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Seems there’s been lots of talk recently about scavenging full time and I thought I’d give my experience. My story may be a little different than most but hopefully my experience can help somebody. I was working nights full-time up until a month ago but finally decided the 80 hour weeks were taking too much time away from my family.
I’ve sold on eBay off and on (more on) since 2001. I even tried Amazon for a couple of years around 2009. In 2013 I decided to get serious about selling on eBay and turn it into an actual business. I decided to invest $300 and to this day that is all the money I’ve put into the business.
I was already in the habit of hitting up garage sales, thrift stores and estate sales. I added auctions to my sources with that initial $300. At first I started with school surplus auctions plus my usual finds. I quickly expanded into vintage and antique items which I’d always had an affinity for. For the first year I invested all my profits back into the business. By the end of year one I had a 10×20 storage unit for storing everything except clothes. In 2014 I started purchasing abandoned storage units at auction in addition to my other sources. This lead to more storage requirements so by 2015 I had two 12’x30′ storage units, 2 sheds and a 2-car garage full of inventory.
I was selling six figures annually on eBay but I was getting lots of inventory not worth selling on eBay. Furniture was easy enough to move on Craigslist or Facebook, but what to do with all the smaller items? In late 2016 I started considering opening a retail store. My wife and I (along with a friend) tested the concept in early 2017 by having a couple of barn/warehouse sales in facilities we rented for a week or two at a time. These sales were very successful and in October 2017 we opened a 7500sq ft retail store. I advertised only on facebook and in the first full year of business in-store sales outpaced eBay. The store is a mix of antiques and junk. We have some our eBay items displayed but it is mostly the items not worth listing online. Our in-store philosophy is quick turnover while our online method is long tail.
Our sourcing now is mostly auctions and storage units, with the remainder being people coming to us with items to sell. Once we had a storefront we had people coming in daily with anything from one item to an entire household to sell. We actually have to turn opportunities away now due to having too much inventory.
If anyone has any questions about running a retail store I’d love to help. Also, many thanks to Jay and Ryanne for their podcast. I’m not sure I ever would have grown my business to this size without their experience and the experience of others through the forum/podcast.
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When you say 80 hour work week, do you mean 40 hours at a night time job plus 40 hours at your retail store? Yeh, that sounds rough.
Great story, and, as you said, different than most of us on the forum. I’d also love to hear more.
Where do you live / what state?
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Sharyn,
Yes, I was working 80+ hours per week between my job and my business. I did it long enough to be certain the business alone could support our financial needs. No regrets now though as I am home with the family every night and I enjoy going to work every day. My wife was also working at the business full time all of 2018.
I am in deep South Texas.
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I remember your story. Didnt you once mention you wanted to move to the East Coast?
We have these kinds of businesses in our region. Guys go out and buy up truckloads of stuff at auctions or buy out estates. Sell it in their huge warehouse store or flea market. You’re smart to sell the good stuff on eBay for a higher dollar amount. Challenge is finding the space and having enough help.
Sounds like you have a lot in common with Pete: https://www.youtube.com/channel/UCuuH6JPI65tzx2sO87UjpGg
He buys from people who come into his store and estates. Sells in his store, facebook, craigslist, and eBay.Questions I think many of us would have is. If I imagine a 24 hour day:
–who runs the store? what are your hours?
–who photographs, lists, and packs for eBay?
–who is going to auctions and buying new inventory?
–Where and how do you sort through all the stuff you buy?
–How large is your eBay inventory?
–Do you have employees?-
Hi Jay,
Yes I did speak to you awhile back. We do still hope to move our business North in the next few years.
–who runs the store? what are your hours?
We partnered with a friend of ours, so it is my wife, our partner and myself working at the store. We are open 10am-5pm 5 days a week and 10-2 on Sunday.–who photographs, lists, and packs for eBay?
I photograph everything at the store and list it at night from home. My wife does all the shipping there at the store.–who is going to auctions and buying new inventory?
My partner and I go to auctions and do pickups.–Where and how do you sort through all the stuff you buy?
We keep a section in the back of the store for storing unsorted inventory as well as eBay inventory. As we sort we divide it into eBay items and in-store items. The in-store items are priced with a price gun. We use totes and pallet racking to try to maximize the space. We also have a 500sq ft office area that we use for photographing, shipping and box/packing material storage.–How large is your eBay inventory?
