Opportunity Village forced to consolidate

Friday, Jan. 2, 2004 | 11:26 a.m.

A fiercely competitive market in the second-hand store industry has pushed Opportunity Village to close all but one of its thrift stores in the Las Vegas Valley to save costs.

The Salvation Army has opened a new, high-end store in Henderson this year, bringing it to eight stores in the Las Vegas Valley.

Goodwill of Southern Nevada has seven thrift shops in the valley, raising 92 percent of its revenue.

In addition, dollar stores and discounters such as Wal-Mart present even more competition for nonprofit organizations seeking bargain-hunters.

"The thrift store business as a whole has become much more aggressive since Salvation Army has opened up new stores, and the dollar stores have also hurt us," Chief Operating Officer Kurt Weinrich said.

Opportunity Village, a nonprofit organization that serves developmentally disabled people, has met the competition by consolidating, Weinrich said.

The consolidation has actually helped Opportunity Village's thrift store bottom line, as well as its ability to help its clients, many of whom gain job skills by working in the stores, he said.

The "large cost of doing business," was just too much for Opportunity Village to keep four of its five locations open, as the cost of rent, utilities and insurance have skyrocketed, Weinrich said.

In addition, there were better job opportunities for Opportunity Village's disabled clients in other job markets, Weinrich said.

"(The stores) were closed because as an agency we were able to find more jobs for people that have a mission-related aspect to them than what we had at the thrift stores," Weinrich said.

Most of the disabled clients Opportunity Village serves were placed in custodial, food service jobs and paper shredding jobs, Weinrich said, where there is typically more opportunity for advancement and bigger paychecks. The clients who wished to stay in retail were transferred to the remaining store at 921 S. Main St., which was expanded by about 1,000 square feet to take in the inventory from the other stores.

The stores at 4110 S. Maryland Parkway, 4000 W. Sahara Ave. and 538 S. Boulder Highway in Henderson were thus consolidated into the Main Street store between July and September this year. The processing plant at 6300 W. Oakey Blvd. was also consolidated into the Main Street location.

The Main Street store expanded from 15 clients and seven staff members to 45 clients and 15 staff members, Weinrich said.

In the four months since Opportunity Village consolidated the stores into one, Weinrich said the Main Street location has doubled its revenue.

"We got probably 65 percent of the market from the other stores, as many of our customers were shopping store to store anyways," Weinrich said.

Consolidating all of the distribution processes has also saved enough money that revenue for all of the thrifts shops is actually up 50 percent, Weinrich said. The profit from the thrift shops pays for other services Opportunity Village offers to its disabled clients.

"It's kind of the same thing as Kmart," Weinrich said. "We had to downsize to get a handle on things just as retailers in the Wal-Mart era have."

The Salvation Army has also felt the stress of the Wal-Mart era, said Maj. William Raihl, coordinator for all of the organization's operations in Clark County.

The continued expansion of Wal-Marts, the dollar stores and other discount shops all have hurt the nonprofit's business, Raihl said.

"As more of those stores open, they do pose a threat to all thrift store operators," Raihl said.

He said Salvation Army does not try to compete directly with the larger discount chains, but instead tries to bring in more quality items and keep prices low. The organization's furniture store, for instance, slashes prices on furniture in half if the piece remains in the store more than 30 days, Raihl said.

Like Opportunity Village and other nonprofit thrift stores, the store also benefits the community. The profits raised pay for other community programs and individuals in their drug and alcohol rehabilitation programs receive job training at the thrift stores.

Steve Chartrand, president and chief executive officer for Goodwill of Southern Nevada, Inc., said his organization's thrift stores are the mainstay of their services to disabled individuals.

About 92 percent of the company's operating budget is made through the seven thrift stores Goodwill has in the Las Vegas Valley, and individuals also work at the stores.

"That drives us to be really excellent in how we run our business," Chartrand said.

Like any other retail store, Chartrand said Goodwill tries to place their stores in good locations, provide quality products and hold excellent sales.

"I think shoppers are looking where they can provide the best quality and the best deals," Chartrand said. "Nowadays that can be at any store. It is really a highly competitive field."

Discount stores such as Dollar Tree and 99 Cents Only stores deny they compete with the thrift stores because they rarely offer items like clothing or furniture which thrift stores thrive on.

"If someone wants to go to Salvation Army, they are not going to be looking for the same thing they are going to be looking for in our store," said Sak Lad, vice president of new business development for the 99 Cents Only stores.

Thrift store operators point out their shops have the added benefit of aiding the community. Most of those who shop in one thrift store tend to go to the others too, operators said, allowing all of the nonprofit organizations a niche in the market. Even Weinrich of Opportunity Village said the group may open more stores again in the future.

All of the nonprofit organizations, however, tried to express how their thrift stores were somehow unique -- showing that competition was at the forefront of their retail work.

"We actually have the lowest price when you compare it to any thrift store," Yvonne Givens, general manager of the Opportunity Village store, said. "I think Opportunity Village really has the lowest prices."