Resale shops require creative approaches

Location, marketing, inventory top list of tips

"Location, location, location" is often cited as the key to success in the real estate market, and it is not that different in the retail business, says Debbie Ludvik, manager of the hospice resale shop at Hospice of the Western Reserve in Cleveland, OH.

A resale shop, by itself, does not attract new customers who come into the shop on a whim, Ludvik points out. "One key source of our new customers is those who come into our shopping center to visit a nearby store," she says. "We have a wonderful deli and a popular shoe store near us, so those two stores generate traffic in our area."

Although customers of the other two retailers do not come into the shopping center specifically to visit the resale shop, they often come in to the shop because something in the window caught their eye or because they are curious, Ludvik says.

Marketing a resale shop also requires thinking like a retail store but emphasizing your differences, she says. An early sign for the shop used the words "resale store" but a new sign says "Hospice Resale Shop" to let people know they are supporting a community organization, Ludvik says. "It is large enough to see from the street and is easy to read," she adds. "The new sign resulted in quite a few people telling us that they heard about our store because they were driving by."

Unfortunately, one issue that resale shops and traditional retail stores do have in common is shoplifting, says Ludvik. "We've lost a clock valued at $300 and a set of casserole dishes valued at $200, along with designer shoes, jewelry, and CDs," she says. After a series of thefts, Ludvik began placing items such as CDs, jewelry, and expensive china or clocks in locked display cases that employees or volunteers can open for customers to examine. After finding someone's old shoes placed in a box that contained a pair of designer shoes on display one day, the method of displaying designer shoes changed, she says. "Our designer shoe display has only one shoe on display and an employee or volunteer can go into our back room to get the other shoe for a customer," she says.

Because some of these items were taken out of the store during busy sales days in which all volunteers and employees were at the cash registers or with other customers, a new position was created, says Ludvik. "Now we have a volunteer who 'patrols' the shop to talk to customers and keep an eye anyone who might be suspicious," she says. "We've found that talking with people and letting them know that not everyone is busy with other customers can discourage shoplifting."

Ludvik and Cathy Olsen, director of resale shops at Hospice of Palm Beach County in West Palm Beach, FL, set quality standards for the items they accept for their shops. This policy enables them to set competitive but profitable prices for their items and attract customers on an ongoing basis. However, it also presents a problem most retailers don't face, says Olsen. "Inventory control is a real challenge for resale shops because you have no control over what items are donated and when they are donated," she explains.

Even though a resale shop manager can't place orders for specific items like most retail store managers, there is a way to let people know what you need, Olsen says. "We don't get specific, such as asking for winter coats, but we do remind people each quarter to donate gently used items to our shop," she says. The reminders are a combination of newspaper articles or advertisements, postings on the resale shops' web site or Facebook page, and agency intranet for employees, Olsen says. "We tie the reminders to specific seasons such as spring cleaning, end-of-year tax deductions, or making room for holiday gifts," she adds.

In addition to encouraging visitors to the shops' facebook page to donate items, coupons and photos of items in the shops encourage people to visit as customers, says Olsen. "We often have donors become customers, but photos and announcements of new items in the shops generate even more new customers," she adds.

Ludvik says, "One of our most effective marketing strategies is a bag stuffer for every customer." Her small marketing budget doesn't allow much advertising, so flyers promoting upcoming sales are put in the bags for every purchase. "I've found that special sales, such as a clothing sale or a home accessory sale, generate more traffic than a generic sale," Ludvik says.

Of course, one of the most obvious places to promote a resale shop is the admission packet for all new patients, she says. "Families and friends of hospice patients often make donations to us and let us know that the hospice cared for their loved one," Ludvik says. "They like the opportunity to give to the hospice that provided care, even when they are not able to make a cash donation," she adds.

In addition to raising money for the hospice, the resale shop serves another purpose, says Ludvik. "We are a good public relations tool for the hospice because we are in the community, and we give people who have never had a chance to learn about hospice to learn about us through literature in our store or by talking with our employees and volunteers, and we give everyone a way to support us," she says.