Guidelines for Running a Thrift Store


Thrift stores sell used and overstock items at prices far below original retail, giving sellers a chance to make money with miscellaneous merchandise and shoppers a way to save a great deal of money. Thrift stores are especially popular during times of economic uncertainty when saving money is a priority for consumers. But opening and operating a thrift store requires you to follow many of the same guidelines as any other type of business.

Documentation and Tax Status

When you start your thrift store, you'll need to file for the appropriate documentation for your state. This usually includes getting a business license and tax identification number. If you plan to operate as a nonprofit business, you'll need to file with the IRS, indicating that your proceeds go toward a charitable or educational purpose. Until you have your paperwork in place, you'll need to wait before opening your store, hiring employees or taking in any money or donations.


When you hire employees for your thrift store, you'll need to use your employer tax identification number to fill out their tax forms. Even if you file as a nonprofit organization, you must still withhold income tax from your employees' paychecks, along with unemployment tax and Social Security withholdings. As a thrift store, you're also subject to all of the labor laws that apply to retail workers in your state. These include minimum wage laws, regulations about when to administer breaks and benefits laws for full-time employees, such as mandatory health insurance if you employ enough workers.


Acquiring inventory is an ongoing need for a thrift store, especially since you might not have steady suppliers as other retailers do. The best way to stock your store initially is with a large purchase of clothes and merchandise. Sources include other thrift stores or recently completed charity sales and online resellers. Once you have nonprofit status, you can begin accepting donations and providing receipts that allow your donors to take tax deductions based on the value of what they donate.


It will be difficult to run your store successfully unless you have an effective marketing strategy. Thrift stores are primarily about saving money, but other areas of appeal include the process of treasure hunting for collectors and the need for unique items, including old-fashioned clothing, for projects such as theatrical productions and costumes. You can call attention to all of these uses for your products in your marketing, which should target your most likely shoppers, based on age and location. If you run your store as a nonprofit, you may be able to receive discounted advertising rates or partner with other nonprofits to promote each other's services free of charge.

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