Beth Karlin / Shopping Centers Today – The sale of used clothing, whether called secondhand or vintage or gently used, is exceedingly popular now. And with celebrities like Kim Kardashian having taken to cleaning out their closets by selling their secondhand duds on eBay, we may well be at the place where used apparel meets celebrity auction meets spring cleaning.
To be sure, the concept of reselling used apparel is hardly any newer than the clothing itself. In 1991 Chip Gergen and Gerald Block saw they could profit from reselling secondhand garments, so they co-founded Berkeley, Calif.–based Crossroads Trading Co., which now operates 35 stores, most of them in California. The chain is about the size of Tucson, Ariz.–based Buffalo Exchange, another secondhand up-and-comer, which has 30 stores around the country. Thus neither of these is big enough just yet to distract segment giant Plato’s Closet, which caters to teens and tweens through some 300 stores nationwide. And yet that may only imply that these hungry smaller competitors have nowhere to go but up.
Today Gergen and Gabriel Block, son of the late co-founder, are following their growth instincts to new places. They have launched Fillmore & 5th, an offshoot of smaller shops — at 1,200 to 1,500 square feet, these are less than half the size of the 3,500-square-foot Crossroads stores — that offer designer clothes on consignment. For the most part, the Crossroads Trading stores buy brand-name, though not necessarily couture, apparel from sellers who, though less famous than Kardashian, perhaps, are equally eager to make room in their wardrobes. The Crossroads Trading shops buy this clothing for cash or offer the sellers an option of store credit.
“Fillmore & 5th is a way for us to pursue an additional, higher tier of merchandise than we offer at Crossroads,” said Block. “Crossroads’ top 20 percent of inventory is F&F’s bottom 10 percent.” The company operates three Fillmore & 5th shops, in California, one of which is at Town & Country Village, a Palo Alto mall. There is also one in San Francisco and another in Long Beach. Block says the company wants to open more of these, especially in shopping centers, where they may be able to cultivate relationships with national developers. In the beginning that was a pipe dream, he says. “The chaos of a thrift store was our nemesis,” Block said. “It was definitely hard to get landlords to sign on.”
The longstanding perception of resale shops was that they were little more than junk stores, but this has been undergoing dramatic change. “The idea of consignment and resale stores as viable retail concepts began typically with home furnishings and then found a market in clothing,” said retail consultant Jeff Green, who runs an eponymous firm in Phoenix. “In high-growth markets like Phoenix and Palm Springs [Calif.] and edgier markets like San Francisco and New York, consignment and resale shops have gained quite a following, especially since the economic downturn.”
As demand grows, Crossroads Trading is spiffing up its image, having hired architecture firm Gensler to help design the high-fashion Fillmore & 5th stores. Meanwhile, “we are still very actively pursuing opportunities for Crossroads,” Block said.
To date, most Crossroads Trading stores have been stand-alones or -operate at the strip centers of local landlords. But demand is such that it’s a sector worthy of the attention of national mall developers, observers say. Many members of the Millennial generation check for the presence of resale shops when considering a new neighborhood, according to online real estate website Rent.com. “A majority of these 18-to-33-year-olds have to contend with student loans and starting salaries, making them a fiscally conscious bunch,” the site reported in an April blog.
But interest is hardly limited to Millennials. Everyone enjoys a treasure hunt and hope they can uncover a Dior, say, among racks of used clothes. Today many shoppers will proudly show off resale bargains as a badge of pride. And Hollywood stylists are forever pointing out in the media that one can find one-of-a-kind booty at secondhand stores — and at the same time, help the environment, because the garments purchased might otherwise have gone to the landfills. Developers might do well to take note of these twin benefits of cost savings and environmentalism.
“I exclusively buy used clothes,” actress Shailene Woodley told People magazine. “I’m going to be a citizen of this planet, and I’m going to do my responsibility and live in stride with nature instead of constantly fighting against her.”