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How to Run a Successful Secondhand Store?

Table of content.1.Introduction....2,3,42.Insight and meaning of a business.4-63.Types and structure of business.7-134.Idea of a secondhand store...13-165.Things to put in place before setting up...16-186.How to structure your store.18-20?7.Where to source for goods for your store...22-25● Watch the hammer (The auction House)● Car boot sale/boot fair.● Big stores that sells new.● House clearance.● Rat sellers.8.Challenges of a secondhand store…...26-29

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How to Run a Successful Secondhand Store.

Chapter 1

Introduction.

How to run a successful second hand store.Running a second hand business is like running every other business.The term second hand means selling used products. In order to run a successful secondhand store, you will have to put few things in place. Before I start on this topic I will tell you how I started my secondhand store and running it for 5years before moving on to something else. In 2009 I started running a removal service that brought me into a profitable secondhand business.In the process of moving people’s things from point A to B as a removal business, people will ask me if I wanted an old piece

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of furniture, but I always decline until one day when a girl I moved house for ask me if I had any secondhand furniture for sell because she was moving into an unfurnished apartment. From that point I saw an opportunity in that area and decided to jump on the train of making money. Running a secondhand business is a very lucrative business if you know how to position yourself in the market. I was shocked when I saw the amount of money I was making selling what I was getting from people for free. I can remember getting a piece of suit 3+1+1 from a customer that I moved from Dublin to Waterford, I was payed €220 for the trip and sold the suite for €480 immediately I returned from that trip. At that point I new I would do better if I concentrated on the secondhand furnitures. So I decided taking things from customers who will ask me if I wanted them, or will ask them if they wanted me to get rid of a piece of furniture for them. I started storing things at my home and was selling them from home but in no time my house was full of secondhand stuffs and had no entrance, Then I decided to lunch into the

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business fully getting a place outside my home where I could trade from. I rented a garage space for storage, then moved to a bigger retail unit, that was the beginning of my new found business. I eventually progressed gradually moving from selling second hand stuffs into selling my own brand of new furniture’s.

Chapter 2

Insight and meaning of business.

The first thing that comes to mind when the word business is used is “activity” then followed by “Gain” or “profit” as some may call it. To get a proper understanding of what we are talking about, we have pulled out the meaning of business from different sources which points to the same thing in our conclusion.

What is a business?Business is an occupation, profession, or

trade.

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A business is an organization that uses

economic resources to provide goods or

services to customers in exchange for money

or other goods and services.

A business is the purchase and sale of

goods in an attempt to make a profit.

Business is when a person, partnership, or

corporation engaged in commerce,

manufacturing, or services for profit-

seeking enterprise or concern.

A business is an activity engaged in as a

means to make profit.

It is any commercial, industrial or

professional activity undertaken by an

individual or a group of people in

reference to a specific area or type of

economic activity.

It can also be an organization or

enterprising entity engaged in commercial,

industrial or professional activities’

business can be setup for the purpose of

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making profit, such as a publicly-traded

corporation, or a non-profit organization

such as an agricultural cooperative.

Types and structure of business.

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There are three major types of business divided into different minor types. 1. Merchandising business-This type of business focuses on buy n sell, this type of business deals buying in bulk/wholesale price and sells at retail price keeping the difference between

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their purchase price and the selling price.eg Supermarket, Jewry store etc.

2. Manufacturing Business-This is a business that buys product (raw materials) With the intention of making a new product to sell to the public.eg Glass manufacturing companies, poetry etc.

3. Service business-This type of business provides intangible products such has expertise, advice, professional skills to its clients.eg Haulage companies, law firms etc.

Business structure.1. Sole proprietorship-A Sole Proprietorship is one individual or married couple in business alone. Sole proprietorships are the most common form

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of business structure. This type of business is simple to form and operate.

2. Partnership-Partnerships come in two varieties: general partnerships and limited partnerships. In a general partnership, the partners manage the company and assume responsibility for the partnership's debts and other obligations. A limited partnership has both general and limited partners. The general partners own and operate the business and assume liability for the partnership, while the limited partners serve as investors only; they have no control over the company and are not subject to the same liabilities as the general partners.

3. Corporation-A corporation is a business structure that has its own separate legal personality different from its owner’s. A corporation is an independent legal entity, separate from

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its owners, and as such, it requires complying with more regulations and tax requirements.

The biggest benefit for a business owner

who decides to incorporate is the liability

protection he or she receives. A

corporation's debt is not considered that

of its owners, so if you organize your

business as a corporation, you are not

putting your personal assets at risk. A

corporation also can retain some of its

profits without the owner paying tax on

them.

4. Limited liability company-A limited company is formally recognized as a separate legal entity to run the business and is governed by company law. The liability is limited to the company; it makes shareholders liable for the amount of share capital that they have.

