For shop, an unlikely exchange

Consultants: Business students get real-world experience while the Woman's Industrial Exchange may get new a lease on life.

March 23, 2002|By Alec MacGillis | Alec MacGillis,SUN STAFF

BUT THE VENERABLE INSTITUTION — The Woman's Industrial Exchange has been at North Charles and Pleasant streets since 1887 - long before anyone heard of business buzzwords like SWOT analyses, back when marketing meant riding your horse and cart to town.

But the venerable institution - part consignment shop, bakery and restaurant - is now looking to just those sorts of newfangled strategies to improve its chances of surviving another century.

In an unlikely partnership, the Exchange is receiving free consulting advice from a half-dozen graduate students at the Johns Hopkins School of Professional Studies in Business and Education, who have spent the past few months poring over the Exchange's operations and financial records.

For the students, who will formally present their recommendations today at Hopkins' Downtown Center, the consulting represents the final project required for their master's degrees in business administration - finding financial solutions for a nonprofit organization in the Baltimore area.

For the Exchange, the project represents a much-needed reassessment of how it manages its shop and restaurant - both of which are barely scraping by despite a core of loyal customers.

"We're pretty excited about it," said manager Mary Brown. "We hope over the long haul, it will help get this place going."

Founded in Baltimore after the Civil War, the Exchange was part of a nationwide movement in the mid-19th century to provide gentlewomen who had fallen under hard times an acceptable way to "go into trade." Women, often widows, could discreetly bring homemade clothes or baked goods, which would be sold on consignment.

More than 100 years after it moved into its current location, relatively little has changed. Local women (and some men) bring potholders, jewelry, dolls, handbags and more to the shop, a colorful and jumbled room festooned with sock monkeys. And they still collect the same share of sales - 65 percent.

In the tea room behind the shop, veteran waitresses still serve bargain breakfasts and lunches, including a chicken salad advertised as the city's best and a tomato aspic that has converted its share of skeptics.

But tradition carries only so much weight at the cash register. Five years ago, the Exchange closed for a month and almost went under before donations rescued it. Last year's tax forms show it brought in only about $142,000 in revenues, well short of its $245,000 in expenses, and relied on about $200,000 in contributions to put it in the black.

Enter the Hopkins MBA students, some of whom were having lunch at the Exchange when it occurred to them that it would make the ideal subject for their final project. Another group of students is consulting this year for the Maryland Special Olympics; past clients have included Baltimore's Center Club and the Paralyzed Veterans of America.

The students researched every aspect of the Exchange - interviewing board members, employees and customers, studying its budget and sales records. They completed a SWOT analysis - determining internal "strengths and weaknesses" and external "opportunities and threats" - and came up with a list of solutions.

Most important, the students said, is that the Exchange improve its marketing. Many Baltimoreans don't realize that it exists, marked as it is with a small sign. And many who do know about it assume the Exchange sells secondhand goods, the students found.

Because the Exchange has little money for advertising, the students suggested that it ally itself with other retailers, hotels or museums, raise its profile with professional women's groups and attract tour groups - who don't have to contend with the parking shortage faced by other shoppers.

The students also suggested it call itself simply "The Exchange" on signs and stationery, and call its clients "artisans," not "consigners." But, they said, it should do more to highlight its history in the shop.

To capitalize more on the afternoon coffee crowd, the students suggested that the restaurant open from lunch to early evening, instead of breakfast to lunch. To encourage more shop purchases by diners, the students recommended that they be forced to pay their tabs at the shop register.

Linda Goldberg, president of the Exchange's board, said most of the tips were doable. Already, she said, the Exchange is sending out mass e-mail messages about its occasional Saturday openings and other specials, and it hopes to receive a federal grant that will pay to spruce up its appearance.

The most direct benefit of the project, though, may be the Exchange's newfound popularity among the Hopkins students.

"I've gotten pretty attached," said MBA student Linda McNamara, a billing manager at the Hopkins Hospital. "I'd never heard about it prior to the project. ... No one knows they're there - but once they go there, they're hooked."

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