How Limiting Supplies Helps Profits

Submitted by Dmitri Davydov on Wed, 2008-06-11 10:12.
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Ian Ginoza, 35, sells sneakers in Wicker Park, but there’s no chance shoppers would mistake his boutique for a Foot Locker.

Sure, Ginoza’s Saint Alfred carries Nike and Reebok, among other brands. But the store orders shoes only every three months, in 12-pair batches, and when a style is sold out, that’s it. Saint Alfred never restocks.

Bewitched by the limited supply, fashionistas and collectors pay up to $400 for a pair of sneakers. Ginoza got into high-end sneaker retailing in 2001 when he opened Kicks/HI in Honolulu after working as an art director for IPath, a skateboard shoe and apparel company now owned by Timberland.

Oddly, some of his best customers ordered from Chicago. So Ginoza flew here to size up the market. He and three partners then spent $150,000 to open Saint Alfred—the patron saint of footwear, they joke—in late 2005. The shop turned profitable within six months, Ginoza says.

[Via - BusinessWeek.Com]

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