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This business must have a minimum of

two directors and a company secretary whom

can be a director or an outside agent like

an accountant or solicitor. The limited

company can be created from scratch or an

‘off-the-shelf’ name may be purchased from

a registration agent. The name must be

approved and registered with the Registrar

of Companies. Two documents are required to

be filed which are The Memorandum of

Association and The Articles of Association

which includes a Certificate of

Incorporation that must be filed before a

limited company can commence trading.

Cooperative-Cooperatives are independent

organization associations formed and

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democratically directed by individuals who

come together to meet common economic,

social, and cultural needs. Cooperatives

are founded on the principle of

participatory governance; co-ops are

governed by those who use their services:

their members.

Based on the principles of empowerment,

education, and community, co-ops operate

laterally promoting participation both

within their own organization, and through

a focus on community interaction, and

support.

Chapter 3.

Idea of a second hand store.

Second hand by definition means had a

previous owner. Anything that has been

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owned or used by someone before coming into

your possession is a second hand item. The

person who bought it from new is the first

hand holder why been passed onto someone

else means they are the second hand holder.

A Second hand shop/store is a place of business where the transaction of used

items is bought and sold for the purpose of

making profit. It’s a shop that sells goods

that are not new. It’s a premises where

used items are sold. The original idea here

is; every used item has a potential buyer.

Dealing in Secondhand merchandise meets a

need in the world today. Lots of people

wants to buy new things but can’t afford

it, so they turn to a second hand shop to

get it. Even the rich pocket looks for

quality and antiques in the secondhand

shop.

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Types of secondhand shop.

There are various types of second hand

shop, all specializing in a particular type

of Goods.

● Antique Shop-This is a type of second

hand shop that sells the same type of

goods of better quality or with rarity

value, charging much higher prices.

● Charity shop - This type of second hand

shop is setup to fund a specific

charity. These tend to specialize in

clothes. The quality of the clothes

donated for sale depends on the

surrounding area.

● Give away shop - everything is given

away at no cost. Some operate as swap

shops and require the customer to donate

merchandise.

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● Junk shop - sells all kinds of old

goods. The best junk shops are piled

high to encourage browsing and bargain

hunting. These shops also sell low-

quality antiques.

● Used bookstore - sells used book and

other publications.

● Furniture shop- This type of secondhand

shop sells all type of used household

and office furnitures. You will find

house hold items from the likes of sofas

to fire screens and office chairs.

● Vintage clothing shop- often a source of

good quality garments.

● Used car shop - Pre-owned cars with

variable quality and price.

Things to put in place before Trading.

Starting up any business needs time and committed effort. Before you jump into the

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idea of starting a secondhand business you need to know why you want to start the business and the type of secondhand shop you want to open. Knowing why is vital to the success of your business because it’s your reasons that will drive you to stay committed and focus on the main goal. It is easy to drift away from your goal running a secondhand shop. A secondhand business is a very lucrative business if you trade with an open mind of no barriers to what you can sell.Running a secondhand shop opened my mind to lots of things in terms of what people buy. I said it earlier and am going to say it again; “Everything as it’s buyer “what looks like junk to a person is a treasure in the eyes of another. Before you open a second hand shop and start trading you need to put all this in place-

Check list.

1. Ask yourself why.2. Do your market research.3. Choose a name for your business

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4. Examine the different business structures before you register your business.

5. Write a business plan6. Rent or buy a premises in the right location. The type of second hand business you decide to do will determine the location you choose.

7. Make a banner with the name of your shop for your premises.

8. Build or buy a website.9. Make sure you have transportation sorted. Buy a van or have someone take care of your deliveries.

Chapter 4.

How to Structure your store?

In this chapter we will be talking on how to structure a furniture second shop. I want you to know it’s possible to trade household, office furniture’s, clothes, shoes and bags in a premises.

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To start with, you should always make sure your shop is always clean and tidy, because people will only do business with you when the premises is welcoming.● Make sure you have all paintings and picture frame hanged to the wall.

● Make sure the clothes are hanged on a clothing rail.

● Make sure you have the sofa’s arranged accordingly if they come in set.

● Make sure you have sofa ramps to put chairs to create space. The ramps are very handy, or better still you can make your own ramps on the wall so some suits seats on the wall for more space.

● Make sure all books are arranged neatly in the book shelf.

● Make sure all your electronics are plugged in and working.eg if you have a television for sale, leave it on so potential buyers can see the picture quality. If you have a music player for sell, play music on it.

● Make sure all your merchandise is arranged in order.

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● Make sure every product can be seen and spotted clearly.

● Make sure you leave a wide passageway in the middle or side of the shop from the back to the front. This way will be the freeway for moving goods back and forth.

● Make sure you stick a price on every product you have in your store.

● You should make sure you write your shop policy on the wall where everybody can see and read.

Sample of shop policy.

● No refund is giving in this store.● We will only hold an item for maximum of two weeks after sale.

● Deposits are not non fundable.● Our delivery days are Monday, Wednesdays and Saturdays.

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Chapter 5.

Where to source for goods for your shop.

