Understanding second-hand retailing: A resource based perspective of best practices leading to business success

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Han, Jinhee
Major Professor
Linda S. Niehm
Committee Member
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Organizational Unit
Apparel, Events and Hospitality Management

The Department of Apparel, Education Studies, and Hospitality Management provides an interdisciplinary look into areas of aesthetics, leadership, event planning, entrepreneurship, and multi-channel retailing. It consists of four majors: Apparel, Merchandising, and Design; Event Management; Family and Consumer Education and Studies; and Hospitality Management.

The Department of Apparel, Education Studies, and Hospitality Management was founded in 2001 from the merging of the Department of Family and Consumer Sciences Education and Studies; the Department of Textiles and Clothing, and the Department of Hotel, Restaurant and Institutional Management.

Dates of Existence
2001 - present

Related Units

  • College of Human Sciences (parent college)
  • Department of Family and Consumer Sciences Education and Studies (predecessor)
  • Department of Hotel, Restaurant, and Institutional Management (predecessor)
  • Department of Textiles and Clothing (predecessor)
  • Trend Magazine (student organization)

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Second-hand clothing has been traded since the Renaissance era, and widely consumed by a majority of the populace. However, very few studies concerning second-hand retailing and consumer preferences have been conducted, especially in the United States. The present study was conducted to understand second-hand retailers' current marketing practices, sourcing strategies, and resources that lead to their business success. Moreover, unique features and definitions of three specialized types of second-hand retailers (e.g., vintage stores, consignment stores, and thrift stores) were discussed through a typology.

Resource-based theory (RBT) (Barney, 1991) and the Four Experiential Realms (4Es) (Pine & Gilmore, 1999) were used to frame the qualitative study. Owner-managers (N=13) of three specialized types of second-hand retail stores (vintage, consignment, and charity/thrift) in the Midwestern U.S. were recruited for the study. To obtain candid responses from participants, an open-ended, semi-structured questionnaire was used. A grounded theory approach using open coding and axial coding was employed for data analysis and interpretation.

Four major themes were identified from the results of this study: business background and motivations, resources generated for second-hand retail business, marketing and management plans, and definition of second-hand retailing. Concerning the theme, definition of second-hand retailers, each specialized type of second-hand retailer (e.g., vintage, consignment, and thrift stores) was defined and classified by contrasting similarities and differences among formats. Unique features of each specialized type of second-hand retailer were also discussed. Although all types of second-hand retailers are similar in the sense of dealing with used items, this study revealed that each possesses distinctive characteristics.

Second-hand retailers' business resources that lead to their business success were discussed within the theme, resources generated for second-hand retail business. A majority of second-hand businesses are operated by owning one or two physical stores. Critical resources possessed by thrift stores are balers, used for baling unsold clothes and sending them to trading companies. Owner-managers were very supportive to assist their neighboring communities, and made efforts to maintain network relationships with counselors and business partners. Some vintage stores often sold exclusive items through alternative retail channels, such as websites, movie productions, and social connections. Finally, diverse types of sourcing methods and suppliers for each specialized type of second-hand retailer were discussed.

Second-hand retailers' marketing and management plans that enhance business growth were discussed within the theme, marketing and management plans. First, a product strategy uniquely performed by second-hand retailers was agile inventory turnover and quick circulation from racks to stock. Some price strategies were practiced by second-hand retailers by providing affordable prices to approach various types of customers. Second-hand retailers specifically focused on maintaining relationships with customers and customer services, such as welcoming and greeting, finding a proper outfit for customers, and searching for items customers requested. Experiential, entertainment, esthetic, and escapist experiences were offered to customers so customers not only consume products and services, but also enjoy second-hand stores' unique atmosphere.

This study is a beginning point for second-hand retailing research in the U.S. By identifying information about second-hand retailing and U.S. markets, this study inspires and encourages other researchers to conduct future studies by utilizing the findings from this study. For future studies, investigating each specialized type of second-hand retailer's business practices can be considered. Examining consumers' viewpoints towards second-hand business are also suggested.

Tue Jan 01 00:00:00 UTC 2013