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Do you want to start thrift store business?
Do you want to start a thrift store? Well, if you want to start a business whose startup costs will be run over by the profits earned in the very few months, helping the underprivileged side by side, then this is undoubtedly the most suitable business for you.
A thrift store resembles opening a second hand store, in which you can keep used clothes, books, furniture, crockery or whatever you want, and sell them in relatively low prices. The thrift store owners gather the items by the rich community, which are in a position to be used again, and keep them in their stores.
Just like every other business, the first thing before starting a consignment shop is to make a business plan for thrift store, adding all the details and decisions about how will you manage to collect the items, how many persons will be required, which will be the most suitable location etc. As you might be starting this business without experience, you will be in need of a help regarding writing an professional business planning. You can take help from this sthrift store business plan sample free of cost written for a thrift store startup named, ‘City Thrift Store’.
Executive Summary
2.1 The Business
City Thrift Store will be owned by Jude Daylon, who is a graduate from Harvard University. City Thrift Store will be located on Howard Street, one of the bustling streets of San Francisco. The business plan for thrift store is aimed to gather the used items which are in a condition to be used again and sell them at economical prices. The variety and number of the used items depend upon how vast do you want your business to expand. City Thrift Store is aimed to keep used clothes, books, toys, musical instruments, furniture items, small electronic instruments at the store with appealing presentation all the time.
2.2 Management
Management is the primary footstep on which the whole thrift store business stands. This business will require extraordinary management skills to make sure that the stock of items is available in the store every time and is displayed in the appealing way.
Jude has many unique thrift store marketing ideas, and he will act upon all by being the manager himself. Before starting a consignment shop business, Jude has planned all the policies and possible mechanisms for the smooth running of the store. He has hired a number of drivers and social workers to collect the items by roving in the whole San Francisco, which is a necessity to start a second hand store.
2.3 Customers
Our target market will be the residents who can’t afford expensive things and have relatively low income than the other citizens. Moreover, the people who are travelers, tourists, or students and want to buy reasonable but good quality goods for temporary use will also be our potential customers.
2.4 Business Target
We aim at becoming the most visited thrift store in the whole San Francisco. We aim at stabilizing our business plan for thrift store and balancing the initial startup costs with earned profits by the end of the first year.
The business targets and the profits as forecasted by our experts for the next three years are demonstrated in the following graph:
Company Summary
3.1 Company Owner
City Thrift Store will be owned by Jude Daylon. Jude is a graduate and has been working as a senior manager in a prestigious restaurant for four years. Jude has done a lot of research on how to start a second hand store and is passionate enough to help the underprivileged. He wants to start a trusted thrift store by collecting used products from the wealthier community.
3.2 Why the business is being started
San Francisco is the city, which is suffering from highest levels of income inequality. The difference of the income can be demonstrated by the fact that the city is divided in two groups of rich and poor, and the category being called as rich is the one which has 11 times income than that of the poor. An estimate shows that one out of ten families in the Bay Area are struggling to hardly make both ends meet.
Besides that, the rich community dispose of many things which are in usable or sometimes good state just because they get bored. Such people want someone to take away donations of clothes and other things from them and give to the poor, by usually putting them outside of their houses. So, Jude has decided to help the low-income and average households of his city by gathering those items and running a consignment shop.
3.3 How the business will be started
Don’t do the mistake of opening a consignment shop, without efficient planning. You will need the persons to load the luggage onto the vehicles and display them in different sections in the store. Jude has planned to make separate and arranged sections of the products so that customers can easily buy them. Jude has arranged the vehicles for loading the used items, he has made a list of the staff he will require to hire, moreover, he will also hire some good speakers to raise awareness among the wealthy to donate the things they don’t need.
If you are going to enter this venture you have to collect many things before starting the shop. But, this all can be done only by accurate planning. If you are new to the business plan for thrift store, you can take help from opening a consignment store ideas and plans available on the web like this one free of cost.
The financial experts have forecasted following costs for expenses, assets, investment, and loans for the startup.
Services for customers
If you are thinking about starting a second hand store, you must decide the things you will keep in your store. A thrift store can contain anything which can prove useful for the people. In case, you are a beginner in this business and don’t know much about how to open a second hand store, you can take help from this thrift store business plan sample of City Thrift Store. This sample business plan will not only guide you in opening the store but will also assist you by explaining how to run a consignment store successfully.
