thrift stores

Stores Corner — Pricing Strategies for SVdP Thrift Stores

Stores Corner — Pricing Strategies for SVdP Thrift Stores 1080 1080 SVDP USA

A Discussion by: Dave Barringer, SVdP National Chief Executive Officer

The concept of Pricing is the least understood among the “4 P’s” of marketing – Price, Product, Place (distribution), and Promotion. However, a good pricing strategy can be your strongest tool toward sales and profits in a thrift store program.

In this article I will discuss several pricing strategies you can use to develop a set of guidelines for your store that help ensure you are creating maximum value for your store as well as your customers. As the former National Chief Marketing Officer and National Director Stores Support for Goodwill Industries, my insights below are based on twenty years of supporting more than 2,500 thrift stores across the United States. While the Society of St. Vincent de Paul is quite a different organization, the pricing theories and practices between the two retailers are much more the same than different.

First, know your limits. There is no point in operating a store unless it makes money for your organization. Certainly, the Society of St. Vincent de Paul (SVdP) may give away some, or even a lot, of what it collects directly to people in need, the store still needs to make enough money to keep the operation going. Fortunately, there are proven ways that a store can properly integrate with other aspects of the Society and still meet business objectives.

Here is an example of how this might work: The Council that owns the store wants to provide mattresses at no charge to families in need. They create vouchers for its Conferences to give to those who need this product, who bring them to the store for redemption. You know what each mattress costs from the supplier. Add to this any storage, transportation and other costs, such as labor and administration. From this, derive a “price” for the mattress, even though you will not charge the family in need for it. You will, however, charge the Conference this price for the mattress. In this way, you maintain the sales you need for the store’s livelihood, still provide the mattress at no cost to the family and keep a reasonable cost for the Conference who would otherwise need to purchase a new mattress elsewhere. A corollary example: The Conference may use its own vouchers to purchase the mattress, earned from its collection of saleable goods that are given to the store. Again, pricing plays a role here. The retail team determines, for example, that a truck full of used donated goods is equal 100x. The Conference holds a collection event at its parish and fills the truck. Upon pickup, the retail team pays the Conference in vouchers worth a percentage, say 60x, of the truck’s contents resale value. Everyone wins.

The first critical component of a good pricing strategy is to know your costs. This includes both direct costs (the cost for each unit) plus the indirect costs (costs that are there regardless of the number of units, such as rent) that are then applied to each unit. Most retailers take the total cost of the unit and then double it to set a price to ensure its profits. This becomes your baseline pricing strategy, cost times 2. This price allows for the unforeseen, such as shrink and damaged goods to some extent, and gives you wiggle room to stimulate sales through pricing discounts later.

Competitive Pricing

Some thrift stores simply copy the price of the other stores in town. This is dangerous because their costs may be radically different. The competitor with many area stores can spread its indirect costs over more stores and more items. Perhaps the competitor wants to price you out of business, by selling their goods so low that if you match them, you go broke first because of your cost structure and/or charitable goals.

I once saw a store that priced its goods exactly double those of another thrift store directly across the street. The higher-price store went shopping at the competitor, took its best goods, then doubled the prices for sale. Customers only saw inferior goods at the lower-priced store and were happy to pay the higher prices for the better goods at the other store because, after all, every item is one of a kind. Believe it or not, the lower-priced store was happy for a while being the wholesaler in effect for the other store. Ultimately, though, they realized that shoppers weren’t coming in any longer, because the “treasures” that shoppers enjoy in all thrift stores were being picked away before most shoppers had a chance to find them. What to do? They raised their prices to cut the profit margin opportunity for the higher price store and kept good values for its own customers who had already proved they would pay the higher prices by their defection to the other retailer.

The same concept applies to shoppers who use our stores as suppliers for their yard sales and eBay/online businesses. They show us that our goods are worth more in the marketplace, so why don’t we price them to keep the profits for ourselves? It may be our charitable intent, which I will discuss later. Remember, the first customers to complain when you raise prices are these retailers who make money from what they buy from you. Thus, these complaints are a sign that you are doing a good thing!

Know your Environment

If you are reading this article in hopes that I can give you a specific price point for every item, or even any item, in your thrift store, then you don’t understand your local environment. Did you know, for example, that food prices may be 30 percent lower in Baltimore than only a few miles away in Washington, DC?

We all live in areas with separate economic conditions and cost-of-living realities. Separate from our competitive status, we also have economic truths to consider in pricing. That four-dollar blouse is a bargain in a high-cost area but priced too high for another one. You probably have some sense of your relative trade market economy. Scoping out other thrift stores and discount retailers will help you gauge the range in which your prices may need to reside, at least as a starting point.

