, MO, is always proactive in advertising and promoting her business in slow economic times. During the recession in the early 90s, she doubled her TV commercial budget when most retailers were cutting back on advertising. As a result, Women's Closet Exchange increased their inventory, gained new customers and hired new employees to handle the surge in business.  McCarthy remarked, "We do well because I don't listen to the media reports of doom and gloom. Instead we just keep doing what we do best... providing quality merchandise at affordable prices to our customers. We are rewarded with a business that has flourished for two decades—during both times of prosperity and recessions." 

Ellen Didion, owner of Chic to Chic and her newly opened second location, Chic to Chic Too, in Maryland said, "Reporters who recently visited our stores were quite surprised to hear so many positive things from our customers.  They come in here and completely forget the outside world and their concerns about the economy for a little while. At Chic to Chic they can always find something that is within their budget—they shop around, talk to each other, model clothes for all to see and even if they do not make a purchase, they know they are always welcome to browse and will leave feeling better than when they first came in! Women LOVE to "gather"—aka shop—and consignment stores as well as thrift stores still offer guilt-free shopping!"

Increased consumer commitment to resale has resulted in new shops being opened throughout the country at a rate of about 7% a year. This is a higher growth rate than in previous years and something NARTS expects will continue this year. People who have recently become unemployed and are looking for other career opportunities are exploring the possibilities of opening a resale or consignment shop. Charities seeking additional sources of revenue are opening up thrift stores. NARTS members have also been expanding and opening additional locations. Some members are increasing their space to include specialty categories such as bridal, sporting goods, teens or furniture. A number of clothing stores have opened additional locations catering to teens or specializing in furniture... two of the fastest growing segments of the resale industry.

"Many factors contribute to the popularity of resale during both strong and unsettled economic climates," states Meyer, "Increased awareness of recycling, the quest for higher quality for less money, the lure of finding something distinctive, the 'thrill of the hunt' and the excitement of a good buy are just a few things that allure the savvy shopper. One of the foremost reasons that resale thrives in a slow economy is simple... People LOVE A BARGAIN!"

###

The National Association of Resale & Thrift Shops (NARTS), the world’s largest resale trade association, is dedicated to continuing education within the resale industry. The Association serves resale, consignment and thrift shops of all types by providing educational and professional development for future owners and current store owners/managers. Please visit the NARTS Website at: www.narts.org for more information.