From the June 2005 issue of Entrepreneur

Want to get started in the retail business? Check out your local flea market or swap meet as an inexpensive yet effective point of entry. "It's a good way for people to get into business," says Chuck Pretto, president of the National Flea Market Association , which estimates there are currently between 2,500 and 3,000 weekly flea markets across the nation, bringing in about $5 billion in annual sales.

The first step, says Pretto, is to research your local flea market. Shop the market to get a feel for the customers, the booth design/setup and the kinds of products that sell well, paying special attention to vendors in your same category. Says Pretto, "[Determine] who your competition is, and then you can make [your offering] a bit different or a bit better." In terms of booth design, "Don't just lay your merchandise on tables and on the ground," he says. Design a display that is both welcoming and attractive to customers.

Most cities and states require a vendor's license, and many marketplaces offer a bevy of information to new vendors. Though fees and terms vary by market, booth rentals range from $10 to $100 per day (the high end is usually for permanent vendors selling new merchandise), and fees are often payable upfront in cash. Pretto also notes that many flea markets operate only on weekends--and you'll generally want to shoot for between $300 and $500 per day in gross sales. According to Pretto, items that tend to sell well at flea markets include impulse items under $20: T-shirts, sunglasses, used items, knickknacks, collectibles, toys and kitchen items.

Once you start selling, remember that it's all about value and great one-on-one customer service. As Jack and Marilou Johar discovered, the right balance can help you turn your flea-market business into a larger retail enterprise. Jack, 48, and Marilou, 35, launched their Paramount, California, fashion leather retail and wholesale business, Street Leathers Corp., to sell leather goods like jackets, belts and more. After purchasing quality products from local and international wholesalers, Street Leathers debuted at the Paramount Swap Meet in 1998, where the couple sold $500 of product their first day. Jack is the salesman, says Marilou: "His motto is, If a customer comes to [our booth], never let him or her go without buying."

Soon, they were able to rent a larger, permanent space at a daily swap meet in Anaheim, California, and in 2001, they were grossing about $10,000 per month in sales. The pair then rented a wholesale warehouse space in downtown Los Angeles and expanded their product line to include leather clothing, boots, handbags, wallets and hats. They also began wholesaling to other small vendors. The couple eventually transitioned out of the flea markets, and today, they focus on wholesale, mail order catalog and online sales ( www.streetleathers.com ), which have together pushed 2005 sales projections to between $2 million and $2.5 million.

Flea markets can be just the springboard you need into retailing. "The [entrepreneurs] that are the best at [flea-market selling] will go through that life cycle--they'll start selling, then establish a permanent booth," says Pretto. "And then, over time, if they make the decision, they will find many different outlets for their businesses, [like] online stores and [brick-and-mortar] storefronts. There are phenomenal success stories out there along those lines."