Turning around – The Lima News

PHILADELPHIA — From a warehouse in Pennsauken, Rick Forman built the Forman Mills discount chain into a network of 36 stores, then sold it to private investors in 2016.

He’s now back with Turn7, which he says is a different kind of discount store, taking advantage of a surge in retail inventory and returns that have piled up during the pandemic and the closures that have cost stores 25,000. United States since 2018. Up to 50,000 more stores could close by 2027, according to a Wall Street estimate.

Forman launched Turn7 with locations in Moorestown and Northeast Philadelphia, then in the spring took over a former Forman Mills in West Philly. Turn7 is designed to appeal to both the average shopper looking for a bargain and those hoping to resell low-priced items for a profit.

The store’s name is based on Forman’s goal of turning out all merchandise in seven days.

The “secondary market” for apparel and other items returned to U.S. stores and shippers, as well as unsold stock removed from store shelves or warehouses by managers or manufacturers in favor of new products, has jumped to around $1 trillion. last year, up from about $400 billion in 2017, according to Tony Sciarrotta, who heads the Reverse Logistics Association, an Atlanta-based industry group, citing data collected by Zac Rogers of Colorado State University.

Returns alone reached more than $750 billion, up from $300 billion in the same period as stores closed and shoppers moved online, he added, citing the data of the National Retail Federation. Post-pandemic returns are expected to slow for a while, but the long-term trend is clear: returns from online shopping account for between a quarter and a third of sales, compared to around one in 12 for brick-and-mortar stores. .

And under pressure to reduce landfill and incineration waste, businesses need resellers like Turn7 more than ever, Sciarrotta said.

Jabari K. Jones, who leads the West Philadelphia Corridor Collaborative business advocacy group, welcomed Forman to the neighborhood, noting that small retailers in the area were especially happy.

“There’s always guys selling at 52nd and Lancaster, 47th and Wyalusing, and right outside his door here on Chestnut Street,” Jones said, pointing over his shoulder to the sellers of music, hats and handbags. hand along the sidewalk. “Convenience drives people to shop in the neighborhood.”

Forman recently answered questions from The Inquirer about his latest venture. His answers have been edited for clarity and brevity.

Q: How did you come up with the idea for Turn7?

A: I was going to do a retail store, but then I was down south. I saw they had these chain liquidators, Gimme a Five, Crazy Cazboys. There’s one in New England, Ocean State Job Lot.

These liquidators in Alabama, even on a bad day, had hundreds of buyers. Flea market guys choose these stores. It’s easy with apps now: They go there knowing the prices of big items at Target, Walmart, and Amazon. So they’re looking for those assets, and if they can buy a lot cheaper from the liquidator, they can go online and beat the big guys. They know what sells for $120 on Amazon. If they can get it here for $30 and sell it for $100, they’ll pay us $3,000 for a thousand copies.

And I thought, why not at home? Ollie’s Bargain Outlet started out as a liquidator, also Big Lots, but they got big, and they’re more like regular stores now.

Q: How did Turn7 get started?

A: We opened a sort of pop-up proof-of-concept store in Cottman and on Roosevelt Boulevard. [for pre Christmas shoppers] in the fall of 2021. Then in December, we signed a two-year lease for the former Lord & Taylor’s at Moorestown Mall. Our department store and warehouse, we settled in Philadelphia Mills in Northeast Philadelphia. And now in West Philly. I still owned this place; Forman Mills wanted to stay here, but I didn’t renew their lease.

I hire 400 employees between the three sites.

Q: What do you sell and where do you get it?

A: Since the pandemic, with all the shopping from home, there are all these returns and all the logistics issues in international trade. Remember all those ships off Los Angeles that couldn’t come into port to unload? So this is all finally coming now, and where are the stores going to put it? Not in the landfills!

So we buy, not necessarily from Stitch Fix, Amazon and Costco, but they do business with all the major warehouses, and a lot of those warehouses now have to get rid of their surplus.

We come with money; we transfer the money. Not like the department stores, with their 90-day billing. We pick up the goods immediately — by semi-trailer. Carburetors at Cuisinarts. New or Returns. Kitchen sinks, literally. Bikes – the price we buy them at, you can sometimes resell them for 60% to 70% off the lowest Target or Amazon price.

And we have no idea what it will be tomorrow. Some people will come back just to find out. And they will take it. It’s excitement. Retail-entertainment.

Q: Why do buyers who want to resell items come to you instead of going directly to wholesalers?

A: They don’t have credit, and they’re very local, maybe working in an apartment. After COVID, people don’t want to make $12 or $15 an hour anymore. They want their own business.

Q: Why did you locate your warehouse in a mall?

A: They have the space now. We can take 120,000 square feet from these mall operators and sometimes only pay $5 a square foot, compared to $10 or $12 for warehouses or offices.

Q: Are struggling malls happy to have you?

A: They love us and they hate us. They prefer to have Nordstrom. But the old stores on Madison Avenue have closed. The masses come to us. I had lunch not long ago with Joe Coradino [CEO of PREIT, which owns area malls that have lost longtime “anchor” department stores]. I told him he wasn’t at our grand opening at PREIT’s Moorestown Mall, but we were mentioned in their quarterly investor report.

Q: Who are “your masses”?

A: Everyone. Moorestown has some of the highest incomes in South Jersey. There are people who ride in Jaguars. Everyone now wants to retail.

The inside entrance to Turn 7 at Moorestown Mall

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