Startup Makes It Cool To Buy Used Kids’ Designer Clothes

By Diane Mastrull
The Philadelphia Inquirer

WWR Article Summary (tl;dr) In May 2014, Lisa Batra launched “My Kid’s Threads”, an online consignment shop for designer children’s clothing. Batra describes her business as “an online marketplace for clothes with an exit strategy.” In other words, a place to unload clothes children outgrow and, in so doing, recoup a portion of their purchase price.


Lisa Batra’s e-commerce career has been defined by multimillion-dollar retail names: QVC; the Limited; Bath & Body Works; Lowe’s Home Improvement; Charming Shoppes. And now, My Kid’s Threads.

Wait, what?

That last one might not be a household name, but it’s arguably Batra’s most impassioned professional endeavor, and evidence that despite the high odds of skinned knees and spilling accidents, parents are willing to dress young children in designer duds. They just don’t want to pay top dollar for them.

Batra, 38, came to that conclusion through personal experience, giving birth to two children, now 7 and 5.

“I realized how difficult it was to find high-quality kids’ clothes” at affordable prices, Batra said. She cited an astonishing statistic regarding how much practice any parent of a growing child gets in that hunt: “Kids are going through seven clothing sizes in their first two years of life.”

As a retail veteran with an MBA in new ventures and entrepreneurship from Pennsylvania State University, Batra saw a business opportunity and in May 2014 launched My Kid’s Threads, an online consignment shop for designer children’s clothing, sizes newborn to 16. Inventory at its headquarters and warehouse outside Philadelphia is currently about 10,000 items, and handled by a staff of about 10.

Batra described her business as “an online marketplace for clothes with an exit strategy.” In other words, a place to unload clothes children outgrow and, in so doing, recoup a portion of their purchase price. The clothing must be in good condition, and most definitely not from Wal-Mart or a dollar store.

“The growth has surprised me,” Batra said, declining to provide revenues, saying only that My Kid’s Threads is profitable and experiencing 100 percent growth year over year. “Resale is just becoming so much more mainstream, especially with younger families.”

Among the first in the region to seize upon that realization and build a business on it was Jennifer Kinka, who in June 2010 cofounded the Nesting House, now a chain of three children’s boutiques throughout Philadelphia offering customers the option of turning in clothing for cash or store credit.

My Kid’s Threads is different in three primary ways: its transactions are done through the mail; its merchandise focus is exclusively high-end; and it does not buy its inventory. Consigners are paid only if their items are purchased; My Kid’s Threads holds them for up to a year. It pays 40 percent of the resale price when items sell for cash, 50 percent if buyers opt for in-store credit instead.

“This operating model allows for lower fixed cost and overhead,” Batra said. “Inventory ownership is really hard. Especially if you can’t liquidate it, you end up losing money.”

She has tailored My Kid’s Threads on a couple of trends that have emerged since the 2008 economic collapse, including: “People are just spending their dollars smarter. … I’ve heard a lot of people say to me when they shop now, they think about what the resale value is going to be.”

Kristen Gingerich, a former English teacher and now stay-at-home mother to children ages 8, 6, and 2, has been consigning with My Kid’s Threads pretty much since it opened for business, making $200 to $300 so far, she estimated.

At first, her motivation was to help a fellow Penn Stater, Gingerich says. Then she was hooked. “It was a way for me to give these clothes for someone else to use, and I could also make some money _ and whatever couldn’t sell she donates.”

She’s also a regular My Kid’s Threads shopper, attracted by such brands as Ralph Lauren, Tea Collection, and Hanna Andersson at deep discounts.

Consolidation has been a consignment trend, leading to the shuttering of brick-and-mortar shops _ and making such online-based alternatives as My Kid’s Threads especially attractive.

Batra is “adding to the spectrum of what’s available,” said the Nesting House’s Kinka, one of her competitors. “An online resource is a good resource.”

So why has she resisted that route herself? Kinka, who founded her business with husband Christopher, acknowledged that Batra can serve a “broadband area” with an online operation. Those who consign with Nesting House have to bring merchandise to one of its stores.

“The people who live really close to us like turning their dollars into store credit,” Kinka said, estimating that 85 percent to 90 percent of Nesting House’s consigners opt for store credit over cash (40 percent of what items sell for).

“It’s truly a community exchange,” said Kinka, a Philadelphia mother of three children under 11. “I’m not sure I’m willing to break up that vision.”

Batra’s vision is growth.

“The platform we were built on really enables us to grow in so many ways with traffic and products,” said Batra, who recently adding maternity clothes to My Kid’s Threads offerings despite the seeming incongruity with the company name.

“A natural progression,” Batra called it.
Top 10 states with the most My Kid’s Threads buyers and consigners:
New York

My Kid’s Threads’ top consignment brands:
Mini Boden
Baby Dior
Hanna Andersson
Ralph Lauren
Tea Collection

-SOURCE: Lisa Batra

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