Starting a Resale Business

starting a resale business

The resale market in the United States has snowballed in recent years. Reselling is when you source a product second-hand to resell for a profit. ThredUp, a popular website to resell clothing items, reports the resale market, now valued at around $28 billion, will grow to $64 billion by 2025. There are many theories about why the resale business is exploding. The global pandemic is producing cost-conscious shoppers. The rising unemployment rate means many buyers are looking for bargains. Another theory is that the younger millennial consumer base cares deeply about resources used to make clothing and find second-hand shopping more comfortable. Finally, widespread access to technology to resell items has made the industry much more mainstream and efficient.

Storage auction bidders have been reselling items for decades. Reselling is their business, and they were doing it long before the internet provided easily accessible places to resell items. Storage bidders have been sourcing goods to sell since before eBay and the dot-com bubble. Their success and the popularity of storage auction TV shows led to an explosion in the resale trade. Unfortunately, the TV shows glamorized a business that is much more than an easy side hustle. Many people don’t realize when they start bidding on storage units; buying and selling items from storage auctions is a material, legitimate business. It is a resale business. Here, we will share some tips with you to be a successful reseller.

 

Setting Up Your Resale Business

Success in any business requires a lot of pre-planning. First, you will want to obtain your business license from your state. See here for a state-by-state guide for obtaining a business license. If you plan to have a second-hand store or sell items in person, you might want to consider getting liability insurance. Liability insurance provides protection against claims due to injuries or damage. Insurance will protect you, your employees, and anyone who visits your shop. You will also need a resale permit. This permit allows you not to pay sales tax when you buy your inventory. You will need to charge sales tax when you sell the items and then report your sales tax collection each year. You can get a resale permit from your state’s Department of Revenue.

Besides licenses and insurance, you will need a way to track all of your purchases and sales. Think about purchasing an accounting program, like QuickBooks or Zoho Books. You should have a business bank account separate from your personal account. Co-mingling your personal finances and your business finances could lead to a tax nightmare in the event of an audit. It is important to know which purchases were made for your personal use and which ones were made for the business.

You will also need an inventory management system. When you are ready to file your taxes, you will need to know what sold and for how much. Additionally, you will need to know what you purchased that did not sell. Zoho offers an inventory management system with a free edition. eBay also offers the Easy Auctions Tracker. The Easy Auctions Tracker is an Excel-based spreadsheet, but it is sophisticated and robust.

Do Your Research

What are you planning to sell? Do you know what typical prices are? Some reseller pros recommend finding a niche market. Still, as storage auction bidders, it is difficult for you to pre-plan your inventory, so you might need to become an expert on selling many different types of items. Below is a list of things you might find in a storage unit to resell:

    • Electronics
    • Video games
    • Clothing & shoes (especially sneakers)
    • Collectibles
    • Sports equipment (varies by season)
    • Kitchen appliances and parts
    • Auto parts
    • Legos
    • Plush toys

Resellers can get overwhelmed when it comes to shipping items to their items. One problem is there are so many shipping methods to choose from. Another problem is online sites, like eBay, have shipping fees built into their platform. If you don’t have a clear understanding of how these fees work, you can end up overpaying.  Do you want to set up used fixed shipping fees or use a shipping calculator? You also do not want to price yourself out of the sale if your shipping rate isn’t competitive. It is worthwhile to learn about how shipping works unless you plan only to sell locally. You can consult the United States Postal Service about the weight of shipments and shipping rates. You can get free boxes and mailing envelopes from the USPS. Many of the online resale programs also offer guidance on shipping. For example, you can find out about shipping with eBay here.

Where to Sell

There are so many websites you can use to resell items. Some sites, like OfferUp or Letgo, allow you to sell almost anything. However, several sites like Poshmark and Etsy have specific requirements for what you can sell. Other sites specialize in a certain type of goods. You could get more money selling on the specialty sites than you might on a general resell site. Be sure to look at all different places to see where you might get the best return for your items.

  • Poshmark – designer brands, on-trend fashions, and shoes
  • ThredUp – new and used women’s and kids clothing and accessories
  • The Real Real – jewelry and designer goods
  • Kidzien – kid’s clothing
  • Etsy – vintage or hand-made goods
  • Ruby Lane – antiques and collectibles
  • Chairish – high-end furniture and décor
  • Swappa – tech gadgets
  • 5miles – sell within a 5-mile radius

The most important thing you can do to be successful is to treat reselling like a real business. Be active and consistent with your postings. Post often and follow through with all requests. You might find other resellers in your area and network with them. They might be willing to share their experiences and tips with you. If you want to get started right away, check out our two-part blog series Reselling Clothing: Best Practices. You can find part one here.

