In 2018, Once Upon A Child® franchisees collectively purchased roughly 84 million items and sold more than 86 million units, which include gently used clothing, shoes, toys, books and equipment.
With more than 350 locations across North America, Once Upon A Child has firmly established itself as a leader in the kid’s resale franchise segment. It’s grown by leaps and bounds since it was founded in 1984 by a pair of Ohio-based entrepreneurs.
The road to becoming an industry-leading resale franchise brand is paved with consistent consumer demand, a strong business model and a focus on robust unit-level economics.
Growth of the Resale-First Consumer
The secondhand apparel industry is worth $18 billion and is expected to grow to $33 billion by 2021. There are a number of reasons behind this growth:
- Widespread acceptance of resale concepts – Roughly 1 in 5 American consumers shop at a resale shop every year. Comparatively, 11.4 percent shop at factory outlet malls and just under 20 percent shop at apparel stores. Driven to get the greatest value when making purchases, shoppers are increasingly turning to resale concepts to find fashionable clothing at the most affordable price.
- Resale shoppers have formed a habit – Shoppers who already shop resale are inclined to continue doing so for the next several years. In fact, the average resale shopper’s closet is expected to be 40 percent secondhand apparel within the next three years.
- Millennials coming of age – Of all the demographic groups, millennials are the most likely to buy from a resale business. Having grown up through the Great Recession, Gen Y is keenly aware of the need to make smart purchases. At the same time, many are beginning to or already have had children and investing in a home, making resale shopping an even more important part of their lives.
A Kid’s Resale Franchise Business Model Built for Growth
The founders of Once Upon A Child were inspired to open a kids resale franchise concept because they experienced the frustrations of shopping for young children first hand – their own kids rapidly grew out of their brand new clothes.
By the mid-1990s the owners had opened 20 franchise locations, but they hit a roadblock in expanding into other markets. Winmark Corporation® took ownership of Once Upon A Child and helped restructure the business model to grow the system and improve unit-level economics.
By 2001, the brand had reached 229 units with an average unit volume of $402,109*. Fifteen years later, there were 348 Once Upon A Child stores across the U.S. and Canada, and the AUV reached $966,865.
Achieving this level of success is the result of consistent investment in creating a business model that encourages repeat customers, inventory management best practices and technology that helps franchisees maintain strong store-level operations and sustains a singular focus on the community.
- Keeping customers coming back – The buy-and-sell business model helps franchisees convert buyers into sellers and vice versa, offering cash on the spot for gently used items.
- Inventory management – Once Upon A Child franchisees have access to proprietary inventory management software that allows them a 360-degree view of store inventory, helping owners recognize the right times for sales, a heavier focus on buying and where to allocate marketing and advertising spend.
- Community at heart – As a kid’s resale franchise concept, store owners often open their location knowing first-hand how much of an impact the business can have on local consumers’ wallets. However, many franchisees go above and beyond by partnering with charities and like-minded organizations to give back to those who support the business and others in need.
Leading the Kid’s Resale Industry
In 2019, Once Upon A Child was ranked No. 129 overall on Entrepreneur’s Franchise 500 and was also recognized as the No. 1 Franchise in the Children’s Retail category. Not only is resale apparel a growing industry, but Once Upon A Child is also at the front of the pack in providing business owners with an opportunity to start out on the strongest foot possible.
Contact us today to learn about resale franchise opportunities with Winmark Corporation’s brands.
*The amounts stated are as reported in Item 19 of the 2002, 2007, 2012 and 2017 Once Upon A Child® Franchise Disclosure Documents, respectively (based on the previous year’s Gross Sales). In 2001, of the 202 stores that reported, 89 or 44% of the reporting stores attained or exceeded the Average Unit Volume. In 2006, of the 187 stores that reported, 82 or 43% of the reporting stores attained or exceeded the Average Unit Volume. In 2011, of the 236 stores that reported, 110 stores or 47% of the reporting stores attained or exceeded the Average Unit Volume. In 2016, of the 316 stores that reported, 143 stores or 45% of the reporting stores attained or exceeded the Average Unit Volume. A new franchisee’s results will likely differ from these results.