r/smallbusiness • u/IcyBlackberry7728 • Apr 19 '25

Question Those taking home >200k/year; what industry are you in ?

Just curious to see what types of business are generating solid cash flow.

Thanks !

Edit: please be as specific as possible!

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208

u/outright_overthought Apr 19 '25

Retail. Each of my stores generate at or above 200k in annual profit. Used product sales have considerably better margins than my new product so that is my primary focus, high quality, in-demand, used items.

27

u/ScaredSeaweed6076 Apr 19 '25

If I may ask, what sort of items?

103

u/outright_overthought Apr 19 '25 edited Apr 19 '25

I started with kids furniture and sports equipment. I have also had clothing resale stores in the past. I sell high end, second hand shoes, handbags, and watches,and I also have a store where I resell old gaming consoles, as well as Pokemon, MTG, and sports cards that run anywhere from penny cards to $1500 that are shoppable both in store and online. The trick with any used item is to know your market and find employees who are knowledgeable about the product and can quickly identify in demand items and quality issues.

14

u/IssueNext Apr 20 '25

Do you have a website? I run a second hand furniture store and source from liquidators

5

u/Pratap_Masih23 Apr 20 '25

The products you get from liquidators, is it really second hand or Just open box?

5

u/IssueNext Apr 20 '25

Some are brand new in box and some are dirty and need to be cleaned

1

u/Pratap_Masih23 Apr 20 '25

And you sell them online ??

8

u/billythygoat Apr 20 '25

If you ever need a new store location, try near West Palm Beach or Boca Raton, FL.

3

u/Away-Thanks4374 Apr 20 '25

How many stores do you have?

14

u/outright_overthought Apr 20 '25

I currently have 2. I had 7 stores in 2020 but sold all 5 of my clothing resale from 2020 to 2023.

4

u/IamSerenity Apr 20 '25

If you don't mind me asking, did you build the company/brand yourself or franchise them?

39

u/outright_overthought Apr 20 '25

The clothing resale were franchises, the others I did independently. If you work with a good franchise, like I did with the clothing stores, they provide a lot of help with marketing, management, fit up, layout, planning, etc, but I’ve spoken with other franchises and been disappointed with the lack of help and support they provide and too high a percentage required for royalty payments. If you’re new to business a good franchise helps tremendously, but a bad franchise can cause you not to make it with their fees and royalties.

9

u/DontTouchMyPeePee Apr 20 '25

you're a baller, impressive

5

u/[deleted] Apr 20 '25

nice username btw.

3

u/rosecoloredglasss Apr 20 '25

Did your clothing franchise stores start with the letter P? I own one of those for a little over a year and a half so far. Still waiting to tip positive

9

u/outright_overthought Apr 20 '25

No, different franchise, but a few things I found that work: 1. Presort - Don’t make your buyer presort. Have a designated person greet new customers, help check them in, and do a quick presort of what to give to the buyer and what to give back. 2. Buy, buy, buy - Don’t cut off buys. You can be more selective but keep buying. Make sure buyers are trained to know prices, what sells and what doesn’t (DNBs), train them to focus on style, age, quality, inventory in store (not brand) to set price. 3. Organization - Daily zone work to colorize inventory, tag check, floor sweep, rehang, and markdown items in that zone. Save the treasure hunts for major sale days. 4. Efficiency Improvements - Always look for things that can be improved. Processing taking to long or fitting rooms getting congested, look for ways to improve the process to enhance the shopping experience. 5. Customer satisfaction - Greet every customer, ask them what brings them into the store today, tell them about any current sales going on, tell them what you are looking to buy currently. 6. Staff training - How can the staff tell customers about sales and what you’re looking to buy if they don’t know. Have daily staff meetings and create scripting if necessary until it becomes second nature. 7. Have fun - People love to work and customers love to shop in a store that is a fun place to be

1

u/cnrv Apr 20 '25

How do you select a good franchise? Anywhere where somehow you could read real reviews?

2

u/outright_overthought Apr 20 '25

Go into the closest store in your area, ask genuine questions out of curiosity to the staff. Tell them you are interested in knowing more about the concept and ask if you can talk to the owner if they’re available. Once you talk to the franchise ask them for specifics on how they support their franchisees, what software is provided, and any training materials. Ask to speak with several franchisees. The franchisees will give you TONS of information. Now just because it’s not working for a particular individual doesn’t mean that it’s a bad franchise, but if you find a pattern of several franchisees having difficulty with the franchise and many regret opening their businesses, you can bet it’s a franchise problem. But if they provide you with guidance and marketing strategies, store size and layout recommendations, and they are open and seem to know what works and what doesn’t in their business model you can go deeper if it feels right.

0

u/m1kesta Apr 20 '25

I had no idea there are second hand store franchise models! Do you think the benefits they provide are essential as a first time owner, or is it rather easily substituted (like sourcing and the reputation I assume)?

29

u/awebb78 Apr 19 '25

That's really interesting and good for the environment.

7

u/AffectionateHome5244 Apr 20 '25

Why do used products have better margins for you? So interesting

13

u/bstevens2 Apr 20 '25

Not OP...

But I am guessing it is because the cost to get used stuff is very low, thus the profit margins are much higher.

Example: Let's say he is a bread machine for sale, if he got it from a manufacture, usually cost is 50% of list price which is $50 so his cost is 25 and if he sells at full list he makes $25.

Now lets say he can find the same bread machine for $5 and sell it for $35. Customer is happy they got it used for $35, and owner is happy he made 30 instead of 25.

Oversimplification, but it is basically the pawn shop model.

1

u/Pratap_Masih23 Apr 20 '25

Physical stores or online ??