Do you want to start a used clothing business online? This article will teach you how.
Potential business owners who want to open a used clothing store may find many benefits of opening up an online used clothing business over starting a typical retail chain. Start-up costs are often way less than those of a traditionally used clothing store.
During a sluggish economy, second-hand shops such as a used clothing business tend to grow, not to mention the e-commerce growth over the past year. However, before starting your own used clothing store, there are a few things that you must consider…
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Is a Used Clothing Business Right For You?
Used clothing business is perfect for entrepreneurs who are passionate about fashion or clothing in general, loves to help people save, and enjoy clothes shopping.
If you don’t enjoy going to thrift shops and garage sales, a used clothing business may not be for you because this kind of business does entail a lot of time spent looking for second-hand items so you have the stuff to sell.
Capital Needed to Start a Used Clothing Business
Starting as a side hustle, an online used clothing business can be started for as low as $500 for initial inventory but if you have some extra cash, might as well capitalize your business with $2,000.00.
This budget will give you some extra funds for other things that may be needed to run your business aside from buying inventories which will be discussed in a further section below.
If all you have is enough capital to buy a few used clothing here and there, and you’re not yet planning to build a used clothing shop, your startup capital can be as low as the price of the first item you’re going to try to sell.
To avoid further e-commerce costs, you can try to sell your first item on Craigslist, Kijiji, and/or the Facebook marketplace.
Selling stuff on Classifieds sites may be of a slow start as you’ll get a lot of tire kickers and trigger happiest, tapping on the “is this available” default message without necessarily having the will to purchase your goods.
The best way to start selling on classifieds is to start by offering your products at a lower price than the market value and start building an online presence there, just like how business owners start out with penny auctions.
You’ll be able to sell more items this way that start-up costs will be kept low which means you can build your inventory for as cheap as $500 and not really worry about additional financial needs aside from paying for storage and shipping.
Once you start gaining traction and start building a solid repeat customer base, you may start selling items at higher prices so your average sale price is generally higher than what you bought it at or made it yourself since we know most entrepreneurs wear their favorite clothes as often as they can before selling it.
How to start an Online used clothing business on the side?
Your average start-up cost may be around $1,000 which includes enough inventory of clothes that are clean, tagged, and presentable for sale. As time goes on you start adding more items to your inventory to sell online.
The good thing about this kind of start-up is that you can start selling stuff even while working another job or go full-time later once you’ve gained enough traction to start scaling up your business.
What are some things I should consider when starting a used clothing business?
When starting out with your own used clothing business, there are certain risks involved but all entrepreneurs must face these risks if they want to start a business or start their own fashion brand.
How much does it cost to open an Offline Used Clothing Store?
The costs of opening a used clothing store start at $10,000 and go up to $50,000. The cost will depend on the size of your store and the location of it as well as any renovations that you may need to make as part of opening the store.
The start-up costs of opening a used clothing store include, but are not limited to:
Retail space lease or house payment if you will be operating out of your home. The size of the retail space will depend on how much inventory you plan to carry and whether or not you plan to offer additional services like tailoring, shoe repair, custom orders, etc.
Construction/renovation costs for retail space or house payment if you want to open in an existing location that needs renovation. Construction costs vary depending on the scope of work that needs to be done and may include anything from new floors and paint to plumbing for commercial sinks if you need them.
Fixtures like racks, mirrors, dressing rooms (if necessary), display cases (for jewelry or other items that need a case), light fixtures, and signage.
Stock supplies for start-up inventory like hangers, price tags, garment bags, and shrink wrap.
Startup website costs include hosting, services like Google Analytics installed to track progress on the site, search engine optimization (SEO) so your site shows up in online searches for a used clothing business, contact pages with information about you as well as details regarding your inventory, etc.
Inventory start-up costs – clothes from thrift stores are very inexpensive but it takes time to find what you need at a price that will be profitable enough to keep going. You’ll also likely have some expenses related to cleaning the clothes before they can be resold which start at $0.50 per item and can go up depending on how dirty the clothing is, what type of stains need to be treated, etc.
