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How to Start an Online Resale Shop

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Someone else's cast-off clothing can become cash for you when you start an online resale shop. Because the shop is online, you don't have the expenses of a brick and mortar store, such as rent, utilities or employees.

Make Your Choice

Resale shops are stocked in two ways. The first method is the clothes are bought by you and then resold. The other method is consignment, where you are selling clothes on behalf of someone else. When the item sells, you pay the owner the agreed price less the commission you retain. An online shop works the same way, except that you don't have the clothes; they remain in the possession of the owner. The owner posts photos of her clothing on your website and determines a price. The customer buys the clothing and pays you. The owner delivers the clothing and gets paid by you.

Set Up Payment

Offer more than one method of payment to increase sales. Set up a merchant account to accept credit cards. Use third-party processors such as Paypal, Google Checkout and SquareUp, which allows you to accept credit card payments with your smart phone. You don't need the actual credit card to swipe through the reader. The information is entered manually.

Collect Clothing

Scout out clothing for your store at estate sales, thrift shops, tag sales and garage sales. Churches often have tag sales with merchandise that's a step up from thrift shops. Contact companies who stage estate sales and let them know the type of clothing you buy. Ask them to call you so you can arrive early and be first in line. Keep the clothing in a spare bedroom or closet. If there's not enough room in your residence, rent an off-site storage facility that's climate-controlled. You don't want the clothing damaged by mold and mildew.

Create the Website

The site needs to display the clothing to its advantage with photos and written descriptions. Visitors appreciate being able to search for clothing by gender, age, item, color and size. Shopping-cart software is necessary as well. Add a blog to the site to answer visitors' questions. Create a presence for your business on social media sites such as Google+ and Facebook to engage potential customers. Encourage people to follow you by offering a discount. Announce new clothing acquisitions to friends and followers.


You may think that because your business is online that you aren't required to have a business license. You are and you may have to obtain one from both the state and the city where you live. Additionally, a sales tax license is necessary for sales made to customers who live in the same state. Different states and cities have different rules as to what's required. The state and city business development offices should be able to tell you specifically what you need.


Brian Hill is the author of four popular business and finance books: "The Making of a Bestseller," "Inside Secrets to Venture Capital," "Attracting Capital from Angels" and his latest book, published in 2013, "The Pocket Small Business Owner's Guide to Business Plans."

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Petar Chernaev/E+/GettyImages