Interested in small consignment business ideas? If YES, here is how to open a consignment store with no money and no experience. How much does it cost to start up?
How to Start a Consignment Shop
Are you looking for a cheap and easy business to start? When you want to start a new and exciting business, you may want to think about starting a consignment shop. There is a lot that you can do with this type of business and still have a lot of fun doing it at the same time.
A consignment shop is a store where people bring things that they want to sell. Oftentimes this is clothing, but it can be any number of items. You then sell the items for the person and take a percentage of the profit, giving them the rest.
Consignment shops are great not only for the owner, but for the customers as well. People who can’t afford to shop retail can find nice items in consignment at a lower price.
Consignment shops have started popping up in nearly every town across the United States and the world at large. Whether they are selling clothes or furniture, sporting goods or household appliances, consignment offers a great way for people to buy and sell used goods, whether it is online or in a brick and mortar store.
I have here 5 steps to take for you to be able to start a consignment shop in your community or city and here they are.
Research your Competitors
It takes a lot of research and groundwork to kick-start any kind of business and starting a consignment shop is no different.
Before you begin this business, you have to research your competitors. Jot down what you believe are their strengths and weaknesses. You should fine tune your business plan and your advertising to play up your uniqueness. Decide what area of town your consignment shop would do best in.
A Business Plan for your Consignment Shop
For a business to be successful, the one thing it needs initially above anything else is a solid consignment shop business plan. Even if you are not planning on getting a loan, you still need a business plan to help you plan things out and know the direction you want to move in. Without a business plan, the success of your consignment shop is uncertain.
Even a ten-page business plan will double your chances of success. Your business plan should spell out what your market is like, what kind of competition you have, and what niche you will fill. It should specify your business structure, how many employees you’ll need, and what your startup costs will be, as well as what your monthly overhead costs will be and how many months it will take for you to break even.
You also need to write a basic marketing plan, and write a detailed resume for yourself and why you have what it takes to run a great consignment shop. There are plenty of resources online for how to write a business plan, but that gives you the thumbnail sketch.
The location is a primary consideration and one of huge significance. Several aspects need to be considered. Obviously, the first consideration is rent. Most prime locations charge a steep rent. But if you can afford it, you should not compromise on a location which has all the elements necessary to start a consignment shop.
Some of these are ample parking space, high traffic from pedestrians and vehicles and proximity to similar or complementary businesses.
Have it in the back of your mind to get a good location that fit your budget so you don’t end up in a tight situation.
This will be easier than you think. Almost any consignment store owner will tell you that getting inventory is not a problem. Place a few ads or let friends know you’re taking inventory, and your store will fill up faster than you can believe.
The real problem is picking stuff that will actually sell. That’s a fine art, and most of your long-term success as a consignment store owner will hinge on it. Just keep practicing.
If you are taking things in on consignment, remember to only accept items that really grab your attention. You have no obligation to take things off of people’s hands that are too used or don’t fit with your style. The pickier you are, the more unique your store will become.
Advertising your Consignment Shop
If you decide to start up a consignment shop, your biggest expense is going to be advertising. Be patient and continue to spread the word. Be fair with your prices and people will come in and give you repeat business.
As you make a profit, grow your business with it. Eventually you could move your home-based business to something even larger!
You can advertise in the local newspapers. This is a great way to let others know whom you are and what you want to do. Another good idea is to send out flyers to the local neighbors in your area to let them know that you are new and that you are in business.