NEXT TIME: PART TWO – Different Pricing Concepts to Explore

If you have a topic that you would like addressed in a future Stores Corner article, please e-mail our Jeff Beamguard, National Director of Stores Support at jbeamguard@svdpusa.org

National Council Welcomes National Store Support Manager

National Council Welcomes National Store Support Manager 799 1117 SVDP USA

The National is excited to welcome the new National Store Support Manager, Jim Conley.

In his new role, Jim will oversee the opening and operation of the second SVdP National Thrift Store in Fairview Heights, IL. Once open, the store will serve as an additional location for Conference and Council Stores leaders to come and learn best practices to take back to their thrift stores.

Jim received his Bachelor of Science Degree in Finance from the University of Missouri – St. Louis in 1997.

After graduating, Jim went on to work in retail management for more than 20 years. He worked for companies such as The Home Depot and, most recently, Total Wine and More.

Jim enjoys teaching and training associates to deliver outstanding customer service, as well as helping to build successful, profitable businesses. He is very passionate about helping his associates reach their career goals and providing them the level of training needed for that.

Jim currently lives in Ballwin, MO and has a 13 year old son.

Please join us in welcoming Jim to the SVdP team!

If you would like to contact Jim, he can be reached at (314) 576-3993 ext. 229 or by email at jconley@svdpusa.org.

Stores Corner — I Don’t Know What I Don’t Know

Stores Corner — I Don’t Know What I Don’t Know 1080 1080 SVDP USA

Written By: Rick Bologna, Stores Director, Central Texas

Are you willing to take a hard and honest look at your store operations? Are you willing to say and admit – I DON’T KNOW WHAT I DON’T KNOW? I would like to share my firsthand experience with you in this article.

Have you ever wondered how you can make your store more profitable? How can you generate more income and move more product through your store more efficiently and faster? As store leaders, we no-doubt have asked these questions in our minds.

In October of 2020, our store in Austin reopened after being closed due to the pandemic. The store had annual sales of $200K and a warehouse stacked high to the rafters with clothes, housewares, donations, and junk, with more items coming in daily.

Through brute force, common sense, and a lot of trial and error, our team installed processes and workflows to push additional product to the floor and generate additional income.

Our customer-base loved the changes we were making in the store; however, our processes and workflows were not sustainable. The key to sales and income is through the back-room production. Please read that sentence again!

We were working extremely hard, but not very smart.

After the first fiscal year, we increased sales to $400K from $200K. Then we went to $610K in our second fiscal year. We had plateaued. This was as far as I could lead our team.

I was tapped out on my knowledge-base and experience in getting us to this level. This was an awful fact that I had to personally own and share with my team — I DON’T KNOW WHAT I DON’T KNOW!

I reached out to the Director of Stores Support in the National Office, Jeff Beamguard, for help. Jeff heads up the National Training Store in Phoenix, AZ and leads the National Stores Committee.

Jeff arrived in Austin in October of 2022, bringing 40 years of thrift store experience and completed a full assessment of our store.

Key components we learned from Jeff:

  • Initial sorting of product – Is it sellable, recyclable or trash? This will save you a ton of time on product selection for the floor.
  • Each product has an exit strategy from your store — the product will either sell during the color rotation cycle or it does not sell, and it comes off the floor for recycling or trash. IT IS REALLY THIS SIMPLE!
  • Initiated the 5-Week Color Rotation Cycle – If the product has not sold after five weeks on the shelves with various markdowns to .99 cents (in a thrift store) the market will tell you, they do not want the product. Put new products out on your shelves and turn over the shelf space more rapidly by selling more profitable items.

In conclusion, I must say, our Austin team has completely embraced what we are doing and where we are going. Without the team’s buy in, we would not achieve this success utilizing Jeff’s assessments, suggestions, and our implementations.

This fiscal year, our sales will be around $800K. Our workflows and processes are now sustainable, due to education. Our annual production in three years went from 109K pieces to 176K pieces, to about 300K pieces this fiscal year.

As a staff, we NOW KNOW WHAT WE KNOW! We are headed towards the million-dollar store benchmark because of education, proven methodologies, and continued support from the National Stores Committee and Jeff Beamguard. The National Stores Committee and Jeff are here to serve you.

How much money are you leaving on the table in your store without this education? Are you doing your store and Council a service or disservice by not running the store as efficiently as possible?

Please take advantage of this educational opportunity for your store and get into the KNOW!

Please encourage your store personnel to subscribe to the to the e-Gazette, by emailing mboyer@svdpusa.org.

