Talking Money: Set Up Shop

Jean Chatzky
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Posted: Sep 16, 2009 3:17 PM

Looking for a glimmer of hope in the retail economy? You may not find it in the stores. According to the U.S. Commerce department, total retail sales fell (again) this past July.

Don't despair! You can find hope on the stoop or in your own front yard, or even on the Internet. The garage sale economy, you see, is chugging along nicely. Ever since the downturn of the economy, listings of used-item sales on sites such as Craigslist and Facebook Marketplace have tripled in the last two years. If you haven't cleared out your junk just yet -- and you're looking for a way to fund those school supplies or winter heating bills -- you may want to consider selling your unwanted items. Here are some strategies.

-- Ready your merchandise. Clean out your closets, pull everything out from under the bed, and dig through the basement. You'll be surprised at how much stuff you have that you really don't need or even want. Jon Fulghum, author of Everything You Need to Know About Garage and Yard Sales, says that during your overhaul, keep an eye out for tools, children's items and house wares, which all tend to sell the best. What doesn't? Clothing is a bit of a slow-mover, as are personal hygiene items. (I thought that one would be a no-brainer, but Fulghum says you'd be surprised.)

Once you've selected the things that are going to sell, make sure they're all clean and in good working order. Replace missing buttons, dust off your electronics, and clean up toys.

-- Price it right. Sentimental value won't transfer to your potential customers, who are just looking for a deal. If you live in a yard sale kind of neighborhood, do a sweep to see what the competition is charging. No one is going to buy your $7 book if they can get it down the street for $1. Once you've done your research, use a combination of a few methods to set your prices. Donna Smallin, an organizing expert and author of The One-Minute Organizer: A to Z Storage Solutions, says that a good rule of thumb is to charge 20-30 percent of what you paid for the item. But you should also take into account the condition of the item, what you yourself would objectively pay for it, and wiggle room for price negotiations. Then mark everything in an organized way. "I like to use blue painter's tape because it rips off easily like masking tape, but the blue color is more visible. You can also put signs up, so if you have a bin full of books, your sign would say 'all books $1'," suggests Smallin.

-- Advertise. First, pick a date. Then pick a rain date. Once you've settled on both, take out an ad in the local paper, to run the day before the sale. If you wait until the day of, says Fulghum, your potential customers will already be out scrounging for deals while their paper -- and your ad -- sits on the doormat. You should also hit Craigslist, where advertising is free, and distribute fliers where you can. Supermarkets, Laundromats, drug stores and local banks are prime targets, as are telephone poles. (Just be sure to remove the fliers after the sale is over.) And nothing spreads faster than word of mouth, so tell your co-workers, your friends at the gym, and other parents at your kids' school. They may even want to join you, and when it comes to yard sales, the more the merrier.

-- Set the scene. Organization is key. You can't just throw a bunch of things on a blanket or table and expect to make some cash. "Think about how a retail store is set up. They have departments, and you want to set up departments throughout your sale. So in one area, you might have purses, jewelry and accessories," says Smallin. By placing similar items together, you'll make sure that a potential buyer sees all of the options. Make sure that any clothing you've decided to sell is marked with the correct size. Fulghum also suggests hanging clothing up individually. (A broom suspended on two ladders imitates the metal racks you see in retail stores.) "That way, people can rummage through them without creating a lot of disorganization." Make sure you also have the ability to plug in electronics, so buyers can verify that they work.

-- Have a back-up plan. You may sell everything, but if you don't, it's up to you: Do you want to shove the leftovers back in the closet? Try your hand on eBay? Reopen shop another day?

If the idea of lugging everything back inside isn't appealing, I suggest putting your items on a "super sale" about an hour before closing time. If books were $1 before, start offering them at two for $1 or 25 cents each. Throw in a few enticing extras -- if someone is considering taking that shelf off your hands, offer the set of dishes for free. You'll still make some cash, and get rid of your stuff in the process. With reporting by Arielle McGowen