Steps for How to Start a Thrift Store the Right Way!

Updated on July 16, 2018
RichSims profile image

Rich Sims is a business consultant and blogger who has helped hundreds of people across the U.S. open small businesses.

Learn methods for how to open a thrift store the right way.
Learn methods for how to open a thrift store the right way. | Source

Everyone, whether they admit it or not, shops at thrift stores. Why not open your own? Many people open consignment stores because they do not know how to get merchandise for their store any other way. In this article, I will lay out a way to get quality merchandise for pennies on the dollar.

How to Start a Successful Thrift Store

  1. Decide how your business will be classified
  2. Advertise that you are buying used items
  3. Plan an item transportation strategy
  4. Create a marketing structure
  5. Buy fixtures and racks

Step 1: Decide How Your Business Will Be Classified

I have helped people and organizations from all across the country set up thrift stores. The major problem in starting a thrift store is discovering where to get, and keep getting, good merchandise. People are used to donating their used or unwanted clothes to thrifts run by charities across the country. Many people do not even know that these thrift stores only give a small percentage of the money to the charity that is on the door. They are run for profits, and big profit at that. If you have a charity to affiliate your business with in order to receive donations, then this is a great way to do it. Most people who run for-profit businesses do not want to go through the legal steps necessary to take donations and advertise a charity's name on their door. However, it is not that difficult to set up. I do this on a regular basis. Nevertheless, it is not necessary.

Step 2: Advertise That You Are Buying Used Items

Several years ago, I started helping people start thrift stores by advertising to buy clothing for a few cents a pound. Usually, about four to five weeks before the store opens, I have them put ads on sites like craigslist and other local internet posting sites. The ad simply reads, “Wanted Used Clothing. Will come to your home and pick up. We pay $.10 a pound-CASH paid on spot”. Be sure to list a phone number as well. If you do not want to go to their homes, you can have them come to your future store. I have found that going to homes is a much better way to get started. This ensures that the merchandise is a better mix. Now, if you wish, you can advertise to buy other products like furniture and household items. It has been my experience that when you buy their used clothes and shoes for $.10, or whatever number you come up with that is fair for your area, you should ask if they have anything they wish to donate. You will get the other items.

Your store's success hinges on your willingness to advertise!
Your store's success hinges on your willingness to advertise! | Source

Step 3: Plan an Item Transportation Strategy

You will need an SUV, pickup or another type of truck to make the pick-ups. When you are buying a few hundred pounds of clothes, it takes up a lot of room. Usually, within two weeks in most areas, five to 10 thousand pounds of clothes and shoes can be purchased.

Let's say you buy 10,000 pounds of clothes and shoes for $.10 a pound, the cost would be equal to $1,000. The average number of items per pound is roughly three. Therefore, 10,000 pounds of clothes would have 30,000 or so items of clothing to sell. Shoes weigh around one pound to five pounds, depending on whether they are children’s, men’s, or women’s. That gives you a cost basis for your clothing of around $.03 per item. I've included a table below that can help you visualize this.

What Do I Do With Leftover Items?

You will have some clothes that are not suitable for reselling. Those should be saved. Anything you cannot resell can be saved up and sold to rag businesses. Large thrift stores sell a container of rag clothes for around $.20 a pound. Large thrift stores also sell most of the clothing that is donated to them in container form to wholesale operations that pay around $.30 to $.60 a pound for the clothing. Small consignment, or thrift stores, buy the item for several dollars a pound.

Item Type
# of Pounds
# of Items Per Pound
Total # of Items
Cost Per Pound
Total Cost
Clothing
10,000
3
30,000
$.10
$1,000
Shoes
10,000
1
10,000
$,10
$1,000

Step 4: Create a Marketing Structure

By purchasing clothing direct from people, you cut out the middleman and set your business up to make huge profits. Even if you sold your clothing for an average of say $2.00 an item, you are making a huge profit margin. As you are picking up the clothing, you should also collect email addresses and phone numbers. This is your start of a marketing base to send weekly emails in order to drive business.

Thrift stores are profitable, but you can still have huge profit margins. If you do not plan a great marketing structure, then, even if you follow my previous instructions, your store will not make it. Word of mouth is the best marketing strategy. By using the purchasing strategy I mentioned above, you will get the word out fast.

