Opening a thrift store is a rewarding venture for many budget-conscious entrepreneurs, and these businesses can flourish while others decline in tough economic situations. In the realm of retail businesses, thrift stores are relatively easy to open and generally require only minimal initial investments. With some basic business knowledge and entrepreneurial spirit, new business owners can build and launch a successful thrift store.
A Business Plan is Essential
Regardless of the type of business they are starting, entrepreneurs should always start their venture with solid business plans. Serving as a guide for building and operating the business, the plan spells out critical components like marketing, budgets and objectives for profitability. In addition, business plans contain a number of financial projections that predict when the business will become profitable and how much, if any, income the owner can take home. Finally, the business plan also serves as a guiding document to follow when times get tough, and almost all businesses experience some period of reduced income. The U.S. Small Business Administration offers entrepreneurs volumes of information on building a business plan, and the Service Corps of Retired Executives (SCORE) website makes free business-plan templates readily available. For additional consultation, entrepreneurs can also meet with a SCORE representative, free of charge, for assistance in developing an effective business plan.
Location is Key
Because thrift stores require customers to physically walk in to an establishment to browse the selection, a pleasant, safe and welcoming physical location is critical to the store's success. The location should be large enough to accommodate the store's inventory and allow future expansion, but not so large as to incur the expense of unused space. In addition, a high volume of vehicle or foot traffic is ideal, as a tremendous amount of advertising is accomplished solely through the store's visibility to passers-by. Entrepreneurs who have difficulty identifying a desirable spot may consider enlisting the services of a real estate scout or simply driving around and looking for empty high-traffic storefronts. If a store is empty, the landlord usually displays a sign with his contact information, though a property search may be required if no sign is displayed.
Basic Supplies
Once the business plan is developed and a location identified, new thrift store owners can begin purchasing basic supplies. Basic supplies, such as price tags, pricing guns, ledgers, writing instruments and stationery can usually be purchased from local office-supply stores. More thrift-store specific fixtures, like display shelves, clothing racks, hangers and even a cash register, may be found at wholesale clubs or commercial-supply companies; budget-conscious entrepreneurs, though, can also find gently used models of essential store fixtures in online sales venues like Craigslist or at local going-out-of-business sales. If the location does not have utilities such as electricity and water in service, the local utility companies will need to start these services.
Inventory
Before the store is ready to open, racks and shelves must be stocked with merchandise for customers to purchase. Generally, a thrift-store owner buys used, unwanted or over-run merchandise from local shops and private individuals, prepares the merchandise for use by a new owner and makes it available in the thrift shop. Inventory may be purchased from a number of wholesalers or even imported from overseas manufacturers, but buying practices vary from store to store. Many successful thrift store owners pick up the bulk of their inventory at yard sales or from individuals selling their unwanted stock, and some even advertise for unwanted clothes in local classified ad publications. Many thrift-store owners profess that success can only come through selling customers what they want at a low price, so thrift-store entrepreneurs must constantly browse available items to procure the best quality items at the lowest prices.
Advertising and Signage are Important
With the business set up and inventory in place, thrift-store owners are ready to welcome customers into the shop. "Grand Opening" advertisements placed in local news papers, on bulletin boards, in money-saving club newsletters and even in radio slots can help make customers aware of the new thrift store, and a flurry of advertising coupled with "new customer discounts" can help entice customers into the store. More important than advertising, however, is the signage in and around the thrift store itself; signs outside the location let passers-by know that the new store is open and can offer information on current sales. Inside the store, well-placed signage can help guide customers to preferred merchandise and make the shopping experience more pleasant. Of course, the most critical advertising for any business is word-of-mouth; if the thrift store offers customers a convenient place to find low prices and (perhaps most importantly) excellent customer service, they will help ensure the store's success.
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