Precious Seconds

9/3/2010 - The Boston Business Journal

A couple of years ago, Jeffrey Casler, CEO of consignment retailer Second Time Around, found himself facing an issue common among many entrepreneurs.

Following the lead of his mother, Dottie Casler, who opened the first STA shop in Newton in 1973, Casler had opened his own location on Boston's Newbury Street in 1990. From there, he grew the business into a multilocation operation with a presence throughout the Northeast and beyond, by presenting an upscale version of the consignment shop model.

The Boston‐based company sells new and resale contemporary and designer clothing and accessories -think Chanel and Prada - at a fraction of the cost. Consignors receive 40 percent of the sale proceeds when an item is sold. The company has also tried to be innovative by enabling consignors to view their accounts online and by locating a couple of its shops in two area malls ‐- the Burlington Mall and the Atrium Mall in Chestnut Hill.

With that model in place, Casler felt he could grow the business even further - but he also recognized that he could not do it on his own.  "I realized that the machine I had built was getting too big for me to handle alone in many different ways," said Casler, 46. "I was working seven days a week all day and night, and I was still always trying to catch up. Money got very tight, and I needed capital - both financial and human - to expand and take advantage of the opportunity."

It was a significant turning point for Casler, the moment he realized he needed some outside assistance. "It's very hard to step away and realize you need help. ... And, itcould kill (your business) if you don't understand it, recognize it, and do something about it," he said.  Casler was introduced to a private equity investment firm, Generation Equity Investors, with local offices in West Newton, from which STA ultimately received a "seven‐figure" investment in April of 2009.   "We really liked the business model," Gary Furst, managing partner at Generation Equity Investors, said.  "From a customer's standpoint, it has the feel of an upscale boutique environment with really attentive service, coupled with a great selection of high‐end branded merchandise along with amazing values. And we believe the value it brings to the customer is here to stay whether the economy improves or not."

Casler subsequently took another important step and brought on Bill Soncini, an executive with more than 30 years of retail management and operations experience, who most recently served as senior vice president of the nationwide swim and resort wear women's retailer Everything But Water, to serve as STA's president and COO this August.

For his part, Soncini said, "Jeff has done a great job of building the business to this point. And, I'm really positioning it to take it to the next level."

The company currently has 22 locations in nine states - Massachusetts, Connecticut, Illinois, Maine, New Hampshire, New York, Philadelphia, Rhode Island and Vermont - and Washington, D.C.  STA, which has a staff of 134, has grown its revenue from $6 million in 2008 to $8 million in 2009 and projections of between $12 million and $15 million for 2010.  On a recent day at the flagship store at 176 Newbury St., a steady stream of bargain hunters - many of them younger women - perused the neatly displayed racks and shelves of fashionable clothing, shoes and accessories. STA's inventory includes many designer names. However, Casler said the company is focused not only on the brand, but also on items "that are in great condition and that are in season."

Both Casler and Soncini say they feel the company is well‐positioned to take advantage of opportunities in the marketplace, during a time when the economic downturn has fueled consumer interest in a good deal. "I think the economy is primed for consignment," Soncini said.

Adele Meyer, executive director of NARTS: The Association of Resale Professionals, said there are some key attributes of successful resale businesses: "They have to do their homework (before getting started). They have to have the right location and the right merchandise. They have to treat their customers well. And, they have to know how to run a business successfully."  Soncini said a couple of his key initiatives at STA are improving the chain's IT systems and strengthening its relationships with both customers and consignors, the latter category of which number about 50,000.  "We have to make the customer's experience in the store a 'wow' experience," Soncini said. "They have to love the way we process the product, and they have to love the way we treat them."

With Soncini in place, Casler said he'll have more time to devote to business development and securing real estate for the business.  "Since the downturn in the economy, there has been more of an opportunity to consummate leases in locations at favorable rates that would have been unthinkable just a few years back," he said.
Casler further said his strategy is to find locations in "affluent, high‐density areas." He also said the model for stores is around 2,000 square feet.
Interestingly enough, Casler stepped into the business 20 years ago with no prior retail experience.  Formerly an accountant, he had observed the business his mother, Dottie, had pioneered at the original STA store in Newton - where she still works behind the counter - and liked what he saw.

"I thought it was a great business model and very low capital to start," Casler said. Michelle Purcell, who has been a customer of Second Time Around for 12 years - and more recently, a consignor - frequents its Newton location. She said, "I almost never leave without having something in my hands. ... The quality of the merchandise is very high."

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