Thrift stores have proven to be a viable business to start especially since people are eager to find those treasures that other people don’t want, from clothing to trinkets to furniture. The US thrift store industry is valued at over $10 billion and is expected to keep growing.
Irrespective of whether you choose to focus on vintage clothing, furniture, or a wide range of items, it is possible to make good money owning your own thrift store.
Starting and managing a thrift store most definitely comes with its own perks and challenges and will necessitate work and time to get started. Nevertheless, if you are looking to start a thrift store, below are the pros and cons of this endeavor.
Pros and Cons of Owning a Thrift Store
Pros
1. Rewarding work: Owning this sort of business can be quite rewarding. After all, you are in business to see to the needs of your customers and you’re working on something you genuinely care about.
2. Viable business connections: In this line of business, you never can tell who you will meet at a thrift shop. Keep in mind that this could be the beginning of a mind-blowing business opportunity!
3. Daily physical activity: Managing this business warrant a good deal of movement than other lines of work. Some days, you will be walking, running errands for your business, and carrying out a wide range of tasks. Note that this will have the right impact on energy levels and your overall health.
4. Good perks and discounts: Owning a thrift shop comes with its benefits! Keep in mind that as a seller of these products/services, you will get to enjoy industry perks and discounts.
5. You are your own boss: As the business owner, you will be tasked with making decisions for almost every part of the operations.
6. Local Community: Another viable part of starting a thrift shop is that you get the platform to cultivate a loyal following by selling your products at craft shows, farmers’ markets, or even local storefront businesses.
7. Simple business model: A thrift shop boasts of some of the simplest business models, and this makes starting and building the business easier.
8. Easy to Learn the Business: Note that when starting your thrift shop, there is a whole lot of information for you to access online. This will aid you in getting the business started.
9. Never a dull moment: This is one business you will most likely enjoy especially if you don’t like having the same experience every day. Your job comes with a wide range of customers and allows you to meet interesting people from all walks of life.
Cons
1. Intense competition: The competition in this line of business is known to be quite intense, as such it is very necessary you invest both time and effort to evaluate your market and ensure you extensively understand where the prospect and demand lies.
2. Finding The Appropriate Supplier: A good number of businesses in this space go the supplier/manufacturer route, and this is indeed a viable niche! Nevertheless, note that locating the ideal supplier can be time-consuming, and will take up so much energy and you will have to engage in trial/error. If done right, this process will save you months of time and energy.
3. Low margins: According to industry reports, the gross margins for your thrift shop are typically around 43%, and this can make it even more difficult to incur new expenses and maintain profitability.
4. High employee turnover: Another thing to note in this line of business is that employee turnover is often high, and this can prove to be quite expensive and time-consuming for your business.
5. Taxes: In this line of business, you will have to pay self-employment taxes which can be quite exorbitant.
6. High overhead expenses: As the owner of a thrift store, note that there are operating expenses that come with selling a physical product.
7. You may need to charge sales tax: In a good number of states, you will be expected to charge sales tax. Even though this might very well not impact your financials specifically, it can be very daunting to put in place a process and procedure for this.
8. Time commitment: Depending on the scope of your business, you might be responsible for all the activities in your store. While this is not necessarily a negative thing, work can take over your free time at times. This can in many ways impact your relationship with friends and family.