How to Open a Consignment Store — The Complete Guide
January 15, 2021
Being an entrepreneur can seem overwhelming but don’t let that stop you from doing what you love. There are many resources out there to guide you in the right direction to help you open a consignment store correctly. The most important thing is to be prepared and this blog is a great place to start. Here is the complete guide on how to open a consignment store.
I am sure that you have been told you need a business plan to open a consignment store; however, this really depends on your situation. Forbes recommends that if you aren’t looking to raise money, a loan, or bringing in partners then a business plan isn’t necessary. Brian Cheesy, the founder of Airbnb, only had a one-page business plan which he is well known for because we have seen how Airbnb did. If you are looking for funding or loans then you need to know what that specific audience needs in order to feel comfortable. Forbes also covers the recommended business plan contents:
- 12-month expense projections
- Marketing plans
- Customer acquisition costs
- Customer value
- Results of testing (i.e. a dashboard of KPIs)
- Proof of consistent improvement
- Knowing your burn rate, and never falling below 6 months of cash
To save you time, Alejandro Cremades created a pitch deck template for entrepreneurs. A pitch deck is helpful when presenting your business plan. Use these helpful tools to come up with your business plan for your consignment store. You may also get help from us because you’re not in this alone. SimpleConsign wants to help you reach your goals and continue to help once you’ve gotten started.
You have a couple of options, in-store consignment, online consignment or you can have the best of both worlds and have both. More than ever, online shopping has grown which means that if you are opening a local store some people may still choose to shop online. Demographics also play a part in this, certain people may be further from your shop. For a physical shop, you’ll have to take those demographics into account. You need to learn who your audience is, you can offer many things but you may want to specialize in one or two of those categories. Take a look at what is needed in the area, is it a plus-sized store? Is it a store for teens? Figure out what that is and make it your niche. If you plan on opening a furniture consignment store you can also figure out the style of the people around you so that you can attract that target audience.
Bring that audience into your shop by having an event where you speak about consignment. Teach them about the importance of consigning and the effect it has on the circular economy. Have drinks and snacks for your visitors.
Your grand opening
When you open your consignment store have a grand opening and let everyone know about it. Reach out to all the local channels that can help spread the word of your grand opening. Get on local Facebook groups, reach out to radio stations, post about it, and sponsor those posts. You can also create a newsletter for everyone on your contact list, after that you can start to grow your contact list to have a regularly scheduled newsletter for your audience. Create business accounts on all social media platforms and start a posting schedule to create consistency. Share this page on your personal social media accounts to have your friends help you spread the word. Even if you are starting an online store only, you can use these methods to encourage visits to your online shop. You have more room to work with at that point because you can go beyond the people in your area.
For the actual grand opening day, have fun with it. Offer anything you feel comfortable with such as drinks, snacks, and create an environment you and your community can enjoy. Of course, this is harder to do during a global pandemic, at that point, you can still offer all of these things but socially distanced. Follow the guidelines set for your community and work around it. For example, if you can only have a number of people visit at a time, you can allow those people to come in and let others in as others leave. Another idea is to have a sign-up sheet, as people sign up with their email you can email them the time they can visit your shop and have them show it at the entrance. This can also be a creative way to get people’s emails for your newsletters.
The biggest part of marketing right now is social media, be sure to be active and get programs that allow you to schedule your posts. Start a blog where you can create an online following to gain customers for your online shop. Schedule weekly emails to inform your customers about new inventory, deals, coupons, and updates in general. We are living in a strange and new time, read our FAQ’s of Marketing During a Recession to get some ideas.
A fun idea for an online shop is to include extra things in your orders that have your store’s logo on them, such as stickers, a pen, a tape measure, or anything that makes sense for your shop. Use this as a way to have your customers do some free marketing for you. It also helps the customer feel as if they had a more personal experience since they didn’t get the face to face interaction they would in-store. Another way to give them a better experience is to write a little thank you note to your customer. Thank them for supporting a small business and you hope to hear from them soon. Add your socials on there and encourage them to share pictures and tag your shop.
If you enjoyed reading this and want more ideas for your consignment store, click here for more.
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