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 
Hi Auntie Katie,
I am interested in buying the stock from an existing shop that is for sale.There are 614 consigned pieces that they value at $150,000 and 540 owned pieces that they value at $87,000. It is a leased space with annual sales of $220,000. They are asking for $350,000 for just the stock and client list. I believe that the asking price should be based sales history. Could you pls advise on how to properly value a stock only buyout? Thanks for your help!
Ms Jillian, thanks for asking, but I am a mite confused. Are you buying merchandise and a client list or just the merchandise? And what’s the leased space or annual sales got to do with it? And how will you turn a $350,000 into something that you can profit on? Are you sure you are interested in this?
Hi Kate!
I bought your starter pkg:) I am a newbie. And I would invite any and all advice..please!
I live in a very small town and want to keep my business here. Not looking to get rich, just be happy. There happens to be a thrift shop in town that is kinda lower end.
I want my shop to offer resale, consignment and some new items in a boutique/gift section. What do you think about this idea? Should I be worried about my competition? ( I feel I have more to offer). And what do I call it? Resale and gifts??
My daughter says I over think everything, lol. But I can’t help it;)
I am going to look at a building tonight, super excited!
Hi Gina, great to hear from you! But you’re asking the wrong question. It’s not what I think of your idea: it’s what your potential marketplace thinks! Do they WANT what you have envisioned? If not, they won’t shop with you, no matter how much “overthinking” you put into it…What will work in your area with the time and effort and money you want to put into it? And what does “work in your area” mean to YOU? What return on your investment of bloodsweatandtears will make you happy?
Tough talk, but I’d rather you mull over these questions now than a year down the investment road…
I love your comeback Auntie Kate on your post from July 5th! You never miss a beat. You have to be the smartest person I know – I feel like I know you because I have practically all of your books and look forward to receiving your email in my inbox everyday. My husband was working in our children’s consignment boutique the other day. Two ladies came in and one claimed to be the biggest resale guru ever and looked around our store as the other lady took notes. When my husband told me this I almost passed out thinking it just might have been you. Have you been in the North Carolina area in the last week? Surely it wasn’t you and I missed the biggest opportunity of my life by not meeting you! Anyway – I really don’t think I would be where I’m at today without you. For that, I thank you from the bottom of my heart.
WHAT? An imposter? And a rude one as well? “Taking notes” in a shop without identifying yourself and asking permission is a HUGE no-no. Has ALWAYS been so in retail. Something I learned when I was 18… (yes, Fred Flintstone taught me…)
And no, haven’t been in NC for years… and would have called ahead or at LEAST given out my card as I introduced myself. Besides, I probably would have missed you, since you’re not on the Resale Directory & Zoomable Map yet! Hopefully, by the time I come a-tootin’ thru in the TRUE GuruMobile, your shop will be!
Hi Aunie Kate…so glad to find you on the www. My question is that I want to open a consignment “sporting goods” store with everything relating to sports..yoga clothes, hiking, swimsuits, etc plus equipment like snow skis and snowboards at the appropriate time. So would your literature apply to me? I’m guessing some of it would, but I’m not just offering clothes and accessories so I feel like I’m alittle out ot the water here. Also, I have found a great location in the downtown area where I live, but it is a unique size (bowling alley is more like it) 13.5 wide x 86′ long and am wondering it this is realistic.thank you so much. pam
HI Pam, nice to hear from you. The main thing that I worry about when a potential shopkeeper “wants” to open a shop (well, 2 things actually) #1 Is there the market for it… that is, do people want to buy what you want to sell?, and #2, with a very specialized merchandise line, how will you get the general public to consign with you? For example, a potential consignor has lululemon and Armani and Coach in her closet… why would she deal with you for just one of those designers, when a general-consignment shop would be delighted to get/sell all 3?
As to a long narrow space being realistic? Sure, depending on how you use that space! Best wishes, and come back to let us know how it’s going. I’ll watch for your order of the Manual 😉
Shop almost ready to open! Only because of what I have learned from Kate!!
