Become a FabJob Guide to Secondhand Store Owner€¦ · Open your own resale store or consignment...

Open your own resale store or consignment shop!

Lori Soard and Susan Pennell

FabJob Guide to

Become a Secondhand Store Owner

Visit www.FabJob.com

ContentsAbout the Authors ..........................................................................9

1. Introduction ..........................................................................................101.1 Types of Secondhand Stores .......................................................111.2 BenefitsofBeingaSecondhandStoreOwner ..........................131.3 Inside This Guide .........................................................................16

2. Developing Your Skills ......................................................................182.1 Skills Assessment ..........................................................................18

Skills Quiz .......................................................................................192.1.1 AreYoua“BornBargain-Hunter”? .................................202.1.2 RetailingSkills .....................................................................222.1.3 Interpersonal Skills .............................................................24

FabJob Guide to Become a Secondhand Store Owner

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2.2 Ways to Earn While You Learn ...................................................262.2.1 HoldGarageSales ..............................................................262.2.2 Sell on the Internet ..............................................................282.2.3 HaveaBoothataFleaMarket ..........................................312.2.4 Work in a Secondhand Store .............................................332.2.5 WorkatAntiquesShowsorAntiquesMalls ...................342.2.6 WorkatanAuctionHouse ................................................36

2.3 BeYourOwn“MysteryShopper” .............................................372.4 Learn From Experts ......................................................................43

2.4.1 Talk to Secondhand Store Owners ...................................432.4.2 Join an Association .............................................................452.4.3 Take a Course ......................................................................48

2.5 ResourcesforSelf-Study ..............................................................52

3. Starting Your Secondhand Store .......................................................553.1 ChoosingYourNiche ...................................................................57

3.1.1 Antiques and Collectibles ..................................................583.1.2 ClothingStores ....................................................................593.1.3 OtherNiches .......................................................................61

3.2 OptionsforStartingaSecondhandStore ..................................643.2.1 BuyinganEstablishedStore..............................................643.2.2 Franchising ..........................................................................703.2.3 OpeningaNewSecondhandStore ..................................75

3.3 ChoosingaStoreName ...............................................................763.4 Your Business Plan .......................................................................78

3.4.1 What To Include In a Business Plan .................................793.4.2 Sample Business Plan .........................................................843.4.3 FinancialPlanning ..............................................................90

3.5 Start-UpFinancing .......................................................................943.6 YourBusinessLegalStructure ..................................................1013.7 OtherLegalMatters ...................................................................108

3.7.1 Business Licenses ..............................................................108




3.7.2 Taxes ...................................................................................1083.7.3 Insurance ............................................................................111

4. SettingupYourStore ........................................................................1154.1 FindingaLocation ......................................................................115

4.1.1 Possible Locations .............................................................1154.1.2 Points to Consider ............................................................1184.1.3 SigningYourLease ...........................................................124

4.2 StoreDesign ................................................................................1324.2.1 Outside the Store ..............................................................1334.2.2 Inside the Store..................................................................1354.2.3 Store Security ....................................................................139

4.3 DisplayingMerchandise ...........................................................1404.3.1 TipsforDifferentTypesofMerchandise .......................1404.3.2 LayoutTipsforMaximizingSales..................................1434.3.3 CreatingWindowDisplays .............................................145

4.4 Equipment and Supplies ...........................................................1474.4.1 ItemsYou’llNeedForYourStore ...................................1474.4.2 Suppliers ............................................................................150

4.5 YourInventory ............................................................................152

4.5.1 OptionsforBuildingInventory ......................................1534.5.2 GettingConsignmentMerchandise ...............................1544.5.3 WheretoFindMerchandisetoResell ............................1574.5.4 AcquiringNewMerchandise ..........................................167

5. Store Operations ................................................................................1705.1 DevelopingaProceduresManual ............................................170

5.1.1 HowtoCreateYourManual ...........................................1715.1.2 Areas of Operation Checklists ........................................172

5.2 InventoryManagement .............................................................1755.2.1 InventorySoftware ...........................................................1755.2.2 InventoryTagsandLabels ..............................................176




