How To Run a Thrift Store Business? The Go-to Guide For Retail Thrift Store Owners

a graphic of a smiling thrift store owner in their shop surrounded by merchandise

Running a successful thrift store requires a number of factors. Cleanliness is the number one factor to consider. Secondly, you need to make sure that you have a regular supply of inventory to meet your customers’ needs. Participate in community events to increase your brand awareness and employ effective strategies to curb shoplifting as much as possible.

Knowing how to run a thrift store business is important because thrift stores are not your run-of-the-mill retail store. While in your average retail setting you have several specific products from a few suppliers with subsequent reorders, thrift stores operate differently. 

Instead, every item in a thrift store is unique, seen once and never seen again. Also, unlike usual retail stores, your donors are your suppliers, and there can be thousands of them. 

As a result, normal retail store inventory procedures do not automatically apply to thrift stores. That’s why running a thrift store business is a whole new ball game, and knowing how to go about it plays a big part in your business’s success. 

If you’re interested in learning more about managing a thrift store business, this blog is the perfect spot to uncover the most critical advice for managing this kind of business. 

1. Keep Your Thrift store well-organized and clean

Customers looking for bargains and second-hand items don’t necessarily want to dig through piles of stuff to find something. Organize your thrift store exactly as you would a normal retail clothing store. 

Display the prices of items in plain sight. Categorize clothes based on size and place them separately from household items. The more organized your thrift store is, the more enticing it will be to all types of shoppers. This allows consumers to quickly find what they want, improving the consumer experience within your store and fostering a natural customer flow. 

2. Collect Inventory Continuously

As previously mentioned, ordinary retail store owners purchase their inventory from suppliers or manufacturers, which is not the case for thrift store owners. One of the unique features of a thrift store is that the inventory is constantly changing and not always reliable. 

Call on community members for items regularly, reminding them that you are a trusted place to donate, sell, or receive store credit for gently used items. However, donations from the community are not the only sources you have for inventory. Thrift store suppliers include online sources, wholesalers, swap meets, and niche communities. 

Donations from the community

Community members are the most common suppliers to thrift stores; this model is used by many thrift shops, from small independent thrift stores to large chains such as the Salvation Army and Goodwill. 

When an individual donates to a thrift store, they can write off the value of the donation on their taxes. Others might seek store credit or cash. Many thrift shops also offer these options.

Leverage consignment selling

One of the most popular ways for thrift store owners to fill their shelves is to operate consignment stores. In a consignment store, the owner resells used items on behalf of the original owner and receives a percentage of the sale price. 

Individuals bring their items to the store, the owner evaluates and offers them for sale, and if the items sell, both parties benefit.  If the items do not sell, the owners of the items can either take them back or ask the seller to offer them at a reduced price.

Online thrift store suppliers

Another great channel that thrift store owners can use to source inventory is through thrift store suppliers. These suppliers can be store supply warehouses that you can physically visit or online wholesalers that exclusively serve the used clothing market. Some companies, such as USAgain and A&E Used Clothing Wholesale, operate in this realm. 

You can also search for inventory on online shopping websites like eBay, Craigslist, Facebook Marketplace, and, in some cases, Etsy. Today, it’s not uncommon to see thrift stores operating eBay stores or conducting eCommerce on other platforms. Creating an online store allows thrift stores to reach a broader audience than they could with a single physical store.

Estate sales, yard sales, and moving sales

Yard sales, moving sales, and estate sales are also popular sources of supply for thrift stores. Some thrift store owners purchase inventory exclusively from these types of sales or include them as part of their business’s inventory model.

As an example, a thrift store owner may also offer estate cleaning services, facilitating the process of cleaning a deceased person’s home for their relatives while giving the thrift store owner quick access to a high volume of potential inventory.

Thrift store owners don’t limit themselves to sales held by private individuals. Some items sold during a store closing or business liquidation are often found on thrift store shelves. 

3. Participate in Community Events

The more people know about your business, the more likely they are to patronize it. After all, your store may be visited by school groups, teachers, artists, single parents, civic clubs, etc.

To that end, engage with the community you serve. If possible, set up a booth at community festivals; give out flyers about your thrift store; develop an area of specialization, such as vintage clothing, and promote it, especially if you are the only store in town offering this type of product. All of this will help your thrift store stand out from the competition.

4. Set an Operating Budget And Stick to it

Running a thrift store business requires you to maintain the ability to operate at a low cost. Since the items you sell are typically lower-priced that traditional retail, you will likely be making smaller margins. Therefore, you must find ways to reduce overhead and operating expenses to ensure that most of the money is reinvested in the business, including a business owner’s salary and those for your team.

Challenges to Face In Running a Thrift Store Business

If you are considering opening a thrift store or are already a thrift store owner, you’ll likely find some common challenges, like managing your inventory, setting pricing, and running the eCommerce side of things. Running a thrift store comes with a lot of work, with pitfalls and unexpected expenditures along the way. Here are some of the biggest challenges:

Many of the donations will be junk items

Although you will have enough items, many of them will be junk that will not sell or sell very slowly. It’s important to come up with a plan for such items.

If you accept donations indiscriminately, be sure to have a systematic way of going through these items and weeding out articles that are unlikely to sell. If you pay for your supply, stay picky and only accept higher-quality items.


