These days, everything seems to revolve around the web – from food, lifestyle, to money matters, and what have you. There can never be a better time or opportunity to start developing a business for yourself online.
Even though retailers of the past were required to invest tens of thousands into developing a storefront and stocking their shelves with inventory, the internet has opened opportunities to even entrepreneurs with only a few hundred dollars to invest.
Note that you can sell items online with just the click of a button. Websites like EBay, Amazon and Craigslist make it easy to advertise items and they feature great management tools like shipping services, accounting and tax preparation. This is why working or starting your business at home has never been easier, and you can own a successful online thrift store in a variety of industries.
It is very important to state that the best approach to an Online business focused on selling goods is to choose a niche. These niches may be video games, books, car parts, or small appliances. But no matter which one you choose, pick one specialty and develop a working knowledge of what items sell and the ones that don’t.
We also suggest that you start small with your online thrift store business and expand as your income grows along with your knowledge of your chosen niche.
Also note that immediately you must have chosen which niche suits you best, it is time to find suppliers. You may be able to find discount or closeout suppliers for new items or you may visit local auctions and estate sales if you plan to sell antique or vintage products.
Steps to Starting a Thrift Store from Home With No Money
1. Understand the Industry
The popularity of online thrift shopping exploded in the wake of the Great Recession, bringing with it hosts of new online stores that allow people to buy and sell used clothing.
eBay was the original online thrift store, but over the past few years, reports have it that the number of thrift stores opening across the nation is on a steady growth of 7 percent and there are presently well over 25,000 registered thrift and resale stores in the whole of the united states of America.
Note that businesses in this industry sell (mostly donated) used goods, with the purpose of donating a significant portion of their proceeds to charity. We believe that the thrift stores industry is countercyclical, with industry performance negatively correlated with general macroeconomic trends, such as income levels and national employment statistics.
Reports have it that during the recession, reducing per capita disposable income levels and surging unemployment encouraged consumers to shop at thrift stores rather than other retail stores as a means of reducing their overall spending, which boosted the revenue of this industry.
Reports have also shown that in the coming years, improving domestic economic condition is believed will hurt industry revenue, and constant growth in disposable income is also believed will encourage consumers to opt to purchase new goods at big-box stores, e-retailers and other retailers, rather than spend their money on used goods sold at thrift stores.
It is very important to state that this industry has a moderate level of market share concentration, with the industry’s three largest players expected to generate about 53.4% of the overall industry revenue in 2017. Even though Goodwill, Savers and the Salvation Army control over half of industry revenue, the remaining share of industry is controlled by a large number of small operators.
Note that these businesses are usually managed to some extent through a charitable organization. But even with the prevalence of small thrift shop operations, the industry is slowly becoming more concentrated as the industry’s three largest players grow to control a larger share of the market.
2. Conduct Market Research and Feasibility Studies
- Demographics and Psychographics
Without a doubt, this business is a great business for those who enjoy interacting with people while treasure-hunting for bargains at flea markets or estate sales. Also those who have a talent for finding bargains and negotiating prices can transform that talent into a successful Thrift store business.
Note it is also a good choice for recycling enthusiasts who want to save usable items from landfills and help conserve natural resources. Community-oriented people who want to help provide necessities for low-income residents at reduced prices are also good candidates for this business.
It is also very important to note that six in ten Americans have used an online reselling site themselves, and many people now know someone else who uses online Thrift stores or who has found an awesome cheap commodity online.
People’s ideas and general public attitudes towards online shopping have become much more positive in recent years, and the advent of technology have also increased the awareness and need for individuals to buy and get their commodities delivered to their doorsteps.
3. Decide What Niche to Concentrate On
Indeed all resale shops – be it consignment stores or Thrift stores, all are stocked in two ways. Resale shops are where commodities are bought by you and then resold, while consignment shops are where you sell commodities on behalf of someone else. When the item sells, you pay the owner the agreed price less the commission you retain.
Even online shops work the same way, except that you don’t have the items; they remain in the possession of the owner.
Owners can post photos of the commodity on your website and determine a price. A customer buys the commodity and pays you. The owner delivers the item and gets paid by you. You also need to decide whether you will be a for-profit business or a charity.
Also for you to survive this business, you need to choose the type of merchandise to sell. Select something that you are interested in and knowledgeable about. Things you can choose from may include;
- Retailing used apparel
- Retailing used books
- Retailing used furniture
- Retailing used household appliances
- Retailing used merchandise
- Retailing used sporting goods
- Other used goods
Level of competition in the Industry
Even though resale shops and thrift stores are not exactly a new premise, they seem to flourish in a challenging economy. We believe that these shops can generate tremendous sales whether they are a for-profit business or a charity, if they are stocked with enough high-quality merchandise at reasonable prices.