Step 5: Buy Fixtures and Racks

When you start to set up your store, you will need fixtures and racks. These are expensive, if you buy them used or new. Remember, for thrift stores, you do not need a department store look. When I am buying racks and fixtures for my store, I first ask local chain stores if they have racks they are getting rid of. I drive behind the local strip malls to see what has been put next to the dumpsters. You can obtain 90% of the fixtures and racks you need, if you start using this strategy around two months before you open. Most other things can be found on online liquidation auctions. At these auctions, you can usually find fixtures for a few dollars. I would go to fixture dealers as a last resort. They will make you pay through the nose. Remember, a pretty fixture in a thrift store does not make you money.

Hangers are another big expense, but these can be gotten using the same method you used to get the fixtures (going to local chain clothing stores and asking for them). If they say no, remember that their dumpsters always have lots of hangers. Most stores do not reuse the hangers, but simply throw them away when someone does not want the hanger.

If you have any questions please post a comment with an email and I will try to get your question answered. Using the methods I have described above, a 2,000 to 5,000 square foot store can usually be opened for around $10,000. Most of that expense is taken up by paying for rent, paint, advertising, a cash register, and other non-merchandise items. If you already have most of these items, then you can open for little to nothing. Good luck!

Comments

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    • profile image

      Lorene Dennis 

      5 months ago

      This information was very useful

      I would like to start a non profit thrift store soon under my Ministry

    • profile image

      Brittany 

      10 months ago

      I’m starting one in my home in my garage, do u have any tips.

    • profile image

      Monica 

      18 months ago

      Hi Rich,

      Wow, this validates my research! Thanks for your experienced input! I'm considering the idea to support our local community: Animal Shelter and Single parents in hardship, in Arizona.

      I would appreciate your thoughts on this..I'm at tinytoeschildcare@hotmail.com.

      Thanks again,

      Monica :)

    • profile image

      Paul 

      18 months ago

      Do you recommend industrial size washer and dryer to best prepare clothing for sale?

    • profile image

      Ed 

      2 years ago

      I am interested in opening a thrift store and I do have already two storage full of merchandise, but the main issue for me is the high rent prices for a small store front. Any idea? Also what are the legal requirements. Thanks

    • profile image

      Eunice Jean-Marie 

      2 years ago

      Great article. I have a few questions as well.

    • profile image

      Jason Brandon 

      2 years ago

      I too am looking to open a non-profit thrift store in East Texas. I have a few questions I would like to ask you. I appreciate your time and any information you can share with me.

      jasonbrandon08@gmail.com

    • profile image

      Patricia Bosley 

      2 years ago

      bosleypatricia@yahoo.com

    • profile image

      Patricia Bosley 

      2 years ago

      I'm recently unemployed, I'm 50 years old having a hard time finding employment. I always wanted to open my own thrift store. Any advice

    • profile image

      fuentes 

      2 years ago

      just go online google HOW TO ___.... and you'll find all your answers, a little bit of research can go a long way

    • profile image

      Patrice Turner 

      2 years ago

      I am interested in opening a charity based thrift store of my own. In Georgia do you think i should take classes on starting new businesses. And your article is very helpful.

    • profile image

      shalonda 

      2 years ago

      i have questions about keeping inventory and tax deductions

    • profile image

      Duane 

      2 years ago

      Hello. I have an opportunity to lease 4000 sq ft for 1200 a month on a corner that has 8000 cars drive by a day. I have enough inventory to fill it up. Think Ill make money?

    • profile image

      Kimberly 

      2 years ago

      We are a non profit looking to open a thrift store. We would really appriciate some more ideas and insight. If you have time please email me. Kimberlyroy@hotmail.com

    • profile image

      Kay 

      3 years ago

      hello... Is it possible to speak to you to ask questions?

    • profile image

      djones 

      3 years ago

      Thank you for the information , I would like to. Set up a clothing thrift store in Florida and I am affiliated whit a NGO in Africa , please can I have your help at bbranco210@gmail.com .

      Please

      Thank you very much

    • profile image

      Tamika Perry 

      3 years ago

      I have a non profit tax exempt organization and I am the process of opening a thrift store. Would you please email, I have a few questions. Friendslikeme@ymail.com

    • profile image

      Tony G. 

      3 years ago

      My question is if I open a thrift store as a non-profit and donate a percentage to a charity, am I able to profit the rest or can I personally only profit being a for profit thrift store. I want to be able to accept donations to help the community and give the tax break. I believe this will also help in keeping inventory flowing into the store. I am in Texas, please respond to tonygomez711@yahoo.com. Any help appreciated, thank you.

    • profile image

      Mona 

      3 years ago

      Hi, im in the beginning stage of considering opening a thrift shop in Florida and could use some guidance. Please email me at Mightymo163@yahoo.com Thanks

    • profile image

      Ozzie 

      3 years ago

      I'm trying to open a thrift store but out of the country,I just need help finding good merchandise like what the thrift stores sale. This is my e-mail izziemontes87@yahoo.com I would appreciate some help.