Clothing store start-up costs – selling online via a website or an app start at $100/yr for basic eCommerce services with Shopify that have no additional fees. There are also free eCommerce options available but you will not have access to features like customer service to help customers place orders, shipping rates set up so you only charge what it costs to ship each order, etc. Some tools are meant specifically for thrift stores or used clothing businesses so take some time looking around before deciding which one(s) you want to use.
Advantages of an Online Used Clothing Business Over Brick and Mortar
Selling used clothing online offers start-up entrepreneurs a few advantages over opening a retail store. The start-up costs for an online business start at $10,000 and go up to $250,000, depending on the size of your store and the location. If your startup with a website or an app, these start at $29 per month for your own Ecommerce website, costing no additional fees and offering customer service and shipping rates set up so you only charge what it costs to ship each order.
With pre-owned clothes selling on eBay gaining popularity in recent years it can be a good idea to look into selling on this platform, even if your startup with a website or an app. It’s easy to start selling on eBay and the fees are relatively low, plus there is no cost involved for getting yourself set up – just start listing your items!
The advantage of opening an online used clothing business, whether it be running a storefront on Shopify, Etsy, or eBay or using other eCommerce services like Big Commerce or Wix is that you can start small and grow as needed, which isn’t possible when opening a brick and mortar location.
With a physical location come added responsibilities like paying rent/mortgage, utilities, taxes, employees, etc., which really add up!
Start-up costs for Online Used Clothing Business
The start-up costs to start a used clothing business online depend on what you want to sell. If you start your own business through eBay, Amazon, or another reseller site, you won’t have the start-up costs of opening a brick-and-mortar store. You’ll need a computer or tablet from which to conduct your sales and some start-up cash to purchase the clothes you want to sell- in this case start-up costs may run you in the $2000 range.
Most items sold in original condition, no matter how old or outdated they look, can garner significant profits when retailed at thrift stores. Vintage clothing is particularly popular in this industry and can be found at thrift stores across the country; there are 56,000 vintage boutiques in the US alone.
To start a used clothing business online start-up costs are usually much lower- you’ll need only enough money to start buying clothes for your store. Start-up costs include purchasing second-hand clothes at thrift stores or liquidators and then retailing them at your shop. The start-up cost for starting a used clothing business can run around $1000 or more if you start with an online reseller platform like eBay or Amazon; without these platforms, start-up costs may be closer to $500 dollars. If you plan on selling wholesale offline, start-up costs will likely be higher than $3000 to get started.
Where starting a used clothing business online can get expensive is in paying monthly fees for your storefronts on Amazon, eBay, etc.
eBay charges you per listing bracket and the most your list, the more your listing fee will be. You’ll start at a minimum $0.20 fee and then move into $0.35, $1, $2, or beyond depending on how many items you want to list per month. If you start out selling clothing wholesale eBay may require an application fee of up to $100 dollars- this is refundable if your application is denied. Amazon charges $0.99 per item, plus additional fees for items over $15 dollars. It’s important to start out with a monthly plan- start small and you can upgrade your plans at any time if your business is doing well!
Start-up costs for Shopify start at only $29/month; the fee structure kicks in when you start selling items. It will start at 2.9% of your sales- this applies to all sales but can be decreased by using PayPal or other payment processors for which Shopify offers extra discounts. There are no application fees for opening an online storefront with Shopify, you simply start your business once you receive your username and password!
Selling Prices for Starting a Used Clothing Business Online
The selling prices of starting a used clothing business online will depend on local economic conditions, competition in your area, and how much money you have invested in buying extra inventory. eBay, for example, charges startup fees as well as a 10% fee on all sales through its website.
You can start a used clothing business online with little start-up cash if you want to start small and grow your business slowly by selling at local thrift shops or garage sales. You could start this way with only $500 in inventory if you wanted to start this type of start-up business- just be prepared to work long hours at first until you build your customer base.
Why Branded Used Clothing?
