Advice for your consignment, resale or thrift shop is as close as your computer: Just Ask Auntie Kate!
Update June 2016: There are now about 700 comments on this page, and while they are completely fascinating, it can be difficult to find your specific issue. For more guidance see our Products for the Professional Resaler, covering over 30 areas of resale shopkeeping.
Also, check out the articles at Too Good to be Threw in our Back Room. They might have the info you’re looking for.
In the tradition of Dear Abby and Ask Ann Landers, we present Ask Auntie Kate. Well, actually, it’s Ask Auntie Kate and her resale industry buddies, because I expect you… yes you, Dear Reader… to chime in with your thoughts, experiences and perspectives. Don’t be shy. People ask questions because they want answers.
To keep questions and responses together, you need to be sure to hit “reply” when you’re reading the post that you want to, well, reply to. Otherwise everything gets all mish mashy and tops hang off their hangers and placemats are stuck in with the pillow cases and tags get lost and it looks like a mess.
Yes, Auntie Kate will reply to your most vexing problems, most heart-felt concerns, your secret shames and undiscovered desires. After she gives her friends a chance to put in their 1o-cents’-worth. So ask, answer, or opinionate away.
Auntie Kate The Resale Expert 
you know what I miss? back in the old days on your old site you had a page where the shop owners could go and talk to each other about things, it was great reading what everyone was going though that you were
Hey, Elwanda, thanks for remembering my Sharing Board. When Facebook got more mainstream, everyone wanted to be over there. There’s a good FB group for NARTS members; try that one!
I have a dream of opening a consignment/thrift store much like one that is about 2 hours from me. Ever since I went there, the thought has been with me. I would love to talk to the owner of the store to get any insights from her, but do you think that would be offensive or wrong of me to do? I think 2 hours is a fair distance for us to be apart without taking business from her? It’s a huge leap for me and my family and I just want a piece of mind from someone local who has made it.
Hi Joni, In most parts of the country, 2 hours travel time means that you would not be operating in the same market area. I don’t think the owner would be offended to be asked, but do realize that if she will talk to you, she would be well within her rights to ask for a consultation fee.
Before you approach her, though, I would advise that you spend time educating yourself, so that your questions are well-formed and relevant. Fortunately, you can “pre-teach” yourself online, with the many resources you’ll find at our New Here? page.
Best wishes! Be sure to come back and tell us how it’s going!
hi im on the verge of stating a biker apparel consignment/resale business. at first being onlne and going to rallies. anyone have any info on this type of consignment? and attracting cosigns info is greatly needed!
thanks
tobyann
I am in my second year of owning a children’s consignment store. We struggle at the end of each season. We have a lot of consignors that want their items back. Any suggestions on making this an easier process? For example: we have consignors that bring in there children while trying to pull clothes which makes it so they can’t find everything or the children are having a free for all so we step in and help pull the items which pulls us off of tasks that could be making us money. Any suggestions would greatly be appreciated. Thank you.
Hi Rita, It sounds like your business would be well-served by staffers pulling unsolds for consignors. The hub-bub, the “I can’t find X; it must have been stolen” comments, and the dis-ease of shoppers trying to shop amidst all that is costing you a LOT more money than having a staffer pull unsolds upon receiving a phone call from those consignors.
Of course the ultimate goal is not to pull at all, which means selling it all. It could also involve dissuading consignors from requesting returns. How about thinking of ways to have fewer unsolds to pull?
Here’s hoping that you have used TGtbT The Manual to guide your business. If not, maybe it will help you re-examine areas of operation that are not going as smoothly and as profitably as you dream it could be.
Kate,
A complete bare bones setup, and penny pinching to the extreme. What do you think it would cost to setup a small retail location?
Sarah, thanks for asking. That’s a REALLY hard Q to A!
Best advice I can give you?
Add up what things cost where you are. That would start with rent, utility deposits, signage, fixturing/ equipment.
Then add in at least 6 months of overhead: rent, utility usage, advertising.
