Used-clothing franchise taking off

17:00, Aug 08 2014
Recycle Boutique
READY TO ROLL: Hayley Budd says the Recycle Boutique has a different model to most secondhand stores.

Young entrepreneur Hayley Budd is making the most of a growing appetite for vintage and second-hand clothing.

Budd, 24, opened her Recycle Boutique franchise at the Tannery in December last year.

Today, business is well ahead of all her projections - with four extra staff turning over 100 new items of clothing every day.

Budd says she "always knew I wanted to start my own business - I just didn't know what shape it would take".

Budd studied business at Victoria University, and was a keen op-shopper while in the capital. When she shifted home to Christchurch, she decided to combine both passions by opening her own store.

Like many young entrepreneurs, the first obstacle she faced was capital.


"It was tough, because as a young person just out of uni it is really hard proving to the bank that you're worth investing in. I worked hard on a big business plan and I feel like my time on that helped with the bank's support. I'd recommend that to anyone."

With funding in hand, she took on a space at the Tannery. Since then, she says, "It's been a bit of a blur."

The store's business model works entirely with a "sell on behalf" model - customers bring in clothing to sell, Budd and her team assess pricing, retail the clothes, and split the price 50-50 after GST.

It's a tough balance, Budd says, trying to please both the seller and the consumer. Prices have to be high enough to keep sellers happy, while low enough to keep shoppers buying.

Clothing operates on a strict seven-week price dropping cycle, and at least 100 new items go out every day.

"Basically, if stock isn't moving, we just want it gone," Budd says.

At seven weeks, unsold clothing goes to Women's Refuge or the City Mission.

It's fast moving, and labour intensive for the staff who have to select, assess and price the clothing - and bundles of unopened bags sit in the storeroom upstairs.

"At the start, a big challenge was we didn't have the staff to facilitate the demand coming in," Budd says.

"We had so many drop-offs with people moving house after the earthquakes, we were just running ragged."

One of the biggest challenges has been learning all the details of the business, as well as keeping up with day to day in the store.

"That first six-month period I was running the store, but wasn't putting enough time into running the business. There's a difference between putting all your time and energy into the store floor and the day to day, and then actually spending time on marketing and admin and invoices and growing your business. I found that really tough, but now with the extra staff I can take a step back and take care of the success of the business long-term."

Working fulltime herself, Budd also employs four staff - another fulltimer and three part-time.

She is now in the process of searching for a new location for a second store.

Because of the store's slightly more "up market" location, Budd says it can hit a middle ground between classic op shop and boutique store - attracting customers who have not bought second-hand before.

The Recycle Boutique franchise began in 2007 and there are now seven stores around the country. Around the country, the stores sell up to 100,000 items a year.