How to Open a Consignment Store

You do not need to have a business background or retail experience to open a consignment store. What you do need is ambition, the right location, quality merchandise and a helpful personality, along with some advice from someone who’s already done it.

Instructions

Difficulty: Moderate

Things You’ll Need:

• Storefront
• Display racks
• Cash register
• Hangers
• Inventory
• Tax ID number
• Business license (depends on your city/county codes)
• 3-ring binder to keep contracts
• Consigner contracts

1. Before you open your doors, there is a small amount of legwork. You need to have a tax ID number (which you can get at your local tax office or apply online), potentially a business license (depending on your city, county and state laws) and you need a storefront.
2. You also need to determine what kind of merchandise you will consign. Will it be high-end, low-end, baby, adult, clothing only, toys, furniture or big machinery? Once you know what you will resell, you can choose your location.
3. Children's consignment store Collect enough inventory prior to your grand opening that you can get the store going without consigners. Go to auctions for the retail equipment, like hangers, cash register, display racks, phones, and more. I even got my credit card swiper system at an auction. Search through other resale stores, garage sales and on-line auction sites for inexpensive items. You will also be able to use your tax ID number to purchase at wholesale prices.
4. Target your buyers and market directly to them. If you will consign children’s items, attend playgroups as a guest speaker, flyer cars at safety fairs and talk to caregivers at the local parks. If you’ll be consigning antiques, attend auctions and pass out your business card. Do this before you open the store and then do it bi-monthly after. It’s inexpensive and you’ll see great results.
5. Have your consigner contracts ready to go the first day you are open. These should explain the process, the percentage of pay the consigner will receive, how and when you will pay them and any other information that is store specific. It should also have a space for their contact information and signature. You will retain the original and give the consigner a copy. This will avoid any confusion or bickering after a sale.
6. Set your space up for convenience. Think of your customers, and design for them. If you’re a children’s store, make sure there is enough room for strollers and consider putting in a play area.
7. Send a press release to the regional papers a week before you open, use word-of-mouth, rely on everyone you know to spread the word and at least stop in for a visit on the first day. Chances are, you’ll be consigning the minute your doors open.

Tips & Warnings

• Do not price items too high. It’s much easier to sell ten $.50-cent items than one $5.00 item.
• Decide if you are going to haggle on prices or if you are firm. What you do for one customer is what you’ll need to do for all.
• Be prepared to put in a lot of hours. You’ll need to be open the times your customers can shop. This probably means days, nights and weekends. Check around with other resale stores to see their open hours.
• Attend specialty fairs in your region. You can find great items and future consigners.
• Make sure you have a sales tracking system. You can assign each consigner a number and put it on the price tag. You can color code tags, use names, initials. Be sure to keep it fairly simple and organized. You must be accountable and accurate.