And at least 6 months of whatever you need to exist personally.
That total is the bare minimum you need to have readily available to use, and readily available to lose, as well… because, of course, starting any business is a gamble.
(As you can see, I can’t give you actual figures. Rent depends on market value, what size, location… fixturing depends on what you’re looking to sell: bikes or boots? for example. Overhead and personal expenses are completely up to the individual.)
Shortest advice I can give you?
Buy my manual. That’ll cost less than $100 and save you way more than $1000 just during set up… not to mention how much it’ll make you once you open! It’ll also cut the “gamble” factor into shreds, because you’ll have the experience of my success guiding you. I started with the equivalent of less than $4000 and thrived from Day One.
Of course some days were wonderful, and some not so… but I always, always made more than enough to feel like I was a success.
Hope that helps! Remember, though: the #1 cause of ALL business failures is not having enough capital to get established. The #2 cause is, not learning what you need to know, every day.
Kate,
What do you think is more important, visibility or foot traffic? I have a resale store in Austin and we need to move because the lease is up and rent went sky high. It is so expensive here, and I don’t want to work just to pay rent….
The spaces with great visibility from the road has very little foot traffic, and the spaces with great foot traffic are hidden.
Thanks!
Good question, clee210! Thing is, what do you want: visibility, foot traffic, or buying customers inside your shop?
That was a trick question LOL
There’s an old retail maxim that I think holds true even in 2015: you can pay it in rent (that is, a prime location) or you can pay it in advertising (that is, what you save in rent by being in a less than prime location, you have to spend in advertising). With our want-it-now mentality, though… I’d spend it on the perfect location before trying to attract attention in an ever-more-fragmented media world.
The thing about traffic/ visibility is: how EASY is it to make the leap, in a potential customer’s mind, from “Oh yeh, I see that place all the time; someday I should go in and see what they have” to “I’m here, I’m already parked, I just had a nice lunch/ bought a cute lamp/ am strolling with my besties… oh look, what’s this fascinating-looking shop?” while avoiding “Golly, they’re right there but I have groceries in the car/ tired kids/ they’re not open right now.”
Point in fact: there are 3 new consignment shops in my town. Problem is, they’re on the “wrong” side of the street… on my right (easy turn in) when I am headed downtown for a meeting… on the left (impossible through traffic) when I’m leaving the meeting and have time to stop in.
More on location, of course, in the Manual.
Which consignment software do you recommend?
Thanks Sue for following Auntie Kate’s blog! Please see my thoughts on this subject on our TGtbT.com Links Page… and read my thoughts on choosing software in the manual.
Hi Kate and followers,
I am in the beginning stages of starting a consignment business and am looking at retail spaces for lease. I found one that I am interested in that is being leased out by a private individual owner, rather than a broker or business management company. Do you have any reservations about going this route? Would you suggest using my own broker/attorney to negotiate lease?
Thanks!
Julie
Hi Julie, I personally think it’s to your advantage to deal directly with the owner of a property rather than a management company… just like shopping locally, having connection to the “boss” is better than trying to deal with a corporate structure.
And yes, OF COURSE you need an attorney versed in business leasing to at least look over your contract/ agreement for you, although “negotiating” should probably be done directly by you to start with. Think of the dollars your lease will be committing you to spending, and you’ll realize that you need someone looking out for your best interests before agreeing to anything. Herr’s to finding the space you want on the terms you want!
Hi Kate,
I am considering opening a consignment shop for furniture and curios. My fear is that I live in a city with many consignment shops of that nature. The area where I would open is about 20-30 minutes away from the closest one, but I don’t want to step on any toes. There is one resale clothing store in my area, but we wouldn’t compete since she doesn’t do furniture. Do you recommend contacting other area stores beforehand? I want to be on good terms without taking business away from them while still being successful. Ideas?
