Wealthy shoppers maintain rich lifestyle in tough economy with high-end consignment shops

As some businesses are struggling to keep their revenue out of the red, local high-end consignment shops have said they are at least one market that is thwarting the difficult economic times.

Business owners of stores like Great Estates and Echoes and Accents said the secret to their success has been catering to wealthy consumers who are trying to maintain their rich tastes with luxury finds at consignment thrift shops.

Consignment is a kind of secondhand store where individual sellers, or consignors, allow a store to sell their items for them and divvy up the profits between both parties.

The National Association of Resale and Thrift Shops has reported that as consumers cut back on spending and look for ways to make a little extra money on the side, consignment stores are seeing major increases in sales and consignor inventory.

In a recent survey comparing sales figures of April 2008 to April 2007, the association discovered that 75 percent of 185 respondents across the country claimed their sales increased. The average increase reported was about 30 percent.

The survey also showed 80 percent of the stores had an increase in new customers, and 65 percent had an increase in new consignors, sellers or donors.

That trend is familiar to Melanie Dunaway, owner of Great Estates, a high-end consignment business in Millersville. She said her August sales this year were up 30 percent from August 2007.

"Our business is only getting better, not worse," Mrs. Dunaway said. "We've seen a real up-tick in sales."

The elegant showroom, bejeweled with crystal lamps and oversized mirrors, has an array of plush upholstered furniture, solid-wood dinettes and full-grain leather pieces on the floor. The pieces are set up in vignettes like catalog photographs - but not just any catalog. More like from the pages of luxury retailers Bernhardt, Hooker or Brunschwig and Fils.

Mrs. Dunaway said her store's clientele are wealthy shoppers. And their increasing desire to get luxury furniture at resale prices is a sign of the times, she said.

Barbara Price, co-owner of Echoes and Accents, a luxury consignment shop in Annapolis off of Chinquapin Round Road, said customers are becoming more cost-conscious and inclined to bag a bargain.

At her store, after 30 days on the showroom floor, pieces of furniture have always received a 15 percent price reduction, and after 30 more days, the items receive an additional 15 percent discount.

"A lot of the people nowadays mark on their calendars when the prices are going to reduce and call back on that day to see if we still have an item," Mrs. Price said. "We see a lot of people come in here with their notebooks, jotting down the dates particular items will get reduced."

On a recent spontaneous shopping trip, Sarah East said she felt lucky snagging a varnished wood desk from Echoes and Accents for her son's bedroom. She caught the piece at its 60-day discounted price.

Though Ms. East said the setback of $258 wasn't by any means "cheap," it was relatively inexpensive.

"For the quality of the desk, it's great," she said. "I mean it's a good piece of furniture, and honestly, for a kid, you usually end up shopping at Ikea and you'll pay about the same amount for particle board."

Sales are not the only increases luxury consignment shops are experiencing now. The number of people turning to consignment shops to get rid of unwanted items is growing.

Currently, Great Estates has 300 active consignors, said Jan Marie Goebel, the commercial account manager of Great Estates. She said consignor inventory for August 2008 has jumped 30 percent this year over last August.

Mrs. Dunaway said her business does all the legwork. At Great Estates, the consignment sellers get 60 percent of the profit from each of their items.

At Echoes and Accents, consignors get a similar deal with 55 percent of their items' profits, Mrs. Price said.

She said the increasing number of interested consignors, coupled with the Navy roots in the area, which bring many souvenir furniture pieces from all over the world into Annapolis, adds to the success of her shop despite the economy.

"You know we feel very fortunate right now that in this kind of a market, we can actually get more one-of-a-kind items for people who are looking for bargains," Mrs. Price said.

A "bargain" isn't a knickknack from the dollar bin. For example, a California king-size, distressed leather sleigh bed from the Arnold Palmer collection will run an Echoes and Accents customer $1,199 or less, instead of the company's suggested retail price of $3,075.

Many of the items such as the sleigh bed are unused items that Echoes and Accents has purchased from stores going out of business. In the past six months, Mrs. Price said she's received three lots of furnishings from liquidated businesses, which she said is also a "sad" reality of the retail climate today.

At the end of 2007, Furniture World, a furniture-industry newsletter, found that across the country, furniture sales had fallen 8 percent.

"A good percentage of our customers still want to get their shopping or designer fix, they're just a lot less willing to pay through the nose," Mrs. Dunaway said. "That takes the joy out of it."