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How to open a pawnshop? What is needed for this?
How to open a pawnshop? What is needed for this?

Every year the demand for pawnshop services is growing. This is due to many factors: the fall in the solvency of the population, the decline in wages, the tightening of credit policies by banks, the rise in prices for all groups of goods, and much more. Thus, the profitability of this type of business is rapidly increasing. Therefore, many entrepreneurs are thinking about how to open a pawnshop. Step-by-step instructions will be discussed later, but for now it is worth noting that you need to be extremely careful when starting this type of business, since it has many nuances and pitfalls.

General information

pawnshop employees

Pledged lending, like any other type of business, has certain features that should be considered at the planning stage of a project launch. This is a very competitive field for activity, in which it is quite difficult to survive. This is especially true for start-up entrepreneurs who do not have much experience in the field of collateral.lending. The following are the main aspects that answer the question of how to open a pawnshop. The step-by-step instructions discussed in this article will allow you to create a profitable company that can withstand any competition.

Step 1: Market Research

This is one of the most important stages in the development of any project. Over the past few years, the number of pawnshops has increased dramatically, due to the abolition of licensing. In addition, the demand for services for cash loans has also increased many times over, since it is much easier to get them than to open a bank loan. On average, about 150-200 new pawnshops appear annually in our country. Therefore, before starting your own company, you need to study the market and identify potential competitors operating in your city.

Step 2: choosing the direction and mode of operation of the company

The story of how to open a pawnshop is best to start with the choice of specialization, since it is very extensive. Lending companies can issue cash loans secured by vehicles, real estate, jewelry, household appliances, mobile gadgets, antiques, branded goods and many other assets with high liquidity. As a rule, one organization carries out its activities with a certain type of property. With which one to work, it is rather difficult to answer. Here you should focus on the market, as well as choose the closest specialization for yourself. As for the mode of operation, most companies today work around the clock.

Step 3: financialplanning

work in a pawnshop

It is impossible to answer the question of whether it is profitable to open a pawnshop or not, without financial planning. Before drawing up documents, renting office space, purchasing equipment and hiring staff, it is very important to calculate the amount required for this. Without specific figures, you will not be able to determine the profitability of the business.

The following items of expenditure should be taken into account:

  1. The amount needed to implement the project.
  2. Monthly operating expenses.

The first point implies the amount that is needed to register and start a business, and the second is the monthly expenses of the pawnshop necessary to maintain its work. When all the calculations are in your hands, you will be able to determine the optimal interest rate on loans, as well as the amount of monthly lending, which is necessary not only to pay off the pawnshop, but also to generate profit. It is worth noting that, in addition to the principal amount, you must have a "safety cushion", since during the first months of operation the business will be unprofitable.

Step 4: decide on a name

Talking about how to open a pawnshop in our country, it is necessary to touch on the topic of choosing a name. It should sound simple, attract the attention of potential customers and be easy to remember.

Here are some criteria for choosing a good name:

  1. Short length, maximum two words, one of which is a pawnshop.
  2. Your company name must beexclusive, unlike competitors.
  3. It must inspire confidence and win people over.
  4. The name should be associated with reliability and safety.

It is worth noting that any self-respecting company should have its own website. Therefore, when choosing a name, immediately check if a domain name with this name is taken.

Step 5: Choose a location for the office

pawnshop staff

How to open a pawnshop so that it makes a profit? Answer: choose the right place for the office. Approximately 70 percent of the success of any business depends on this, regardless of its type of activity. In megacities, the ideal location for a pawnshop is considered to be sleeping areas in which there is a lot of people traffic. At the same time, it is better not to go to the city center at first, because, as practice shows, when looking for a company to apply for a cash loan, people simply do not reach it. But in small towns the trend is quite the opposite. Among other things, it is desirable that there are no other companies nearby that work with the same group of collateral as you, because in this case the lion's share of customers will go to your competitors. If we talk about the requirements for the premises, then it should be about 60-70 square meters so that the company can fully function.

