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The Beginner’s Guide to Consignment Stores, Thrift Shops and More

in Courtney's Posts, Sell Your 'Stuff'

Note: This is a post from Courtney Baker, chief seller and long-time running wo-man of MvD.

For the longest time, I misunderstood the world of second-hand shops. I assumed that all shops gathered their inventory by buying goods from people directly, or from donations. I was completely oblivious to consignments.

I also was completely unaware that online marketplaces like craigslist, Amazon, and eBay are also considered second-hand shops.

It turns out there are four types of second-hand shops – consignment, pawn, classified and thrift.


The difference between each one comes down to:

  • When you relinquish ownership of the physical possessions
  • When you are paid
  • Whether someone helps you sell your items

Consignment

Consignment is when a shop sells goods for an owner. The owner keeps ownership of his item until it sells, if it sells. As the owner, you’d pay a small fee to the shop as compensation for them selling your item.

For example, you consign a children’s bicycle for $20. Generally, when they sell your bicycle, they take their 50% or $10. You receive $10. If the bicycle doesn’t sell, then you take your items home for no charge. (Some places do charge a small “activation” or consignment fee.)

There are two consignment options – physical shops and weekend sales.

Consignment shops

Consignment shops are locally owned businesses with a mom-and-pop feel. They set their own terms for how their consignments work, so it’s important to research the store policies before committing. When you visit the store, the items will have an identification code on the tag to identify which account gets credit for the sale.

How it works for the seller

It’s standard for you to drop off your items for a 30-, 60- or 90-day cycle. If your item doesn’t sell within that period, some shops will discount the item (by say, 30%), or you will need to pick it up. You can expect to be charged a 25% to 60% commission, which the shop collects as its profit. Some shops offer you higher percentages if you take in-store credit instead of cash.

Is it worth it?

There isn’t a ton of inventory in these shops, so your item has less competition, but in many cases, there also isn’t a ton of traffic coming through the door. It takes quite a while to see results from many of these shops, so it’s not a great idea if you need cash pronto.

I think consignment shops are only worthwhile if you have quality goods to sell. For clothing, you need to have high-end brands. You’ll need antique furniture or nearly new high-end pieces. Auctions are hit and miss. I’ve even found the children’s consignment shop circuit to be impossible to make money at with kids’ stuff unless you have some really high-end brands.

I avoid consignment shops as a seller, but love them as a buyer!

Examples of consignment shops:

Consignment sales

Consignment sales are short, but intense events. They usually pop up for a weekend, 2 to 4 days, in random vacant spaces. I’ve seen them in strip malls, hotel conference rooms, and school gymnasiums. They are intense, because hundreds of people will be thumbing through the items throughout the weekend. The energy is high, and you can expect to see shoppers’ cars packed to the brim!

How it works for the seller

The week before the sale, you’ll prepare your items with tags specific to your sale (most sales have a website with full information). A few days before the sale, the organizers will open the doors for you to drop off your items. It’s standard to earn 60% of the sale price as a base rate on your sold items, but you’ll also pay a $10 to $15 entry fee.

After the sale, you can either collect your items or have them donated on your behalf.

Is it worth it?

Consignment sales have the opposite problem of consignment shops. There’s an incredibly large inventory. I’ve never seen so many play mats, strollers or onesies in one place! Your item will have a harder time standing out, but there are literally hundreds of shoppers ready to load up their cars.

I personally prefer a consignment sale over a consignment shop, because I get immediate results. I find that I can send less-than-perfect items to a consignment sale that wouldn’t be accepted in a consignment shop.

Plus, I love the frenzy, which would be an absolute con for several of my girlfriends!

The most important thing to know about consignment sales is that they are only worth it if you have a large selection of things to sell. It’s hard to turn a profit with five smaller items and a $10 entry fee.

Examples of consignment sales:

Pawn shops

I have a very stereotypical picture of pawn shops. It involves jewelry, ripped-off cell phones and wrought-iron bars. I never thought of resale clothing stores as pawn shops, but technically, they are.