Hi Rebecca, Yes, it would be polite and probably to your advantage to contact existing stores beforehand… but it all depends on what you mean by “contact” and what you mean by “beforehand”. Consider how your means/ message of contact will be taken, and how much beforehand…
Also, be sure that you thoroughly understand how the shops dealing with your planned merchandise mix work and mull over why someone might choose your business to deal with rather than one of the existing shops. What can YOU do that will have folks coming to YOU to supply and/or shop?
And think, too, of why your target area doesn’t have a shop already… is there something to know about your area that you are overlooking, or has the area simply been overlooked?
And best wishes on your new business!
Hi Kate,
I have been running a children’s resale shop in a small town for 12+ years. I recently moved to a larger location. I love my customers both buyers and sellers, and many give me great word of mouth advertising. I have a Facebook page which I use to promote new items etc. I have noticed with Facebook though that there are some of my previous customer now selling on their own on various rummage sale sites that have been created. When I first noticed this happening, I had some serious reservations about how I would compete with this because I already had my moving plans in the works. What bothers me is the customers want my store to be the end all be all and have all the inventory that they could possibly want, but now a lot are selling on their own. I am looking for advise. I keep pressing on, but I am getting frustrated and down about it.
Hi Jane, I know it’s easy to feel left out of transactions, and of course customers shopping and selling elsewhere means these transactions are threatening your livelihood.
My question to you is: what are you doing about it? Have you talked in your blog about stranger-danger selling to unknown folks? Have you written about the extravagant use of time and gas used when attempting to keep your family in clothes and equipment? How about the very real possibilities that the items you may be buying from individuals have been recalled, and you’d not know it?
All of these issues, of course, you’d “solve” by including the WIIFM. For example, “MyShop keeps up-to-date with consumer safety issues, so you never have to worry about taking home something that could cause harm to your children.”
Some FB swap groups allow businesses to join. If that’s the case, by all means join, and very gently, often, promote your shop. E.g.”Shop MyShop, where you have so many styles and sizes to choose from every day, 7 days a week” or “Just in, 2 more strollers. That makes 10 today for you to choose from!”
If you’re concerned that you aren’t getting the best incoming, similar messages would be “Worried about how to price?” “Tired of answering e-mails?” “Did they make an appointment and never showed” etc, again with the WIIFM: “At MyShop, we do the pricing, presenting, marketing and waiting FOR you!”
Hope that helps, Jane!
Hi Kate,
My name is Carrie Lance I have owned a resale business for little over 2 yrs now in a small community. The winter time is very, very slow. The locals do not support local business’ much as this is more of a retirement based community. My main shoppers are tourists and e-bay sales have gotten me through the winter months so far. I have everything from women’s, men’s, children’s,, junior’s, name brand clothing; formal wear to hand bags, jewelry and home decor’. Some of my items are new and some consigned. My struggle right now is trying to get the locals in to shop due to the fact of they do not understand the concept of name brand shopping because this is the type of town that the families never leave from home or barely go on vacation. The only shopping they know is Walmart, Kmart, Dollar General, Cato and Belk. We have Goodwill, Habitat for Humanity (Safe) and a Thrift store in town. The locals are use to those shops with sales very cheap. My main reason of opening a shop was to not only fulfill my dream but, to help the community by giving them (teens) and parents a place to come to buy at a fraction of price gently used name brand clothing. Also, they can consign and make some extra money with the economy the way it is and make some extra gas money or grocery money. Teens in this small town have it hard a lot of times as some parents do not take them shopping and so some do not get to wear new/name brand clothes at the beginning of school year,etc. so that is why I opened too. It really is so heart breaking to have lived here all my life and most of my family members live here and the small town thing is if someone else is doing something better or greater then them they do not support you. But, if they see you struggle or not making it (negativity) they just love it. Then, they are right there to see you fail. If you know what I mean. I have had to ask my landlord to lower my rent for winter months just to make it. The stress is by far getting out of hand. I have prayed and prayed just as I do about everything. So, here I am on your site!!!! I feel that “everything in life happens for a reason” I do not know what to do from here and think I should just close my store. What is your true opinion and any suggestions. I have a face book page “Deja, Vu’ All Over Again, LLC.” Sorry for all the run on sentences, etc. I am at shop now and I run shop by myself. My daughter who is a full-time college student helps me part-time when she is able. (No overhead) another thing is about 95% of my consignors are a 90day contract deal and after that they forfeit to store. The other % is 60day with yearly consignor fee and must pick-up within 5days of consignment period is up. Sorry for the book. Very concerned and worried shop owner. Please help me if you can!! Thank you, Carrie Lance
Carrie, Winter can be the pits in most marketplaces, can’t it? The GOOD thing about slow times is that they give you some breathing space to figure out where and when you can brush up on your shopkeeping skills.