But since these businesses do not always have a definite supplier for all their merchandise, it can take some skill and planning to find and maintain inventory.
This is why if you have skill as a buyer and a passion for the industry or for charity; consider opening your online thrift store.
Note that it doesn’t take much to open an online thrift store, just a few items for sale, and an attractive website. Running an online thrift store operation successfully is more complicated. Just because you are offering used merchandise at discounted budget prices doesn’t mean you can ignore the rules of running a profitable retail store.
Experts have said that it is easier to find stiffer competitions amongst those who are into the sale of used items that are highly affordable especially items such as clothes and shoes.
But the truth is that no matter the level of competition in this business, entrepreneurs who are running the business are still making their profits and some of them generate as high as 50 percent turnover rate especially those that have good marketing plans and ideas.
4. Know the Major Competitors in the Industry
Just as it is with other businesses, so it is with the online thrift stores. There are brands that have grown from small to big and have become a force to reckon with. They include;
- Gone tomorrow
- ASOS marketplace
- The vintage twin
We believe that all online stores attract consumers from all economic levels. There is no distinctive resale shopper, just as there is no distinctive resale shop. But the idea is that everybody irrespective of their financial status would usually look towards saving money and it could come from selling off used items or purchasing used items.
Also, individuals with low income take advantage of the opportunity resale offers to save money on apparel, furniture and other consumer items. Also the money saved from either purchasing used items or selling your used items can be diverted to other areas like paying bills, for vacations or for hosting your guest et al.
Building and sustaining an online Thrift store is just like starting any other business. It requires that you conduct your feasibility studies and market survey so as to get your economic analysis right. The economy analysis will sure help you relate well with how best to market your business, how to reach your customers and maximize profits.
Note that when conducting economic analysis for your online Thrift shop business, you have to critically examine these key factors; place, product, pricing, and promotion. Furthermore, it is advised that you review your economic analysis quarterly or annually.
5. Decide Whether to Buy a Franchise or Start from Scratch
Buying into a franchise is the best way to start up an online thrift store business. An existing online thrift Store business will have honed its operations over time. It simply means that you will inherit a business with streamlined and documented systems, making it very easy for you to learn the ins-and-outs of the business.
We also believe that existing staff often have more of a coalface perspective than the boss – they can provide valuable insight into how the business runs and areas that could be improved. In such cases, staff are likely to feel more comfortable communicating their concerns to a new boss, and may be able to suggest ways of solving some problems.
It is very important to state that another benefit of inheriting staff is that you don’t need to recruit and train staff. This will save time, money and energy that you can focus elsewhere in the business. We advise that strive to identify early on if there are any staff morale issues that need addressing, or if staff are resistant to new ownership and the changes this might bring.
Consider talking to the staff and find out if they are happy in their roles, if there is anything that would help them do their jobs better, and what concerns they might have about a new owner coming in. Being able to show staff you are interested in them and open to discussion should help ease any worries they may have, particularly if they have strong loyalty to the previous owner.
6. Know the Possible Threats and Challenges You Will Face
Note that starting an online Thrift Store Business just like any other known business has its own challenges and problems. A lot of individuals patronize these shops so you should strive to avoid any threats or rather, take care of them immediately they surface. Some of the challenges may include,
- Differentiating yourself from other online Thrift stores
- Naming your online Thrift store
- Securing the permits needed in your state to operate a service business
- Buying a platform to run your Thrift store
- Purchasing a domain name from a domain registrar
- Developing incentives for people to join your online Thrift Store
7. Choose the Most Suitable Legal Entity (LLC, C Corp, S Corp)
It is very important to state that the legal structure for your business will depend on your decision to make your thrift store a charity business or a for-profit business. But for the sake of this article, we advise that you form your online thrift store as a nonprofit 501(c)(3).
Note that this legal status is gotten by filing the necessary forms with the IRS. Note that you need to incorporate your online thrift store as a non-profit in your own state before you can apply for 501(c)(3) status. It has been proven to be very helpful, but not essential, to have a professional (an attorney or accountant) do the paperwork. There are many advantages to having non-profit status:
- People who donate goods, services, or money can claim their gift as an offset against their taxes, which may well increase how much they give.
- Starting with this non-profit status gives credibility to your organization.
- This entity gives proper separation between the charity and personal finances.
Note that immediately you complete the necessary paperwork, the legal status may take around three months to obtain. You will also be issued a three-year provisional tax-exempt status subject to fulfilling IRS requirements and submitting a Form 990 annually with the government. Form 990 details the money taken in and the money spent on behalf of the charity.
You are advised to keep good financial records because without them, your non-profit status might be withdrawn by the IRS. Also after three years, when the IRS is satisfied that you are running a legitimate non-profit venture, you will be granted a permanent 501(c)(3) status.