We currently have about 3000 items listed. There is probably close to that many more waiting to be listed. We’ve been building up our inventory in anticipation of me quitting my job.–Do you have employees?
We are currently looking for a part-time employee to work at the store. Since they will be dealing with cash we are being very selective.-
You deserve all the wealth for working so hard. Amazing.
–How did you have time to build up your business working 80 hours a week?
–You say you still have a job? I assume its at night?–How do you structure your business with a partner?
–Are you an LLC?
–Equal partners between the three of you?
–Do each of you take a salary? or Do you split up all profits each month?
–Is there an exit plan in case one of you wants to quit?-
I quit my job a month ago. When I was still working I was working that job 4pm-2am four days a week. I would work at the store every other moment I could. I didn’t sleep much last year.
My partner was doing something similar on a smaller scale. When we teamed up she bought into my portion of the business as I had significantly more inventory. I wouldn’t have partnered with just anybody but she was someone I had known and trusted for a long time.
We are an LLC, 50-50 between my partner and I. My wife gets paid hourly since she often has to take time off to care for our young son. My partner and I each take a salary with everything else remaining in the business. Just to give you an idea of what is possible, in 2018 I made more from the business than I did from my tech job in the telecommunications industry. Thats when I knew it was safe for me to quit.
In the event one of us wants out of the business, the remaining partner would pay the exiting partner for half of the inventory and other property owned by the company. Not retail value, but whatever was invested in it.
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Amazing. Very good to hear you’ve already thought through the exit strategy. I’ve heard of too many businesses that implode because the partnership agreement isn’t thought through to its logical extreme. Especially if you’re buying inventory, equipment, and possibly real estate.
Congrats on leaving your job. For some reason I thought you had done that a long time ago.
–How much of your profit do you need to plow back in to the business to keep thing cranking?
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As long as you have a huge space to sort and sell, a box truck/trailer, and time, it’s a goldmine because there’s so much stuff. Most of us are just dipping cups into the pool of water. You’re filling up from the full blast firehose.
We know a local couple who do something similar. They buy 2-3 three estates a month, entire households. They pick it up in their box truck, unload, pick out the best stuff for eBay, and then sell the rest in their thrift store. They have about 6-10 employees at any one time.
These guys try to sell all non-eBay in thrift store, but I know they cant sell a certain amount of it no matter how low the price is. They do a clean out every couple weeks and donate the junk to a local charity.
What percentage of the stuff you buy is junk that wont sell? Any issues with your store getting too cluttered and stuff piling up with unwanted stuff?
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You are right Jay, when dealing with this quantity of stuff it is impossible to sell it all if you have limited floor space. Storage units result in quite a bit of trash while auctions seem to result in the least. Buying entire estates can also supply a lot of less desirable items. We usually try to put every item somebody could conceivably want on the floor for at least a short time. Well over 90% makes it onto the floor or onto eBay. If items don’t move quickly we become much more negotiable on price. Towards the end of the month we will often have a “fill a box for $5” sale from a certain section of the store (books, clothes, cheap glassware, etc). When it gets to a point where we have to liquidate, we have three outlets for the excess inventory. If the stuff looks decent we will make box lots and take them to the auction. Otherwise we will donate it to a charity thrift shop or we have a couple of people we can call who will take almost anything for free.
Regarding items getting cluttered, yes it happens. I’ll try to get you some photos of our space over the weekend to give you an idea.
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I do not own the building, we rent.
Here are some photos of our store. It’s a mess right now, especially the back area. Mostly because in the past 10 days we won 4 storage units, had a trailer-load of auction winnings and cleaned out the estate of someone moving to an assisted living facility.
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Love this story. I would love to hear more about your numbers:
–What are your margins on your brick and mortar store vs your eBay store?
–What kind of velocity (Sell Thru Rate) are you seeing in your retail store? Your eBay Store?-
It’s difficult to calculate exact margins on a per item basis because we buy in such large quantity. When we buy it is usually trailer-loads at a time of a variety of different goods. Overall I can say our profit margin is around 80% on average. Nearly half of the profit goes into fees, taxes and overhead.
As for sell through rate, eBay can range between 6-10% a month. In the store we try to get rid of items quickly to make room for the new inventory. Except for certain unique or expensive items we move everything within 6 weeks.
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