How to Start an Online Consignment Shop — From Home!
If you’re a reselling with a passion for flipping gems that you thrift at Goodwill or find on websites like eBay, Poshmark, and Mercari, it might be time for you to learn how to start an online consignment store.
During these days of the coronavirus, there is so much uncertainty. Starting your own online business and generating a steady stream of cash into your pockets might be just what you need to create a little bit of stability in your life — and, not to mention, give you something exciting to do while you’re spending much more time at home!
COVID-19 has caused the eCommerce industry to completely explode. Today, more people than ever before are online shopping and you can bet your bottom dollar that most of them are looking for a great deal. With the holidays right around the corner, now is the best time to learn how to start a consignment shop online so your buyers can purchase the perfect gift for their loved ones and so you can generate a little extra cash!
First, what is an online consignment shop?
An online consignment shop, is a place where people can go to buy and sell used items. Occasionally, online consignment stores may have brand-new items with the tags still on them, but that is certainly not a requirement for selling items on consignment.
As an online consignment store owner, people will bring their clothing and accessories to you for you to resell as you see fit. You will set a commission price for your shop (typically between 50% and 70%) and then split that commission with the party that sold their items to your shop.
Is a consignment shop different from a thrift store?
The main difference between consignment shops and thrift stores is that consignment shops deal with three parties: the consignment store owner, the consignor, and the customer. Thrift stores only deal with two parties: the thrift shop and the customer.
If you would like to know how to start a thrift store, keep reading because we’re going to get into all of the details.
Psst, want $0 upfront consignment inventory?
Check out Flyp to get premium brands to sell on commission from your home! Apply here
The 5 things you need to start an online consignment store
1. Something to sell
Start by going through your own closet and organize your clothing and accessories into two sections:
- Items that are gently worn, stain-free, and in excellent condition
- Items that have stains, holes, and other impurities
Items that are in the first section will make great candidates to be resold on consignment. Items in the second section will be better off heading to a donation center or the trash, depending on their condition.
2. Back Inventory
Once you have cleared out your own closet, it’s time to look elsewhere for items to sell. You will want to start looking in places where you can get quality clothing for free or at a low cost. For example, you can look at garage sales, other thrift stores and consignment stores, or ask your friends and family if you can take their unwanted clothing off of their hands.
You can also set up an account with an online consignment platform like Flyp to gather inventory from clients and split the commission with them.
3. An ideal audience
When gathering items to fill your online store, think about who you want to sell your clothing to. Do you want to sell to a niche audience like people who love retro ’70s clothing? Or do you want to appeal to a more general audience and sell anything that you can get your hands on?
Usually, starting out with a niche audience and really honing your store to represent a certain type of person works best. As your customer base and consignment business grows, you can begin to branch out into other styles and grow your audience even more.
4. Shipping materials
When your customers make a purchase from your online shop, you’ll have to send them their new items in the mail. To keep your shipping process quick and hassle-free, it’s a good idea to keep a decent stock of shipping materials at the ready.
Here are some shipping materials that are good to have on hand:
- Small and medium sized shipping boxes
- Small, medium, and large sized shipping bags
- Packing tape
- Printer paper
- A printer with black ink
- Packing protection (bubble wrap, packing peanuts, packing paper, etc.)
5. A way to sell your items
There are a few ways to resell your used clothing and accessories online, but the most popular are:
- Through your very own eCommerce site
- Through an online selling/consignment platform
How to start an online consignment store through an eCommerce site
To create your very own eCommerce site, you will have to build a website with a service like Wix or Squarespace. This can be an attractive option to those who wish to set up shop with their own store name, completely customize their shop’s appearance, and avoid selling fees. The downside to creating your own eCommerce store is that there’s a lot of work that goes into setting up the website and payment platform, not to mention the cost for your own domain and payment platform fees.
How to start an online consignment store through a selling platform
There are many consignment platforms that are already available for anyone and everyone to use — and they’re incredibly easy (and free) to get started!
Online consignment platforms like Flyp, Poshmark, and Mercari are all-in-one services that make it incredibly easy for you to start a consignment store online. All you have to do is create an account, list your items, make a sale, and ship the items!
Creating an account
Whatever platform you choose to use, you will have to create an account with a username. If you want to start an online consignment shop that grows into a brand, we suggest choosing a username that reflects your brand — think of it as your store’s name.
Listing items
Once you’ve got your account all set up, it’s time to list the clothing and accessories that you’re looking to resell so you can start bringing in some extra money from home.
- Take quality photos of your clothing and accessories that you wish to sell.
- If there are any impurities on the items (discoloration, tears, scuffs) make sure to take a close-up photo of that area. Customers will appreciate your cadence.
- Write an accurate and detailed description for each item that you upload — include size, true fit, fashion era (if applicable), texture, and any other information you think would be important to a buyer
- Set your shipping price. Some online platforms will have a shipping calculator to help you set the most accurate shipping price. If you prefer, you may choose to raise the price of your items and include shipping free with the purchase.
Now that you have everything you need to start an online consignment store, let’s discuss the logistics of having your own consignment store.
Establish your terms of service
Now that you know how to set up an online consignment store, you’ll have to decide how you want to run it.
- What will you do with unsold items?
- What is your return policy?
- How long will you list items before you take them down?
- How will you collect payments?
- How will you pay your consignors?
- How will you handle shipping cost and timing?
- Will you offer insurance on high-priced items?
Remember that your terms of service are legally binding. You may want to have an attorney help you set them up to make sure you and your shop are fully protected.
Keep records
Like any good business, you should keep a good record of the items that you sell, how much they were listed for, how much they sold for, if they have been paid for, if they have been shipped, and if your consignor has been paid for them.
Pay consignors on time
To keep a good reputation, make sure you pay the people who offer up their clothing and accessories to you on time. The time frame in which you pay your consignors and the amount that you pay them will be predetermined in your agreed upon terms. Adhering to them will also help you avoid any legal repercussions.
Final thoughts
There has never been a better time to learn how to start an online consignment store — and it’s never been easier! Take control of your life by starting an online consignment business with a service like Flyp today!