There is endless information about reselling that you can find on the internet. We are going to share several tips and tricks of the trade here on our blog. For example, do you know how the descriptions in your product listings become keywords for shoppers to find your items? Check back next month for marketing tips to enhance your listings.

Be sure to visit our website to see what great units await you to jumpstart your resale business.

 

 

 

 

 

 

 

Winning an Auction: What Happens Next?

moving after online storage auction

Buying a unit at a storage auction is more complicated than it might seem. Television shows make it look so easy – find an auction, outbid the competition, discover epic treasure! However, storage auctions are just like any other business in the world; there are rules. Familiarize yourself with these rules to be successful.

Bidding is a fascinating part of the auction process, but winning is the ultimate goal. Once you’ve landed your first unit, everything moves very quickly. First thing, you will get your winning bidder email. You will only have 24 to 72 hours from the sale’s close to empty the unit. Plan early to get into the office to pay your winning bid amount. After you pay, remove the unit’s contents (without using the facility dumpster), and devise a plan to resell your winnings. It might be easy to overlook some essential steps. See below for tips to follow after you win an auction on StorageTreasures.

Contact the Facility

After you win a unit, the first thing you should do is contact the facility to confirm the unit is still available. A very frustrating, albeit legally required, part of online storage auctions is the delinquent tenant gets a little extra time to pay their bill. In an online auction, the tenant can pay up until you take possession of the unit. To take possession, you go to the facility, pay the bid amount, and place your lock on the unit. If you win a great unit and think there is a possibility the tenant might make a last-minute payment, you will want to get to the facility as quickly as possible.

Bring Items Needed to Claim the Unit

There are a few items you will need to be able to pick up your unit. Always bring a copy of your driver’s license or other identification. You can have other people pick up your units for you, but you will need to list them as an authorized pickup person on your account. If an authorized pickup person goes in your place to claim the unit, they will need to show their ID. See the image below for where to enter a person authorized for pickup.

StorageTreasures Authorized Pickup Person

 

You will also need to bring cash for the bid amount, possible sales tax, and a cleaning deposit. Some facilities allow credit card payments. Be sure to check the Additional Information section on the auction listing for all facility rules and online auction regulations. If you have a Sales and Use Tax Resale Certificate, have a copy on hand you can give to the facility to remove the sales tax. You will get your money back once you have cleaned the unit to a swept condition.

Remember to bring a lock to secure the unit. You do not legally take possession of the unit until you have placed your lock on the door. Storage facilities often have different types of locking systems. When you call to verify the unit is still available, ask the facility manager what kind of lock you need to bring.

Check out this previous post titled “4 Things to Bring to a Storage Auction” for more information about what you need for a successful auction.

Clean the Unit to a Swept Condition

Swept condition is precisely what it sounds like, swept clean. Swept clean means you have to remove all items from the unit and sweep up any remaining debris. There is a thing in storage auctions called “cherry-picking.” This is when the buyer takes what they want from the unit and leaves the rest behind.

I have heard some buyers say, “it was worth it to lose the cleaning deposit not to clean it out.” Unfortunately, it is not that simple. Failing to empty the unit can result in you being banned from bidding on auctions on StorageTreasures.com. Our rules (and most all storage auction rules) state you must remove the unit’s entire contents from the premises.

You also cannot use the facility dumpster. This rule isn’t because the facility manager doesn’t like you. It is because storage facilities have small dumpsters that can’t handle the entire contents of storage units. Seasoned auction buyers get passes to the local dump to dispose of the unwanted items from online storage auctions. It is wise to keep the clean-out process in mind when buying multiple units.

Recover Your Cleaning Deposit

Once the unit is empty, you will need to have it inspected by the facility manager to get your cleaning deposit back. Keep in mind; the manager will only be available to return your cleaning deposit during office hours. If you are traveling from a far distance to claim the unit, you should plan ahead to secure your cleaning deposit return.

Some storage companies require you to put your cleaning deposit on a credit card. If that is the case, you likely won’t get your deposit back for 3-5 business days due to the nature of credit card processing. Be sure to read the Additional Information section of the auction listing for any rules concerning the cleaning deposit.

If you want to find out more about storage auctions and prepare for your first auction, here is an excellent article from Side Hustle Nation that gives you a more in-depth perspective from an experienced auction buyer.

Now that you know what to do after you win a unit, head over to www.StorageTreasures.com to find your next big win! If you have any questions about how an auction works, reach out to us on Facebook or contact our Customer Support Team. You can reach them at (480) 397-6503 or support@storagetreasures.com.

StorageTreasures Communication to Bidders About COVID-19 Virus

COVID 19 scaled

StorageTreasures Logo

Valued Bidder Community,

As you’re undoubtedly aware, the growing Coronavirus pandemic (COVID-19) has brought unprecedented changes to our personal and professional lives on a national level. Rapid changes in government mandates and recommended safety precautions have forced many businesses to pivot standard practices to maintain daily operations and protect the well-being of their staff and customers.