Step 6: registering a legal entity

pawnshop managers

In Russia, the most common type of credit institution, in terms of profitability, is a pawnshop. You can start a business inas an LLC or CJSC operating on the general taxation system.

At the same time, the following activities should be indicated in the statutory documentation:

  • short-term loans secured by movable property;
  • provision of services for the storage of valuables;
  • provide consulting and information services.

It is worth noting that when registering a legal entity, the name must contain "Lombard". This is a requirement of current legislation, so compliance with it is mandatory.

Step 7: Paperwork

So you've decided to open a pawnshop. What documents do you need to obtain from regulatory authorities? To engage in secured lending, the company must have the appropriate certificates. As for licenses, they are not currently required. If you work with jewelry, then you must register the company with the assay office and obtain the appropriate document from the assay office. In addition, it is necessary to develop a charter for the internal oversight organization, as well as purchase laboratory scales, which will have to be checked in once a year.

Step 8: design and promotional materials

pawnshop meeting

Opening a pawnshop (documents must be drawn up in advance) is quite simple, but promoting it so that as many people as possible who would like to use the company's services find out about it is much more difficult. First, you will needa high-quality sign for the office that can attract the attention of passers-by, and secondly, you need to prepare promotional materials. In addition, if you plan to expand in the future and want to create a network of pawnshops, then you should immediately think about creating a corporate logo. Do not try to do everything yourself, as this should be done by a qualified specialist. It is better to hire a professional designer with experience in this field.

The sign should not be too colorful and bright. Here it is better to stick to minimalism. The font should be large so that the information is easy to read.

Step 9: technical equipment of the room

girl manager

Many people are interested in the question of how to open a pawnshop from scratch. We have already covered the legal formalities and also talked about what documents will be needed. The next stage is the technical equipment of the premises. The size of the necessary financial investments depends on many factors, the main ones being the specifics of the company's work and the level of finishing of the premises.

Required equipment is:

  1. Shopping: showcases, metal racks, counters, office tables and chairs, safe.
  2. Technical equipment: computer or laptop, MFP, Internet. Landline and mobile phone, internet.
  3. Security: burglar alarm, CCTV, metal door, window bars.
  4. Specialized equipment: laboratory scales, reagents and instruments for the evaluation of precious metals anddiamonds, speaker test stand.
  5. Advertising: signboard, pillar, facade lighting.

It is worth noting that the choice of equipment depends on the specifics of the company, so this list may differ for each specific case.

Step 10: software selection

Revealing the topic of what you need to open a pawnshop, you need to say a few words about the software. It plays a very important role and allows you to monitor the functioning of the company, keep records of its work, quickly serve customers, simplify document flow and improve the quality of service in general.

The most common software is "SmartPawnshop". This program has excellent functionality, high security and a simple interface, so you can master it very quickly and easily. In addition, a big plus of this product is that it is adapted to pawnshops of various specifics, so it does not need additional refinement.

Step 11: Search for employees

When talking about how to open a pawnshop, special attention should be paid to finding employees. The thing is that credit companies have to deal with various groups of goods that act as collateral. Each category of property has certain characteristics, so the staff of the pawnshop should be specialists who are well versed in those goods with which the organization works. In addition, if the client refuses to repay the debt, you will have to sell his property, therefore, without experienced sellersthis is also indispensable.

pawnshop deal

Here is a list of positions that should be in any credit institution working in the field of secured lending:

  • appraisers;
  • credit managers;
  • sellers;
  • accountant;
  • guard.

Not only the profitability of the business, but also the prestige of the company depends on the level of qualification of the working staff, therefore, hiring employees should be approached very responsibly.


Now you know what it takes to open a pawnshop in Russia. By following the simple steps listed in this article, as well as following all the tips and tricks, you can build a profitable company that will generate monthly income. But starting a business is only half the battle, as it is much more difficult to promote it, as it will take time. Therefore, work honestly and openly in relation to your customers, because the best advertising, as you know, is the people themselves. And you will certainly succeed.

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