In a pawn shop, you relinquish your ownership of your item in exchange for immediate payment.

There are actually several nationwide chains that resell goods under pawn-shop policies, like Half Price Books and Plato’s Closet.

How it works for the seller

For example, you want to sell baby clothes. You bring in your tubs of clothes for the shopkeeper to evaluate. At the end, they offer a quote for the cluster of items they’re interested in. If you agree, then they’ll pay you from the cash register.

The items no longer belong to you. They may never sell the clothes, but it doesn’t affect your payout. All the risk falls on the store.

I’ve found these types of shops to be inconsistent in how much they pay you. Your quote may be different on a Tuesday than on a Thursday for no real reason.

I say this very lightly; but technically, it’s 50% of what they’d sell it for. So, if a pair of Children’s Place pants in their store resells for $7.50, you’d earn $3.75 up front. A book will resell for $10, so they pay you $5 for it.

Is it worth it?

You don’t have any control over how much your item sells for. The company will make an offer, and you can accept it or turn it down. This is a great option if you want immediate, same-day results and never worry about your crap again.

Do I think you’re getting the best for your money? No, not really. I think you’ll get better results from the next types of second-hand shops – classifieds. I do think they’re better than consignment shops.

This is where you have to look at your priorities for time and money. Is it better for you to just be done with it? Or are you wanting to really recoup as much value out of it?

Examples of pawn shops:

Classifieds

Classified ads are the alternative to the standard second-hand shop. They’re widely popular for eliminating the expensive middle man. While there nominal fees for placing your ad in a newspaper, magazine or online marketplace, it’s usually smaller than consignments or pawn shops.

Classifieds also provide a marketplace for items that are rarely sellable in the other shops, including RVs, collector’s items, renovation scraps or items in bulk.

How it works for the seller

The costs and procedures drastically vary from platform to platform. Newspaper spaces can cost $15 or more for an ad, while the online marketplaces can cost $1. Craigslist is beloved, because it’s a completely free marketplace for selling your stuff.

The pro to a classified ad is that you have more control over your item, but that also means you have more decisions to make and more responsibilities to get it sold.

You’ll want to consider:

  • How much is the ad?
  • How many people will see my ad?
  • Do I know anyone who’s successfully used this platform?
  • How much time do I have to sell my item?

Is it worth it?

With other types of sales, you are paying some of your profit to businesses to get the job done. With classifieds (person-to-person sales), you can save that money, but now you are the one connecting with potential buyers, negotiating prices and handling the transaction.

I’ve found a system that makes this a no-brainer for me. I’ve learned how to quickly write ads, to know which marketplaces to sell different items in, and how to handle interested buyers.

This is the route that allows me to get the most money out of my used crap, most efficiently. As a warning, though, this type of second-hand selling can also flop if you don’t do any research.

Examples of classifieds:

Thrift shops

It’s important to point out that some second-hand shops operate solely based on donations. These thrift shops frequently work as non-profit organizations, but not always.

How it works for the seller (or in this case, donater)

You drop of your donations at the store (although some offer a pickup service), and they’ll give you a tax-deductible receipt based on the estimated value of your items. You feel good about yourself while increasing your tax deductions, and they place your items on their shelves.

Is it worth it?

There are some scenarios (like donating an old car) where the tax-deductible receipt is a lifesaver, but I rarely actually use it.

When the payouts from other second-hand shops would be tiny, I prefer to just donate those items. I might be missing out on a couple of bucks from that item, but I’m avoiding the hassle of selling it while also helping a good cause.

I regularly donate my baby clothes to local shelters (obviously, not a second-hand “shop,” but a non-profit). Every time I take them into consignment or pawn shops, I get offered quarters for nice clothes. Instead, I’m happy to give it to a needy family!

