It's 2009, the economy is in a slump, and business is booming at Overstock Avenue. Poised for another record breaking year, this ambitious apparel wholesaler seems to be oblivious to the fact that there is a recession going on right now. Or are they? "No, we're fully aware of it!" laughs Lisa Sperow, company founder and president. "We're just plugging away, in spite of the recession." "Plugging away," may be a bit modest. In the past year, the company has undergone a name change (formerly Madison Avenue Closeouts), doubled their warehouse space in Charlotte, NC, unveiled a new website, hired several new associates, and launched a new distributorship program for individuals and businesses who want to share in the success and growth of the company.
After operating as Madison Avenue Closeouts for the past seven years, the company has decided to rebrand themselves under the name, Overstock Avenue. Why the name change? Sperow cites several reasons. "We decided to drop the 'closeouts' part, since it really didn't describe the bulk of our inventory. Most of what we carry now could be better described as overstock or shelf pulls, as opposed to actual closeout merchandise.
We dropped the "Madison Avenue" part for a couple of reasons. It was originally meant to convey that we carried more upscale, high end products. While we will absolutely continue to do that, we will also be broadening our mix to include more budget friendly offerings. We also had a lot of customers who thought we were in New York, so this will probably lead to less confusion. We worked with an agency that helped in the naming process, and we are very happy with the new name. Keeping the 'Avenue' in there gives us some continuity, and the new name is really a better fit for us," says Sperow.
Booming Business in a Recession?
In a year when many companies are posting losses, Overstock Avenue has seen their business continue to grow. "Well, I will say that it has not been easy," says Sperow. "This economy is keeping us on our toes, and I think we're all working harder than ever. But we are growing and hearing a lot of success stories from customers, and that's very satisfying." Sperow cites the company's ability to adapt to change as a key to their success. "This industry is constantly changing," she says. "You can never get too comfortable and just assume that you can do things the same way you did last year. We're always tweaking and adapting, and doing what we should do to meet the needs of our customers."
The customers that Overstock Avenue works with are also changing. Katie Glodowski, sales manager, says the company has seen changes in their customer base, in response to the current economy. "We've gained a lot of customers in the past year who were actually not previously buying off-price," she says. "They have realized that despite the economy, their end consumers are still continuing to shop and purchase new clothing, but they're just more bargain conscious than ever. To continue to earn their business, retailers have to find ways to continue to bring in great merchandise, but at lower prices. The neat thing is that these new customers are so pleased with the quality and value of the clothing they're getting from us, they say they will continue to incorporate off-price offerings into their mix, even after the economy recovers," Glodowski says.
Changing with the Times
As retailers are being forced to reevaluate their product offerings, wholesalers need to be able to adjust their products and services to follow suit. The team at Overstock Avenue listens to customer concerns and is committed to fine tuning their operations to best suit the needs of their customers.
Betsy Breen, director of operations, notes several key areas in which Overstock Avenue is making enhancements. "One of our biggest short term goals is to diversify more in several different directions," she says. "We're working with new partners and getting ready to bring in some new product lines. In addition to adding new lines, we're also getting a little more vertical in each of the lines we already carry. We'll be providing more options at different price points, which will allow us to serve customers looking for price points at both ends of the spectrum, and in between."
One thing that has worked to the advantage of wholesalers recently is an increase in the number of liquidation offerings. "Over the past two or three seasons or so, we have been able to take advantage of more opportunities than ever," says Sperow. She credits overbuying by department stores, as well as an increased need for some companies to liquidate products at a loss, in order to quickly generate capital. As a result, Overstock Avenue has been able to receive more inventory than ever before, and can often put together very customized lots for their customers.
"It hasn't always been like this," admits Sperow. "We used to receive very limited quantities of certain categories, and a high degree of customization wasn't always possible. Now, since we have more product lines plus greater access to available inventory, we can work with customers more to put together shipments with the mix of products that best suits their needs." The company says that the degree to which they can customize shipments is always dependent on available inventory. Glodowski says that in addition to helping customers with immediate needs, she also keeps "wish lists" on file, and notifies buyers when items of interest are received or become available, from one of the many distribution centers they work with.
For customers who are choosier and able to visit the company's warehouse in Charlotte, North Carolina, Overstock Avenue also offers what they simply call their "Pick and Choose" option. Rather than having to meet minimum order requirements by category (example: buying 48 suits or 100 pieces of children's clothing, standard lot sizes for the company), customers can hand pick merchandise from the warehouse. They must meet a minimum wholesale purchase requirement of $500, but can otherwise mix and match from all of the different categories of merchandise carried at the warehouse facility.
This option has been immensely popular with customers, says Pamela Robinson, Warehouse Manager. Robinson regularly assists customers at the warehouse and says, "Almost everyone that comes to tour the warehouse and purchases from us becomes a repeat customer. They love being able to look through everything we have here and put together their own orders." Everything is priced according to a percentage-of-retail system, which allows buyers to pick a price point that is comfortable for them. Retailers on a budget often love the department store branded items, she says, because they offer great quality, style, and a value price. Boutique owners enjoy choosing from the higher end designer labels that they will still be able to sell to their customers at a substantial discount from original retail. Customers can typically choose from among several different merchandise categories, including sportswear, evening wear, dresses, suits, sleepwear, lingerie, footwear, jewelry, accessories, luggage and domestics.
The geography of Overstock Avenue's customer base is something that Sperow says always amazes her. "When we first opened, our vision was that we would start out as kind of a regional company, attracting buyers from more of a local radius," she says. Within the first month, however, the company was doing business with customers in Australia, Japan, and the Caribbean. Today, they have customers all across the U.S. and on six continents. "We've grown globally and regionally simultaneously, which has been a pleasant surprise," Sperow says. "Locals are always so surprised and excited that we're here in Charlotte," she continues. "So many times they tell us they have been driving or flying to New York or California to do their buying, and then are thrilled to find there is a closer option."
Buying from Overstock Avenue
When asked to describe the typical customer, Sperow says that their largest groups of customers consist of apparel brokers and brick and mortar independent retailers. They also work with customers who sell at flea markets or through various online venues. The company is able to work with buyers of all sizes, offering low minimums for small or start-up businesses, as well as pallet and truckload specials at volume discounted pricing for veteran and larger buyers. They are a proud member in good standing with the local Better Business Bureau, and an active partner with their area Chamber of Commerce.
Not surprisingly, Sperow says there will be plenty of new initiatives taking place in the coming year. With the rollout of the new website complete, she says that the next priorities will be launching their new distributorship program and continuing to add new products and suppliers. "We're having a ball," she says. "We're working like crazy, but it's fun. We've got great products, an awesome staff, and really great customers, which all make it easy to love what we're doing."
For more information:
5400 West WT Harris Blvd., Suite K
Charlotte, NC 28269
Tel.: 866-795-7990, 704-596-0554
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