Thrift stores require minimal start-up financing while serving as fund-raising vessels for charitable organizations, low-cost retail options for consumers, and steady sources of income for ownership.
Historically, the concept of thrift arose alongside the founding of religious and private
A man stands outside a Goodwill thrift store and Mission church in Minneapolis in 1937.
Although these charitable organizations began with limited resources, the revenues eventually generated by their thrift stores rivaled those of traditional retail businesses. In the 2006 fiscal year, for example, Goodwill Industries reported revenues in excess of $2.9 billion with $1.8 billion (62 percent) generated in retail sales from its global network of 2,100 thrift stores. Similarly, the Salvation Army of the United States reported $3 billion in revenues, with approximately 15 percent of its revenue generated from its nearly 1,500 thrift shops.
According to the National Association of Resale and Thrift Shops, resale is one of the fastest-growing retail segments, with an annual growth of 5 percent. Furthermore, during any given year, 16 to 18 percent of all Americans shop at thrift stores, and 12 to 15 percent shop at consignment stores. By contrast, 11.4 percent of Americans shop in factory outlet malls, 19.6 percent in apparel stores, and 21.3 percent in major department stores.
Aside from online storefronts similar to eBay and Amazon.com, thrift stores offer a low-cost and easy-to-replicate business model, while providing inexpensive retail options for customers. Additionally, secondhand shopping is no longer a passé exercise of individuals with limited incomes. Discount retailers, such as Target and Wal-Mart, have contributed to consumer acceptance of cheaper goods. Whether motivated by the desire to save the environment, to access inexpensive haute couture, or to stretch budgets during economic downturns, thrift stores have redefined secondhand retail shopping while blossoming into multibillion-dollar industries. Within the retail industry, thrift stores are viewed as ideal, in that they are associated with minimal start-up costs and the profit margins depend on donated merchandise. As such, if properly managed, a thrift store could have a revolving door of profit.
Horne, Suzanne. Charity Shops: Retailing, Consumption, and Society. New York: Routledge, 2002. Larned, Emily. Thrift Store: The Past and Future of Secret Things. New York: Ig Publishing, 2005. Reeger, Jennifer. “Thrift Stores Are a Growing Presence.” Pittsburgh Tribune-Review, November 26, 2005.
Retail trade industry
Warehouse and discount stores