Fashion Finds Sizzle at Consignment Shops

Business may not be booming at the malls or the big box stores, but quietly and under the radar of most economic analysts, some small business "resalers" are racking up sales.

For shoppers and sellers in the consignment boutique industry, the motto is, "Shop high, shop low, but whatever you do, don't pay retail." In this sector, high-end goods are being bought and sold at prices that would make any retailer cringe, even on Black Friday. For these business owners, times have never been better. 

Is upscale resale the new anchor?

The consignment boutique, the rich and sophisticated cousin of the thrift shop, is popping up all over cities and suburbs, some in the prime real estate usually reserved for the big name, fashion forward boutiques.

DoubleTake on Broad Street in Red Bank occupies a chic space in the business improvement district between Tiffany & Co. and the yuppie eatery Pizza Fusion, just two doors down from Garmany, the upscale clothier. Across the street and across town, there are empty storefronts where small businesses have come and gone in the last year, as the real estate and retail markets have struggled for a foothold. But since December 2010, here in the bright, airy boutique with polished floors and exposed brick, women come in a steady stream to buy and sell designer fashions, leaving 50 percent of the profits to the store.

"I'm here everyday," said Marie Karinja, a Red Bank resident who also works in town. "I'm probably their biggest consigner."

Karinja has been buying and selling her designer clothes on consignment for years, but quickly became a loyal customer of this boutique, leaving behind other local shops.

"I loved the quality of merchandise, the professionalism of the staff, their knowledge," she said, standing before rows of Manolo Blahnik, Prada and Chanel shoes, shining like they were straight from the factory. "If there is any question about a piece, they won't take it in. And their prices are reasonable."

Consignment shops are not a new phenomemon but today's boutique is more pre-owned luxury than second hand clothes, with some shops like DoubleTake offering what owner Marci Kessler calls "Neiman Marcus service." Just like in the luxury department store, customers are treated to individual attention and personalized shopping, even though the Hermes bag and the Burberry scarf, or even the fur coat, could be 50 percent off their original retail pricetag.

Often designer consignment boutiques will tag their items with the original retail costs. Recently at the Couture Exchange in Shrewsbury a pair of black Chloe boots was marked at $699. The retail, according to the label on the never worn sole, is $1,770. That's an almost 40 percent savings.

From the closet to the showroom

Much of the inventory in these boutiques has been worn once or never. Karinja says she often brings in pieces she bought but never wore. "Some things don't fit me. Sometimes it it is something I waited four months to try on and now it is too late to take it back. Some are gifts people have given me or clothing I've gotten from my sister."

And if it hasn't been worn in two years, Karinja kicks it out of her closet. "Because it takes up too much space, and even if it's sentimental, it's just stuff. And if you turn it around quickly," she said, "it's still in style."

A new economic barometer

Kessler said that when the economy took a sharp downturn a few years ago she saw an influx of merchandise. "People were purging themselves of everything they didn't need."

And on the other end, her customers were snapping up those designer clothes. Since December, Kessler said her sales at the Red Bank store have increased every month. "It's been unbelievable," she said, "Amazing."

Red Bank is Kessler's fourth location for her business. She began with a shop in Short Hills 20 years ago and followed with stores in Englewood and Ridgewood, NJ.

It would seem that Kessler's experience goes against the depressing retail numbers economists have been churning out. Last month the The Wall Street Journal reported that national retail sales fell this summer, beyond even what economists predicted. First-time retail sales continue to be sluggish and according to the Journal, the holiday retail forcecast is bleak.

Not so in the second-hand market, says the industry's trade group, the National Association of Resale and Thrift Shops (NARTS), which reports a seven percent growth in the number of resellers over the last two years. The group estimates that there are more than 30,000 of the shops nationwide. A survey of NARTS 1,100+ members last year showed a 12.7 percent increase in sales from 2008-2009.

But for Ann Marie Elia of Monmouth County based, All Things Consignment, that's way too conservative a figure.

"I've seen a 30 percent increase, at least," she says about sales in the last few years. Elia owns two consignment stores, with a large range of brands and price points. Her West Long Branch store the , considered the lower end, accepts all brands. There shoppers will find clothes from Ann Taylor, J. Crew, Jones New York, Tahari and others. Elia opened a high end store a year ago in the affluent small town of Fair Haven, partially to satisfy her own love for designer fashion, she said. Also called All Things Consignment, the boutique carries largely high-end designers or couture like Emilio Pucci and Badgley Mischka .