If you have a topic that you would like addressed in a future Stores Corner article, please e-mail our Director of Stores Support-Jeff Beamguard at jbeamguard@svdpusa.org.

 

Stores Corner — Staffing Standards / Labor Management

Stores Corner — Staffing Standards / Labor Management 1080 1080 SVDP USA

Written by: Lori Malcom, Northeast Region — Archdiocese of Boston

Determining the appropriate amount of labor hours is critical for an efficient retail operation and can appear to be a very daunting task. Guessing can often lead to overstaffing or understaffing, each of which has negative effects on the bottom line and employee morale.

The following tips will help guide you through the process and may be applied to existing stores operations as well as those in the planning or feasibility stage.

Start by determining the size of the store and hours of operation. Be sure to include the hours the store is open for donations. A manager/assistant manager or lead staff person must be in the store at all times. You can determine if your store will have an assistant manager or lead based on the size and hours of your operation. Some smaller stores may not need an assistant manager. You will need to consider any break periods for the staff to insure you have proper coverage during these times.

Consider all of the duties needed, including sales, production, merchandising, janitorial etc. For example, you will need a cashier and a donation attendant during all business hours. Be sure to include hours when multiple cashiers and or donation attendants may be need for busy times.

Allocate an appropriate amount of time for each job duty for each weekday of operation. Some duties have established labor standards, such as production, others will be reasonably determined estimates. Discuss this with your store leadership and consider their input. Staff acknowledgement and buy-in is the key to an efficient labor standard, accountability, and success!

Please consider attending the National Assembly Stores Meeting on September 6, 2023 in St. Louis, MO to learn more ways to serve your thrift store customers.

Please encourage your store personnel to subscribe to the to the e-Gazette, by emailing mboyer@svdpusa.org.

If you have a topic that you would like addressed in a future Stores Corner article, please e-mail our Director of Stores Support-Jeff Beamguard at jbeamguard@svdpusa.org.

SVdP Bremerton Supersizes Their Thrift Store

SVdP Bremerton Supersizes Their Thrift Store 2560 1707 SVDP USA

The Society of St. Vincent de Paul in Bremerton WA has proudly opened the doors to its new and improved thrift store.

With 27,000 square feet, 50% more than the previous store, new fixtures and mannequins donated by JC Penney, Silverdale and lots of unique treasures, the Conference has proudly named its newest iteration the St. Vincent de Paul Super Store.

Located in East Bremerton, Washington, the shop features a large selection of new and vintage jewelry, fabulous men’s and women’s clothing, and a robust inventory of furniture and household goods, all at very reasonable prices.

Said Bremerton Mayor Greg Wheeler, “This new location will continue to provide a helping hand and essential support to those who need it. Our city is stronger due to the work that St. Vincent de Paul and others do to help people in our region. No matter what the season, in the dead of winter or the heat of summer, those struggling or in need of assistance receive help and hope.”

In addition to providing goods to the community at affordable prices, the Super Store’s voucher program provides clothing, furniture and household items to those in need while providing a shopping experience that’s full of dignity and fun. For neighbors who might need an outfit for a job interview or court appearance, the Super Store will take care of them, no questions asked.

Last year, SVdP Bremerton provided 4,800 items worth $23,000 to the community. In addition, a Friends of the Poor Grant from SVdP National allowed the local Conference to give tents, sleeping bags, rain gear and blankets to those experiencing homelessness during the cold winter.

Stores Corner — Recession Benefits and The Need for Long-Term Planning

Stores Corner — Recession Benefits and The Need for Long-Term Planning 1080 1080 SVDP USA

During a recession, the thrift industry seems to thrive. Although shoppers tend to cut back on spending for non-essential purchases, sales for thrift shops like ours tend to boom. This is a great opportunity for our stores.

The Offer Up Recommerce Report 2022 suggests that the secondhand shopping economy will grow 80% in the next 5 years. Will our stores be ready for this potential growth?

Since consumers tend to hang on to their possessions much longer during a recession, this could pose a dilemma for some thrift stores. If fewer donations are received, yet the demand for our merchandise is growing, how might we plan for this? We need to be creative and use some forward thinking to get ahead of this.

As we know, our donation locations must be convenient for our donors. We might explore targeting specific donation drives where we bring donation receptacles to our donors, i.e. organize community events such as “Fill the Truck” at churches, targeted neighborhoods, or civic organizations.

We can increase social media efforts to target specific age groups, donation sites or specific merchandise needs. Promote special donation locations in church bulletins, on social media, Homeowner Association newsletters, and the like.