Branded used clothing sell for a lot more money compared to regularly used clothing which is why it’s smart to only buy branded used clothing from garage sales and thrift shops, and aside from commanding much higher prices, they also tend to sell faster, especially if you’re selling on marketplaces such as eBay and Poshmark.
You can buy used branded clothing from thrift shops for pennies on the dollar and in surprisingly great condition.
Branded clothes start at an average of $10USD and increase depending on the demand for that specific brand.
How much money does a used clothing business make?
There are a lot of factors that affect the potential profits for starting a used clothing business online. For example, one type of store may have higher overhead costs than another. In addition, local economic conditions can also play a part in the profits because they have an effect on what people are willing to pay for clothing. The best thing to do is start your own online used clothing business and track everything you spend and make for a few years. This will help you determine if starting a used clothing business really makes financial sense in your area or not.
In the US, consumers spend about $17 billion annually on used clothing. The big-name chains in this industry can reel in billions of dollars annually. Starting a used clothing business online lets you partake in this multi-billion industry right from your home office or warehouse.
If you’re willing to hit the streets on a regular basis to find the best deals on quality branded used clothing, you can easily make $2,000.00 a month selling used clothing on the internet.
How to start an online used clothing business
1) Start shopping at thrift stores to find items in good condition with great prices. Set up alerts for sales on specific brands – most thrift stores get new shipments every week that they mark down 50-75% off of regular prices once they’ve been in the store for 2 weeks This means that if you shop every week (or more often if necessary), you’ll start to build up a stock of items with great prices that can be sold online.
2) buy items in bulk at thrift stores, sell them one by one on eBay or Craigslist – basically turning your home into a library of secondhand clothes. The only downside is that you’ll have to pack and ship each item yourself (or hire someone else), which can take up a lot of time if you end up making good money from the business!
3) Start selling on an eCommerce platform. This is the most popular option when launching because it offers security for both customers and businesses – you don’t have to worry about any privacy/security issues or handing out credit card information over the phone, and buyers know that they’re protected when making purchases from your website.
4) Launch your own used clothing e-commerce shop. If you have absolutely no experience with technology it’s best to launch an e-commerce shop that puts technology behind the curtains. Shopify does exactly this! You don’t need to learn how to code or pay $10,000 – $20,000 to launch your own e-commerce store.
5) Drive traffic to your site via SEO which will start showing your site in Google results for specific used clothing keywords like “buy used clothes,” “thrift store near me,” etc. There are many articles available about what type of content needs to be included on your start-up website in order to start ranking in Google, Bing, etc. for specific keywords.
6) Promote your used clothing business via social media. Post images of the items you’ve recently acquired at thrift stores by tagging the store location with the #NameOfYourState hashtag so that others can start looking out for them when they visit this particular store. This will help increase interest and traffic not only on your start-up website but also on social media pages where interested shoppers will start following or liking posts to see what’s up next in terms of inventory for resale.
7) When you start a used clothing business from home, you will need to calculate the percentage of your expenditures that are related to start-up costs vs. those that lower ongoing monthly expenses. The sooner start a used clothing business online becomes profitable, the sooner you’ll be able to pay yourself a wage!
Tips to Start a Successful Used Clothing Business Online
1) Price items based on how much you paid + cost of cleaning the item + 20% markup. How much you start with will determine how much you have to charge. If you start by only buying items that are 25% off, then aim for 50% markup when selling online.
2) Take pictures of the clothing in natural lighting without using a flash so they look their best – start with close-up shots and move out to show multiple pieces at once or in different types of outfits. You can also start taking video clips of the clothing in motion if possible.
3) Write professional-sounding product descriptions complete with details about stitching style & quality, fabric content, color name & number (if it’s not your brand), etc. Use Google Translate if necessary when writing product descriptions in other languages since most buyers are looking for used clothes to resell in their own country.
4) Set up your used clothing eCommerce website in a way that customers start to trust you and start buying items to resell in their own stores. Some tips for this include giving various sizing options (including EU size), having good customer service, posting pictures of the clothes on models rather than mannequins when possible, offering discounts/promo codes for repeat customers, etc.