Generating supply and demand, after market

To build her business Elia employs some creativity and innovation to turn a side business into a supply chain. In the wealthy suburbs of Rumson and Fair Haven, Elia is known for her organization skills. Clients call on her when their closests begin to overflow and they count on her ruthless editing to whittle their wardrobes down to their favorite and most wearable pieces. The rest either goes into a bin to donate to the non-profit 180 Turning Lives Around, or goes into Elia's sales floor. Just like her regular consigner deals, her business splits the profits with her clients.

When clients are reluctant to part with a piece they have never worn (even one they say they will likely never wear), Elia tells them, "Let's put that money toward something you will enjoy."

In cleaning out the closets of Monmouth County's wealthy, Elia has amassed a collection of designer luggage and handbags from Louis Vuitton, Gucci, Tods and Etro, among others, which she will offer to her clients at a private sale this week.

Both DoubleTake and All Things Consignment sell their wares online, sometimes with exclusive offers.

In resale, a market for every buyer

Fashion houses like Michael Kors often put out a line at a lower price point. Consignment shops are the same way. Customers who might find All Things Consignment too rich for their tastes, can head down River Road to In-Style Vintage, also in Fair Haven, where they might trade some ambience and "Neiman Marcus service" for the opportunity to buy quality basics from J. Crew along with the occassional Chanel or Burberry.

"We get young girls to women in their 70s," says Kathleen Slavin, who took over the business last December from a previous owner. Any couture stock she gets in the store "blows out of here in a matter of days."

In Matawan, Jennifer O'Brien, is getting ready for its grand opening. "The clients that have come in so far, they're excited, which gets me even more pumped up," said O'Brien, who also works as a property manager for a real estate company.

Times may be leaner, but these shop owners say their clients are still buying. "People don't want to be flashing logos the way they did in the 90s," Slavin said, "but they still want those fine clothes."

And it turns out that shoppers are willing to travel far to get those fine clothes. Reagan Barron, a university employee, travels from her Weehawken home to Howell several times a year to slog through the cramped racks of on Route 9. The tiny shop in a decrepit strip mall lacks curb appeal, but overflows with merchandise, some from top designers.

Barron hesitates to be interviewed about the store, a closely guarded secret. "I only tell my closest friends about it, and only ones who aren't my size." Among her favorite finds are a cream silk and rhinestone Chloe halter blouse and a one shoulder Emporio Armani red silk top which she took home for less than $50, for both items. 

At New Attitude there are no private sales or personal shoppers. There is no professional lighting to highlight a couture display. The dressing room is behind a curtain in the stock room.

For Barron the lack of atmosphere and the cramped quarters aren't an issue. "The more clothes, the better. It makes the hunt really worthwhile when you hit the jack-pot. When I find beautiful things, I imagine the person who might have worn them. Where did she go? Studio 54? A first date? It's like the clothes carry some of the spirit with them."

In Long Branch, it's the accessible and not the high end, that draws a resale crowd.

On Labor Day when tourists were soaking up the last bits of summer at the beach, the locals were at on Brighton Avenue. Women were queued up for the two dressing rooms, their arms loaded up with designer jeans from Lucky Brand, Citizens of Humanity, J Brand and Paige, with tags marked from $20 to $35. The shop, a good example of a combination of low and high brands, opened in 2009.

Owner Christine McAlary isn't interested in just carrying designers. Featuring "mall" brands like Abercrombie & Fitch, Hollister and Gap, at below mall prices, keep her young customers, and their parents, coming back. This year she said her back-to-school sales were more than double last year.

"With the jeans kids want, they could be a $150 a pair," she said. "Why would you pay that when you could pay $30?"

Rebranding resale, second-hand turns vintage

The stores at price points high and low are being helped along by savvy shopping celebrities and TV shows like Bravo's Fashion Hunters, where resalers scour the closets and attics of New York's wealthy to find their stock.

"When I first opened my store, people would call and say, 'Can I come in the back door," said DoubleTake's Kessler. Now she says, "Celebrities are talking about it. They're proud they are wearing vintage."

Elia says whether the economy is fat or lean, it's that change in perception that will keep driving this market.

"Years ago people would never have stepped foot in a consignment store," she said. "Now they're saying, 'Why would I spend $5,000 on a Chanel bag when I can spend $2,000?'"