Thank you! Question-have seen a couple of shops with obvious closeouts from retailers-one was Chico’s, one was Lucky Jeans. How does one find out how to take advantage of this idea? Any help would be appreciated.
Auntie Kate,
My sister and I own 2 consignment shops, a children’s shop and a junior/ adult shop. (Sweet Peas Childrens Consignment & Boutique and Salvaged Consignment… both on Facebook and the web) We’ve outgrown our current shop locations and are looking to move into a much larger location. We have developed a strong brand and look for each of our shops which we have become known for in our area. We are thinking of combining and expanding our shops and adding furniture which would result in taking on a new look and trying to rebrand our shop. The new location we are looking at is more than twice the size of the shops we have now so we would be increasing our expenses. Would a rebrand be wise or should we stick with our trademark styles that we’ve established and gently change things later on?
Kelly
Hi Kelly, thanks for visiting. I think you’re wise to realize that your shop rebranding is not something to be taken lightly, especially if you’ve been strong promoters of the existing branding (although I cannot seem to access either web site at this time). Trying to rebrand AND move AND add another focus to the business is a lot from your current and potential clientele to absorb, so I’d go with moving first, adjusting the branding later. Here’s another thought: how about making the new spot your “consignment village”… maintaining the separate looks, and adding the furniture… which would make it much more of a destination shopping experience? Oh, and adding all three to the Resale Shop Directory & Zoomable Map might be a good choice, as well, to draw in those travelers, tourists, visitors from the web!
Hello, My husband and I own a resale store in Union, MO. We have a lot of trouble with our no Return or Exchange policy, people just don’t understand we have the policy in place I have signs posted throughout the store, and we tell everyone before they purchase anything and yet still i get phone calls or people in the store daily trying to return things. I also am having the hardest time selling clothes and toys. We have organized and re-organized, priced and re-priced, we have sales and nothing seems to work. I just can’t move those products. I really need help I can’t tell what is going wrong we have an all clothing store in town and people shop there all the time but mine won’t sell, even though customers tell me we have way better prices. I know I am asking a lot but we really love all the advise you give others and are hoping you can help us too! Thank you!
Hi Katie, thanks for visiting! I find it interesting that your two concerns might be related… and I also notice on your Facebook page two things: you “get a lot of things donated” and that people can take things on approval “if they ask.” So here’s what might be an avenue for you to explore: Make your approval system into your stated return policy. That way, if folks know they can return things if they’re the wrong size, style, inoperable, they might be willing to buy something.
Having daily questions about wanting to return items is way excessive… This change may mean some difference in how you operate, but you know that change is necessary! If you don’t know where to start, there’s info and forms on approvals in our Sales Counter Forms Layouts Kit that will get you on the fast track to providing the reassurance your customers might need to start buying!
I think something is in the air with returns lately. I have a 3 day merchandise exchange, but am lax on that if asked. It’s more of a guide. I had a lady in Friday who bought something 2 months ago and it doesn’t fit. I thought it was weird that she even asked, until I had a customer in Sunday who bought something in JANUARY and now it no longer fits (divorce diet) and wanted to exchange it. I think she got embarrassed after she said that out loud and realized how crazy it sounded, although I did tell her to bring it back in the fall and we would work something out.
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Dear Auntie Kate,
Sometimes I dislike some of my consignors. I know I can’t be alone in this. How do you manage your difficult consignors? Have you ever “fired” a consignor? Some days I am tempted.
