Profitable Swap : Moving Up to Retail Space Paid Off
After selling costume jewelry at a swap meet for a year and a half, Carol Shapiro realized she was running a small business. She used that experience to open a retail store in a discount mall and earned a better return despite the higher costs. Shapiro was interviewed by Karen Kaplan.
I started selling costume jewelry at garage sales, but then the city where I live limited garage sales to only two weekends a year. I decided to take a chance and try selling at the Roadium Open Air Market in Torrance, a swap meet where I had been shopping for seven years.
The swap meet is a very booming business. It would cost me about $42 a day to rent a good aisle space, although I’d have to get there at 4:30 on Saturday and Sunday mornings to get a good space. I had to get a permit from the city of Los Angeles, which is free. I also spent about $200 on wood and fabric to make some display tables and everything else I needed to get going.
Gradually I started selling at the swap meet four or five days a week and I gave up my regular job as a secretary and office manager. After about a year and a half, I realized that I was running a real business and I decided to find a retail store.
You see, there are some drawbacks to selling at a swap meet. You have to reserve your booth and pay for it a week in advance, and you don’t get your money back if it rains. I got tired of people bickering over prices all the time. There was also a theft issue. When you are the only one manning your booth, it is easy to get scammed.
The revenue stream can be really unstable. I could make $300 on a Saturday or Sunday and then make $50 the next week. If the weather was really bad or if it was too hot, there would be very few customers. Plus, the extreme heat could damage my jewelry.
On the plus side, I did get a lot of valuable market research by talking with customers at the swap meet, although I didn’t realize it was market research at the time. For example, I found out there are a huge number of women who wear clip earrings and can’t find them anywhere, so I made a point of selling them.
It cost about $145 a week, or $600 a month, to rent a space at the swap meet. Compared to that, the rents at regular shopping malls were outrageous. But last year I found a place in a discount mall and it has about three times more space than I had at the swap meet.
Now my rent is $1,000 a month, and with all of my insurance and operating expenses, the total cost comes to about $2,000 a month. That’s obviously more than I paid at the swap meet, but it’s definitely worth it. Even with the higher expenses, I’m making more money with the store.
People are willing to pay more for merchandise in a retail store, and that allowed me to sell better jewelry. Now that I’m in a regular store, business fluctuates less. And since there are security guards here, I haven’t had a problem with theft.
I think swap meets are good for a lot of kinds of businesses because you can set up a store for very little money. But I would also encourage people who have been at the swap meet to consider getting a retail space.
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AT A GLANCE
Owners: Carol and Don Shapiro
Nature of business: Costume jewelry and accessory store
Location: Los Angeles
Year founded: 1996
Number of employees: 3
Annual sales: Expecting $75,000