How to Start a Consignment Shop

A consignment shop is a store that sells gently used clothing and accessories in a storefront.  People bring their clothing for the store to sell at a marked up cost.  The owner of the item is usually paid after the item sells.

• Write a business plan to use as a concrete outline of your business goals that you can present to investors and banks.  Include research about the consignment clothing industry, competitors, and your resources.  Draft up a financial budget and a projection of earnings.


• Secure capital to open the store.  Use your own savings, get partners, or borrow money to pay for expenses.  Visit the small business administration for links to useful entrepreneur websites.


• Locate a busy shopping district with a lot of foot traffic and parking.  This will help your store to attract customers that will browse your store when walking by. 


• Research clothing suppliers via the Internet.  Consider purchasing merchandise from suppliers selling large lots of new and used garments at discount prices.  Find clothing, accessories, and shoes in auctions that sell garments by the pound.  While this is a time consuming method to purchase vintage clothing, it is a cost-effective means to build store stock.


• Register your business with your state employment office and obtain a federal tax identification number.


• Purchase or obtain racks and shelf displays to hand the clothing.  It is helpful to design the store in a way that shoppers can easily browse.  Create a display for your front window using a mannequin to attract customers.