Savers Value Village, the national chain of thrift stores that sells secondhand merchandise, announced this week that it’s using AI to help price its goods in dozens of its 375 stores. But the company denies that it’s going to be used for so-called dynamic or surveillance pricing, the practices of changing the price quickly based on market conditions or the individual characteristics of who’s doing the buying. The AI platform is called ThriftIQ and it aims to take the guess work out of pricing the goods that it sells. The company pays non-profit organizations for things like clothes and household items and then turns around and sells them for a profit. Jubran Tanious, the president and CEO of Savers, explained during an earnings call Thursday how pricing has traditionally worked for the used goods retailer. “Prior to ThriftIQ, our team members would assess each garment and they would grade it based on condition and quality to determine its value. And then that grade would translate to a price based on the category and department. And for many years, this method has worked well,” said Tanious.
Tanious said that pricing with that strategy would be inconsistent and that two employees could evaluate the exact same item and come up with different prices, even with the best training since it was so subjective. “So now fast forward to ThriftIQ, we’re no longer asking the team member to assess condition and quality,” Tanious said. “We’re simply asking them to identify the brand. We then use that brand and combine it with seasonality [and] sell-through to determine the price of the garment. So it’s easier, it’s more objective, allows us to show up to the customer in a more consistent and in a precise way, and that is the key.”