Examples of thrift stores:

The resale store full of donated goods down your street might not be labeled a thrift shop. And Half-Price Books doesn’t market itself as a pawn shop. But it’s true!

Selling your stuff second-hand is a great way to clear out your house and pocket some extra cash. Hopefully these tidbits will help you decide which second-hand marketplace is the best option for you.

Where do you sell your stuff second-hand? Have you had any success with consignment shops?

Comment and let us know!

{ 27 comments… read them below or add one }

Michelle March 5, 2013 at 9:26 AM

I sell a lot of my stuff to secondhand young adult stores. The pay isn’t horrible (around 30% of what they sell it for). I don’t have to do anything, just bring it up there.

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Courtney March 5, 2013 at 11:45 AM

They are definitely easy, especially if you have designer clothing. I haven’t received the greatest price for my items, but that’s made up for with how little effort I can put in.

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Jon August 23, 2013 at 4:03 PM

I’d love to find a place like this. My children are 10 6 and 4 and that’s exactly what I want to do. Just drop it off and get something for it.What is the name of the place you go to?

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Jessica March 5, 2013 at 10:37 AM

Great list! I hadn’t really thought of Half Price Books or Once Upon a Child as pawn shops either but they definitely fit the mold, lol. I’ve been on a donating kick myself. We downsized to a smaller apartment last year and our “stuff” has been piling up with no where to go. I finally just got frustrated and started packing stuff up to donate. I usually bring stuff to my mom’s house and we have a joint yard sale but we’re still weeks away from warmer weather.

I will say that you should NEVER under any circumstances send clothing to ThredUP.com! Their website says that they’ll pay you 20-40% of what they are selling it for (which is low to begin with) but I sent in a bag with 80 items in it and they only “accepted” 8 of them and paid me 10% of what they resold the items for. I got a total of $3.55 for my bag. They are the biggest rip off I’ve ever seen. If I had known that they would do that, I would have donated the items or kept them back for a yard sale and priced them at a quarter a piece and made over $15 more. Some of the items that they didn’t accept had never even been worn but they said they were dirty or had too much wear. I would have gladly donated them to a family in need instead of lining the pockets of a scammy corporation.

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Courtney March 5, 2013 at 11:42 AM

My family is big on yard sales. Come to think of it, my mom kind of runs a consignment shop with her yard sale! Several people put their items in the sale with their names marked. She doesn’t charge a percentage, but people always give her one out of courtesy for hosting.

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Courtney March 5, 2013 at 11:43 AM

Oh, and I’ve never heard of ThredUP, but thanks for the heads up. You never know if it’s worth it until you try.

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Joan March 5, 2013 at 1:11 PM

I’ve actually done ThredUP and I admit, it wasn’t an experience I’d repeat, either! I had done it under what I think was their earlier system – you ship a box directly to someone – and it was a huge loss for me. I’d have rather donated in my community as well! But like Courtney said – now I know! :)

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Jessica March 5, 2013 at 5:50 PM

I actually loved ThredUP’s old system. I sent out a few boxes of gently used baby clothes and received boxes of gently used baby clothing in the sizes I needed AND a box filled with new plus size clothing. I lucked out because I found a woman who had recently lost weight and was using ThredUP to get rid of her old clothing and they were exactly the size I needed.

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Freedom | Rethinking the Dream March 5, 2013 at 12:21 PM

We sold a few children’s dresses at a thrift shop. We weren’t in a hurry, so it seemed like a good way to sell them and get a little more than we would at a garage sale.

Also, donating can be pretty huge if you are already itemizing your deductions. We used “It’s Deductible” (by Quicken/Turbo Tax) to track and value our donations. For most items, especially clothing, we ended up with more money from the deduction than we would have from a garage sale or consignment shop.

