Second-hand retailers score during recession

By Ed Stoddard and Tim Gaynor

DALLAS/PHOENIX (Reuters) - The recession has taken its toll on many large U.S. retailers but smaller ones catering to the second-hand market are flourishing as the cash-strapped seek the holy grail of the American consumer: a bargain.

In August the National Association of Resale & Thrift Shops (NARTS), which claims to be the world's largest resale trade association, said a survey of its membership about second quarter sales in 2009 compared to the same period in 2008 showed increasing turnover in the second-hand sector.

"Of the 263 stores that responded, 64.1 percent said sales increased -- with an average increase of approximately 31 percent -- 11.5 percent said sales were about the same and 24.4 percent had a decrease in sales," it said.

Dallas-based Half Price Books, a privately-held operation that mostly trades and sells used books and magazines, has seen its sales rise and has plans to open new stores.

It has opened four new stores so far this calendar year, with more due to open in the fall. It currently has 106 stores in 16 states.

"We are buying more books than ever before so people are selling ... It started last year with people coming in and selling books for gas money," said Kathy Doyle Thomas, executive vice president for marketing and real estate.

"I think people are okay with buying used ... it is also part of the growing culture of recycling," said Doyle Thomas.

Such success is rare amid a financial crisis that has thrown millions of Americans out of work and made many think twice before they shop, which is almost a national obsession.

Macy's Inc said in January that it was closing 11 stores that were performing badly in the recession and Dallas-based diamond and jewelry retailer Zale Corp has been closing stores -- just two of several examples.

Sales for Half Price Books' last fiscal year (July 1-June 30) showed an increase of six percent to around $200 million in same store sales and a rise of 10 percent for total sales including the new stores.

Kathy Gropper is a regular.

"Whenever I finish books I bring them back and get more. I do the same with clothes," she said after bringing in a box full of books and magazines to the retailer's main store in Dallas.

"For me it's a recycling thing. We also did it before the recession but we are even more careful now," said Gropper, who is a stay-at-home "home-schooling" mother.

The chain's origins were modest. It was started in 1972 by green activists in a converted laundromat in Dallas with 2,000 books from the founders' own libraries

SECOND-HAND CLOTHES ARE CHIC