    • profile image

      Ozzie 

      3 years ago

      I'm trying to open a thrift store but out of the country,I just need help finding good merchandise like what the thrift stores sale. This is my e-mail izziemontes87@yahoo.com I would appreciate some help.

    • CaitlynBeamish profile image

      Caitlyn 

      3 years ago from Dover, Ohio

      Im interested in some information and advice. I would be very appreciative! caitlynbeamish@gmail.com

    • profile image

      Tia 

      3 years ago

      I'm in the beginning stages to opening up my own thrift store. I never thought of buying the clothes in bulk would really like to know more. Rotia332@gmail.com

    • profile image

      Sandra 

      3 years ago

      Hi, I have lots of questions about opening my own thrift store. For a 700 sf space with lots of traffic, what kind of revenue should I expect to make? Is there a network or list of local designers to contact about selling new items also? Up front cost? My email address is sandraberto@yahoo.com. Thanks for any help you can provide. Are you still in the business of helping peoples set up shop?

    • profile image

      Lynn 

      4 years ago

      Hw do you pair with. Charity. BRATEVARO@HOTMAIL.COM

    • profile image

      Jennifer 

      4 years ago

      This article was very interesting and very helpful. My husband and I have a little money put back from a car wreck we were in. I'm a huge yard seller and have always wanted to start a thrift store. I am looking at doing a fairly large store with a section for clothing, furniture, household items, etc. My question would be, once your business is established, what kind of income can you expect to make? I would need to hire at least one employee and pay myself a small paycheck. My husband has seen many thrift stores come and go and he's paranoid that we might not make it, but I have great amount of sales, customer service, and marketing experience. Can you email me some advice please. My email address is jenelectra@yahoo.com. Thanks for all the help.

    • Chris Collier profile image

      Chris Collier 

      4 years ago from Atlanta, Georgia

      can you help us with our new and up coming (to be opened soon)

      Thanks

    • profile image

      rahina 

      4 years ago

      I will like to collect used clothes to help schooling in Africa .Please give me advices at rboureima13@gmail.com

      Thank you.

    • profile image

      diana rivera 

      4 years ago

      i have been in this business for almost 25 years its not truth everything this people its saying that takes to open a thrift store....there its not a such of thing of buying 10 cents a pound.....its 40 cents to 60 cents a pound....you need to know the market,the area that you are,location,good merchandise,the proper rag out...etc...its not that easy...but its possible to make a lot of money if you have the knowledge,the capital,location and the good merchandise.

    • profile image

      debbie 

      4 years ago

      Hi I'm now running a thrift store for my church.no one has interest and never has.my pastor has said on several ocassions maybe you should just close that thing down.Well it has been a help to many families.I was just wondering if I close it down would it be better to open it as a non profit and I get a pay or just open it for my own business and still give to them that need? I have run it for about eight years with no pay . My family is in need of a paycheck yet I still want to help those in need .please help me to do the rite thing like I said church doesn't care and suggest I close it.

    • profile image

      Garry 

      4 years ago

      Hi rich, first of I have to thank you for so much info on one page, info that would take a multitude of different we page to find. I want to start up a trift store it would not be non profit. Saying that I would like to donate money each month to a different charity each month. How would I go about this? If you have the time I would appreciate your profession input. Gazzmanian1@aol.com. Thanks Garry

    • profile image

      Marie Foster 

      4 years ago

      New Update Craiglist do find now

    • profile image

      Marie Foster 

      4 years ago

      I have try Craiglist and every time I post an ad I get no replies at all by e-mail or phone So I think Craiglist is another scam ad place

    • profile image

      Sherrie Wright 

      4 years ago

      I am trying to open a Thrift Shop in Florida. I am working on my Business Plan for proposal for a Business Grant. Is asking for $30,000 or $50,000 too much to ask as a new business owner? I have 6 years of experience in Sales.

    • profile image

      Zach S 

      4 years ago

      RichSims,

      I'd love if you emailed me as I have some questions regarding, not a thrift store, but actually an exchange.

      email is zachary.scheiner@gmail.com

      All the best,

      Zach

    • profile image

      annette 

      4 years ago

      i am interested in opening a shop....i have three storage bins full of so much inventory, i am bursting at the seams! now i need a store front and tons of ideas to make my dream a reality. please help me ....i am in cleveland my email is axc101@gmail.com thanks.

