101 Guide on How to Start a Thrift Business!

Call it COVID-19 and its effects, but the entire fashion industry moved towards sustainability. Nowadays, thrifting is a culture promoted by high-end fashion brands. So, if you want to pursue your dream of starting a fashion brand, here is the best time and the guide that we have come up with to help you out! 

Before you start your business, you must be clear about what thrifting means for a business. Thrifting is a collection of products from various brands and selling them at a relatively lower price than the original pricing. It is also a process of buying used items like clothing, accessories, and more to sell at lower prices. 

Currently, the thrifting business for clothes is very popular and is gaining even more prominence among the younger generation. 

Here’s what you have to make sure to start your business. 

Select your niche 

As mentioned, the thrifting business includes a lot of categories out of which clothing has high prominence. However, apart from that. You can also keep your niche as per your interests. 

Technically, if you pick up your interest as your niche, there is a high chance that you must already have an idea of the category and will be interested in the business operations. 

Hunt the factory-reject items to sell 

The next part is to start hunting for the best products to sell but here is a technique. You must carry the field studies to select the items you want to sell along with considering which factory items are up for rejection so that you can grab them first. 

Start looking for the markets for these used as well as the rejected items. For example, you might do research on the local markets in your city and start strolling through them down. 

Along with this, you can also check out the items that are owned by your family and friends that they need to sell. That can also make up for a product line in thrifting. 

Making the products ready and making them sell-worthy

Now, here comes a technical part. To make thrifted items like clothes, sell-worthy might be challenging because they either have been used earlier or are rejected by the factories for some reason. 

Firstly, you must ensure that the products are worthy of usage. If they are not, check where can you improve and then only work on the display part. 

Think of the aesthetic angles that might make your products look appealing. Hire a reliable photographer and product designer to help you out in managing and displaying of the products because that is the only route taking you through the customers. 

Time to set up your online store

Now is the time you set up your online store and make your dream a reality. Make your space in the third-party websites or take your own domain name for it. 

Make sure you select the payment modes in advance so that there is no technical glitch later. Give digital payment methods, net banking, UPI, Cash On Delivery, and more as options for the customers to have an assured of their payments.

The next step is to also make sure that you are partnering with the delivery service providers. There are various platforms providing the same or for the initial steps, you can have your own delivery partners as well.

Physical store opening - the steps

Opening a thrift store might require a few steps to be taken from your side:

• Determine the type of business structure first - it can be sole proprietorship, partnership, LLC, etc. You need to file any required paperwork according to the type of ownership for the store and share it with the state and local authorities.
• Get your name registered with the brand’s name with the Registrar of Companies, Department of State.
• Now, after the legal procedures and the due process to be carried out by the authorities, you need to obtain a general business license, which is usually issued by the Department of Revenue or a similar agency.
• As you would also need a vendor permit, get yourself registered for a vendor permit as well as a sales tax permit to be able to legally collect sales taxes.
• In the case of the physical store, you'll have to obtain a zoning permit to make sure that your business is located in a permitted area for retail operations.
• Since you will be dealing with branded or copyrighted items, make sure that you have permission that the authorities will be able to guide you.
• Moreover, make sure to comply with the Goods and Services Tax (GST) regulations in India as per your state.

How to price the products

In thrifting, prices tend to be lower than the actual prices of the brands when brought first-hand. So, here is what you have to see!

• Make sure that you cover your costs first. 
• The cost must include the original price, shipping costs, and the cost of marketing.
• You need to check the prices of similar products that are being kept by the competition. This will help you get an idea about the kind of prices you should keep.
• You can also determine the price according to its trends and demand.
• Check out the value added to the products to determine the price of sales.
• Consider the usage of the item and keep the prices: To determine the price of a used item, consider the items and check for the ratio of  50%, 25-30%, or 10% rule as per the actual condition of the item.

Marketing the products is the most important

Even if your products are ready to be sold with the best packaging and finishing, until and unless you market them better, they will be of no use and have payment difficulties in bringing up sales. Hence, follow these steps to drive sales:

Open social media accounts

In times of growing dependence on social media, it is nothing but a necessity for you also to connect with customers on social media. We would suggest that you start your Instagram page as well showcasing the news, products and any development about your brand over there.

Create a marketing plan

To promote the products, it is important to create a marketing plan for your brand. You need to streamline the process from the beginning. The brand also has to decide that the marketing plan comprises the posts to go up, the product lines to come up and when you are going to release the products for sale. All of it has to be marketed in a storytelling format for the customers.

Time to optimise the search engine 

It has now become a game of search engines. So, you need to keep up the game and you must know that about 60% of the sales might be derived from the search engines. Target the right keywords and also aim to optimise your store pages initially. For instance, if you are selling branded bags, you can use tags like Prada scond-hand bags or similar keywords that match the same interests.

User-generated content

Another way to market the products is to request the customers to share their purchases in their social accounts so that people can be enticed towards the products. They can post a picture of them wearing the products or the packaging or the unpacking of the video.

These days, user-generated content is one of the greatest ways to reach out to customers or target groups. You can also provide the vouchers if the customers come through other customers.

Keeping customers engaged in a consistent manner

Through all your social media and web content, it is important for you to keep your customers engaged in a consistent manner to let them know that you are an active brand. Plus, customers are likely to engage more with the sales if you keep the brand up on social media for all kinds of developments. You can also try to keep giving them offers to lure them into buying.

Keeping up with the customers also mean that you need to keep up with the community that you are forging along with the brand. So, reach out to the customers with other initiatives like keeping a newsletter in place for sharing blogs about your new products and more abiut the thrfiting business. 

Making sure the exchange policy is in place:

• Since thrifted items are usually used before, the customers become very sceptical about buying them and that might impact the sales.
• To reduce the hesitance, keep your policies in place. Make sure you offer the exchange provisions for the items you have so that it helps build the customer base initially and the repeat customer afterwards.
• Secondly, if there are no other products of the same line, make sure you have the return policies in place. Take ownership of the products and get the product returned so that even if you make a loss in the short run, at least, you build the brand name in the longer run.

A robust customer service

As mentioned above, running a thrift business might be a challenge as the owner has to deal with the damaged items and there might be cases when the customers do return their products. Keep this in place.

• If possible, hire a small team to ensure the timely checking of the customer's queries.
• Reply to the Instagram messages and the queries on the website by making it a habit to check it daily.
• Keep up the game of CSM (Customer Service Management) by using new tools like Artificial Intelligence and Machine Learning.
• While thrifting is a new culture in India, it is likely to grow even more in the coming years. And, you should try to make the best of it as well if running a thrifting store was always on your list.