I try to remember that all my relationships with my consignors are first and foremost professional relationships. “Liking” the consignor for me is just an added bonus or the icing on the cake. I don’t expect it, require it or think it a necessary part of doing business. I’ve found that the majority of folks are pretty good, a few exceptional and a few hard to take. We smile and do our best to always remain positive and professional with them all. 😊
Yes, I found myself wanting to fire so many of them that I changed my store from “consignment” to “buy-outright”…now we know that NO system is perfect, but so far it takes care of the daily phone call from some “did you sell anything today of mine”…”no, but I”m sure you’ll call back tomorrow”…to, “this is ALL you sold?’ when they get the check….I think some people are so attached to their clothing etc. that they probably think the landfill should pay them to bring their garbage in…I have been having pretty good luck screening people during phone calls..”what do you have, brands, sizes how many pieces?..and all those things, how much do you think you would be willing to sell those for if I bought all of them, oh you have no idea?…oh would you take $25 dollars…oh you would? ok…or oh you were thinking more like $200 dollars…you can get a feel for the type of person they are but the bottom line is ..they can say “no”….and you don’t have to do the book work and see the look on their face when they come in and are mad at the amount of the check or the zero amount!
After 3 stores and 4,000+ consignors later, we have come across those consignors who drive us up the wall. The one thing that I have learned through the years is that going out of my way to extra nice to the ones that irritate me has almost always changed the way I feel about them. Most people are guarded or but up fronts when they are dealing with people who may intimidate them, or they think if they bully you that you will take more of their consignments. Sometimes a kind word or a extra discount can go a long way to changing the attitude of a difficult consignor. We have never “fired” a consignor but usually the ones that we want to go away will weed themselves out over time. If there is someone that you absolutely can not deal with, let someone else do it. It is better for someone else to handle the situation and you walk away then for you to give your shop a bad impression by showing that you dislike a consignor. Keep your head up 🙂
Wow, thanks, for all three of these responses. Very helpful, all around.
Hi Kate,
I have your book and have read a lot of it over and over. I have a question, please, when estimating the revenue of cost per square foot, wondering if you are using sq. ft. based on the exterior or interior of the building. Mostly all buildings I have looked at are using the exterior square footage for quoting monthly rent and then when measuring inside sq. footage, about 30% is lost due to thick adobe walls here is Santa Fe. So, back to my original question, the statistics in your books on revenue averages price per sq. ft., is this based on sq. ft. of the exterior or interior of the building? Thank you.
Seva, you figured it out! Landlords measure from the outside, tenants from the inside, since we can’t live/sell in the walls. Income per sq foot is based on actual selling space… which not only means from the inside walls, but subtracting bathrooms, back hallways, even the sq footage that the HVAC takes up!
Thank you. I figured that. I felt silly asking the question, it seemed obvious.
Just wanted to make sure. I am trying to project the possible revenue based on your formula in your book. Thank you for answering my questions. I can imagine that us newbies must be asking questions that seemed so basic to you. I appreciate your patience.
Not at all, seva, you actually figured something out that most shopkeepers never think about. I actually learned this “the walls only count in figuring the RENT” concept from a long-time consignment shopkeeper, Rick, whose keen eye and suspicious manner have saved many an entrepreneur from ruin… or at least lack of profits! LOL
Thank you again for all your help. I am so appreciative!!
I have another question, I am struggling to find the right location, and I have found a building that is on a main road and in a good area, that has parking in the back of the building and the entrance would also be in the back of the building. Wondering if you have any feedback on this type of configuration?
Is this too broad of a question. There is also another building with this same situation. On a main street, easy to access and in a nice area but once you enter into the driveway you need to go to the back of the building and enter in the back. Any objectives? Or would you have to actually see it to answer this question? Thank you. Seva
Sorry, Seva, can’t quite picture this scenario. Can people SEE the shop, and that it’s a shop, and what goes on in there, before struggling to find out how to get in? Of course, a place that’s hard to enter COULD be marketed as “Your Secret Closet” or some such!
Thank you. Yes, the shop is very visible on a main street, it is a free standing building.
A nice attractive historic building. When you enter the driveway on the side of the building. There is tons of parking in the back. And an entrance in the back. (there is also an entrance in the front that goes up around 10 steps.)
I would only want to use one entrance and the back could be the main entrance due to that is where customers would get out of their cars. Thank you again.