We might consider offering a store coupon to donors as an incentive for them to come in and shop at our store. If they don’t use the coupon, perhaps the donor might share the coupon with another prospective customer.

If you don’t already do so, maybe explore purchasing new product and selling the purchased merchandise at a markup. This might bridge the gap, as needed, to fill the stores when donations are low and provide cost-effective merchandise for our customers.

The SVdP National Stores website has a listing of National Partners that could be a resource in this area. For a list of National Partners, visit: https://www.svdpusa-thriftstore.org and select SVdP National Partners under the Resources tab. These vendors have shoes, clothing, bedding, and much more.

As always, if you have questions or would like to reach out to a National Store Committee Member, their names and region can be found here.

If you have a topic that you would like addressed in a future Stores Corner article, please e-mail our Jeff Beamguard, Director of Stores Support at jbeamguard@svdpusa.org.

SVdP Stores Corner — Expand Your Reach Using Your Fleet

SVdP Stores Corner — Expand Your Reach Using Your Fleet 1080 1080 SVDP USA

Written by: Brooke Trick — Senior Director of Retail Operations
District Council of Madison

Businesses are always looking for effective and unique ways to inform large audiences of their brand and services. What better way to expand your reach then with a rolling billboard? Truck advertising (wraps or vinyl decals) is one of the most successful and cost-effective methods of advertising when compared to other typical marketing; it’s endless exposure for a fraction of the cost of traditional advertising. Truck ads boost brand recognition two times higher than mobile ads and have a higher recall rate than other roadside signs.

Truck advertising offers flexibility unmatched with stationary billboards. Trucks drive diverse pick-up routes often during heavy commute times and frequent popular areas in town. On trucks, whether owned or leased, your brand and the exact message(s) you want to tell are visible to everyone without having to buy the audience. Customers and donors will remember your brand when shopping and will be familiar with your mission after they see your ad in a variety of locations.

Truck advertising is different than traditional advertising because it isn’t restricted by placement, timing and rates. While people can switch off television commercials or use ad blockers online it’s difficult to ignore a colorful and creative ad while driving down the road or stuck in traffic. Most importantly, truck advertising is not invasive or repetitive.

When considering truck advertising, remember these key factors:

  • Be creative! Creative displays attract attention; consider font, color scheme and layout when designing your ad. If you have a fleet, contemplate keeping the format the same but use different pictures to identify shopping and services.
  • Words. As much as you want to inform the public of all the wonderful things you do, use short sentences or phrases that can be read in a few seconds. Experts say catchy or memorable phrases are often the most effective. Some of ours include “Shop with your heart,” or “help your budget, help your planet,
    help your neighbor in need.”
  • If you’re thinking of changing or adding these types of ads to your fleet, consider hiring a local advertising company. They will know current design trends and will incorporate your brand guide into a memorable design. If you have your own design team, they can work together as well.

For more information and resources regarding branding, templates, and logos, click here.

07-14-2022 A Letter From Our Servant Leaders

07-14-2022 A Letter From Our Servant Leaders 1368 1387 SVDP USA

This isn’t a stores column, but let’s use a store as an example. When reviewing a Thrift Store, I always request that the manager and I close our eyes and we suddenly appear in the middle of the store. What do we see, and what is the store trying to tell us?

In a recent overseas stores tour, the request led me to see a lot of signage about sustainability. That’s a fairly new term for what stores used to call “reuse, renew, and recycle” to which all Thrift Stores can contribute. While such sustainability is a great stores benefit and certainly a very Catholic objective, it is not why we operate our stores. Rather it is one of many good business practices we undertake in the course of our work.

Thus a second and most important question, for all our works: Why don’t we tell more people about our actual mission in what we do to meet it?

Our mission is to bring people to holiness, done through the serving of the poor, assisted with the operations and revenues of, in this example, the store. Our members often complain that no one knows enough about the Society. However, we continue to tell them only what we do. What we often fail to tell them is who we are.

It is natural to confuse activity with intentions. Our communities see our food pantries, pharmacies, and other programs, and so assume that these are the Society’s mission. Even worse, for privacy reasons we purposely don’t show the public our core Home Visit service, so they have no evidence that this is any aspect of our Society’s mission. At best they know we “help the poor,” and because that’s often enough to stimulate donations and good will from most people, we leave well enough alone.

This might all be fine if our mission was to attract volunteers and funds to help our neighbors in need. That’s dangerous thinking because many good people don’t need a faith basis to be charitable. As pro football coach, Bill Parcells once said, you are what your (win-loss) record says you are. What does our Society program, signage and advertising “record” say we are? Could we easily be confused with another social services organization, another used goods store, or a parish ministry?