8. Choose a Catchy Business Name from the ideas Below
If you are yet to come up with a name for your online business, you may want to consider the following;
- Clothes for Kids Resale
- Cottage Thrift Shop
- Crayons Children Resale
- Divas online store
- World Treasures
- Vast Vintage
- Unity Thrift Centre
- Finders Keepers Thrift shop
- Vikings Store
- Lifelong Thrift Store
- Uncle Treasure Thrift Store
- New Resale
- Life Thrift Shop
- Beyond reach Closet
- Plus Size Resale
- Awesome Parlour
- Green Light
- Sand Dollars
- First Chance
- Second Image
- Online Boutique
- Simply Thrift Store
- Denim Clothes
- Sunshine Thrift Stores
- Whale circle
- Thrift Nation
- Value Village
- Thrift World
9. Discuss With an Agent to Know the Best Insurance Policies for You
As an online business, you need to understand the unique risks and challenges that web-based retailers face. In this business, you need a tailored e-commerce insurance solution built around your activities. Your goal should be to mitigate risk by making your site as safe as possible. This is because no focused entrepreneur will want to bring bad name for their business.
The internet is not a zero sum game when we are talking about theft and scams. Your client loses and you lose. A commodity gets stolen and it could all be over. Can your company withstand a multi-million dollar lawsuit? Here are some insurance policies to look into;
- Internet liability insurance
- General liability Business insurance
- Advertising agency insurance
- Creative insurance
- Copywriters insurance
- Business equipment insurance
- Business interruption insurance
- Business building insurance
- Business contents insurance
- Professional indemnity insurance
10. Protect your Intellectual Property With Trademark, Copyrights, Patents
It is very important for you to understand that intellectual property rights are a business asset, and are often the most valuable business asset. Any business presently trading or considering trading on the internet needs to check what intellectual property rights it owns and ensure that it is fully protected. Note that a lot of ideas can be protected in different ways, depending on how they are expressed.
Also have it in mind that this intellectual output and the protection of it is known as intellectual property. It is a collective term for different types of asset including copyright, trademarks, patents, design rights and others. These assets are intangible but can be very valuable since they enjoy legal protection.
Indeed there will be a number of intellectual property rights which exist in your website. Any logos or branding are likely to be protected by registered trade mark rights or the law of passing off. There will also be database rights in any database underlying your website.
However, most of your website, including the text, design, graphics, data, website layout and any music, broadcasts, software and images on your website, will be protected by copyright. In other to protect your intellectual property in the online thrift store business you need to do the following
- Make use Duplicate Content Detection and Monitoring Tools
- Create preventive methods
- Take Action after Finding a Plagiarist
11. Get the Necessary Legal Documents You Need to Operate
Note that the legal documents needed to run your online thrift store business are perhaps the basic legal requirements needed to run any business in the United States of America simply because of the nature of the business. Documents play an essential role in protecting the interests of the business and business owners over the course of a company’s lifetime.
- Social Security number
- Tax identification number
- Employer’s identification number
- Non-disclosure agreement
12. Raise the Needed Startup Capital
Note that one amazing thing about businesses like this one is that you can start the business without any startup capital (money). You only need to get used goods from family members; friends and neighbours with the agreement of helping them sell it and pay them the agreed amount while you make your own cut.
But you still will be needing funds in this to launch a standard website, and trust me it can be challenging raising capital to launch a business idea. Your idea must be workable and promising for you to be able to secure finance from financial institutions or from angel investors. Ways to get funding may include;
- Personal savings
- Business loans
- Social investment
- Credit cards
13. Choose a Suitable Location for your Business
It is very important for you to note that in case your online thrift business requires a storefront, choose an attractive location in your city’s business district. Choose tasteful, conservative furnishings; hire friendly and engaging staff members who can set new online clients at ease.
But most times you really won’t need a business location but a storage facility. Locate one big enough for a considerable inventory and with a staging area in the back room in which to get merchandise priced and ready for resale. Placing your shop in an area with considerable traffic will help generate customers.
14. Hire Employees for your Technical and Manpower Needs
Indeed one of the very attractive aspects of a being an online entrepreneur is that your daily activities will differ and do not need to be conducted in any particular order. But still a typical day often involves a great degree of research about what you intend to sell, including how other sellers describe the product, how much they charge for it, and how much it will cost to ship it.
Have it mind that this research aids you to creatively describe and competitively price your products in order to stand out from the competition.
Other daily activities include verifying payments that have been completed, answering seller questions, and shipping products within the specified time frame of your listing. Also note that it is important to maintain a steady stock of things to sell.
Among the best skills to help someone build their online thrift store, what you will need will include marketing skills. This is because everything from choosing a sensible website name to writing evocative descriptions of products being sold involves the same skills that go into traditional advertising and marketing.
