Question & Answer-- Opening a Store

Question:
Hope all is well. I purchased your guide earlier this year and it has helped me a lot. I really admire your knowledge about fashion and the retail industry itself and would like your opinions on a few things. I have been selling on e-bay for a while, but I have decided to venture in to bigger and better things so now I want to open a store. I do have a lot of reservations and as you've mentioned people get carried away and think they will be very successful when they open a store. I just want to ask you about how we can purchase overstocks or last season stocks from Barneys and Saks. Thank you in advance.

Answer:
I would just encourage you to think twice about the store. Just based on my observation of past buyers of the guide that have gone that route. It's a money pit for a very long time before it begins to pay off.

As far as the closeouts, you should just call the stores' corporate headquarters, try and work your way to the distribution centers and find the person who is the sell off agent or in charge of liquidating their merchandise.

The merchandise does go up for bid, often bid on by jobbers. But when you buy you have to buy it all and that might be too much for you. I mean, in the beginning a full load might be just enough to completely stock your store, but what will you do when you only need filler? You can't bid on a full load, it might be 3000 pieces or $200,000 worth of merchandise (at your price). That's why you may still need jobbers.

Even when Bloomingdales has their high end job-outs a few times a year, those trailers are $50,000-90,000 sometimes. Remember you're talking merchandise with such a high original retail price that you aren't getting a lot of pieces. And sometimes they don't have "price caps". Paying 10% of retail on a $1,000 suit is nothing, but paying 10% of retail on a $5,000 suit is hard to swallow.

I would suggest that you start by having some trunk shows, some sample sales, build up a following. Go to some of the jobbers that carry high end sore stock and start working with those loads from Saks. Go to their warehouses and look and see what a FULL LOAD looks like. It doesn't look like what you think. You might not like the idea once you see all the "bad stuff" they have to take as part of a load. Trust me, some of it is crap but a JOBBER can move it because they always have a few clients that will take anything at cost.

Anyhow, try the trunk shows and sample sales and build a serious following to the point where you have a couple hundred people you've either sold to or had inquiries from. Then think about opening a store. Otherwise you may open a store and be literally waiting weeks or even months to get decent streams of customers.