The City Thrift Store has hired skilled repairers to repair any type of damages to the second-hand objects and make them reusable. Our store will sell the following items.
- Furniture: We’ll clean and polish the furniture items such as wooden tables, chairs, cradles, old rugs and carpets, cupboards, etc. which are in a reusable condition and sell them to at very low and economical prices.
- Clothes, Shoes & Books: The reusable books, shoes, fashion accessories, and clothes like dress shirts, sweaters, jackets etc. will also be kept at the store to be purchased by the low-incomes.
- Small Electronic Devices: We will also sell the technology products and small electronics such as cell phones, microwaves, printers, mobile and computer accessories, storage devices and much more than that.
- Sports Equipment & Musical Instruments: This type of inventory is often found in the solely new condition as people after getting bored put their guitars, pianos, rackets, footballs and the things like that outside their house to be taken by someone, so we have decided to keep such reusable things in our shop.
- Miscellaneous: Besides the above-mentioned necessities of living, we will also keep the miscellaneous items like crockery, decoration pieces, baskets, plastic products etc.
Marketing Analysis of thrift store business
The most significant component of a thrift store business plan is its precise and accurate marketing analysis. Marketing analysis will help you to understand the position and demand of this business plan for thrift store in the latest market. It is important as it can help you in finding the most suitable location for your store. The location which will be frequently visited by your target customers and your donors. Your consignment shop business plan must also include the strategies and policies you’ll adapt to market your services and how effectively can you gain and maintain your potential donors.
So, if you have any doubts and confusions regarding how to start a consignment shop business, you can take help from the thrift store business plans available online, you can also take help from this thrift store business plan sample for City Thrift Store. You can also have the opportunity of downloading business plan for thrift store pdf from the web. No matter, how many business plans you read before writing yours, that cannot be equivalent to a single consignment store business plan written by a professional marketing analyst. It would be better for you to seek the services of a professional to make for you a thrift store business plan template. A professional can better understand the marketing trends and do accurate marketing analysis and segmentation of your location before making a thrift store business model for you.
5.1 Market Trends
Due to the rising economic inequality in the city and financial stress on the underprivileged and the average, people are now trying to cut their discretionary spending and are fascinated towards the idea of buying second-hand things on reasonable prices. The industry of selling used goods is growing at a noticeable rate of 2.6% annually. According to IBISWorld, there are about 84,037 such businesses running in the United States, employing more than 267 thousand people in the whole country. No matter, how many businesses of thrift store are currently running in the country, there is still demand of more in some areas, like the one for City Thrift Store.
Note
If you are thinking that how can you generate a profit by selling the goods at almost no prices, whereby you have to bear the expenses of the staff you hire, don’t worry current report by IBISWorld has shown that this business has generated $20 billion at an annual rate.
These statics shows that you can also earn a massive profit besides helping people, provided that you plan your business plan for thrift store successfully.
5.2 Marketing Segmentation
Our customers will be the people with average financial background. Most people living in the Bay Area of San Francisco do not have enough incomes to meet their expenses in a rich city. These people lust for the items like clothes, furniture etc. and are convenient in buying used items. It is also a requirement of this business to attract notable and rich people for maximizing our donations, they will not be our customers, they will be our need. We’ll arrange seminars and advertise the need of their donations through social media.
The detailed marketing segmentation of our target audience is as follows:
5.2.1 Moneyless Senior Citizens: According to a report by City Performance Scorecards, more than 15 thousand senior citizens are living below the poverty level in San Francisco. The health and age of such people don’t allow them to meet their needs by hard work.
5.2.2 Underprivileged Children, Teens & Adults: There are many children and teens in the city who desire to buy good clothes, tech-based things, or sports equipment and musical instruments, but the reality is that most of their desires remain unfulfilled due to the costs of such items. Moreover, about 61 thousand young and adults are living below the poverty level in San Francisco, according to the same report. So, our marketing analyst has identified this as our largest target group in buying used goods.
5.2.3 Tourists & Students: There are often situations when you are roaming in another country, but due to wrong estimates, become out of budget. So, the tourists or students who have to cut their discretionary needs, temporarily, will also be one of our target groups.
5.3 Business Target
We aim at serving more and more needy and average people of our city to help them in raising their status and spirits. Our aim is to become the most visited thrift store in our city and the most trusted thrift store in the eyes of donors. We also aim to balance the initial startup costs with the profit earned in only a few months after the launch.