Thanks, I will be consulting a lawyer before I sign anything. The current rent is $2200 and they make a profit of $30,000. I will look at what you recommended and apply it. I also am somewhat naive and didn’t think about the stores possible debt to consigners and taxes, both great points! I always assumed they went with the old owners. Thanks so much! Please let me know if you think of other points I maybe overlooking. I still feel comfortable moving forward just have to have things made clear and given the attorneys okay.
Thanks Aunt Kate,
I have minimal financial startup.The past owners are sending me the financials, I will only accept the terms of the lease if the financials for the past two years support a working profit. If the financials are good but not good enough to meet the landlords asking rent of $2500, I figure I will renegotiate with the landlord, and have some actual evidence to back up a reasonable rent. The landlord is willing to accept a lower rent and gradually increase to his asking. The current owners are very nice and accommodating, they’ve put a great deal of energy and money into the store, they’ve been open for 7 years and don’t really want to see the store close, they are giving me their security deposit, so my only initial investment is actually the first months rent which includes all utilities. This all has to happen pretty fast because their lease expires at the end of July, and a lot of the inventory is being sold on sale because they were expecting to close.
How would you negotiate with the landlord? What is common, for instance should I ask for something? What else can I do to make sure I’m making the
right decision?
Thanks
Linda, you are buying this business, you say. But you don’t have all 7 years of financials in hand? I think you’re getting ahead of yourself here, worrying about a lease before you look at buying the business. You don’t mention what the business is now paying in rent, so you’re planning in the dark. You say you “have minimal financial startup”… does that mean you aren’t going to invest much, or you don’t have much money TO invest? Because the first investment you need to make is to hire a lawyer to examine your purchase of the business. Unless you want to hear some horror stories of new owners not understanding that the old owners owed a lot of money to consignors that they were now responsible for, back taxes that involved seizure of assets and more. Have you had the opportunity to read the Product for the Professional Resaler, Business Valuation Kit, yet? It’s available at the TGtbT Shop here.
Hi Kate,
I’d read your manual ( well I’m still, over and over again ) and want to thank you for it.
I am in a big trouble choosing a location, and therefore I need your help.
In the country where I live they are only a few ( 5 ) consignment shops, but I think this is just the beginning…The town where I want to open one ( children and mother to be consignment ) has about 800 000 people. I choose a neighborhood considering the number of kids under 12 years living there ( also they are 2 classes of social status in the same neighborhood: where the store would be – medium high and medium low in the rest ( which I hope to be my buyers :)). The parking is a big problem ( in the town ). I found a location in a parking place surrounded by apartment blocks, with some other businesses in front ( furniture restaurateur, car wash, pharmacy ), 1 big school ( age 0-12 ) and 5 preschools ( age 0-6 ). Its also surrounded by 3 very commercial streets, but the visibility is only from one of them and there is a low pedestrian traffic ( but mostly mothers taking children to/from school ). Its about 1000 sq m.
Kate, I need your advise: visibility but difficult parking or parking but bad visibility and people walking by ( but considering the fact that there are no other stores near by and considering the schools around, and hoping that whit a good marketing people will come to see us ).
Thanking you in advance,
Best regards,
Desi
Desi, I’m guessing that you are located in a culture that could be significantly different from the one I live in, so I hesitate to give blind, long-range advice. But think about: will these mothers be willing to drive around the block, make a special trip, or even, will they make the effort to get out of the car to come into your shop?
Having mothers of young children as your target market means that you must make allowances for the things they deal with: unbuckling the kids from the car seat, wheeling a stroller up and down curbs, and what if they pick the kids up at school but the little ones are too cranky to go shopping… will the mothers make time to come back to your shop?
And good marketing is REALLY hard, at least in the US, to mothers… they’re simply too busy to pay much attention to anything outside their day-to-day concerns.
I’d choose whichever location will have the mothers already out of their cars, strolling with their children. Pedestrian traffic is perhaps more important than vehicular traffic. BUT then you have the problem of how are potential consignors going to bring things in to you, so their car (at least in the US) will have to be within eyesight of the shop for them to do this readily. If you choose the site where mothers are walking the kids to/from school, be sure to match your open hours to when they will stop in… even if that might be earlier than you’d really like to be at work!
