If you sell new or used Gymboree on eBay, or just have a large family and purchase multiple items at Gymboree, you'll want to read their new policy.  There's also some information regarding Gymboree's VeRo activity, so be sure to read to the bottom.    The following is reprinted with permission from GymboreeNews.com:
 
 

THE POLICY CHANGE (as per the Gymboree website):

How much can I purchase of a single style?

We do not authorize the purchase of our merchandise for resale purposes. To enforce this policy, we reserve the right to limit purchases to five (5) items per style, per color, per customer (excluding "stock accessories"), regardless of size of the merchandise. Stock accessories include all hair accessories, jewelry, basic socks, sunglasses, basic tights and underwear; stock accessories do not include fashion tights, fashion socks and handbags. We also reserve the right to cancel multiple orders of merchandise purchased in violation of this policy. We may modify this policy at any time for any reason and we may make exceptions to this policy, as we deem appropriate.

This Limits on Purchases Policy applies to purchases made at our Gymboree stores, Gymboree Outlet stores, and on www.gymboree.com.

QUESTIONS & ANSWERS:

I emailed Gymboree over the weekend to clarify a few points on their new policy.

GNGC:
I noticed your new policy today stating that no more that five of a single item may be purchased and more specifically stating that you do not authorize purchase of your merchandise for resale. For the past two years I have run a newsletter targeted specifically toward Gymboree resellers who sell on eBay. The vast majority of our subscribers are not only resellers but complete Gymboree addicts as well. They live and breathe your store and I am at a loss as to why you would so deliberately alienate such a loyal group.
As with any cross-section, there are those who try to abuse your generous sales system, but the overwhelming majority are happy to stay within your sales guidelines and try hard to do so. They are not stealing your stuff. Most of them love your clothing so much that they resell it solely or mostly so they can have extra money to clothe their children in your lovely clothing which would otherwise be outside of their budget.
Before I started the newsletter, I bought and resold Gymboree clothing for exactly that reason. As a result, my children (all four of them) are clothed almost exclusively in Gymboree. When I first started reselling on eBay we were thoroughly broke (hubby had just gone through a very large employment change) and reselling allowed me to clothe my children well when the alternative would have been GoodWill (as it had been for awhile before that).
I quit reselling long ago, but I still clothe my children in Gymboree simply because I love the clothes and they last forever. My start in reselling ended with my becoming a long-term Gymboree customer, and I have talked to countless other women who have come to Gymboree the same way. Why would you deliberately discourage that?
A couple of months ago, we ran a poll asking subscribers what their Gymboree purchases were mostly for. That poll had the highest response rate of any that we've run - 644 unique responses. Here's the breakdown:
  • Personal use only ~ 11.02% (71 responses)
  • eBay only ~ 4.97% (32 responses)
  • Mostly for personal use but with a little for eBay ~ 22.36% (144 responses)
  • Mostly for eBay but a little bit for personal use ~ 16.15% (104 responses)
  • Even split ~ 14.44% (93 responses)
  • Personal use and then resell after it's outgrown ~ 31.06% (200 responses)

As you can see, even in a sample that is clearly skewed toward resellers and should have a large majority saying they purchase mostly for resale, less than one third of respondents buy even half of their merchandise for resale. What's interesting is that those who do typically buy a very large amount of merchandise and are some of your best customers.

Your store has a completely unique opportunity. Because your clothing is all organized into lines, your clothing has an almost collectible aspect to it. I've seen people get completely fanatic about finding the one item to complete their outfit (I've actually done this myself). I think that plays a large part in why your clothing sells so well on eBay. When the stores are out of something, eBay often has it and it's usually the only way to get the same line again the following year when it's been gone from stores for months.

Instead of discouraging some of your highest volume customers (and make no mistake, this will be a huge PR problem for you), every effort should be made to accomodate these customers. You basically have thousands of people who want to spend a vast amount of money at your store.

You've recently made several policy changes intended to discourage fraudulent transactions or systemic abuse. These include shortening the return policy to seven days and the new Gymbucks redemption code which makes it harder to swipe those. That's great! These target the people who are trying to operate outside the system, both resellers and regular buyers alike. Why punish those who are not trying to work outside the system?

If you would please address these issues as soon as possible, I would be happy to print Gymboree's side of the story in the newsletter. Specifically, I would like to know why the new policy was placed into effect and if this is a permanent policy or will be tested for awhile before the decision is made whether or not to keep it. Thank you so much for your time and best of luck with the FOG sale this weekend.

Yours,

Rachel Shubin

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GYMBOREE:

Dear Ms Shubin,

Thank you for your enthusiastic support of Gymboree. We often hear stories of extreme loyalty and heartfelt appreciation for the types and styles of clothing we produce. It serves as a great motivator for us to work even harder to keep designing and producing what we consider the best children�s product on the market.