So what I’d suggest to you is:
Brainstorm how to get more customers in, more often, and buying more. There are a jillion ways, some almost free and some way too costly. Write down every way you can think of, then choose those which seem like the most suited for your clientele and work on developing them.
For example, you’re all over the map… you say retirees don’t shop, then you talk about focusing on teens. You mention eBay selling but there’s no indication on your FB or web site that would lead people there.
I personally believe that with mass media, the savvy consumer in a small town, even though she has to shop at Walmart or Dollar General, KNOWS her brands and WANTS them, but until they understand you HAVE them at prices they’d be thrilled with, will continue buying discount stuff. Perhaps you might focus your FB on that?
Your retirees, if you carry what they want, will be a loyal base… they love to shop. Heck, I even had them volunteering in my shop, dusting shoes, just to have something to do! What can you do to attract them?
Maybe those few ideas, and reading everything on all my sites, will keep you fueled and energized through February.
Chin up, things will get better!
I own a small resale shop. Been in business for 8 years. I do not consign, I buy outright. I always struggle during the winter months. I was wondering the pro’s and con’s to converting my store to consignment. I will loose some of my sellers, I’m sure, but maybe this is something I should consider in order to have a better cash flow and possibly even earn a better salary. I would appreciate your assistance.
Hi Carmen, changing how you obtain your merchandise won’t have much of an affect on the slow winter months… after all, it’s basically buyers who aren’t around then, right?
But as to your Q re pro’s & cons of consignment/ BOR:
Consignment pro’s:
If it doesn’t sell, you haven’t forked out cash for it.
If it DOES sell but at a MD, you and the consignor share the reduction in price.
If a staffer accepts something on consignment with a problem (from spots to style), you can simply contact the consignor to pick it up/ allow you to donate.
Consignment cons:
You will always pay whatever %age you have set in your agreement to your consignor.
Interaction between shop and consignor is more time-consuming.
You may not succeed in having consignors bring in items at the right time of season.
BOR (buy outright) Pro’s:
You can pay what the seller wants, and mark up as you see fit… 10%, 100%, 1000%, depending on what you have learned about your customers.
You can market goods as you see fit… put it on the sales floor when you want, take it off when you want, MD it as you deem necessary.
BOR cons:
Hard to train a helper to spend YOUR money as you would when they’re purchasing in your place.
You have to lay out cash before you can make cash.
Earning a better salary depends, of course, on a better profit margin. If you have been BOR-ing for 8 years, you know what your final profit margin is, after damages, shrinkage, markdowns. How does that figure compare with paying 50 or 40%, or whatever you decide, to consignors… and paying zero on items which do not sell?
You might consider a hybrid: continue buying the things you know are sure sellers, and consign those items you are doubtful of or which you can’t pay “enough” for: eveningwear, furs, designer items, for example. Let us know what you decide and how it goes!
I have been in business for 13 years, I have come to a point which people are dropping off everything (garage sale, dirty, unwashed, wrong season). We approximately sort 80,000 items to get 20,000 good ones. I just sent a letter to all consignors stating we will no longer be going through drop offs with non-washed items. My question is, we get so backlogged with the drop offs, that our hanging & computer input gets 4-6 weeks out!! I need advise to stream line the system! HELP!