Hi Auntie Kate,
I’ve come across a great opportunity to purchase an already existing women’s consignment shop (fine women’s). The previous owners are ill, and will be turning it over to me with no disruption to the store or customers. The landlord is charging wants me to sign a five year lease at 2500 per month. The store has a good following and has nice items and consigners but I’m worried that the rent might be a far reach. I have limited funds and am concerned that it would be unrealistic to make a profit, after working the store myself. Do you think the rent is a fair price? and is it possible for me to actually make a profit?
Thanks,
Lynfmd
Hi Lynfmd, I am sure that you have in your possession the financials of the business so far, so you’d be better able to judge whether the business could support a $2500 monthly expense, or has been doing fine with such an expense. I assume the business is now in the same location as you are talking about? Of additional concern would be the other aspects of the lease and other costs that might arise. Is there a clause calling for increases? Common space fees? If you are responsible for HVAC, the heating and cooling of the space, a common clause, is the equipment likely to fail in the course of the lease? You may find that the landlord is taking advantage of the change in ownership by jacking up the rent on the new owner, in which case the value of the business itself would have to be adjusted downward. After all, much of the value of a business sale lies in the ability of the new owner to continue, as you say, “with no disruption to the store or customers.” What does your lawyer say about this situation?
Hi Kate,
Thank you for your advises!
Finally I will go for another place I just found..Kate, would you please share with me the kind of consignment software you use, i know you say is not necessary and even not good in the beginning, but i would like to start with it or at least to know for the future…thank you!
Best regards,
Desi
Desi, Please see my note at http://tgtbt.com/links.htm#products. And further reasons for delaying your selection, of course, are in my Manual, which you must have before you even LOOK at locations… so you know what you are getting into!
Thank you Kate! And OF COURSE i have the Manual.., best regards!
Good Morning Kate,
I ordered your “Beginners Luck” package earlier this week. I have feverishly read through the “PDQ” files and am waiting patiently (to the best of my ability) for your Op’s Manual. In the meantime, I am researching POS Systems and have become stymied by the choices. Do you or any of the industry mavens on this site have recommendations to help narrow the field? Also, on the same subject, what are the differences between a general retail software and a consignment specific software? Any information will be GREATLY appreciated!
Thank you for providing this site and all of its wonderful information!
Toni Rossi
Hi!
I am planning to open a children’s consignment shop in my hometown… I have searched the market and we do not have any children consignment shops; however, I know that our town does consignment via the web and meeting up at various locations. I was wondering if this would be a limiting factor for my shop. In my personal opinion I rather go to a shop with more options and variety but I wanted go see if Kate or anyone else had advice/feedback
Thanks,
Heather
Heather, I think you will find in any town that there are consumers who use various places on the internet to buy/sell/trade and who have face-to-face swaps. I don’t think that should a problem, if you can offer your target market obvious, tangible (pun intended) and popular reasons to use your business as the middle man. Style and selection and even more, INSTANT gratification are longed-for benefits amongst young parents, and you might start there with your business plan. Have you considered doing a poll to see what this market wants, and what it doesn’t?
Thanks for asking, and I am sure that other shopkeepers have good ideas to add.
Likely your shop will offer “more”. More convenience, more options, more customer service, more payment methods, more everything. The online selling and meeting with groups for swaps or what not are various other ways of doing business however, it is not business everyone wants to use. We were the only shop in our town and in the past 6 months or so facebook groups selling all sorts of various things started popping up in town. Now there is one for adult clothing, one for just kids stuff, one for accessories, one for expensive stuff, one for…. the list goes on. You will offer convenience, safety and a bunch of other things.
The only thing that we find is hard to get is larger things; pack n plays, swings, strollers, etc. However at the time of writing this we actually have approximately 12-15 strollers in stock, never heard of 🙂 We buy outright but on these larger items we would give as much as any consignment store would and you get the store credit or cash up front. People can usually fairly easily sell those items online pretty quickly for as much as we would sell it for and often times more.
