Thrift and pawn stores across the Boston area say that as prices for gas, groceries and utility bills increase, more people are turning to them both to buy low-cost, second-hand items and for a little extra cash to cover expenses.
Daniel Burhe, manager of LBC Boutique & Loan in Allston, said he’s seen a steady increase in both customers and borrowers in recent months.
“Traffic is honestly, like insanely crazy the past six, seven months,“ he said. “Before it was ... 10 to 15 [customers] a day. Now it’s way over 30 to 40 to 50 a day. It’s very, very, very busy.”
Customers need cash, Burhe said, and they’re selling items or getting loans through his shop, which like all pawn shops is regulated by the Massachusetts Division of Banks. Pawn shops generally offer customers a loan equal to a portion of the value of whatever item they leave at the store, and the customer can buy it back by repaying the loan plus interest, which the state caps at 3% a month.
Burhe said the soaring price of gold, combined with the fact that people from all walks of life are hard up for money, has led to more people selling jewelry or designer items in order to pay bills.
“Pretty much everything. Like it could be gold, any designer stuff, not only like selling or getting a loan. Some people try to take advantage of it because gold is up ... because they need the cash because of the economy,” he said.
He said it’s not just low-income people pawning items, but some higher-income customers in need of money.
Tim Jugmans, chief financial officer at EZCORP, a publicly-traded network of pawn shops based in Texas, told Marketplace last month that the average size of loans his company gives in the U.S. has increased from around $160 in 2022 to $231 at the end of last year.
“It gives you an indication — over time, this is slowly increasing, because the need for cash is increasing for customers,” he told Marketplace.
Thrift shops are also seeing a boom. At the Buffalo Exchange resale clothing store, which has locations in Brookline and Somerville, Aarian Frye said there’s been an uptick in business.
“Buffalo Exchange tends to do well in economically tough times as people look to save money on clothing and/or earn some extra cash by selling their closet cleanout,” said Frye, a marketing coordinator for the for-profit retail chain.
The specialty shop allows customers to bring in clothing to exchange for cash, store credit or both.
While Frye said the stores tend to get busy in April and May with people doing spring cleanouts and students moving out at the end of the semester, she said her company “provides budget flexibility and quick access to quality clothing, unlike a resale app or online platform.”
Thrift stores in the U.S. earn an average of $300,000 in revenue per year, according to the National Association of Resale and Thrift Shops. Profits hover around 3% to 4% of total sales.
At SoWa Vintage Market in Boston’s South End, co-creator Stephanie Pernice said foot traffic has increased with people moving to Boston who need to furnish their apartments. The idea of sustainability is appealing to vintage customers because items often have better quality.
“I do think a lot of people are trying to be very thrifty and save money wherever they can,” she said. “But I think the bigger reason why we’ve had some pretty great traffic the last couple of years is because of the movement for the younger generation to try to reuse what’s already on the planet, and not contribute to, you know, waste, over-consumption and pollution.”
Rachel Silverman, co-coordinator at Thrifty Threads in Brookline, which accepts clothing donations and then resells them for cheap, said “the needs are skyrocketing.”
“Now, you know, sales are much higher. We have so much more foot traffic,” said Silverman. “Come to our store, a pair of pants are $4, a top is $4 ... You know, we have luxury items that are going to cost more. But in general, you can get out of that store for $8 and have a top and a bottom that you can wear somewhere.”
Not all thrift stores are seeing an increase recently, however. At Diversity Consignment in Jamaica Plain, which showcases local artists as well as “budget-conscious options” for under $30 on its website, founder Ian Drake cites something he calls, “the paradox of thrift.”
“What that paradox states is true, as things become more expensive, people who buy new, do not just switch over to buying used,” he said. “Instead, they just buy less new. And the people who buy used, buy used at a less frequent rate
Drake adds that as spending goes down overall and prices go up, people tend to hold onto things longer, which can be a detriment to his type of business.
Pernice of SoWa Vintage Market also said she’s seen a decline among one specific segment of customers.
“We’ve seen a decrease in international travelers this year,” she said. “We used to have a huge amount of international travelers visiting the market, and we’ve just noticed a big decline.”