Despite this, sometimes nice items just don’t sell. So you’ll need to come up with a plan to clear inventory quickly, primarily by holding sales. Following the example of some big-box donation centers – set up color and date labels that are put on sale frequently based on how long the label color has been on the shelf. And remember to get a thrift store POS that can make running promotions by category fast and easy.

Requires a fairly significant workforce

The thrift store market is a very competitive job market, so you will have to pay accordingly for honest and reliable employees. You will need many employees unless you are willing to work long hours with family members. Be aware that it will take some time for your business to become sufficiently established financially before you hire people. You may have to work alone for a while. Take your time during the hiring process. It’s important to interview well to find long-term team members who can grow within your company. Offer great employee benefits, promote internally, and create a workspace that encourages strong retention of your team members.

Requires significant opening costs

Though the overhead costs for starting a thrift shop are lower than many other businesses, there are still some significant expenses that you’ll need to figure out.

The retail space will be the most important. Typically, thrift stores operate in busy urban areas that have more foot traffic. These spaces are always going to be expensive. And a lot of thrift stores have a large space, adding to the expense. But you’ll also have other basic expenses, such as your contactless checkout terminals, inventory scanners, and other retail POS hardware.

Shoplifting may be an issue

As with other retail stores, thrift stores are also susceptible to theft – perhaps even more so. Preventing shoplifting will be an ongoing endeavor. A good retail layout with easy sightlines will be beneficial. You can also invest in some basic technology to help deter potential thieves. But, at the end of the day, you’ll need to rely on your store employees to help you prevent retail theft.

Constant attempts at haggling

Brace yourself for constant attempts at haggling. Of course, you’re free to accept or not accept the lowest offers, but be prepared to be swamped with customers trying to get the best bargain out of every purchase. It’s not the end of the world, but it’s likely to be a nuisance. You can always put signs up saying that the listed price is the final price to make things easier.

Run Your Thrift Store Business With The Right POS System

The point of sale system is the backbone of any retail business management. However, as a thrift store owner, keep in mind that you don’t need just any POS system. As we mentioned earlier, you aren’t buying from suppliers and selling the same thing repeatedly.

The most important step is finding a POS system that is built around this workflow and suited to your business needs. There are many point of sale systems on the market that you can invest in, but many of them are not designed specifically for thrift stores.

Whether you operate a single thrift store or a chain of stores, your business runs differently than a typical retail store. With that in mind, here are the key POS features thrift store owners should know.

Inventory management headache?

KORONA POS makes stock control easy. Automate tasks and get a clear picture of your entire inventory. 

Advanced thrift store donation inventory management

The first feature to look out for when choosing your thrift store POS system is advanced inventory management. Thrift store inventory management software ensures that the donation process and related inventory tracking needs are automated.

Your team simply enters new donations into the thrift store point of sale solution, and inventory is updated in real-time. Thanks to the functionality of the thrift store inventory software, product receiving, inventory counting, the checkout experience are all organized and streamlined. Thrift store inventory software can also be used to print price tags and catalog inventory items immediately upon receiving.

Processing integration

Choosing a point of sale solution that imposes its own merchant services with high rates will never benefit your business. As a business that opened not long ago or is going through a rough patch financially, it is imperative to find ways to cut costs and keep your expenses minimal until you get things back on track. Opt for a solution that can help you find the best credit card processor, allowing you to choose the right credit card for your business. 

Color labeling and discount rotation

In thrift stores, customers are constantly looking for the best deals, and they’ll likely be interested in the special discounts and promotions. Sales discounts are a significant part of any thrift store business model. They are a great way to get rid of your excess inventory and bring in more shoppers to your store.

So you need an efficient and modern thrift store point of sale solution that can dramatically reduce the administrative hassles associated with managing sales and promotions. Modern thrift store management software gives you the ability to track your color labeling system easily. 

Easy to use

It’s essential that your choice of POS solution is designed to improve functionality and help you manage many aspects of your business more smoothly and efficiently. POS system software for thrift stores must be truly accessible and user-friendly. Employees may also need to process end-of-day sales reports, you’ll need to create price groups, adjust prices for promotions, manage inventory across multiple locations, run a customer loyalty program, and so much more. Each of these need to readily accessible and easy to use for your management and retail floor staff.

FAQs: Running a Thrift Store Business

Is owning a thrift store profitable?

Owning a thrift store can be profitable if you reduce the business’s operating costs, implement a good marketing strategy, and opt to sell some of your products online, as a majority of consumers are increasingly turning to online shopping. The average profit for thrift stores is quite low because of all the costs associated with having a physical location. Figures show that the general retail industry makes about 5% profit on sales, which means just $5,000 in revenue for every $100,000 in sales.

How do I start a thrifting business?

Starting a thrifting business requires that you first work out the details of how you will run your business next. Consider whether you will sell various items or whether you will focus on selling antiques, vintage furniture, used clothing, or other items. Seek out the necessary licenses and permits. Look for a good location. Gather merchandise from consignment stores and other suppliers and market your thrift store.


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Written By

Mahougnon Martial Amoussou

Passionate about SEO and Content Marketing. Martial also writes about retail trends and tips for KORONA POS. He loves NBA games and is a big fan of the Golden State Warriors.