Research, research, research! and get Kates manual and products 🙂
Hi Kate,
I am currently reading your operations manuel and I love it! The book has provided insight and affirmation to so many thoughts. One question that you address a little on is locating near retail stores… My question is, is it a bad idea to put your location in strip malls next yo say Target and other retailers? ( not outlets). I know that you can never be 100% sure but my mind set is that these places already generate high volumes of traffic due to the large amounts of advertising that they do (like you mentioned in reference to grocery stores). However would a target or a walmart in the same strip mall help or hurt your business?
Thanks,
Heather
Well, I’m not Kate, but I will add my .01 cents. You need to look at your customer base and see who it is. When I was searching for a place to open my store, I had lots of people tell me I needed to open in the new Whole Foods store development. That is a very specific market, let alone that they are the 4th or 5th store like that to come into an already small market (meaning they will be fighting for that specific customer). Would it generate traffic? Sure. Just not MY traffic. I went into a new development where there is a Publix (nicer grocery store chain). It generates traffic across every socioeconomic demographic. Cheap? Absolutely not. But it’s MY traffic and paid off, tenfold. Are WM shoppers your customer? Are Target shoppers your customer? Think about what you are selling and the price points you will be selling at and go from there.
Several business have closed in our nearby Target shopping area. NONE of the remaining stores are as busy as Target, so I don’t think they are exactly a “pull” for other customers.
I have 3 shops-2 are located on a block with other small local shops and the other is in a small strip with just a couple of other businesses.
The 3rd shop is destination only while the first 2 bring people in from the busy sidewalks.
Heather – Our largest store is across a busy street from a big box, and we see cross-over traffic all the time. The big boxes make the area a destination, so there would be exposure for you. They also allow shopping families to divide and conquer in different stores.
Every situation is different, but the vibe I’ve gotten from Target has been a bit better than Walmart. As a bonus, you may find that a nearby big box means that you and your staff’s own shopping errands become more convenient. Best of luck in your site selection!
Hi Auntie Kate,
I just joined the NARTS. Everyone recommends you. I have a question, please, we are possibly getting ready to sign a large lease. The owner of the building doesn’t use a broker and the lease is straight forward, would you recommend to have a real estate lawyer look over the lease prior to signing?
Thank you. Seva
Seva, How much does the lease make you responsible for? Say it’s $3000 a month for 5 years. That’s $180,000, just as a for-instance. Multiply it out. Then, if the total dollar obligation is something you might feel less than comfortable signing you name to, why would you not make sure that you’re comfortable by having a lawyer look at it?
Kate and Melissa, thank you both so much for the info-friendly helpful support-who could ask for more? Have a great week, both of you.
Have I missed reading somewhere in my collection from tgtbt, fixture layouts for specific spaces-in my case, two rooms,one 23×12′, back room 15×12. There are so many styles of racks it is mind-boggling! Thanks for any possible input.
Sandra
Hi Sandra, There’s the S-P-A-N and a few “typical” shop layouts in the Manual (pgs 97 to 103, if you have the current edition of Too Good to be Threw), of course, but that’s just a starting point. Map out your space, including doors and windows, and figure out an optimal customer flow pattern for whatever merchandise you’ll be selling. Then you can see what type of fixtures would go best where (and don’t forget flexibility!) The style of fixtures would be you LAST decision, after you concentrate on utility.
Hi Sandra,
Since I already had most of my racks from a store going out of business I didn’t have to question exactly what style of racks I needed. You might want to spend some time with a store supply catalog or on their website (nahanco is one, there are tons of others) to visualize all the different options.
I also found it really useful to draw out my design – and I too have two rooms. I stumbled upon http://www.floorplanner.com. It allows you to create a free floor plan/layout/design. You can create everything from basics like walls, windows, and doorways, to putting in furniture icons to represent different furniture pieces, artwork, etc. I even found clothing icons and you can layer them to represent two racks of clothing on the walls. They didn’t have rounders for instance, but since that was what I’d already bought from a store going out of business, I created round glass table icons to represent those. You can then see your creation as a 2D or 3D image.