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Leah March 5, 2013 at 1:10 PM

Good post! We don’t have a lot of “pawn shop” style places for clothes around here, but we have lots of consignment shops for women’s clothes and children’s items. Occasionally, I take women’s clothes to consignment, but it generally only yields $30-$40, it’s hardly worth it. I take children’s stuff to the consignment shop down the street 2 to 3 times a year though. Totally worth it! It’s a highly trafficked store, and very close to us. I get store credit and whenever we need something for the kids, we go there b/c we always have store credit. It’s an awesome set up. Get the clutter out of our house and get the stuff we need for the kids in exchange.

I also post a lot of stuff for sale on a local mom’s yahoo group. They have “yard sale sunday” and you can post stuff for sale on Sundays only. Most everything I offer for sale moves quickly and for a good price.

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Christian L. March 5, 2013 at 1:27 PM

Courtney,
That’s a great look at consignment stores. I’ll have to resist the temptation to look through that whole bicycle catalog.

Do you have a preference or experience finding better deals at thrift shops vs. consignment stores?

-Christian L. @ Smart Military Money

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Rebecca March 5, 2013 at 3:35 PM

For my books I usually go to Half Price Books no I do not always get what I feel that I should for what I donate but, on the plus side I get a bit of extra cash and I get rid of my books. For the rest of it I usually take it to Goodwill just so I do not have to deal with the hassel of having a yard sale or hanging on to stuff in order to have a yard sale and again for me the bottom line is to just get rid of my s*&t as quickly as possible. Plus when you are sneaking out that toy that is so obnoxious it makes you cringe every time your child plays with it or turns it on for me it is a Big win just to get it gone without the drama.

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Mike March 6, 2013 at 9:47 AM

I’ve read a couple articles recently about bedbug infestations and the hazards of Craigslist or second-hand purchases. We’ve purchased furniture in the past second-hand and haven’t had a problem, but I wonder if you have any thoughts on this? Overblown?

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OC Budget March 6, 2013 at 3:41 PM

I’ve been using Craigslist and Amazon.com for secondhand sales. Have had success with both. Although with Craigslist, I’ve been negotiated down alot (that time i sold my xbox and all my games for $90 bucks because the buyer didn’t bring enough money even though he had agreed to my listed price prior.. i was naive and didn’t know that this is a common excuse people gave to sellers while buying through craigslist)

There IS a consignment shop nearby here in South Orange County, California in Newport Beach but i hear that they are snooty at buying your stuff (and many times, they have been known to not even take any of your clothes!) so I have been abit intimidated to take my old clothes in there. One of these days I will do it and might even blog about it, lol!

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laura May 11, 2014 at 3:12 PM

Always list for a little more than you want to sell for in places like Craig’s…ppl want to bargain that way you both walk away feeling better abt the deal. :-)

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klp March 7, 2013 at 12:30 PM

We use thrift stores and charity pickups all the time–the tax savings typically netted us as much as the other options without the headache. The Salvation Army publishes a value guide: http://satruck.org/donation-value-guide. The tax form for non-cash charity is 8283 http://www.irs.gov/pub/irs-pdf/f8283.pdf (instructions here: http://www.irs.gov/pub/irs-pdf/i8283.pdf). be sure to split the load so that you are under $5000 per organization per day–otherwise you will absoultely need an appraisal of your stuff and will NOT be allowed to file your taxes electronically.
One year my wife did a wardrobe purge that proved to be worth $8k+ in charitable deductions.

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Cynthy July 18, 2014 at 11:25 AM

Thank you so much Courtney Baker for this VERY useful article, and thank you klp. for these links. You have no idea how long I have searched for ideas on how to get rid of my stuff and make a profit. Today I just put the right words in the search engine. Friends in need. Thanks guys.

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Cara July 5, 2013 at 1:57 PM

If you are starting your own thrift store do you have to collect and pay sales tax?

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klp July 8, 2013 at 4:32 PM

It varies from state to state. Some states exempt charities, others tax all resale operations.

