Idaho technology companies aren’t the only ones looking to Silicon Valley for inspiration. Two years ago, a team of leaders from the Idaho Youth Ranch, which helps pay for its social services programs through revenues from its two dozen second-hand stores, traveled to San Jose to share best practices with Goodwill store operators there.
Not surprisingly, Silicon Valley stores get some very high-end donations, said Jeff Myers, vice president of social enterprise, marketing & communications for the Youth Ranch.
“They get incredible donations; I was a little jealous,” said Myers. But he noted that the area also has its own problems.
“The cost of living is so astronomical that there are a whole lot of folks who are really struggling,” Myers said. “So it’s a little bit of a different business. They have a really helpful model there for people.”
The Idaho Youth Ranch is a big player in the Idaho thrift store market. So are Goodwill, Deseret Industries and St. Vincent de Paul, all of which operate stores in the Treasure Valley and elsewhere around Idaho. As they compete for both shoppers and donations, all of the larger thrift chains are adjusting to meet changing trends and consumer preferences.
One is the tendency of stores that attract a lot of browsers, like antique stores, to cluster together. According to America’s Research Group, a consumer research firm, thrift stores only began doing this recently.
It’s not clear if the industry is actually growing – there’s little good data to show those trends, Myers said. But it’s definitely changing. Most of the chains now do a brisk business selling donations such as jewelry, books and collectibles online as well as in stores. The Youth Ranch has a large presence on eBay and Etsy, and a small staff dedicated to valuing items such as coins, jewelry and musical instruments. Myers fondly remembers a donated guitar that brought in $5,000.
Shoppers have also turned away from low-price, low-quality “disposable” clothing that was popular a few years ago. Now, a trend toward reuse and recycling is sending more people into second-hand stores seeking items that will last.
“That created challenges for a while, but with the younger generation, the millennials, there’s a significant portion rejecting that,” Myers said of the disposable clothing. “It’s a combination of wanting to be more socially responsible and ecologically responsible. A lot of things you hear from consumers really support that.”
As a result, clothing sales at the Youth Ranch have become increasingly strong over the last six to 12 months, Myers said.
The southwestern Idaho St. Vincent de Paul, which operates six stores in Boise, Mountain Home, Caldwell, and Meridian, is looking for a spot in southwest Boise to move its Boise Orchard Street store. Ralph May, executive director of the southwestern Idaho St. Vincent de Paul, said the nonprofit is looking for 10,000 to 15,000 square feet with loading access in the back, probably in a strip mall. The change is prompted by population growth in southwest Boise, May said.
“A former big-box store, or a portion of that, would be great,” May said.
Thrift stores need plenty of space out back for accepting and sorting donations. And they need storage for the items donated out of season. For that reason, thrift store real estate managers have some very specific needs when they go out looking for space.
Goodwill of the Northern Rocky Mountains, which owns and manages Goodwill stores in Montana, southern Idaho and Utah, found the perfect spot at its new Idaho Falls store, which opened in August.
“For us, the Idaho Falls location really is an ideal location,” said Tim Bleymaier, the assistant VP of retail for Goodwill. The 21,000-square-foot former Hastings store is on the corner of a busy intersection, visible to a large amount of traffic, said Bleymaier, who works in Goodwill’s Boise administrative office.
“We tend to prefer corner locations in a center or a stand-alone building because that gives us flexibility about where to put the donation drop-off area and flexibility for trucks,” said Bleymaier. “We have the covered drop-off area, we have visible easy access, and it allows us to handle a couple of cars at a time if that is the case.
“We don’t necessarily need multiple docks at the back, like you might see at a Target.”
Thrift stores also tend to need more space than traditional retailers because they have to display all of the items they have for sale. They can’t display just one, keeping the bulk of identical items in the back, the way a traditional shoe department can, for example. Pricing is also much more labor intensive.
“With a traditional retailer, it arrives on hangers, with price tags on,” Myers said. “A thrift store requires a lot more labor per dollar sold; you’ve got to sort it and price it, hang it up.”
The one-off nature of donations presents extra expense online as well.
“You only have one, but you have do the same amount of labor: writing the copy, taking the pictures, posting it, as if you had 1,000 to sell out of inventory,” Myers said. “The economics of resale are not nearly as enticing.”
But working in favor of thrift stores is the thrill of the hunt, which draws in people from all different income levels.
“That’s something that isn’t really replicated in an online sense,” Myers said. “So we don’t have same pressures that a traditional brick-and-mortar store does.”
Introducing the queue line
One of the best ideas Myers took from the Silicon Valley trip was the “queue line,” which the Youth Ranch recently tried out at its Orchard Street store. The line, a fixture at many other large stores already, takes customers who are waiting in the cash register line through a labyrinth lined with tempting small items for sale. The Youth Ranch purchases new items for its queue line, such as pet supplies, beauty products, candles, sheets and candy.
“They had really well-planned queue lines for all their stores,” Myers said of the Goodwill in San Jose. “They shared their numbers with us, and it was like, ‘Wow, this could be profitable.’ You’ve already spent the marketing dollars to get them into the store. If you can add $1 or 50 cents per transaction, that really drops directly to the bottom line.”