5.3 PricingMerchandise ..................................................................1815.3.1 PricingGuidelines ............................................................1815.3.2 PricingAntiques ..............................................................1825.3.3 FlexibilityinPricing .........................................................1865.3.4 DealingwithUnsoldConsignmentItems.....................187

5.4 GettingPaid .................................................................................1905.4.1 AcceptingDebitCards .....................................................1905.4.2 AcceptingCreditCards ...................................................1905.4.3 AcceptingPaymentOnline .............................................1925.4.4 AcceptingChecks .............................................................192

5.5 FinancialManagement ..............................................................1925.5.1 Bookkeeping ......................................................................1935.5.2 Financial Statements and Reports ..................................1965.5.3 SettingaBudget ................................................................2035.5.4 WaystoSaveMoney ........................................................208

5.6 Employees ...................................................................................2095.6.1 RecruitingStaff.................................................................2105.6.2 TheHiringProcess ...........................................................2135.6.3 NewEmployees ................................................................217

6. GettingandKeepingCustomers ....................................................2216.1 MarketingYourBusiness ..........................................................221

6.1.1 Advertising ........................................................................2216.1.2 Free Publicity .....................................................................2276.1.3 Promotional Tools .............................................................2306.1.4 Your Website ......................................................................2356.1.5 SocialMedia .....................................................................2426.1.6 Networking .......................................................................2456.1.7 OtherMarketingTechniques ..........................................246

6.2 CustomerService .......................................................................2486.2.1 GreetingCustomers .........................................................2486.2.2 MakingtheSale .................................................................249




6.2.3 GettingRepeatBusiness ..................................................2526.2.4 YourReturnandExchangePolicy ..................................2556.2.5 DealingwithDifficultCustomers ..................................257

7. Bonus Chapter — Antiques & Collectibles ..................................2597.1 Introduction to Antiques & Collectibles .................................259

7.1.1 WhatisanAntique? .........................................................2607.1.2 WhatisaCollectible? .......................................................261

7.2 BuyingAntiquesfromDealers .................................................2627.2.1 DevelopingaBuyingRoute ............................................2627.2.2 WhatYou’llNeedonaBuyingTrip ...............................2647.2.3 EvaluatingandNegotiatingPrice ..................................2677.2.4 GettingAntiquesHometoYourStore ...........................272

7.3 SpottingFakes .............................................................................2767.4 Antiques Care .............................................................................278

7.4.1 CleaningAntiques ............................................................2797.4.2 RestoringAntiques ...........................................................279

7.5 Your Antiques Customers .........................................................2837.5.1 Walk-Ins .............................................................................2847.5.2 Collectors ...........................................................................2847.5.3 Museums ............................................................................2867.5.4 InteriorDecoratorsandDesigners .................................2877.5.5 Set Decorators ...................................................................288

7.6 GrowYourBusinesswithOtherServices ...............................2907.6.1 AppraisalServices ............................................................2907.6.2 Restoration and Repair ....................................................2927.6.3 Other Ways to Increase Your Income .............................294

8. Conclusion ..........................................................................................296




1. IntroductionIfyoulovethethrillofhuntingfortreasuresandarelookingforabusi-nessthatisinexpensivetostartandrecessionproof,thenrunningasecondhand store is for you.

Secondhand,orresalestores,areoneofthefastestgrowingportionsoftheretailindustry.AccordingtotheNationalAssociationofResaleandThriftShops(www.narts.org/i4a/pages/index.cfm?pageid=3285),therearemorethan25,000resalestoresacrosstheUnitedStates.Inthelast25years,secondhandstoreshavechangedfromdark,dingystorestoamulti-milliondollarindustrywithavarietyofnichesandstoretypes.

Today,becauseoftherisingcostofliving,manypeoplebuygently-used items to help their dollar stretch further. As a secondhand store



http://www.narts.org/i4a/pages/index.cfm%3Fpageid%3D3285


owner,youwillhelppeoplefindqualityitemsthatmightotherwisebeoutoftheirpricerange.Youmightalsooffertheopportunityforotherstoearnasmallincomefromsellingitemsthroughyourstoreoncon-signment.Youwilllearnhowtogetstartedinthisrewardingbusinessin the FabJob Guide to Become a Secondhand Store Owner.