Having two rooms, you’ll have the same consideration I did about where to put the checkout area (where you’ll likely spend most of your time) so that you can best keep your eye on both rooms. I also have a front and a back entrance, so I put bells on the doors so that I always know when someone comes in the back, and I can come out from behind the checkout area to greet them.
I had intended to show more of my floor design images on my (personal) blog, but this is the only image I ever posted: http://9adventures.wordpress.com/2013/01/25/short-and-sweet/ I’m happy to report that for the first two months the store looked very nearly exactly like the image – and I was very glad I had planned it out in advance. I’ve since added more wall racks since you can fit more in two layers (three in the kids section) of wall racks than on a single rounder.
Good luck!
Thanks, Melissa… I couldn’t sort thru all my bookmarks this morning to give Sandra that web site… glad you had it handy!
I was informded about a convention held in Vagas this year for consinment shops with updated consinment softwear and tips for running a sucessful consingment shop. Does anyone know about this, and if so when and where excatley does this take place.
Las Vegas? I haven’t heard anything. There’s NARTS Conference, of course, but this year it is in San Diego.
Hi Jackie and Megan, if you aren’t already members of the Resale Connect page on Facebook. I believe Kate may have mentioned this but without the link it’s hard to find. It’s a closed group so you have to email one of the admins with info about yourself to join https://www.facebook.com/groups/197118813684022/?ref=br_tf. On there you can ask questions and find lots of specific responses from other storeowners. There’s also a “Consignment and Resale Group” on LinkedIN you might try. Good luck!
I’m thinking of starting a consignment store in Chicago. I’m trying to find out an estimate of projected income, but I cannot find this info anywhere. I’ve tried calling various chambers of commerce, city offices, small business resource offices, and other consignment stores, to no avail. My space will be about 1300sq ft and is located at a busy pedestrian and traffic location, with free street parking and a small parking lot. Any advice on either where I can find this number, or what said number might be?
Hi Jackie, Projected income is always a guess, because the range of answers in surveys like that of NARTS and the Resalers’ Financial Survey in my manual vary so widely… and of course, surveys can only tally what those who chose to be in the survey reported… There is, in other words, no number to find. It’s like asking what an artist makes… some make a lot, some make a living, and some never sell a painting 😉 Same with consignment shops.
I have noticed that no one wants to give any definite information when it comes to this, thus leaving anyone who asks with no answers to this impending question. Here are my thoughts. How much do you HAVE to make to stay afloat? What is the amount you have to bring in each day to break even? Calculating every single cost including your pay will get you this number. Then you go from there and adjust accordingly to how much over that you would like to make. I have recently realized that this extremely important figure just gets pushed to the side every time someone asks another experienced person in the field and I’m sick of it. I hope my info helped at least a little. I too seek this specific information and have not found it in the varoius handbooks i purchased thinking they would include this information. Sadly I am left with a bunch of common sense information and more questions than when I started. Feel free to contact me if you want to talk.
Megan, I am sure that Jackie appreciates your reply, but that wasn’t her question. You have suggested that she tally her overhead including an amount for herself and then “adjust accordingly to how much over that you would like to make”… which has nothing to do with “projected income.”
It’s not that “no one wants to give any definite information”… it’s that there IS no answer to “projected income”.It’s like asking how long “a piece of string” is. I made $X, the shop down the road made $Y, and a shop across town made $Z. So is “projected income” the average of X+Y+Z… or something else entirely?
To a large extent, how much someone can make in this industry depends on factors specific to the location, business model, and even the shopkeeper’s involvement and personality, don’t you agree? Or is that chip on your shoulder impeding your vision?
Megan’s comment was actually very helpful. The process she described is exactly what I did end up doing to get at least SOME kind of number of what I’d need to make, since no one and no agency and no website will tell me what I might make. I also really appreciated the commiseration, since I’m practically tearing my hair out about this.