    • profile image

      Richard Ubinas 

      4 years ago

      I am intrested to open up a thrift shop and i need to know how to buy the clothing.

      Thank You. call me 1-347-507-0032

      call anytime.

    • profile image

      Richard Ubinas 

      4 years ago

      I am interested in opening up a thrift shop and i need to know how to buy the clothing.

    • profile image

      Mike Yarbrough 

      4 years ago

      Great post! I'm considering purchasing a fuunctional thrift shop and am curious if you might know of any good, less expensive software to manage inventory, revenue and sales trends. Also, might you be available for consulting in the Dallas area? Please let me know.

      Mikey_Yarbro@yahoo.com

    • profile image

      OddsEndz 

      4 years ago

      Good day, I am in the process of opening a thrift store. I had hoped to have my opening at the end of this month but weather and other situations have set that date back. I would like to have a long standing question answered if you could. I have a for profit (not a 501c) store and have a substantial amount of start up inventory. I get a lot of items donated off the internet, from auction houses, and flea market type sales. My question is how do I keep track of my inventory for income tax purposes? Is this necessary? I have received a lot of conflicting information on this and have not been successful in finding an adequate answer. I've been told everything from I need to have every single item accounted for, (which seems completely ridiculous to me since that would equate to tens of thousands of items), to I can group items into lots and keep a running inventory this way (of which I still have some confusion about). If you have any suggestions I would greatly appreciate you help. Danielle at odds_endz@yahoo.com

    • profile image

      Danielle 

      4 years ago

      Hi, I'm quite young and I've been thinking about what I would like to do with my future, and this idea seems just perfect for me. I was wondering if there was any state that would be more profitable for a thrift shop? I would like to discuss this more. My email is danielleflaherty1308@gmail.com thank you :)

    • profile image

      aaronb 

      4 years ago

      Look at how many people come in to buy vs browse

    • profile image

      Sandy 

      4 years ago

      What most people who donated to the big thrift stores don't know is that most and not selling items are given to the dump and not to an organization that could distribute the unwanted items to people in need that have no money also any cells or computer stuff is given to an other retailer to refurbish and sold at close to or the same price as New not what I would expect if I donated my cell I would want someone to be Abel to purchase it at a low affordable cost

    • profile image

      Lorena 

      4 years ago

      Hi

      I have a question about opening a thrift store. My family has been saving a big amount of clothing and so many things that can be sold to people that can find a good use to them. The problem is that we don't know where to open a thrift store or how to open one and like some advice.

    • profile image

      Abby 

      4 years ago

      I am a retail manager and have been for 16 years now. I have been thinking about opening my own thrift store beings I have a "Shop Keeper" mind set, but I need info on profit and non profit organizations. Please help. Email me at alwayzabby2011@gmail.com if you can help.

    • profile image

      Sam 

      4 years ago

      Hi Rich,

      I am interested in opening a thrift store in my area. Would you be available to consult with me on this? I would appreciate it. samrthrift@gmail.com

      Sam

    • profile image

      Rob 

      4 years ago

      Interested in more information on this. Send me an email please rob.moise@gmail.com

    • profile image

      Ali 

      5 years ago

      I am opening a thrift store relatively soon and I have a few questions. I understand that you are being overwhelmed with emails. When you have a chance please email me at alimunafkanchwala@gmail.com. Thanks for your advice, great article!

    • profile image

      Cinderella 

      5 years ago

      oops forgot my email for reply to financing question

      Cinderellas_closet 2012@yahoo.com

      Thanks for all the great info

    • profile image

      Cinderella 

      5 years ago

      This is my second time operating a thrift shop. I've been in business a year & have outgrown my space. My problem is getting the $$ to be able to move & for advertising/signage. Do you have any tips on getting some financing/loan/grant. (hopefully not based on credit score :(

    • profile image

      armard 

      5 years ago

      here is my email for the information on the bridal thrift store. rashard2883@gmail.com

    • profile image

      Chad 

      5 years ago

      Great post. I have a question for you. How do you overcome the same local customers that come in week after week? After they know what you have they stop coming as often or only looking and unless you can switch out your whole inventory every week your sales drop drastically. Advertisement gets expensive and it only draws the thrift store shopper locally as there are thrift stores on just about every corner now days. You can email me if you can help with these questions. (shl796@aol.com)

    • profile image

      JR 

      5 years ago

      My email address is

      Jrosa_1998@yahoo.com

    • profile image

      JR 

      5 years ago

      I am interested in opening a thrift store in NJ. I need help in getting started. I have 15k to invest, I also have mannequins and showcases, I'm just lacking in knowledge....please someone help!