Thischapterlaysthefoundationfortherestoftheguide.Itexplainsthedifferencebetweenaconsignmentstoreandaresalestore,aswellasthevarioustypesofstoressuccessfulsecondhandstoreownersrun.Italsocoversthebenefitsofthisexcitingcareerchoiceandoutlinesthestepsneededtogetstarted.

1.1 Types of Secondhand StoresIfyouarethinkingaboutstartingasecondhandstore,thenchancesareyouhavevisitedsecondhandstoresinthepast.Asyou’veprobablynoticed,thereisawidevarietyamongsecondhandstoresintermsofthe types of merchandise they sell. Before you open your store you will needtodecideifyouwillhaveaspecialtythatyouwillconcentrateonsuchasusedfurniture,clothing,antiques,sportinggoodsorsomethingelseentirely.Perhapsinsteadofspecializingyouwillbecomemoreofa“generalist”,sellingalittlebitofeverything.

Let’stakeaquicklookatthedifferenttypesofspecialtysecondhandbusinesses you can choose from.

Antiques: Furniture,glassware,kitchenware,collectibles,etc.

Books: Paperbacks,hardcoverbooks,novels,atlases,rarebooks,etc.

Clothing: Everythingfrom“gentlyused”currentlyinstyleclothingtovintageclothing;orspecializeevenfur-therin,forexample,children’s,maternityorbridal

Electronics: CDandDVDPlayers,computers,TVs,stereos,etc.

Music and Videos: CDs,DVDs,VHStapes,cassettes,vinylrecords,etc.




Sporting goods: Skis,hockeyequipment,baseballgloves,golfclubs,andjustaboutanythingelsesports-related

Other: Anyotherproductsthatpeoplewanttosavemoneybybuyingused,suchas:furniture,housewares,gar-denequipment,musicintruments,tools,toys

Thisisnotanexhaustivelistandtherereallyarenorulesastowhatkindofresalestoreyouwillchooseyourstobe.Youcancarryalittlebitofeverything,oryoucanspecializeinjustoneorafewareas.Whatyou decide to sell in your store is entirely up to you. That’s the beauty ofsecondhandstoremerchandise;thechoicesaresoflexible.

Basedonyourpersonalexperiencewithsecondhandstores,youprob-ablyhaveasenseofhowsuchastoreisrun,butwereyouawarethereisadifferencebetweenconsignmentstoresandresalestores?Eachtypehasitsbenefitsforyou,dependingonyourownpersonalgoalsforyourfuture store.

Consignment

Consignmentstorestakeinmerchandisefromclientsandsellitforapercentageoftheprofits.Atypicalsplitis60/40,with60percentofthesalepricegoingtothestoretocoveroverheadexpensesandcreateaprofitforthestoreowner,and40percentgoingtotheconsignorwhohaslefttheirmerchandisewiththestore.Consignmentcanbeaninex-pensivewaytobuildinventorybecauseyoudonothavetopayfortheproductuntilithassold.Youcanstockyourstorewithhighendmer-chandisewithoutpayingforitupfront.

Resale

Themaindifferencebetweenaconsignmentstoreandaresalestoreisthatresalestorestypicallybuyuseditemsoutrightandresellthem.Resalestoreownersoftenpickupitemsatauctions,garagesales,orbuythemfromindividuals.Often,youwillhavemoreofaninvestmentupfront,butifyoufindagooddealandareabletoresellforagoodmarkup,thenyoukeepalltheprofitanddonothavetosplititwithaclient.




Manysecondhandstoresoperateonbothprinciples.Theybuyitemsforresaleandtheyalsotakeinsomeitemsonconsignment.Asmen-tionedabove,consignmentisagreatwaytobuildyourinventoryini-tiallyor,onceyou’reestablished,tobringhigherpriceditemsintoyourstore.Onceyouhaveafeelforwhatsortsofconsignmentitemssellwellyoucanstarttopurchasesimilaritemsandmaximizeyourprofit.

1.2 BenefitsofBeinga Secondhand Store Owner

“I love the way someone’s face lights up when they find a treasure that’s not available anywhere else and then realize that they can afford to take it home.”

— AmyBoney,Formerowner AHorseofaDifferentColor

Whilegatheringinformationforthisguide,weaskedsuccessfulown-erswhatthegreatestbenefitswereforthem.

