Bargain Basement Business Shrinks
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LEWISTON, Maine (AP) _ It was a great opportunity for shoppers seeking high fashion clothing at bargain basement prices _ the collapse of the World Trade Center damaged Century 21, a Lower Manhattan store that sells luxury goods at a discount. Designer merchandise with a retail value of $27 million was declared a loss and liquidated by the store’s insurer.
Two of the nation’s biggest salvage store chains, Marden’s in Maine, and Hudson’s in Mississippi, split the goods. Harold Marden wondered whether his company might be seen as profiting from the tragedy, but in the end, he concluded there was no point in having the merchandise destroyed.
So garments by designers such as Armani, Versace and Joseph Abboud filled Marden’s Portland store in the months after Sept 11. Suits that would normally fetch $1,500 retail and $700 to $800 at Century 21 went for $350 to $400, Marden said.
Stores like Marden’s operate on the bottom rung of the retail ladder, offering bargains on items left over from bankruptcies, store closings and sales or damaged by fires and floods.
``In one sense, what we really are in some of these insurance deals is just a giant recycling house,″ said Marden, the company’s president.
Everything is recycled at Marden’s down to the shopping bags, which bear the name of a drug store chain that was sold six years ago, and the shopping carts from the bankrupt Ames discount chain.
Aside from a slight smoky smell or debris dust on a few items, most of the Century 21 items bore no evidence of the terror attack.
Kristin Blomberg, of Kennebunkport, stumbled upon the bargains when she and her mother stopped in.
``Our jaws hit the floor,″ Blomberg recalled. The two women grabbed a cart and started picking through Gucci coats, John-Paul Gaultier jackets, Moschino pants, Pucci dresses, Dolce & Gabbana suits, Fendi gloves, Versace scarves, Prada wallets.
Spreading the word to their friends, they returned again and again to check out new stock and add to their wardrobes at prices they never expect to see again. But they did have mixed feelings.
``The Century 21 shipment was a once-in-a-lifetime thing,″ Blomberg said. ``It was wonderful stuff, but (the attack) was such a horrible tragedy.″
Despite the popularity of stores like Marden’s, the salvage business is shrinking because of a dwindling supply of damaged goods. There were about 10 major salvage operations a decade ago but that number has dropped to three: Marden’s, Hudson’s and Newton Wall Co. of Shawnee, Okla., Harold Marden said.
The industry’s decline is a tribute, in part, to stringent fire protection and insurance regulations, along with changes in the way merchandise is stored and distributed.
When Marden’s father, Harold ``Mickey″ Marden, got into the liquidation business in 1964, clothing, flooring and other goods were often stored in old mill buildings susceptible to fire or flooding from broken pipes.
Things are far different today. And it’s not just the improved quality of the buildings and fire protection.
``Now everything’s made off-shore or for just-in-time delivery. There’s not the exposure in the buildings that would have the insurance losses,″ said the younger Marden, whose nickname is Ham.
Marden’s consists of nine stores throughout Maine. When Ham Marden gets a call about an insurance claim or other opportunity, he can be on a plane in three hours. He used to keep a suitcase in the car back in the days when he was on the road 150 nights a year. He has cut back but still has buying trips that can turn into marathons.
Last month, he was in Annapolis, Md., to buy inventory from a fire-damaged retailer when he got a call about a huge liquidation of kids’ clothing in Mississippi. From there, he was headed to New York to look at a domestics deal arising from a fire when a call he received at Newark Airport prompted him to detour to Philadelphia to bid on a chain of dollar stores that went bust.
Marden is the youngest of five siblings, four of whom work in the business. John is the buyer for furniture, David does flooring and Nancy handles fabrics. Ham does ``anything that doesn’t begin with an f.″
The dimly lit stores, with linoleum floors and plain shelving, are strictly no frills, but Marden makes no apologies. ``You try to have a reasonably clean, reasonably neat operation, but hey, this is what we are,″ he said.
The stores attract customers from all income levels. The regulars hit the store every week or two, but some _ ``the real addicts″ _ stop in every other day, Marden said.
Typical of many shoppers is Roger Robin of Hanover, who stops in the Lewiston store about once a month and heads to the tool department while his wife does other shopping.
``I like to go prowling around,″ he said. ``The hardware prices are real good.″
But shopper Blomberg said she doesn’t always find something to buy.
``It really depends on the shipments they get in,″ she said. ``Sometimes it’s a good hit, sometimes it’s not.″