    • profile image

      Gina 

      5 years ago

      Hi Rhonda , No I never got a response back from Mr. Sims . :/ Sorry it took long to answer back.

    • profile image

      admckenney 

      5 years ago

      I am looking to open a thriftstore in Texas, and would like some ideass or help with setting it up, I would also like to designate a portion of the proceed to two separate charities, can you do that? If so How do I do it, and can I get a 501 status with just a sponsorship from the church. Please return my email at admckenney@yahoo.com. ThAnks for your help.

    • profile image

      Mindi 

      5 years ago

      Hello, my husband and I are considering opening a thrift store. You said that affiliating with a charity to get donations was not too difficult to set up. Could you outline the process involved with this?

      Thanks!

      -Mindi

      -mindilewis@cox.net

    • geissingert profile image

      Rhonda 

      5 years ago

      Rich- I sent you a personal e-mail. I am hoping you would look at it and hopefully respond. Love the information you shared. I am totally fired up! Please let me know if you received it. Looking forward to hearing from you. rgeissinger@gmail.com

      Rhonda

    • geissingert profile image

      Rhonda 

      5 years ago

      Rich- I sent you a personal e-mail. I am hoping you would look at it and hopefully respond. Love the information you shared. I am totally fired up! Please let me know if you received it. Looking forward to hearing from you.

      Rhonda

    • profile image

      Kevin 

      5 years ago

      I am with a donation only thrift store that needs a boost in sales, how do you think a purchase plan would work with an established store? Would it work doing both donation and purchasing?

      Kogerkennel@yahoo.com

    • profile image

      Gina Brito 

      5 years ago

      I have a few questions about opening a Profit or Non Profit Thrift store. Could you please email me at ladygina1969@yahoo.com Thank You very much for your article.

    • profile image

      ISANDY 

      5 years ago

      Thanks for such great info...Can you share some info on opening a thrift shop within a church---non profit organization...We are looking to raise funds for our after school program and the idea of a thrift shop looks promising....how do i get this started?

    • profile image

      sklyles 

      5 years ago

      Would you email me to discuss consulting?

      sklyles@yahoo.com

    • profile image

      superliquidators 

      5 years ago

      Great INFO...Do you offer consulting on how to open a thrift? My wife is thinking about opening a thrift store here in Florida. If you do please contact me at raybartolo1@gmail.com

      Thanks

      Ray

    • profile image

      Ann 

      5 years ago

      i am thinking of Opening a children and moms Thtift store in NY Hudson Valley area?? What would be the best way for me to get feedback on the town or area inregards to opening a thrift store is there a place online were I can put ad add and get some feedback before morn the store in that area??

    • profile image

      kara 

      5 years ago

      What kind of deductions do thrift shops have? Like advertising, rent, clothing donations?

    • joe-christmas profile image

      Malek Zarzour 

      5 years ago from Turkey, Istanbul

      thank you for sharing this useful info..

    • profile image

      zake 

      5 years ago

      Thanks for the information. Do I need a regulare business license to open a trift store?

    • profile image

      Denise 

      5 years ago

      I opened a thrift store three years ago. The town I live in is hard I'm still hanging in there but if you have any sugestions please I would love to know.

    • profile image

      Daniel 

      5 years ago

      thank You for the advice!

      i have a questions please email hers4coures.info@gmail.com

    • profile image

      XRain 

      5 years ago

      Mr.RichSims,

      thank You for the brilliant advice!

      We are thinking to open a thrift shop in Staten Island, and are looking for a low-cost space. What are Your suggestions - how to find it.

      XRainDancer@Verizon.net

    • Sunshine625 profile image

      Linda Bilyeu 

      6 years ago from Orlando, FL

      As a frequent shopper of thrift stores for books, music and odds and ends I found this hub interesting. We have a few independent thrift stores in Florida. Most of them are operated by Goodwill or churches. Thanks for the information. Welcome to HubPages. If you need any help feel free to visit the Learning Center.

    • internpete profile image

      Peter V 

      6 years ago from At the Beach in Florida

      Wow, this is a very good overview of what one needs to start a thrift shop! I enjoy shopping at thrift shops from time to time. it is fun, because you never know what you will find, and you can actually buy it without losing ore than a few bucks. Very informative!

    • bankscottage profile image

      bankscottage 

      6 years ago from Pennsylvania

      RichSims, welcome to HubPages. Great Hub with the nuts and bolts of how To start a Thrift Store. I recently wrote a Hub about why we should all shop at Thrifts. One section talks about opening a thrift. I'll link your Hub to it. Thanks.

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