Freedom

“The most rewarding thing about running the shop is the total autonomy and control of the business and the ability to tailor it to my lifestyle. I work four days a week and have a wonderful sister-in-law who loves to come in to help, allowing the shop to be open five days a week. And it is such a creative outlet!”

— BarbaraBelhumeur,TheNextBestThingConsignmentForHome&Garden Johnston,RhodeIsland

Onethingseveralstoreownersmentionedwasthefreedomthatcomeswithowningyourownstoreversusworkingforsomeoneelse.Whileitisimportantforstoreownerstoofferconvenientandregularhoursfortheircustomers,ifyouhavesmallchildren,astoreallowsyoutotakeyour family to work with you.

Asareselleryoumightevendecidenottoopenastore.Someresell-erssetupboothsontheweekendsatlocalfleamarketsorswapmeets,workingasmanyorasfewweekendsastheywant.OthersopenupshopontheInternet.You’llfindsometipsforthislateroninthisguide.




Interacting with Customers

Ifyouarea“peopleperson”andenjoyspendingtimewith,gettingtoknow,andtalkingtoothers,thenyouwillloverunningasecondhandstore.Ifyouspendanytimewithothersecondhandstoreowners,eitherataconferenceorintheirindividualsettings,youwillsoondiscoverthatthisloveofhelpingpeopleisvirtuallyuniversal.Herearesomeoftheircomments:

“The most rewarding thing about running a secondhand store is the interac-tion with the customers. Most are happy to buy quality, name-brand clothing at an affordable price.”

— TamiSchirch,Kidstuff Florence,Massachusetts

“My customers are very enthusiastic about it all — from how my store looks, the name and logo, the quality, the prices, and the ‘treasures’ they find at my store. I love hearing how people appreciate my work.”

— MarKayAppel,PB&J Marietta,Georgia

“I come from a large family and buying clothing for eight children was very taxing on my parents. It just came naturally, as I spent most of my young life in hand-me-downs and secondhand clothing. As a young adult, I wanted to wear nice clothes; however, the cost was beyond my budget. So I shopped all the thrift stores, which included Salvation Army, Goodwill, and now Value Village. But the service you got at these stores was non-existent. I would find myself showing perfect strangers items I thought would look great on them. I loved pleasing people. The rest is history. I now please people on a daily basis. At my store, not only do my customers feel like family, but they all come back for their daily hug. Try getting that at Wal-Mart!”

— WandaLaing,SarahJean’sBoutique Uxbridge,Ontario

Helping the Environment

AccordingtotheEPA(www3.epa.gov/epawaste/nonhaz/municipal),eachAmericanthrowsoutaboutfourpoundsofgarbageeveryday.NewYorkCityalonethrowsoutenoughgarbageeachdaytofilltheEmpireStateBuilding.



http://www3.epa.gov/epawaste/nonhaz/municipal


Manystoreownersfinditrewardingtobeabletosavesomeonemoneyandrecycleatthesametime.Whenyouthinkofrecycling,youmaythinkofthosebrightlycoloredsquarebinsthatsitbythesideoftheroad,oryoumaythinkaboutseparatingplastic,paper,andglass,butany item that is reused rather than discarded can be considered recy-cled.

“It is a win-win for everyone. First, you are helping the community and the environment by offering a means to recycle clothing and accessories. Second, you are helping the pocketbooks of your customers by offering gently-worn quality clothing at great prices. Finally, you are helping your clients turn unwanted clothing into cash.”

— ShellyNewman,PlayItAgainMam Nashville,Tennessee

“I love being able to make a positive contribution to the community I live in, and to other organizations, some very far away. We make a lot of donations to pregnancy centers, churches, and therapy group homes for their benefac-tors, and we even sent over 1,300 pounds of clothing, shoes, and toys to an orphanage in Haiti last year. All that in addition to the fact that we have a great store!”

— MelanieWorton,AllAboutKids Lutz,Florida

Sense of Achievement

Runningyourownstorecanbeverysatisfying.Ifyouenjoycreatingsomethingfromscratchandwatchingitgrow,thenyouwilllovestart-ingoutwithasmallinventoryandwatchingitblossomasyourcus-tomerbaseincreasesandyougainmoreclientsandmoreconsignees.