Diana, I am concerned that with 13 years in the biz, people don’t treat your Drop-&-Run privilege with more respect! Could it be that your parameters for D&R need to be adjusted? If you have my Drop-&-Run Kit, and/or TGtbT the Manual, you’ll recall that there must be parameters. These are the ones I suggest:
* The privilege of being able to drop consignments off is limited to established consignors (that is, those who know and understand what you can sell)
* Not everyone CAN utilize D&R: for example, those who bring in so many NTYs, don’t bother to wash them, etc. D&R privileges must be granted; D&R is not for just anyone.
* Some shops insist that all D&Rs must be “donate”… I don’t care for that, but I do suggest that if a D&Rer wants NTYs back, they must be picked up the next day. Period.
* Re your backlog: that’s not the fault of the D&R system, that’s a personnel (enough? efficient enough?) and perhaps time/space problem (CAN you be efficient in the time and space allotted?)
Taking time going through batches of unacceptable items is for sure a waste of time… perhaps you’ll need to set guidelines for staff that if there aren’t 80% acceptables in the first 5 items (that’s 4 out of the 5), the entire D&R gets donated or refused without further waste of time.
Hope that helps!
Hi Kate,
Thanks for all your online advice! The holiday season is here and many retail cashiers tell me they are required to ask a customer “would you like to round up to xdollars for xcharity”. Some of our non-profit fundraiser thrift sale team suggested we do this at each sale. It is more money, sure, but many of our customers already throw in an extra dollar or two and it makes them feel so generous, and as a cashier I detest asking people to round up. I think it’s rude even though it generates revenue. What is your opinion or experience? Thanks!
Ali, “rounding up” should be asked for on a selective basis… I believe in choosing when to ask. There are purchasers you can tell are a bit strapped; then there are those who would be delighted to round up to a higher level than you imagine (I had one gentleman round up his $30-some purchase to $50!)
I like stating not only the amount I’m asking for but WHY. “Would you like to round that up to $14, thereby donating 49 cents to women who need help changing careers?”
If you think it’s rude, you might try that approach. And remember, it’s not JUST about the 49 cents; it’s also about verbally making the public aware of your NFP’s mission. That aspect alone is worth developing a short spiel about! (I ALWAYS make a point of “Thanks for helping Women’s Resource Center help our community” with every sale or even every visit in!)
Thank you for your response. It is a good reminder to be aware of our last comments at the end of the sale. We will talk more about rounding up, thanks again for your advice.
Kate,
Wondering if you ever do one or one consultation? Thank you.
Hi Lisa, I sure do… I ADORE being able to work with people one on one. Phone/ email consults are $100/ hour, minimum 2 hours, and can be used in segments of 15 minutes or more over 6 months. We also offer a day’s consultation in Sarasota at $800, or on-site consults. Thanks for asking!
Hello Kate,
I am wondering if a visit to our store would make the most sense to get a real idea of what is going on? Not sure how to and where to put the money for improvements. Been in business for 1 year and going into our 2nd winter.
How would I get in touch with you? Thank you.
Hi Lisa, There’s an email link to me at the bottom of all our pages on our web site at TGtbT.com. I look forward to hearing all about your business!
Hi Kate,
I’m a newbie to the consignment industry and would love to get advices from you and other store owners.
1) What’s the best way to tag items so you can easily pull them once they’re expired?
2) Do you allow consignors to use store credits for new store merchandise?
Thanks.
Welcome Jane! There’s a LOT to your first question… I could write a book (oh wait, I did 🙂 ) And as to Q#2, sure, why not, if you have a sufficient profit margin on these goods!
I have a question and I have searched a bit for an answer but can’t find just the right one.
Here goes: I am a recentlly hired Manager for a faith-based resale shop. It is my feeling that all of the workers (volunteer and paid, mixed)should, as a point of safety, wear closed-toe shoes. I have asked this of my (paid) assistant manager but been told that due to here bunions etc. it might not be possible for her. I know it is safer to wear rubber soled, closed toe shoes but is there a regulation that can back me up? Is there an out for her based on some kind of medical issue. I don’t want to handle this insensitively but I want to do what is best. It sounds a little silly now that I’ve typed it out but I’m curious about your opinions.