Auntie Kate, an average of X+Y+Z is exactly what I’m looking for….just something, ANYTHING, that will give me an idea of what I might be able to bring in. I definitely understand the variability and the factors you describe. I already plan on doing better than most of the other shops I’ve seen because their store designs are all so blah. I also have some pretty unique business model ideas that I think will help me get ahead. But I can’t get anywhere until I can prove to the building manager that I’m worth the risk for the lease, which requires SOME idea of how much I can make.
The building manager doesn’t care what YOU can make; he or she cares if you are able to pay the rent throughout your lease. So put down a “projected income” which is 10 times your occupancy cost. That “makes” your occupancy cost” 10% of gross, which is reasonable. I mean, it’s not like (s)he is going to be standing over you with a whip, huh? (Unless of course, you’re renting a space which involves a percentage of your income which is another whole ball game.)
I repeat, “no one and no agency and no website will tell me what I might make” is a nonsensical statement. There are shopkeepers who make millions and those who go bankrupt leaving a trail of debts in their wake. And anyone who professes to foresee your financial future over the Internet is, to put it kindly, nutso. All you can do is study the available surveys and go from there.
Thanks for the quick replies! In this case, the building manager does care. The retail space is in the same building as, and is owned by, my church. The building manager is a friend and fellow church member. I will be given the space if I can show him, and my fellow church goers, that I can pay the bills. If I can’t do that, he will be forced to pay a service to find a tenant, and no one wants that.
Whether I can figure out what I hope to make, by any means (either the way Megan described or the way you did), is really not the information I’m looking for. Yes, that is what I will end up using for my business plan, I suppose. But really, I just want to know what someone else is making, whether it is an accurate predictor of what I will make or not. I would love to study the available surveys. Where might I find such a thing, without having to shell out $$ to do so? I’m only going to proceed with this business if I am given this space, so until I know whether I’m getting the space, I can’t afford to spend what tiny bit of capital I have on gathering information. And I won’t be given the space until I can assure him that I can make rent, which I can’t do unless I’m able to find some numbers. Isn’t there some kind soul who will tell me what her city consignment shop makes in a month on average?
Hi Auntie Kate,
I have been reading your book, but it will take me some time. I have it next to my bed and read it any chance I get. Do you think it is a realistic goal for monthly revenue to be 10 times rent??? Hummm, this is a scarey figure. I was just projecting to make my break even point at first prior to opening my doors. It seems impossible to know how much revenue I can make monthly until I open my doors and give it a go. Every situation is unique. Of course we all hope to make profit and make money. Thank you for your feedback.
Seva
Yes, Seva, it’s impossible to foretell the future 🙂 … I gave our other commenter that figure because she seemed laser-focused on having a number to give to her building manager,. Eventually, yes, occupancy costs should be at about 10% of gross revenues, but that doesn’t happen overnight!
As to realistic goals: Breaking even is, of course, the bare minimum, and what is “realistic” to one person, is not to another, based on level of involvement, commitment, and one’s business model aspirations. My goal, when I first opened, was to earn enough to replace my cranky old sedan with a Mercedes SL. I worked hard enough, and learned enough, and paid enough attention, to retire 20 years later, at age 48.
Great Jackie! Good luck! Just to clarify, I knew exactly what you were asking for. ;o)
This can be frustrating I know. I could tell you what our store’s sales are but that would be meaningless, trust me. You can’t use numbers in a business plan that are irrelevant.
So, how do you figure it out. First, what do you need to make and how do you do that. How much profit per item, how many people per day, etc.
Bigger than that for me was, due to my 3 year lease, I had to know that no matter what happened I could pay that. Our lease is a lot of money. I had a plan for failure as a backup.
If you believe in yourself, the building owner shouldn’t being taking a risk on the lease. If you fail, you still owe that money, period. If you don’t feel comfortable with that it might not be the right time.
Best wishes!
Megan, I’d love to talk! How can we make that happen without posting personal info on this page??
Cool! I’m not sure how to either! Maybe find me on facebook and we can go from there?. Megan Scoggin