“Owning a secondhand store has been wonderful for my self esteem. It is great to meet all kinds of people daily and provide a service to the commu-nity.”

— LindaNewell,SimplyLinda’s Indianola,Iowa

Be Your Own Boss

Asastoreowner,youwillbeyourownboss.Youwilldecidewhathoursyouwillworkandwhenyouwillnot.Youwillhavethefreedom




tomakecreativedecisionsanddecisionsthatwillbenefityouandyourbusinesswithoutanyoneelsetellingyouhowtodothings.Whereverthespiritmovesyou,youcanrealizeanydreamyoucanimagineandmake it a reality.

Income Potential

Asasecondhandstoreowneryouwillhavemanyavenuestogeneraterevenue.Youcanchoosetokeepyourbottomlinehealthybysalesofyourowninventoryandsalesbyconsignment.Youcandecidewhatbusiness mix works best for you. There really are no rules.

You Can Start Right Now

Asecondhandstoreisabusinessthatrequiresnospecialtraining.YoucanstartonashoestringbudgetbysellingatfleamarketsorontheInternetandthenmoveintoaretailstore.Oryoucantakeinconsign-mentsinsteadofstockingexpensiveresaleinventory.Therearemanydifferentwaysforyoutostartyourownbusinessandstartmakingmoneyrightaway.

1.3 Inside This GuideThe FabJob Guide to Become a Secondhand Store Ownerisorganizedtohelptakeyoustep-by-stepthroughthebasicsyouwillneedtoopenandop-erateyourownstore.Thechaptersareorganizedasfollows:

Chapter2(“DevelopingYourSkills”) explains how to learn the skills youwillneedasasecondhandstoreowner.Itcoverswaysoflearningfromexpertsandthroughobservation.Youwillalsodiscoverhowto“earnwhileyoulearn”bysellingsecondhandmerchandiserightawayontheInternet,atgaragesalesandfleamarkets,orbygettingajobintheresaleindustry.You’llalsofindresourcesforlearningmore.

Chapter3(“StartingYourSecondhandStore”)willhelpyoudecidewhatkindofstoreyoushouldopen.Thischapterdiscussesdifferentproducts you can sell and will help you decide whether to buy an exist-ingstore,operateafranchise,oropenanewstore.Italsoexplainswhatyouneedtogetstarted,includingyourbusinessplan,start-upfinanc-ing,storename,andotherimportantmatters.




Chapter4(“SettingUpYourStore”)offerstheinformationyouneedtoactuallysetupyourstore.Itgivesadviceonhowtochoosealocation,getmerchandisetosell,andarrangedisplays.Youwillalsodiscoverwhat equipment and supplies you will need.

Chapter5(“RunningYourStore”)takesyouintotheday-to-daychal-lengeofrunningyourstoreonceit’sopen.Itexplainshowtodevelopaproceduresmanual,andcoversinventorymanagement,financialman-agementandpricing,marketingyourbusiness,andworkingwithstaffand customers.

Chapter6(“GettingandKeepingCustomers”)describeswaystoef-fectivelymarketyoursecondhandstore—includingmarketingonline,gettingfreepublicity,andadvertising—toattractcustomers.Thenitex-plainshowtoselltothosecustomersandkeepthemcomingbacksoyour store will prosper.

You’llalsofindanexcitingBonusChapter.Chapter7offersyouanin-formativelookattheantiquesandcollectiblessegmentoftheindustry.Afterabriefintroduction,youwilllearnwheretofindantiques,andthenreadtipsonhowtobuy,ship,andcareforthem.Thischapteralsoofferstipsondevelopingaclientele,andprovidesyouwithafewsug-gestionsonotherservicesyoucanoffertohelpbuildyourcustomerbase and increase your income.

Byfollowingthestepsinthisguide,youwillbewellonyourwaytolivingyourdream—openingyourownsuccessfulconsignmentstoreor resale shop.

You have reached the end of the free sample of the FabJob Guide to Become a Secondhand Store Owner. To order and download the com-plete guide go to https://fabjob.com/program/become-secondhand-store-owner/.



https://fabjob.com/program/become-secondhand-store-owner/

https://fabjob.com/program/become-secondhand-store-owner/


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