Stores catering to thrifty shoppers do swift business

Doris Tugwell stood at the jewelry counter at Trendy Consignments in Chesapeake and slowly spun the earring display. A $4 pink pair immediately caught her eye.

"This would be $6 or $8 somewhere else," she said while examining the beaded earrings. "Every penny counts - nowadays it does."

With the prospect of a recession looming, Tugwell is pinching pennies - like many Americans. One way consumers are cutting back is selling their clothes - some new, some slightly worn - as well as shopping at consignment shops. Here, business is booming.

"The slowing economy is certainly the reason why the industry is doing so well," said Adele Meyer, executive director of the Michigan-based National Association of Resale & Thrift Shops, a trade group.

There are about two dozen consignment and resale shops in Hampton Roads - at least ones listed in Verizon's Yellow Pages. Meyer's group estimates that in the past few years, the number of shops nationally has increased at a pace of about 5 percent per year.

The way a consignment store operates is different from a thrift shop.

The latter is typically operated by a nonprofit group to raise money for its charitable causes, and receives items through donations that are eligible for tax deductions. A consignment shop, which is often a for-profit venture, pays the owners of consigned merchandise a percentage when their items are sold.

Lynn and Tammy Smith have been running Trendy Consignments for about 15 months. The couple's shop, in a strip mall near Portsmouth's Churchland section and northern Suffolk, carries household items and furniture, as well as clothes, jewelry and accessories.

Lynn Smith said sales are up 40 percent over last year at this time and profits have increased 39 percent. They have nearly 700 consignors, and appointments with prospective sellers are booked up a month out.

During December, for instance, the couple was booked two months out with prospective consignors, Tammy Smith added, attributing the burst in activity to the economy.

"Things are tight for everybody," Lynn Smith said. "If you could come into a place like this and outfit yourself for less, it makes sense."

Tracey Wise, owner of Savvy Seconds Consignment near downtown Norfolk, also attributes her increase in sales to cash-strapped customers who are being affected by the economy. People are more conscious about what they are buying, but they don't want to sacrifice style, she said.

"They want designer labels but they don't want to pay the price tags," said Wise as she changed a bag display. "You don't want to look like you're going through a recession."

Wise, who was wearing a consigned shirt, said she has beaten last year's February sales and is on track to surpass March sales from last year by about $1,500. She said women, the majority of her shoppers and consignors, will find a way to locate bargains.

In fact, business demand has been so high that she's recently shut down one of her four dressing rooms to store clothes and she plans to hire another person to help her.

There has also been an increase in the shop's consignors, she said. She has had about 30 new consignors since January. At this time last year, that number was about 10.

Wise is booked up for beginning consignors. Earlier this month, she wasn't even taking appointments. "Everybody and their grandmother has been coming in," she said.

Wise's store projects the feel of a high-end boutique with charm: a table of tea and coffee greets customers. Floral dresses, signaling the start of spring, hang on walls, while straw hats and bags rest on displays.

Nancy Christian, a Virginia Beach resident, lugged a plastic trash bag into Savvy Seconds. Wise examined the bags, mostly designer brands like Coach and Dooney & Bourke. She accepted seven bags and three belts.

Christian said she consigns at other shops and does it to earn extra money and to clean out her wardrobe. "I was doing it before the so-called 'recession,' " she said. "I've always done it."

Susan Krohn, 8-year-owner of worththewait in the Little Neck section of Virginia Beach, said her business - half consignment shop, half retail boutique - has seen a 26 percent increase in consignors so far in 2008 over last year.

She attributes the rise not only to the souring economy but also to an emphasis on marketing, word-of-mouth referrals, and the upcoming spring and summer seasons, usually good for shopping.

Krohn said she now has about 1,300 consignors, and so far this year sales have been up about 20 percent over 2007.

"If the economy was good, women are going to spend more on new clothes," she said. "But when the economy takes a downturn, customers are going to be looking for those bargains. So either way, I should be OK."

Jennifer Jiggetts, (757) 446-2643, jennifer.jiggetts@pilotonline.com