Second-hand goods stores do well for brick-and-mortar retail, so why not ecommerce? Resellers of used goods receive the same competitive advantages online as they do off, making thrift stores a viable business model for ecommerce.
The trouble, though, is finding a steady flow of new products — you can’t just reorder more from the manufacturer when you run out. For this reason, second-hand goods sellers need to be vigilant when product sourcing, and sniff out the best places for new old things.
Here, we explain the fundamentals of product sourcing for second-hand goods.
What Are Second-Hand Goods?
Call it what you will — second-hand, used, thrift — but it all refers to the same type of retail. A good is sold, and then sold again to a new buyer, typically at a discount. Sometimes the products are old and don’t work as well, but sometimes they’re just like new with the exception of a single scratch.
As you can imagine, second-hand selling works better in some markets than others. In particular, you often see vintage stores that sell used clothing (not unlike Salvation Army). Another popular niche is collectibles, where only a certain number of items are made and so the only ones available to buy are used. Product types that are only used once, like books, are another common choice. But even industries like tech still have their own small second-hand markets — a lot of tech stores have a section for reselling used and outdated gadgets.
But to make a profit off of selling used products, you need to understand the intricacies of markups and pricing, not to mention which products your customers want. Selling second-hand goods requires knowing your market well so you can maximize your profit margin while still offering customers a lower price than a brand-new counterpart.
And, as we mentioned above, it requires extra effort in product sourcing. It’s hard to find a consistent source of used goods, so successful thrift stores have multiple sources they can tap in case one or two goes dry. But depending on the type of products you’re selling, you may have to explore many different options to find the best for you.
The Best Product Sourcing Strategies for Second-Hand Goods
Want to know the best places to acquire used products? Take a look at these product sourcing strategies.
1. Other Second-Hand Sellers
The beauty of second-hand selling is that products can come from anywhere. That’s an advantage only this business model has; it’s not like Rite Aid can stock up on cough syrup from CVS.
You want to press your advantage by creating a network of other second-hand sellers, whose inventory you can peruse when your own gets low. Traditionally, you should check out these opportunities:
- Garage Sales (Yard Sales) — No matter what colloquialism you use, it refers to normal people selling the things they don’t need anymore. One big advantage here is that, because they’re not professional salespeople, they often undervalue goods, meaning a seasoned second-hand seller can find some amazing deals.
- Thrift Stores — Although technically your competition, thrift stores can still offer some good finds. Don’t expect to profit too much from your markup, though; unlike garage sales, thrift store owners usually know how to value their goods.
- Flea Markets — A mix of professional sellers and everyday people, flea markets often have the greatest diversity in types of goods, not to mention surprise discoveries you’ll be celebrating for years to come.
- Auctions — While some auctions have an expensive reputation, others — like estate sales or police auctions — stem from an “everything must go” desperation. You can find some great deals at these kinds of auctions, especially the ones that many people don’t know about.
- Pawn Shops — Another variation of the second-hand goods model, pawn shops are a great place to come by hard-to-find goods.
These sources all vary in both the types of goods, and their quality. Try visiting as many as you can to learn which will work best for you.
2. Online Resellers
Expanding on our last tip, you should also check out other second-hand sellers online. In fact, eBay was designed specifically for the purpose of reselling used goods — only later did it start incorporating new goods as well.
But aside from ecommerce platforms, you can also find online listings and second-hand selling directories, the modern equivalent of the old-fashioned Classified ads in print newspapers. Craigslist may be the most well-known, with a robust “for sale” section divided into categories like any online store.
3. One Man’s Trash…
Think you’re above dumpster-diving for inventory? Suit yourself, but any successful thrift seller will tell you, sometimes your greatest sales come from the curb.
This strategy, though, is rather inconsistent. It’s hard to plan on finding worthwhile trash, let alone build a business timetable around it. Instead, this is a tactic that’s best to bear in mind throughout your day. Keep your eyes peeled whenever you’re out walking or driving.
But, as always when dealing with trash, take the necessary precautions — for legality, for safety, and for hygiene!
Second-hand selling is, itself, a niche market. Only a certain type of customer looks for used goods over new goods, so more blanketed and mainstream marketing approaches aren’t as effective here. If you’re going to run a thrift ecommerce store, you have to embrace this niche and cater to them. There’s a whole community and culture around second-hand goods, which is part of the reason flea markets are so fun.
Interested in learning more about product sourcing? Check out our guide outlining the best sourcing strategies for every ecommerce business model.