Sourcing for goods for your second hand store is challenging at first when you are just starting but it becomes very easy when you have mastered the business. You get lots of things for free but I will not advise you to depend on that to keep the business flourishing and making the type of profit you want to make. When buying goods or merchandize for your shop, you should always bear in mind the size and space you’re working with. Your space should and must be properly utilize. The first place you should look to buying merchandize is

● The Auction House-It is a public or private sale in which goods or property are sold to the highest bidder. A system where potential buyers place different

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bids on assets and services. The asset or service in question will sell to the party that places the highest bid. In most cases, sellers will pay a listing fee to the auctioneer, regardless of whether the item actually sells for the desired price. An auction can be online(internet) or on site (auction room). It is advice able to always visit the auction room to see the goods your intent to bid for on or before the auction.

● Car boot sale/Boot fairs- This is an outdoor sale at which people sell unwanted possessions, typically from the boots of their cars in an open space. This refers to the selling of items from a car's boots. Although a small proportion of sellers are professional traders selling goods, or indeed browsing for items to buy, most of the goods on sale are used personal possessions. Car boot sales are a way of attracting a large group of people in one place to recycle useful but unwanted domestic items that otherwise might have been thrown away.

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● Big Stores-This are stores that sells new goods.eg if you are running a furniture secondhand shop, you should register with big stores that sells new furniture. These stores get to take most of their customer’s old furniture’s when they deliver a new one. Most of this companies will give you this furniture’s for free but some will give you at a very small cost.

● House Clearance-House clearance is the form of goods sourcing that I like best. House clearance made me lots of money and it’s the most reliable way to get good prices for goods if you know how to group price goods. House clearance is the action or process of clearing or of being dispersed. A house clearance is the process of removing all of the household items from a property. House clearance can be free to you costing you nothing but will cost you moving the item to your shop. But some house clearance comes with a price, you will have to haggle with the seller on how much they want for the item in the whole house and the price you want to pay.

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Even in some cases you get paid to clear the house why you still get to keep the items. The furniture second store will make you a lot of money if you know how to position yourself.

● Rat Sellers-Rat sellers are people that goes from place to place, auction to auction to buy things with the intention to sell to a secondhand dealer. This is the list form of way any secondhand dealer should consider sourcing and buying merchandise to sell. Most rat sellers will come to you to display their product in your shop on percentage basis. If you intend to deal with rat sellers, make sure you set the price based on what you think as a dealer it's worth and not what they tell you it's worth, because at the end of the day, anything that does not sell will keep space occupied in your shop.

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Challenges of a second hand shop.

The second hand business has lots of challenges just like every other business. Most challenges business face today has to do with the smooth running of the business.1. Capital resources- “capital resources” includes any tangible type of resource, such as stores, equipment, locations, and assets related to the business. Good cash flow control is important for any secondhand business. For a growing business, it's crucial - cash constraints can be the biggest factor limiting growth and overtrading can be dangerous.

2. Customer services- “Customer services” in refers to business owners’ or employees’ efforts to build relationships with customers interacting with them, and methods to treat customers with good service.

3. Space-Depending on the size of your store, space is one of the major challenges of a second hand store. It is advisable to set minimum time an item would be held for before they are moved.

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I have seen a customer payed a deposit on an item and came back after 24months looking to collect the same item. So I advise you should have your minimum holding time written boldly on your store wall and your receipt booklet.

4. Labeling and price Tag-This is usually a challenge when it comes to two merchandize that was bought differently. It is very hard to explain to a customer the reason why you are selling a side table for $150 and the same type of side table for $30.You know the reason is because you payed more for one than the other, or you got one for free.

5. Secondhand Market view- Market research isn't something you do as a one-off when you launch your secondhand business. Business conditions change continually, so your market findings should be continuous as well. Otherwise you run the risk of making decisions based on out-of-date information, which can lead to business failure. Taking the time to talk to customers has a lot of advantages. Your suppliers and other business partners can be important

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sources of market information. You should encourage your employees to share what they know about the market.

6. Adapting to Change-Change can be a major threat to a growing secondhand store. Assuming that you will continue to be successful simply because you are in business is not a good place to stand. It is paramount to constantly revising and updating your business strategy, this can help you notice the market conditions and the need to respond to them. An up-to-date plan helps you identify what action you need to change in your store and the way you operate your business.eg

● Changing to suppliers who can grow with you and meet your priorities. As your business grows, consistent quality and reliability will be more important than simply getting the cheapest offer.

● Renegotiating contracts to take account of increased volume.

● Training and developing employees.7. The right Skills-Most secondhand dealer miss it here, they forget that learning and getting the real skill is very important as

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buying at the auction. learning to listen to - and take - advice is one of the hardest challenges. To grow your second hand business, you also need to learn to delegate properly, trusting your management team and giving up day-to-day control of every detail. It's all too easy to stifle creativity and motivation with excessive interference. As the business becomes more complex, you also need to develop your time management skills and learn to focus on what's really important.

The ideas in this book are very practical and will work perfectly, showing you how to running a very successful secondhand

store/shop.