Do you enjoy the fast-paced nature of the resale business? High-end goods have a long lifespan when it comes to financial value, with many products even gaining in price as the items become more rare and difficult to find. Starting a luxury consignment store is a realistic goal that can be accomplished with the right roadmap in place.
You may be surprised to learn how easy it is to start a consignment store. With a smart sense for business and a willingness to be creative, many people can start a luxury consignment store with minimal investment on their part. The average consignment store costs business owners $2,000-$10,000 to start.
Finding a Location
The first step to starting your consignment store is to find a location to sell your items from.
Some people find that it’s beneficial to zone a portion of their home and turn it into their business. If that’s your plan, it’s important to contact your town administration office to make sure your home can be zoned to operate as a business as well.
If zoning your home isn’t an option, or you don’t have the space to start a consignment store in your home, you’ll want to purchase a small retail store. You can take out a small business loan to fund this portion of your venture. Just make sure to account for loan payments when calculating your monthly costs.
Or maybe you’re fully embracing digital transformation and wanting to run an online-only luxury consignment store — which is completely feasible in today’s environment. In order to do this, you’re just going to need an internet connection, a camera, and a safe place to house your inventory — did someone say another up-and-coming garage start-up?
Getting Your Starting Products
Once you know where you’re selling from, the next step to starting your consignment store is to procure your starting inventory.
Starting with what you have
What sets a luxury consignment store apart from other consignment stores is the quality of the items you sell. You may be worried about obtaining your first high-quality items, but many people find this process to be easier than anticipated.
Start by going through your own items, looking for any high-quality items you may be willing to part with. This is a great time to pull out that old china you haven’t looked at since your wedding day, or to comb through your clothes for high-quality products that no longer fit the way you prefer. Do you have an old Gucci handbag or did your relative pass down a pair of Louis Vuitton pumps?
Once you’ve exhausted your personal inventory, the next step is to reach out to family and friends to see if there are any items they’d be willing to sell.
Staging your space
Staging your space is an important aspect of making sales. Customers need to be able to move comfortably through your store and see each item clearly. This means it’s important to keep your store clear and to have a system in place for returning items that aren’t selling so that they don’t clutter up your store.
If you’re running an online-only store, having a modern and intuitive website that provides a good user experience while shopping is essential. Inventory needs to be properly categorized, high-quality imagery should be displayed, product details are needed, and authentication should be proven.
Authenticating Consignment Store Products
When you’re marketing yourself as a luxury consignment store, authenticating the quality of your products is a critical step. Selling counterfeit products and look-alikes can cause your customers to lose trust in you. An authentication service, like authenticatepro.com, can help you certify that your top items are worth their sales price.
Consignment stores face constant threats from forgers of luxury goods, and authentication services aren’t always enough. In the future, NFTs (Non-fungible tokens) may be able to serve as a digital passport of sorts for luxury items.
Managing Your Luxury Inventory
One of the main aspects that set consignment stores apart from thrift stores is the fact that the people who bring in their items receive a portion of the profits. Typically, as the proprietor, you would earn 60% of the profits for an item while the original owner would earn 40% of the profits.
Keeping track of which items belong to which individuals and tracking your sales becomes a critical component of business success.
Most consignment store owners use software to help them manage their inventory and shipping. Aravenda offers leading consignment software designed to help sellers and resellers manage their inventory and track their sales. Our software assists you in managing the inventory life cycle with accurate reporting on inventory, sales, and trends, helping you make better decisions on purchasing ‘new’ items and shelving less popular pieces. This platform integrates directly with Shopify for added convenience when connecting workflows.
How to Market Your Luxury Consignment Store
Without customers, a consignment store is just a room full of very expensive knick-knacks. So, once your consignment store is up and running, the next step is to get the word out.
Most business owners start with a website and some social media pages. The more communication channels you use, the more likely people are to discover your storefront and inventory.
Social media advertising strategies
Social media platforms, including Facebook, Twitter, and Instagram, can offer great opportunities to advertise your luxury consignment store.
Try engaging in luxury reselling groups on Facebook and Instagram. Not only can this give you new traction, but you can also follow other consignment stores and use their posts as inspiration for the type of content you can post.
Another great option is to start a TikTok channel where you record short videos showing off new products as they come in and talking about what makes those products so great. Studies show that TikTok users are more into thrifting than users on any other media channel, making this a great place to showcase your consignment store goods. Make sure to highlight brand names like Dior or Burberry within tags and the content itself.
Consignment Store Software You Can Depend On
People are always on the lookout for luxury items to add to their home, wardrobe, or collection especially when they can find those items at a good price. Starting your own consignment store lets you be the go-to store for these purchases. It also provides you with an opportunity to get to know members of your community and learn their stories while helping them build their future.
Aravenda offers consignment store software you can depend on for all your selling needs. Check out our quick start guide to learn more about Aravenda’s unique features, or start your free trial today.