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Timothy Joiner April 2, 2014 at 6:03 PM

My wife and I are considering starting our own resale/thrift store. It looks as though the market is pretty saturated? Probably not a good retirement family career business? It started out by cleaning out my basement and selling through resale sites on line. That is what I currently continue to do, but there are so many things that might(yesI said might) move better in a store. We live in Taylor, Mi.

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Ann April 13, 2014 at 7:15 PM

My personal favorite is thrifting. People often under-estimate thrift stores, but with some patience, you can walk away with some great items! I love adding to my wardrobe and the thrift store allows me to do so! I blog about all the amazing stuff I find to show people how amazing thrift stores can be! You can be fashionable on a budget!

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laura May 11, 2014 at 3:08 PM

I have used eBay for years more as a buyer than a seller but for confident buying/selling online you can’t beat it.

Recently though, FaceBook buy, sell, swap, yard sale pages have popped up. THEY ARE AMAZING! they are usually local, a little less creepy than craigslist cuz you can look at the other person’s profile and no percentage or shipping costs!

My mom passed and my siblings, having watched too much Storage Wars, were convinced we could get $500+ for what was left over…fail… $200 That’s it.

By comparison I cleaned out my closets and have already made $200 with far fewer items from Facebook…seriously check it out! You can arrange the sale for a public location without them coming to your home! I’ve had many items sell in 3 minutes or less…it’s like a virtual yard sale. As an apartment dweller it’s ideal!

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Jennifer May 25, 2014 at 6:46 AM

Great post! I always wanted a run down on consignment shops. However, I think the pawn shop description is wrong. Huge difference between a resale shop and pawn is that pawning gives you the option to use your belongings as a loan to get money or you can sell your items to them and get money that way. Platos closet isn’t considered a pawn shop but a resale shop. I know! It’s 2014 and I just stumbled across this page but just thought it was a bit misleading about pawn shops.

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Teresa June 9, 2014 at 3:02 PM

I had an experience with a consignment shop that was not a good one. When we moved from Arkansas to Texas, we left the baby bed my son had outgrown with a consignment shop. We called the consignment shop a month after we moved and they told us they thought they would be selling it in the next day or two. Two weeks later we found out the business closed their doors due to bankruptcy. We never heard from them again.

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Celina July 13, 2014 at 10:25 AM

I have found Facebook Yardsale sights to be the very best for selling stuff. Especially if you live in a big metropolitan area or near a ritzy neighborhood. People post a picture and price of their item, people comment “interested” or “Next” (for next in line) if they would like to purchase. The seller goes in order of interest and through private message the two agree upon a price and method of exchange, most meet in a store parking lot or other public place. This can be a great way to get the most for your money at your easiest convenience! Check the search bar in FB with your neighborhood or city name followed by “yardsale” to join a group in your area!

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Shannon August 5, 2014 at 11:28 PM

The selling sites on Facebook are worth selling children’s items or what else you want to sell on there to get some extra cash. I always felt like it was safe meeting people in a public place with buyers and sellers from Facebook . Craigslist is creepy, so I don’t sell on that site. Also, I recently started selling my kids gently used clothes, toys, games etc at the kids exchange (a huge consignment event) in Raleigh NC twice a year. I think that consignment event is well worth it because I made over $200 selling all of my kids gently used items they’ve out grown and don’t use anymore. It beats selling them at a yard sell or an reselling kids consignment store. I sell my gently used or new clothes at Hut 8 in They except more of my clothes than platos closet. I also sell on eBay with kids coats, kid shoes, and video games which sells well on there.

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Chrissy October 14, 2014 at 9:13 AM

I found this entire article to be full of misinformation. I own a children’s consignment store and we are very busy and have a few thousand consignors. Our shop in in the busiest plaza and usually has a line at the checkout. We are so busy in fact, and sell item so quickly that we never stop taking items because we are too full., Perhaps you should mention that your information may only be about the area where you live and not ALL consignment shops. It’s unfortunate that it gets a bad reputation based on the ignorance and limitations of someone personal experience.

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