Also having a descriptive familiarity with PayPal (particularly familiarity with having a business account) can help you to understand how to receive and process payments via the most popular online payment method.
We also believe that an experience in advertising your services via social media as well as more traditional methods (such as sending newsletters to previous buyers) can help make sure that you have a steady stream of both new and returning business.
A lot of entrepreneurs in this business operate on their own. This is because a lot of them operate from their own homes and conduct business entirely on their own means that there is no requirement to split profits. But to be sincere, finding a partner or building a team of sellers is contingent on you conducting more business than you can reasonably conduct on your own.
While it is much more common to simply find a partner and both of you operate under the same banner, it is possible to build a team in which members specialize in certain roles, such as procuring new items to sell, writing promotional copy, or shipping items to customers.
The Service Delivery Process of the Business
Indeed a thrift store is the key place to find vintage treasures in a sea of outdated denim skirts and Talbot blazers—but as certain vintage styles become rarer, it is important to thrift as often as possible to compile a significant inventory. Note that thrift shops aren’t the only place to find sellable goods. This is why it is important to approximate when each item in your shop was made.
Also even though photos should always show your products as clearly as possible, you also have some freedom to experiment with how you photograph. A lot of shops always show their items on models, pinning the clothes where necessary to show how the product looks like when worn by a real person.
Few shops also use mannequins to make it easier for potential customers to see the items on themselves, rather than a model. But whether you choose model or mannequin, steer clear of simply throwing clothes on a hanger and snapping a photo, unless the piece of clothing is something that doesn’t need to show its shape, like a t-shirt or sweater.
It is also important to state that even though online shops may get away with listing sizes as small, medium, and large, but there are no standardized sizes when it comes to some commodities. You need to break out the meter stick to get the exact measurements of each garment or the commodity. Lay each article flat and take the key measurements.
For a dress, this usually means bust, natural waist, hips, length, shoulders, and sleeve length. If a measurement is debatable, it is safest to underestimate, but always record the most precise sizes possible, taking more measurements if necessary.
Also when listing products, type out each measurements and feel free to give an approximation of what it will look like or suit to your target audience.
15. Write a Marketing Plan Packed With ideas & Strategies
Some of the marketing of your online thrift store begins with your listings. For example, the header of each listing should include things like the colours, logo, and branding of your store. Item descriptions should include links to your store’s home page as well as to different categories within your store, meaning that everyone who stumbles onto one of your listings is just a click away from your entire online store.
Note that you can also develop a robust description of your business within your profile and link it to your store when engaging in discussions on any online store discussion boards.
You also need to ensure to include your store name, address, and logo in communication with buyers and other interested parties, and don’t forget to use Search Engine Optimization so that people searching the internet for something particular will find your store. Other things to keep in mind may include;
- The niche is the money
- The mighty authority rules
- Brand yourself
- Get people to your site
- Be creative with your marketing efforts
16. Develop an Iron-clad Competitive Strategies to Help You Win
Note that business is like a game of chess and every move counts and to beat the competition you will require everyone’s collective effort. It is not just a task for the marketing department or top management; it is everyone’s responsibility.
As the leader of your business, it is very important you enlist the support of the whole organization once you have agreed on the strategies to adopt in dealing with your competitions.
- Define your brand and make your site inspiring
- Choose a competitive advantage
- Excite your customers
- Offer something off the board
17. Brainstorm Possible Ways to Retain Clients & Customers
In this business, the best way to attract customers is by using the marketing techniques mentioned above; basically, it is a matter of conscious branding, meticulous communication, and deliberate Search Engine Optimization. You should understand that retaining customers primarily involves a combination of honest descriptions, fair pricing, and open communication.
Even veteran online store business owners are wary of running into instances of scams and fraud, so presenting yourself as an honest and fair seller can help set you apart among the competition. Other things to consider may include;
- Wow your customers
- Follow them up
- Provide some personalization
- Choose the right tools
- Make it simple
- Protect their ideas and interest
18. Develop Strategies to Boost Brand Awareness and Create a Corporate Identity
Generally, the online shopping industry is a highly competitive one, and while running a web-based venture can be extremely lucrative, it requires a lot of hard work and a helping hand to ensure profitability. Effective item descriptions and relentless marketing help make sure that buyers are attracted to your store while honest communication and quick shipping makes sure that they trust your services and return to your store always.
We strongly advise that you maintain marketing efforts within and without your online store, including newsletter, social media advertising, and even networking within online bulletin boards and forums that are interested in any niche products that you sell.
Also we advice that you be diligent in how you set prices so you can continue to straddle the fine line between offering customers a solid deal and making yourself a solid profit. Other things to consider may include;
- Social media marketing
- Efficient Web hosting
- Astonishing website
- Improved Search engine optimisation (SEO)
- Affiliate marketing
- Keeping your site safe