5.4 Product Pricing
Our main target is to serve the underprivileged community of the city, but, due to requirements of staff, wages of employees, costs of inventory, and expenses of transportation, we can’t sell the items totally free of cost. However, we have priced all the items at very meager and low costs to meet the targets of our business plan for thrift store.
Strategy
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If you are opting for starting a consignment store, you must prepare an effective and detailed business plan first. If you want your business plan to be complete and outstanding than instead of focusing on just how to open a consignment store you should also focus on how to run it successfully and how to pull the traffic to your site. If you are having difficulty about how to start a thrift store business plan, you can take help from this sample business plan for the City Thrift Store.
6.1 Competitive Analysis
Our biggest competitive advantage is the location which we have chosen after a great research and analysis. Our store is located on the main street of San Francisco, which is a street every citizen encounter while travelling in the city, as it connects the residential communities to the offices, institutes and recreational places. When so many people pass by our shop daily, a large number of them will be surely attracted toward our beautiful display through the large sized windows.
Our second competitive advantage is our excellent management system. We’ll collect the item which are in a good condition daily and display them in well-organized separate sections in our stores for the convenience of our buyers. Moreover, we have a quick transport facility for the rich people who want to donate their goods to us in large amounts.
6.2 Sales Strategy
For promoting our sales, we will advertise our store in local magazines, newspapers and social media. We will also distribute our flyers in nearby schools and colleges. We’ll post our banners in well-off residential communities.
6.3 Sales Monthly
6.4 Sales Yearly
6.5 Sales Forecast
By analyzing our market segmentation strategy, our experts have forecasted the following sales on a yearly basis which are summarized in the column charts.
Personnel plan
No matter how much you invest your assets on your startup, it is all going to be wasted if you don’t have honest and dedicated workers. Before you open a consignment store, you must make a list of the workers you’ll need to hire. You should train your staff before starting your shop that how to value the needs of customers and help them in finding the best product for them.
If you are searching for how to start a consignment store, then you can take help from this sample business plan for thrift store in which we have a complete guide on how to run a consignment shop. This thrift store business plan sample will guide you by informing you about the staff Jude will hire for running the City Thrift Store.
7.1 Company Staff
Jude will manage the overall operations and will hire the following people for his assistance.
- 1 Accountant for maintaining financial and other records
- 2 Cashiers for selling products and maintaining records
- 6 Salespersons for organizing the store and its different sections and assisting customers in finding their required item
- 3 Drivers for collecting products from the whole city every morning
- 5 Technicians/Workers/Sewers/Menders for repairing and reviving used things
- 2 Cleaners for maintaining freshness and cleanliness of the store
- 2 Persons responsible for advertisement of the store
Financial Plan
The first step before starting any business is to make a comprehensive business plan, and the most important part of an effective thrift store business plan is its financial plan. Before you start a consignment shop, you must collect a lot of items to keep in your store. You can find them free of cost but to be good and distinguished, you should sell these products after reviving them. For managing the costs of their repairs, the rent of your store and the salaries of your employees, you will need money initially. So, in your financial plan, you have to plan the ways of balancing your expenses with the profits earned. Although the business plan for thrift store is in great demand and has is responsible for generating a lot of profit annually, but besides thinking about how to start a consignment shop, you should also think about the worst situations you can face financially.
If you are searching for profit thrift store business plan and need help in writing an effective financial plan, you can take help from this sample business plan for thrift store on how to open a consignment shop. The statics and figures in this sample business plan are for the City Thrift Store, so, it is advised to hire a professional financial planner advisor, who can write for you an accurate financial plan according to your investments and sales.
8.1 Important Assumptions
The company’s financial projections are forecasted on the basis of following assumptions. These assumptions are quite conservative and are also expected to show deviation but to a limited level such that the company’s major financial strategy will not be affected.
8.2 Brake-even Analysis
The following graph shows the company’s Brake-even Analysis.
8.3 Projected Profit and Loss
8.3.1 Profit Monthly
The following charts shows detailed information about profit and loss, and total cost of sales.
8.3.2 Profit Yearly
8.3.3 Gross Margin Monthly
8.3.4 Gross Margin Yearly
8.4 Projected Cash Flow
The following column diagram shows the projected cash flow.
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