Everyone loves a bargain, and especially now when household budgets may be strained, yard and estate sales are enjoying booming business. Estate sales, which dispose of a substantial portion of a person's property, can be especially lucrative.
Conducting an estate sale is more complicated than simply cleaning out an attic or garage. A working knowledge of how to evaluate items and the amount of time that must be dedicated to evaluating hundreds of items makes a huge difference between yard sales and estate sales.
Starting an estate sale business requires a lot of time, not only in learning about the process of evaluating and pricing items, but in the actual preparation of each sale, which in the case of a large estate, may take several weeks of preparation.
Learn How to Value Common Items
Learn as much as you can about antiques and about pricing common items. Study topics such as how to identify Windsor furniture, post card collecting, or toys of the early 1900s. Learn the qualities that make an item more or less valuable. For example, many items are more valuable if they also have the original box they came in. Go to as many estate sales as you can, and pay close attention to items and their prices. Knowledge and experience will make the process of pricing items go more quickly and smoothly.
Cultivate a relationship with a local antiques expert. When you aren't sure of an item's value, align yourself with other professionals whom you can ask to help you evaluate.
Officially Register Your Business
Register your business name. This can often be done simply and quickly over the internet. You will be issued a business registration certificate, and if your state has sales tax, a Certificate of Authority to collect it. You also will be responsible for collecting sales tax on the items you sell, reporting it and sending the check to the state.
In addition, your business should also have an Employer Identification Number (EIN), or you can use your Social Security number if you are a sole proprietorship or a single-member LLC. Either of these are needed when reporting state and federal income taxes. Some states, such as New Jersey, make it easy to register the business and apply for a federal EIN number in one easy step at their website.
Go to the municipal halls of the towns you will be holding sales in, and ask if any special permits are needed. Some towns require permits, and have special rules and regulations about holding estate sales. Be sure you know these and abide by them. There may be a small permit fee for sales.
Create an Estate Sale Contract
Draw up a contract with the party for whom you are conducting the estate sale before any work is done. Details should be clearly and simply defined, so there are no surprises and everyone is in agreement on terms. Commission rates for your services may range from 10% to 20% of gross sales.
Advertise Your Estate Sales
Place ads in the classified ad section of all local newspapers, including daily and weekly papers. Classifieds are usually inexpensive, and can generate a lot of traffic. Many people specifically scan classified ads, looking for estate and yard sales. Local yard sale groups on Facebook are another popular place to advertise estate sales, and you should consider creating a website as well.
Prepare Signs for the Sale
Construct free-standing signs to be posted along streets to direct visitors on the day of the sale. Be sure to remove all signs the day after the sale. Do not place signs near any sort of traffic signs. Graphics companies offer inexpensive signs made out of a lightweight corrugated material with two thin metal legs to make them free standing and easy to push into soft dirt. The signs should be generic, and simply read "Estate Sale,” with an arrow pointing the way. Do not include dates on the signs, so you'll be able to use them for future sales.
Evaluate and Price Items for the Sale
Allow sufficient time to evaluate, price and prepare an estate for the sale. A large estate will require many long hours preparing items. Every item, no matter how small, should be priced and tagged. People are more apt to put an item back if they don’t know the price, rather than ask you. Schedule to sell during a period of two or three day period. On the final day, reduce the price of items for quick sale.
Find Helpers for the Sale
Hire help for sale day. Whether it’s a spouse, friend, or a business partner, sale day will be hectic. Buyers will need directions, and they will have questions. Merchandise will have to be paid for, so have a sufficient amount of change on hand, including ones, fives and tens, and have on hand a supply of pens, paper and a calculator.
Unless you open a merchant account to accept credit cards, the average estate sale proceeds are paid in cash with a “No Return”, “Cash and Carry,” or “As Is” policy.
Protect Your Investment
Believe it or not, shoplifting can be a problem at estate sales. To deter shoplifting, have a number of estate sale staff with a visible presence. You may event want to have a local T-shirt company print a few shirts with “Event Staff” or the name of your business on them to increase visibility and discourage theft. Security cameras represent another option.