5) Continue sourcing inventory so you can start moving products. Keep an eye out for new thrift store openings near your home or start looking online for local donation centers where people drop off clothing they no longer want but don’t sell at thrift stores because they’re not “brand-name.” You can also start looking for private sale groups on Facebook where people start selling their unwanted clothing.
6) Start thinking about the shipping/handling costs you’ll start with. You can start by offering free shipping on all orders over $25 no matter how many items the customer buys. This is one of the most frequent complaints among online shoppers who start looking at competitors’ websites – if they start looking for three items but find that each one starts with a low price tag, then start adding on S&H fees, they’re likely to move on to another website before buying anything.
7) Keep track of changing trends in your industry (this also means staying on top of current events). If you start noticing that denim jackets are “in” this fall, start buying more of them. Even if you don start selling them immediately, eventually interest will start to build.
8) Reduce your prices with coupons or promo codes when you can start making a bigger dent in your inventory without affecting the bottom line too much. For example, start offering 20% off with coupon code “Fall2016” for three days only during the start of fall fashion week in NYC – this way, people start hearing about it more on social media and start looking forward to the next time they can get 20% off.
9) Remember that nothing is set in stone! After getting more than one complaint about having certain types of clothing (e.g., men’s undershirts), start buying less but selling more since some people just need more basics at lower prices while others are looking for higher-end items to resell.
10) Continue supporting the women’s charities you start selling for when your business grows. To start, just check with one of your suppliers to see if they start donating a portion of their proceeds from sold items, then start matching that donation up until you can afford to start donating on your own accord.
11) Remember that every new business owner starts with humble beginnings – keep track of costs and pricing throughout the year so you know whether or not it makes more sense to sell in high season versus low season, etc. If you start noticing a pattern where x type of clothing recurs in a certain time frame every year, start stocking up!
12) Don’t forget about eBay! Used clothing is a big business on eBay (ripped clothing is even more popular), start selling for free and start building your customer base.
13) Don’t start letting the competition get to you! Just start checking out their websites to see what types of items they start putting out there, then start thinking about how you can offer better quality at lower prices or start offering harder-to-find styles people are looking for.
14) Keep track of holidays that might affect the demand for certain types of clothing so you know whether or not to keep buying them in bulk. For example, if Halloween starts becoming a bigger event each year, start stocking up on costumes, accessories, etc., since some buyers will start looking for these items as of their home decorating schemes start.
15) Update your website regularly with “what’s new” sections that start highlighting unique pieces at great prices, start making room for new inventory by tackling one area of the business at the start (e.g., start pricing down pants if there are a lot of coats to sell), and start displaying customer reviews – these can start helping people make more informed decisions about what they buy from you.
16) Think about ways you can start bringing in extra income from used clothing without spending too much upfront! Selling your leftover fabric scraps is a great start, but look into selling used clothing to local consignment shops or starting a small thrift store of your own. You can start going around to homes/apartments after the end of the lease start to start cleaning out old clothes, start partnering with local charities where you can start donating the clothing they don’t want to second-hand shops, etc.
17) Ask for feedback from your buyers! If someone’s buying a lot of items but starts telling you that something isn’t up to par, start listening – if there is demand for an item that you didn’t think would sell, start stocking more or start looking into improving the quality. On the other hand, if there are certain types of clothing people keep asking for but aren’t buying once you start carrying them, start dropping them and start focusing on what works best for your business.
18) Give back to local communities by starting up clothing drives around Christmas time so people who start don’t start worrying about putting clothes on their kids. It’s a great way to start promoting your business at the start but also start giving back to people who need it!
19) Remember that the first year of running your used clothing business is all start-up costs and start taking care of those start-up costs as best you can by shopping around for cheaper fabrics, negotiating with suppliers for wholesale rates, etc. Asking friends/family if they have any old fashion magazines lying around is a great start since some fashion magazines are looking for vintage clothing items to include in themed photoshoots or look books, so getting rid of old vintage fashion this way isn’t a bad idea either.
