How Do Bin Stores Make Money?

If you are thinking of opening a bin store, or even if you just enjoy shopping at them, you may be wondering how bin stores make money. It may appear that they just get some random stuff, put it all into bins, and then profit, but there is quite a bit that goes into operating a bin store.

The quick answer is that bin stores make money from the inventory they sell in the bins, as more expensive individually priced items, in auctions, mystery boxes, or whole pallet sales. There are quite a few expenses that a bin store will have though, so the money made from sales is not even close to the final profit.

Finding the right inventory at an affordable price is very important and can also be difficult. The bin store operator must find reliable sources of good products to sell. Many times these products are customer returns or shelf pulls from places like Amazon, Target, Walmart, Home Depot, etc. As more bin stores and liquidation stores have opened, prices have increased due to more people needing to purchase pallets and truckloads of product. There are also some unscrupulous sellers that will misrepresent what they are selling. Just one or two bad loads can ruin a bin store business quickly, especially since it costs tens of thousands of dollars for each load.

Rent, utilities, and insurance are huge expenses for a bin store business. In addition to a storefront, there is a need for warehouse space for pallets that have not been processed. Depending on the location, having a big enough space for all of this can be pricey. There are various other things a bin store owner needs to consider, such as whether they want a loading dock, and other expenses such as a forklift, pallet jacks, pallet racks, extra trash removal services, and more.

Employee payroll and expenses are another big cost. There are the store employees working cash registers, restocking bins, updating social media, and going through the inventory in the warehouse, plus there may be accounting, payroll, and tax services to pay.

Unsellable inventory is something to consider as well. Since many bin store items are returns, which means that a portion of items will be incomplete or broken. Perhaps some things can be fixed, but not everything is salvageable.

As you can see, a bin store definitely will make money through selling its products. Bin stores are fun and exciting and customers love to come to dig through and find treasures. However, whether the bin store makes a profit is another story. Keeping track of expenses, increasing daily bin prices when necessary, and having a more expensive individually priced section are ways that bin stores can work towards profitability.