How Much Money Do You Need To Start A Consignment Store?

Is A Consignment Store In Your Price Range?

Consignment stores are great business ideas when you want something that does not require a huge investment, but which can bring in a lot of money for you and your family. Consignment stores also serve an environmentally-friendly service. They take what people may not use anymore and sell them again, helping to reuse items and keep them out of the landfill.

What Are The Start Up Costs?

The great thing about a consignment store is that you can start it for very little, or if you have the money, put a good deal of investment into it. Generally, you will pay about $10,000 to $20,000 in start up costs, but you can pay as little as $5,000 or even $2,000 in start up costs. How much your start up costs are depends greatly on how much advertising you put into the store, how much inventory you start with, how big of a building you have and more.

By far, your biggest start up cost is going to be your rent in a building. Typically, you will pay between $1,200 and $1,500, which means you will need between $2,400 and $3,000 to cover the first month and the security deposit.

This isn't the end to the higher costs of starting a consignment store though, you also need to pay for newspaper advertising and flyers for when you have a grand opening and that can run about $1,500, while shelves and racks to hold your merchandise can be about $1,200. In addition, you need to have $1,000 in reserve in the bank, and another $1,000 for miscellaneous costs. After these items, the costs get much smaller. They include:

Signs outside the building:	$500
Accountant Fees:	$500
Insurance:	$600
Utilities:	$150
Telephones:	$100
Credit card terminals:	$300
Business License:	$60
Office Supplies:	$100
Security Equipment:	$150
Inventory:	$800

Additional Costs

There are other costs that may not be required initially but will be eventually. As a result, it can be a good idea to simply buy these items up front to save money down the road. Computers and software to make your business function more efficiently are important but not essential. You should look at getting a printer for tags so you don't have to handwrite them and computers can help you keep your employees and customers organized, which can help sales down the road. You will pay about $3,500 for some computers and printing equipment.

Many consignment stores have music playing to make the shopping experience more enjoyable for customers. Buying a stereo system for $400 is a good idea but not required initially.

Naturally, your costs will vary. If you can buy second-hand items, like your security system and computers, then you can save a lot of money and lower your initial investment by over $1,000. As well, if you can cut costs by limiting the number of computers you buy and the same with telephones, then you will save even more money.

There are other areas where you may spend more initially, especially with advertising. You want customers to know your business is open and ready to sell them consignment items. The only way to do that is to get your customers into the store and that is done through advertising. You may spend $2,000 instead of $1,000 initially, but only $300 every month after that.

It is important to spend more money initially, and recoup the cost as you do business, rather than suddenly hitting your business with high expenses like computers and security systems.

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Buying an Established Consignment Store

Best Days for Consignment Sales

Specializing Your Consignment Shop

Layaway Consignment Policies

Choosing Store Management Software

Resale, Consignment, Thrift and Second-Hand Stores

Locating a Retail Space and Negotiating the Lease

How Much Money Can You Make At Consignment?

A Sample Consignment Agreement

Setting up Your Consignment Shop

Consignment Agreement Policies

Preparing For Your Consignment Store Grand Opening

Creating an Unsold Items Policy

How To Start A Consignment Store

How to Properly Advertise Your Consignment Shop

How Much Money Do You Need To Start A Consignment Store?

Determining Hours of Operation For Your Consignment Store