20) Be conscious of what you buy – you want to start making sure you start stocking well-made articles of clothing that start wearing poorly. Look up reviews on items before start buying them to make sure they’re not cheaply made, start checking for holes, start looking for something that might start coming to lose or fall apart after start wearing it a few times.
21) Finally, don’t forget to start thanking your customers! The best way to build trust is to start giving back so people know you care about them as much as they care about your used clothing business. You can start by sending them thank-you cards in the mail with coupons for future purchases (especially around Christmas time where people are more likely to start shopping for themselves), offer free shipping if their order meets certain requirements, sell unopened packages of new clothing at start deep discounts (to start spreading the word about your business), start giving away free bonus items with certain purchases, etc.
22) If you start receiving high-quality feedback from customers, start rewarding them for taking the time to leave a review by starting offering them a small discount or start donating their next purchase to someone in need that you know of. You can start doing this once per year or so since it’s not something you’d want to start being abused.
23) Finally, try to learn from other people/businesses who have experience in what you’re trying to do! There are plenty of online forums and Facebook groups where people offer advice on different aspects of starting a used clothing business, including how best to start picking out clothing items for start stocking, how to start negotiating with suppliers, start getting used to all the terminology, etc.
Ecommerce Marketplace vs Your Own Ecommerce Store
Selling used clothing on eCommerce marketplaces such as eBay and Amazon has become hugely popular over the past few years.
If you are planning to start a used clothing business, this type of selling may be an option to start with, especially if you have little start-up capital available.
However, before deciding on your eCommerce platform, there are quite a few pros and cons that you should take into consideration before starting your business.
Benefits of selling via marketplaces: – relatively low start-up cost (free for most) – high product volume potential – lots of customers due to increased online competition – immediate access to product listings Disadvantages of selling via marketplaces: – limited control over pricing (mainly driven by other sellers) – not much creative freedom (limited product options & branding) – high start-up costs (high monthly fees)
Benefits of starting an independent eCommerce store: – full control over pricing & branding – independence = increased motivation to succeed – increased exposure to your business (only accessible if people find you) Disadvantages of starting an independent eCommerce store: – start-up cost can be quite high (starts at $30/month for Shopify, Amazon starts at $40/month)
If you are just starting out, selling via marketplaces will likely be the way to go. Once your company is more established and you’d like to expand on your own brand it might be worth considering setting up your own online store.
What do I sell?
One of the main perks of selling used clothing is that there are a number of items to choose from at any one time, making it the perfect starting point if you’re looking for regular income.
In fact, some people start a business specifically to resell other peoples’ second-hand wares.
The main types of products you can sell on Ecommerce marketplaces include:
– Clothing (used or new)
– Shoes (used or new)
– Vintage & Retro Clothing & Accessories
– Household Items (kitchenware, cookbooks, etc.)
– Kids Toys & Clothes
Conclusion
Starting a used clothing business online is a lucrative business opportunity that can be started with limited start-up costs and has a high return on investment. There is enormous demand for used clothing in the resale market due to quality and fashionable products, good value, and an environmentally friendly approach to consumption.
The easiest way is of course to test the waters by selling your own used clothing and other clutter that you no longer use around your household. You can either start selling them on classified websites such as craigslist and start advertising them on social media sites such as Facebook.
For good quality branded clothing, you can sell them on sites like Poshmark and Amazon.
Like any other business idea, a used clothing business takes time, commitment, and a lot of iterations. You will not make a full-time income right away but once you get the hang of it, earning $1,000 to $2,000 a month isn’t impossible in the next few months of your launch.
Keep in mind that just like any other business idea, the second-hand clothing business is an active business that requires your involvement on a day-to-day basis as you need to constantly search for new (old) inventories to sell as well as market and sell your inventory.
The best thing with this kind of business is that it has low-cost startup cost and as you may have observed, you can actually get started with no monetary capital, just by selling your old stuff.