Thanks!
Aprille
Check your state’s safety rules, and if course OSHA as well. The corporation’s insurance policy might also have some input into this issue, vis-a-vis exposure to workers compensation liability.
In our area it just went from $8. to $9. If they raise it to $15. there are some people who will be laid off. I can’t raise my prices high enough to compensate.
Are they raising it to $15 tomorrow? What have you done to absorb the cost of $1/ hour more (plus the allied insurance etc costs)? And what more can/will you do, gradually, so that the $15 rate will be workable by the time that arrives?
One of the things I would personally work on is making sure that I am NOT paying wages for non-productive aspects of the business. In other words, make darn sure that my staffers are worth the money I pay out for them and that I am not burdening them with tasks which are not adding to sales and building the financial stability of the shop. For instance, when I went to software, I was able (amongst many other positive aspects) to cut staff hours by the amount of time it took to hand-write tags for the merchandise… in my case that was 40 hours a week! Where could you alter your business to be able to cut unproductive tasks?
Auntie Kate (and everyone else)- how do you feel about the minimum wage increases? I’m in California so in a couple of years it will be $11.50, then $15.00 eventually (if not sooner). I fear I will have to close my doors with these rising costs.
Perhaps it might be best to include the need for higher staff expenses in your business plan starting now, Tawny. Doing what you can to raise your income to offset rising costs will at least give you a feeling of control over your business. To help you feel like you have the power to not only exist but thrive: The first year I hired people to help me in my consignment shop, minimum wage was $1.60, and if I’m remembering correctly, our rent was around 50 cents/sq ft (monthly; the annual rate would have been $6/sq ft) and the shop’s gross income that year, our 2nd, was around $48,000.
The shop I founded still exists, has 3 locations now, and is thriving. So as costs rise, so can the business strategies and income. Here’s to your continuing success even as costs rise (or inflation rises, take your pick 😉 )!
Preparing here in Seattle. I’m battening down the hatches to be quite honest. I’m trying to get more money out of my business now and into the bank. I have fairly highly paid staff right now but the idea of bringing a new individual in to train at $15 is tough to handle. I’m working on raising my prices already. While I used to buy pretty much everything (supplies, etc. locally) I’m looking for more out of state including services like bookkeeping that can be done remotely.
I’m slowing my charitable donations. I rolled my revenue sharing program into hourly wages, which the staff was not happy about. I am really looking at my staff and will continue to hire well and move people who aren’t as productive out quicker. I’m obsessing on how to be more productive. But the bigger problem is that I can control my business to some extent but I worry about the bigger marketplace in Seattle. Everything will get more expensive and folks in the middle income, my market, are going to have less money.
They may move to a strategy of buying out of state, same as I am. Customer service is already dismal in most brick and mortar shops. This may turn people off. Already we have empty storefronts. Empty storefronts don’t help other businesses.
On the other hand I’m also trying to figure out employee retention programs so that the employees who wont’ be getting a 61% increase in pay won’t be as disgruntled.
So, that is what I’m doing so far. Don’t get me started on what I think. Don’t mean to sound doom and gloom but I’m preparing best I can which is a bummer. I do believe you should pay people well. It has always been part of my strategy and has served me well, but a 61% raise in a state that already had the highest wage is a dangerous experiment.
I agree completely with everything you say… from the necessity of sacrificing “shop local” decisions in favor of conserving money, to the “dangerous experiment.” Here’s to the (we hope) resiliency of capitalism!
We are in Minnesota. Darn! 🙂
Alas, but we had to try, right? Thanks so much for checking, and best wishes in your upcoming endeavor! Weehoo!
Hi Karen,
We’re in Idaho in the beautiful Pacific Northwest. Let me know if you’re in the area. 🙂