 

StorageTreasures is currently experiencing low auction volume as a result of these changes. Most self storage operators have temporarily suspended auction activities – either in compliance with a government mandate, or to provide relief for tenants as many individuals face lost wages and unemployment.

 

We know that for many of you, auctions on StorageTreasures supply your primary or secondary source of income – and understand that you may equally feel the impact of these decisions. While we cannot offer clarity regarding when these auctions will resume, we will continue to provide full customer support for all auctions still available for purchase.

 

StorageTreasures will use this time to continue to upgrade and enhance our platform to ensure the best possible bidder experience when auction numbers normalize. We encourage you to engage with us on Facebook, or subscribe to our blog, to stay up-to-date on this developing situation and gain access to exclusive content,
contests and community-building activities.

 

We are grateful for your unfailing loyalty and look forward to the day when business is booming once again. Stay safe. Stay healthy. And be sure to check back often for new updates, activities, and auctions.

Warmest regards,

The StorageTreasures Team

P.S. Have questions? Please email info@storagetreasures.com, or call (480) 397-6503, to speak with a member of our dedicated support department. They are available to assist you Monday – Friday; 6AM – 7PM MST.

 

StorageTreasures.com Acquires Storagestuff.bid

storage facility auction

StorageTreasures, LLC, the owner of StorageTreasures.com, the storage industry’s leading online auction platform, announced it has acquired StorageStuff.Bid, a well-respected competing online storage auction site. As part of the transaction Cheli and Chris Rosa, both seasoned auctioneers and employees of StorageStuff.Bid, will join OpenTech Alliance, Inc., managers of StorageTreasures.com and majority stakeholder of StorageTreasures, LLC. As part of the deal, over 700 self-storage facilities that have been posting auctions on StorageStuff.Bid will be added to the StorageTreasure.com site making the largest online storage auction platform in the world, even larger.

“We have always had a great relationship with the folks at StorageStuff.Bid and are very excited to now be on the same team. With Cheli and Chris on board, we are the only online auction company to have professionally licensed auctioneers in all states where it is required, which gives our customers a level of protection not available with other online auction sites. They add a ton of credibility to what we’re doing, a wealth of knowledge, and valuable expertise as it pertains to lien laws for both traditional and online auctions,” claimed Robert A. Chiti, CEO of OpenTech Alliance, Inc.

Chiti added, “Cheli will be responsible for supporting the StorageStuff.Bid customers as well as improving our facility manager and auction buyer training programs. We are going to put Chris to work on expanding our Auction Review Service. In addition, we are going to rely on both of them to teach us how we can better support Auctioneers with their live auctions.”

“We have been an OpenTech and StorageStuff.Bid customer for many years. The merger of OpenTech’s technology expertise with Chris and Cheli’s auction experience is a great thing for us and the industry. We trust them to ensure our lien sales are done properly and that we get as much money possible for our delinquent tenant’s goods,” Marc Harris, Vice President of Metro Storage.

“We are proud of what we have accomplished at StorageStuff.Bid, but realized that it was going to be very difficult to compete with the level of investment OpenTech is making in StorageTreasures.com. The amount of money they spend on digital marketing, auction buyer programs, customer service and technology innovations is staggering, so we felt joining forces was the right move. The one area they were weak was actual auction experience. Chris and I are filling that gap and bringing them our years of experience running both online and live auctions as well as our professional auctioneer licenses”, stated Cheli Rosa from StorageStuff.Bid.

The company expects to have all StorageStuff.Bid customers transitioned within 90 days, at which time the StorageStuff.Bid site will be shut down. After the transition, StorageTreasures.com will represent 8,500 facilities, 900,000 active buyers, and 15,000 monthly auctions. As the leader in online storage auctions, StorageTreasures has completed well over 1,000,000 successful auctions for self-storage facilities.

About StorageTreasures
Founded in 2010, StorageTreasures offers the most comprehensive self-storage auction platform available on the internet. In addition to storage auction hunters, the site serves auctioneers, appraisers, pickers, yard sale buyers, self-storage customers, and facility owners throughout the US and Canada. OpenTech Alliance, Inc. owns a majority of StorageTreasures, LLC and manages StorageTreasures.com.

About OpenTech Alliance 
OpenTech Alliance, Inc. is the leading developer of innovative technology solutions for the self storage industry. The company’s products and services include the INSOMNIAC line of self serve kiosks , INSOMNIAC Live! call center , INSOMNIAC CIA access control system and StorageTreasures.com online storage auctions. OpenTech solutions are designed to improve the customer experience, reduce operating costs and increase revenues for self-storage facilities.