Fairbanks thrift stores see increase in business

As consumer budgets tighten, discount retail business is booming

Posted: Monday, July 07, 2008

FAIRBANKS - Joelle DeMunno has a new way of predicting customer spending at Value Village.

She watches the fuel prices posted at gas stations. When the cost per gallon goes up, the store manager prepares for more shoppers.

Granted, it's not an exact science, but the method has proven reliable so far this year: Business is booming at second-hand and consignment stores.

Sales receipts are up more than 30 percent from a year ago at Value Village, and customer foot traffic is paralleling that ascent, DeMunno said. Increases started in January but have shot up sharply in the past six weeks - the same time period in which Fairbanksans watched gas hit $4 a gallon and keep on climbing.

"The economy is kind of in a pinch," DeMunno said. "A lot of consumers are making changes to fit their new budgets. As the gas is going up, we're getting busier."

When consumers tighten personal budgets, the first cuts are often to discretionary spending on items such as clothing and household goods. And when they've got fewer dollars to spend as they please, some people want to stretch the cash as far as they can.

In Fairbanks, several shops offering consignment or used items are reporting steady increases in sales, where a dollar does in fact buy more. People are shelling out for all sorts of merchandise - clothing, household supplies, furniture and tables of miscellany.

Spending is up across the board at the Fairbanks store, DeMunno said. Shelves lined with broken-in workboots, pink galoshes and trendy woven platform shoes surround tables piled high with electric keyboards, forks and knives, a giant blue stuffed puppy. Tight-packed racks of clothing offer real buys for those willing to thumb through REI shorts, Express jeans, sequined wedding gowns and pink ski bibs.

Shopper Marilyn King explores the always-changing selection for items she can use in her motor home and for clothing for her grandkids, who are quick to shred pant knees and add dirt overlays to camp attire. Last week, she picked up two like-new umbrellas and culled from Value Village's shelves a Glacier Gear lunchbox with faux cowhide. She sees no need to buy new when quality used options are available at a fraction of the cost.

At Used-A-Bit, owner Donna Sluka buys and sells household goods, tools and furniture, among other odds and ends. Business is up at both ends. More people are looking to sell and often say they need to fill their gas tanks or fund a move Outside, she said.

"They like to wheel and deal a bit, and we'll work with them," she said.

While Sluka has her weekly regulars, she is seeing an increase in new customers. Sluka attributes much of the growth to high prices for the things people can't do without - food and fuel, mostly.

Higher prices tighten discretionary spending and bring out the bargain shoppers. That motivated Kathy Bell to open a high-end consignment shop - which also sells some new items - at the beginning of May downtown.

After hearing friends rave about three such stores recently opened in Anchorage, Bell realized there was a market at both ends. Women with great wardrobes were looking to cast off the rarely worn in exchange for a little cash, while others were giddy about the deals they found at consignment shops.

"I am seeing a large response here locally, not only in buying but in selling the stuff," Bell said. "People are looking for quality clothing for less price. It doesn't necessarily have to be new."

Bell said one customer bought three sundresses and two tops the other day, for a total bill of around $50. The woman excitedly told Bell that the receipt would be easier to rationalize with so much to show for it. Other customers include military wives who are on a budget but still want to look nice and daughters searching for the labels they covet with price-conscious mothers footing the bills.

Teenagers, eagerly sought by retailers and marketing companies, represent a strong second-hand shopper demographic. Many have less discretionary spending but covet pieces that scream one-of-a-kind or boldly display the latest logos.

"A lot of our teenagers have been shopping here (Value Village) for years for those vintage items," DeMunno said. "They're more apt to buy their labels here; the teen market is very interested in that. Tommy Hilfiger, Hollister, Baby Phat, all those we get in daily, and as soon as we put them out, they're gone."

Vintage is increasingly in-style for customers new to second-hand shopping, DeMunno said, as teen style trends "trickle up to a more mature form."

She's selling to more professional women in their mid-30s through 40s accustomed to dropping several hundred dollars on an office suit.

"The customers who are first-timers had not been customers prior because of the stigma of thrift," DeMunno said. "They've decided to give it a shot to see what kind of savings we have. We definitely have a new customer base, and when the economy straightens out again, I think they'll continue to be regular customers just based on the value."

Bell picked up on that group with tailoring Designers' Closet to the working woman with a yen for high-quality brand names.

Debbie Rimer sought out bargains with a practiced eye at the downtown store, scanning racks stuffed with suits, dresses, skirts and slacks. As a single girl on a budget, the affordable, quality apparel is a perfect fit - as is the opportunity to stock her closets with high-end apparel not found in most department stores.

Choice plays a key role. Diana Burgess said she's a regular already at Designers' Closet, where she finds cute originals at prices that help her dress fashionably.

"It makes it easier to turn over your wardrobe," Burgess said. "You don't have that guilt factor."

While new customers give second-hand stores a try, tried and true shoppers are spending more time at thrift stores to stick to their personal budgets.

Anita Hughes visits Value Village once a week, at least, often with family members.

"These days and times you've got to get what you can get," she said, showing off the most recent find, sturdy black wading boots. Last week she honed in on a $10 microwave for her nephew, who is starting out in his own place. "Anything to save money," she said.

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