Company finds thriving aftermarket in pricey handbags
March 25, 2014 10:56 PM
EdHille / Philadelphia Inquirer photo
Michael Zakroff, owner/director of Narberth based internet business CashinMyBag, show off the Hermes "Kelly Bag."
By Diane Mastrull / The Philadelphia Inquirer
When a boy is raised by a father who helped pay the bills with gold from people’s extracted teeth and their mailed-in jewelry, chances are he’s going to have a knack for recognizing value.
For Michael Zakroff, being adept at Internet research also helps.
He’s counting on both, along with financing from father, Rick, a pioneer in the cash-for-gold trade, to build his new CashinMyBag.com venture into a thriving exchange for primarily designer handbags. Jimmy Choo shoes and other pricey heels are also welcome. So are high-end belts and jewelry.
Mr. Zakroff, 33, says his Narberth, Pa., business of five employees differs from others by abandoning the consignment model. He cuts a check as soon as the merchandise arrives — assuming the owner agrees to his offer — at CashinMyBag’s basement digs via mail or in-person drop-off.
CashinMyBag.com assumes the sales risk. Although, in a recent interview, Mr. Zakroff didn’t sound worried about unloading what he has amassed since launching the business in June.
“It’s so easy to sell,” he said, citing monthly sales of about $80,000, generally at a 50 percent profit. “Our goal is to buy as much as possible.”
CashinMyBag does not buy from outside the United States but sells anywhere, with international sales constituting about 20 percent of the total.
The company is adding 500 customers a month, his Mr. Zakroff's dad said.
Here’s how it works: Those with items to sell go to CashinMyBag.com and provide details about each. Pictures are required. CashinMyBag provides a prepaid mailing label and insures each package up to $1,000.
“I thought it was a scam,” said Barbara Andersen of San Clemente, Calif., who did considerable research before entrusting to CashinMyBag.com about 18 items — watches, shoes, jewelry and purses — her daughter-in-law wanted to sell.
Ms. Andersen even checked out a satellite image of its office to make sure it was a legitimate address, and called Mr. Zakroff several times — “to make sure he was there,” she said.
Within days of the arrival of Ms. Andersen’s goods, Mr. Zakroff sent a check that was more than four times what Ms. Andersen and her daughter-in-law expected: “Our expectations were $500, and we got $2,072. … He has really found a niche.”
Rick Zakroff, 62, made a fortune off people’s jewelry through Goldkit.com and 1-800-Goldkit (1-800-465-3548), which he started in 1995 and sold about eight years ago before moving from Wynnewood to Delray Beach, Fla.
The market that CashinMyBag targets has been a pleasant surprise, the elder Mr. Zakroff said. “I didn’t know that there were handbags worth thousands and belts worth hundreds.”
It was Michael Zakroff who first caught on to that — in his other career as a hair stylist for 15 years on the Main Line, where he currently tends affluent dos three days a week at Raya Coiffure in Haverford.
“All the clients that come in always have Hermes, Chanel, Louis Vuitton,” Michael Zakroff said. About a year ago, “we saw on CNN how in Asia, people can leverage a handbag for their mortgages. That was the lightbulb that went off.”
Research revealed a lot of consignment shops carrying designer bags and shoes, but they do not pay for the items until and unless they sell, he said. “They don’t have the capital to do it.”
That’s where his father came in. As for valuing things properly to make his profit margins, Michael Zakroff said: “It’s just constant research.”
Nioka Wyatt, assistant professor of fashion merchandising and management at Philadelphia University, said used designer bags was “a new fashion construct that is gaining popularity because it gives consumers an opportunity to buy into a certain class with less money. It’s a win-win for the buyer and seller.”
Marie-Eve Faust, director of the school’s fashion merchandising and management program and author of the new book “Designing Apparel for Consumers: The Impact of Body Shape and Size,” sees longevity for CashinMyBag. That’s because, unlike clothing, there are no stigmas associated with used purses, and “fit is not an issue, either,” she said.
“I have a colleague in New York. Instead of buying stock, she’s buying supernice bags,” Ms. Faust said. “She said, ‘In five years from now, I’m going to make more money selling them online.’ ”