Thinking about opening a resale, second hand, and used merchandise stores business? We tell you what you need to know to get started.
Resale Retail Industry Overview
Resale and consignment shops deal in second hand and used merchandise. But there's nothing second hand about the resale industry itself -- with more than 30,000 resale and consignment shops located throughout the nation, this is a multi-billion dollar industry with loads of growth potential for startup professionals.
From the outset, you need to resist the temptation to treat your resale startup like an overgrown yard sale. As a serious entrepreneur, you can't just put junk on the shelves and hope someone will make an offer. Instead, you need to meticulously strategize everything from merchandise acquisitions to pricing.
Stocking the Shelves of a Resale Startup
Retail mechanics aren't the biggest obstacle you'll face in launching a resale operation. By far, the deadliest mistake you can make is to open your doors before you have adequate inventory on the shelves. During the first few weeks and months, shoppers will make judgments about your store based on your selection. Consequently, poor quality merchandise and low inventory levels can sink your startup before it gets off the ground.
To find high quality merchandise for your startup, you'll need to spend several months visiting estate sales, buying abandoned storage lockers and soliciting consignment goods from local sellers. Be on the lookout for fast-moving inventory categories like furniture, kids clothing, kids sports gear, etc.
Each piece of merchandise you buy needs to be evaluated for quality and priced for buyers in your market. As your business takes shape, consider specializing in a niche market category to give your business greater depth and influence in the resale consumer marketplace.
Getting the Word Out About Your New Resale & Consignment Store
Without customers, a resale or consignment startup is little more than a modern museum. To bring customers to your store, you'll need to design and execute a marketing strategy that leverages both online and traditional marketing tactics.
Exterior store signage is an obvious promotional tool, but signage may be limited according to the terms of your lease or municipal zoning codes. Similarly, ads in the local paper will reach a limited number of people in your target market.
A good business website and other online marketing channels, on the other hand, have the potential to reach a broad cross-section of local shoppers. With more than a third of Americans currently using Facebook, pay-per-click or pay-per-impression ads on social media sites have the potential to promote your store to a targeted local audience.
Essential Features of Business Plans for Resale, Second Hand, & Used Merchandise Stores Businesses
Ask a dozen people how to write an effective business plan and you'll get a dozen different answers. But despite the diversity of approaches, there are some business plan features that are absolutely essential.
If your plan lacks required elements like an executive summary or marketing plan, it could jeopardize its potential to deliver real benefits to your startup.
But in today's business environment, it's also important to discuss the external factors your resale, second hand, and used merchandise stores business is facing. As a rule, we recommend including a PEST (Political, Economic, Social & Technological) analysis in your business plan as a way of addressing potential threats and opportunities at the macro level.
Sizing the Market
Given the fact that your resale, second hand, and used merchandise stores business will be largely focused on local customers, it's important to carefully define your local territory. Unfortunately, we meet resale, second hand, and used merchandise stores businesses that are losing money in large part because the owner did not know how to identify and sell to a local market. Avoid that mistake by doing full due diligence on local market demographics.
Take a Look at the Competition
Well in advance of opening a resale, second hand, and used merchandise stores business within your community, it's a smart move to determine how strong the competition is. Try our link below to generate a list of competitors near you. After clicking on the link, type in your city, state and zip code to get a list of resale, second hand, and used merchandise stores businesses near you.
How are you going to successfully complete with existing firms? It's important that you never underestimate the competition.
Find Good Remote Business Advice
After you've evaluated your local competitors, the next step is to speak with somebody who is already in the business. If you think owners of nearby resale, second hand, and used merchandise stores businesses will give you advice, think again. What's in it for them?
However, a fellow entrepreneur who has started a resale, second hand, and used merchandise stores business outside of your community may be willing to share their entrepreneurial wisdom with you, after they realize you reside far away from them and won't be stealing their local customers. In that case, the business owner may be more than happy to discuss the industry with you. It can take a while to find an entrepreneur who is willing to talk, but it's well worth the effort.
How does one go about finding an entrepreneur who is running a resale, second hand, and used merchandise stores business in a different locale who can assist you?
Easy. Find them using our link below and start calling until you are successful.
Advice for Acquiring a Resale, Second Hand, & Used Merchandise Stores Business
Many entrepreneurs elect to acquire a profitable resale, second hand, and used merchandise stores business instead of navigating the challenges of a business startup.
Yet for many entrepreneurs, financing represents a major hurdle to buying a resale, second hand, and used merchandise stores business. The good news is that it's easier to finance an existing company than it is to finance a startup business. However, there is still some distance that needs to be traveled before you can secure enough funding to put your name on the letterhead.
Our Business Acquisition Financing Tips have the information you need to successfully navigate the challenges of financing your new business.
Your odds of being a successful business owner are higher if you go the franchising route and leverage their successful brand and track record.
If you are thinking about opening a resale, second hand, and used merchandise stores business, a smart move is to check out whether purchasing a franchise might be the right move for you.
The link below gives you access to our franchise directory so you can see if there's a franchise opportunity for you. You might even find something that points you in a completely different direction.
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