Marketing people look for the “unique offering” that distinguishes you from the competition, and hopefully provides an advantage in attaining organizational goals.  A unique offering of the Society in a few words is that we offer our members the chance to see the face of Christ. That’s one heck of an offering, right?

We are not embarrassed by our Catholic faith, nor by our members being driven by it to serve the poor. We can be much more intentional about this in our materials messaging, signage, and especially in our language. When asked what the Society does, the proper response might be different for a parishioner than someone else, and that’s fine. Whether the response is, “We help our members grow in holiness through serving the poor,” or “We are Catholics and others who put our faith into action by serving the poor,” at least both point to the same north star of our mission. Yes, we accomplish lots of other good outcomes! We provide sustainable solutions for clothing and household goods. We make efficient use of medications and food supplies to help the most needy. We pay rent and utility bills. We teach neighbors how to be more self-sufficient. We advocate. We do all this and so much more, which, again, is fantastic.

Let’s not confuse what we do, though, with who we are. Others, perhaps many others in our community, can do what we do. No one else is who we are, the members of the Society of St. Vincent de Paul. We are not simply good people doing good works, we are disciples.  And we pray that others will join us and share in our vocation.

I invite you to close your eyes during your Vincentian service, and then re-open them. With this fresh view, what do you see?  Do others see it too?

Yours in Christ (see, isn’t that easy?),
Dave Barringer
CEO

Stores Corner: Skillful Merchandising Adds to the Bottom Line

Stores Corner: Skillful Merchandising Adds to the Bottom Line 738 416 SVDP USA

By: Ed Markiewicz
Council of Greensburg, PA

Achieving and maintaining profitability in our Thrift Stores requires implementing standard operational procedures consistently. Without a doubt having the right people, establishing effective intake processing and pricing procedures as well as a color rotation system, and utilizing the data from the Point of Sale system to analyze and implement the necessary changes are the basic requirements for a successful operation. But skillful merchandising can dramatically add to the bottom line and create a welcoming atmosphere for you customers.

How can this easily be achieved? Create a visual team with a creative spirit. Visual merchandising, unexpected pairings, thoughtful details, and repetition attract the eye. Using flexible space for events and seasonal items, a fresh look or display, and creating a rhythm to the store by placing visual elements that guide customer flow through the store are essential. Clever color placement as well as themed settings draw customer attention, and create a warm uniform effect.

Tell a story high on the walls to draw customer’s eyes to featured items. Use mannequins in a unique eye catching display not merely to display clothes. Be sure to showcase items specific to the area and use a simple signage system that often times is the most effective. It can lead to excitement and additional income opportunities, while capturing data at a granular level for deeper insights into the business.

Customers who believe in the mission of the store and enjoy shopping at the SVdP store can share the store’s presence within their own circle of influence: family, friends, and loved ones. Additional visibility for the store is always great!

Loyalty cards allow your store to capture customer data points, which can be leveraged into marketing opportunities. Ask yourself, how can we stay in contact with customers and make decisions on marketing and advertising campaigns?

From the data points captured through loyalty cards, stores can send out email blasts or text blasts, to the customer base for any special sales or promotions. Customer retention is much cheaper than customer acquisition!

Connect with a Region Rep to learn more about what is happening in your area – the list of committee members can be found under the Resources drop down at https://www.svdpusa-thriftstore.org/.

Stores Corner: Staying in Contact With Your Customers is Critical

Stores Corner: Staying in Contact With Your Customers is Critical 738 416 SVDP USA

Customer loyalty and gift cards can be a positive add-on for a store. Having a Point of Sale (POS) system allows for ease in these types of special add-on programs in daily store operations. These programs create customer excitement and additional income opportunities, while capturing data at a granular level for deeper insights into the business.

Customers who believe in the mission of the store and enjoy shopping at the SVdP Thrift Store can share the store’s presence within their own circle of influence: family, friends, and loved ones. Additional visibility for the store is always great!

Loyalty cards allow your store to capture customer data points, which can be leveraged into marketing opportunities. Ask yourself, how can we stay in contact with customers and make decisions on marketing and advertising campaigns?

From the data points captured through loyalty cards, stores can send out email blasts or text blasts, to the customer base for any special sales or promotions. Customer retention is much cheaper than customer acquisition!

Connect with a Region Rep to learn more about what is happening in your area – the list of committee members can be found under the Resources drop down at https://www.svdpusa-thriftstore.org/.

By: Rick Bologna
SVdP Stores Director / Central Texas

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