At a time when many of the nation's major retailers are sacrificing quality to keep prices down and cash-strapped consumers spending, it appears new competition is emerging from an unlikely source.
Goodwill Industries of Greater New York and Northern New Jersey has been opening stores in higher income areas of the region. In the past couple of years, it has opened locations in an old Tower Records in the shopping mall mecca Paramus, NJ, hedge fund capital Greenwich, CT, New Rochelle, NY and Greenwich Village.
Not only are they getting higher-end merchandise through donations (someone dropped off 37 pairs of Ferragamo shoes a couple of weeks ago at the Greenwich location), the stores are attracting higher-income bracket shoppers.
"What we are trying to do is reinvest in our stores for a positive shopping experience and good value," said William Forrester, Goodwill Industries of Greater New York and Northern New Jersey CEO. "We have a return policy. We rotate goods on average of every four weeks."
Since February, the non-for-profit organization said sales at its stores have grown eleven percent—that as chain stores sales have stalled. Goodwill is also in the process of opening its 40th store in the New York metropolitan area - in Pequannock, NJ.
This year, Goodwill said it is focusing its efforts on opening more Attended Donation Centers in higher-income areas to increase better quality donations.
Don't think of it as someone else's castaways. If you're squeamish about buying used clothing, think back to the Levis vintage jean trend of the late 1980s. Consumers were paying an arm and a leg for them at trendy boutiques.
"In Paramus, our shoppers have told us they're making regular stops at our store on the way to Nordstrom," said Mauricio Hernandez, Goodwill's Executive Vice-President of Business Operations in the NY-NJ area.
That's not surprising given that apparel retailers have been giving the consumers the spin cycle over the past year.
Retailers such as Banana Republic have been selling hand wash only shirts made out of cotton alternatives such as viscose and modal. The fabrics are apparently too fragile to survive the washing machine.
Anthropologie has started replacing its sturdy wooden hangers with shopper-unfriendly cardboard ones in an effort to go "green."
So, instead of spending time washing your new clothes little house on the prairie' style, maybe you should go Goodwill hunting. Buying recycled clothing is environmentally friendly and you never know what kinds of vintage items from before the financial crisis you may find - ones that may last until the next bull market.
Stephanie is Squawk Box producer. Follow her on twitter @StephLandsman
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