This loyal following also brings strong opinions to our policies and sales practices. We agree that the collectible aspect of our lines is of critical importance to many of our customers. We have heard from many of them in the past voicing frustration at their inability to complete their sets due to a piece or two selling out in the first or second day after going on sale. The new policy was, in part, our attempt to try and address this concern.

You are also correct in that Gymboree has been working hard to discourage fraudulent activity. And while not every policy change is met with universal agreement by all of our customers, please understand the intent of these types of policy changes is to create a better shopping experience for the vast majority of our valued Gymboree customers.

We sincerely appreciate your feedback and support of our brand. While we recognize you are not happy with the policy change, we hope you respect the reason for its implementation and truly hope you will continue to patronize the Gymboree brand in the future.

Sincerely,

Investor Relations

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Well, that seemed a bit vague and by then I'd thought up a couple more questions, so I emailed them back.

GNGC:

Thank you so much for your swift reply! This weekend I got a whole slew of emails asking about this policy, and I have a couple more questions. Most of the questions are regarding the part on your website stating: "We do not authorize the purchase of our merchandise for resale purposes." This is generating an enormous amount of confusion.

I've been getting emails from people saying their local store managers are telling them that Gymboree will be actively working to remove all eBay auctions for Gymboree clothing both new and used. Some stores have apparently been telling people that they can't even sell their outgrown stuff at garage sales or consignment stores. I'm assuming that that at the very least is erroneous. `It makes no sense whatsoever and would be impossible to enforce.

However, the eBay question is a bit more sticky. Gymboree does occasionally pull auctions that use Gymboree stock photographs. This is enforcing a legal copyright issue however, and people seem to appreciate the legal footing. Is there a plan in the works to go through Vero to remove Gymboree auctions from eBay? If so, would you be able to explain the logic for that? From the lay perspective, it seems that once an item is purchased it belongs to the buyer and the selling company no longer has say over what can or cannot be done with it. If this is going to be the case, I'd just like to be able to pass along an accurate representation of your position. Also, if you are actively pursuing auction removal, would that be limited to new with tags auctions or both new and used items?

I do have one more question. Your policy states that "To enforce this policy, we reserve the right to limit purchases...." May I assume that that doesn't necessarily mean that all purchases that buy more than five of a style will be restricted? I know of several large families that don't sell on eBay but do buy in volume (I have three girls and tend to buy a bunch when I find something good myself). I'm sure you won't want to discourage these customers. Will application of this restriction be up to the discretion of the employees or are there more concrete guidelines that must be followed?

Again, thank you for your time. I realize that some of these are legal questions that might be better asked to the legal department. Feel free to forward this to them if necessary. What I'm most interested in is a speedy, clear answer that I can bring back to my subscribers.

Rachel Shubin

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GYMBOREE:

Dear Ms. Shubin,

Thank you for your feedback. We apologize for any confusion some customers may have experienced with our field personnel over the past weekend in the interpretation of this new policy. We have already addressed this issue with our operations team.

As to your question pertaining to eBay, we recognize that the collectible aspect and durability of our products has created a secondary market for our products at garage sales and on eBay and other auction websites. While Gymboree does not, and never has, authorized the resale of its products, we recognize that there are legitimate ways to sell our used merchandise. As you indicated, Gymboree has used VeRO to remove eBay auction items that use our photography or otherwise infringe our intellectual property rights. We will continue this practice in the future. However, Gymboree does not and has never used eBay�s VeRO program to remove auction items that are legitimately sold on eBay.

As previously explained, we implemented the Limits on Purchases policy to address numerous customer complaints of �stock out� situations at our stores for new product within the first day or two of an item being introduced for sale. However, we do recognize that there are valid reasons to buy in bulk. In the past, we have had parents buy gifts to hand out at a birthday party, buy a uniform for a team or buy Gymboree merchandise to donate to charity. In such situations, we will make an exception to our Limits on Purchases policy. Store associates should refer customers wishing to make a purchase in excess of the limit to Gymboree�s Customer Service team, who can verify the reason and process the order.

We hope this addresses all of your questions and sincerely appreciate your enthusiastic support of the Gymboree brand.

Sincerely,

Investor Relations

So, they will not be pulling Gymboree auctions unless they use Gymboree stock photographs (which they have already been doing for awhile). For non-resale purchases, they will make exceptions to the new rule. My personal guess is that the stores will enforce this policy on new lines but on older lines that are clogging up their sales floor, they'll be a bit more relaxed. So keep that in mind when you redeem your Gymbucks and make sure that you vary your merchandise purchases. :)

Reprinted with permission from GymboreeNews.com