Forum Replies Created
-
AuthorPosts
-
12/16/2019 at 10:08 am in reply to: Scavenger Life Episode 441: How Do I Go From Rookie to Veteran Scavenger? #71724
In that particular case, the seller is clearly new and just looking to get rid of stuff. And no, NOT a fast seller by any means. I don’t know if I can find a deal THAT good every week, but for a whole week I’ve been finding 1-2 flips a day that are like $100–>$500 range.
As you know though in the short run that eats up a lot of money. It’s a little painful when you’re used to more like 20x or 10x COGS. But if they can be found on a consistent basis then it’s a gamechanger in the medium/long term.
12/16/2019 at 9:26 am in reply to: Scavenger Life Episode 441: How Do I Go From Rookie to Veteran Scavenger? #71716Decent week for me on eBay.
Sales c/w shipping income: CAD$1242, 8 sales, COGS: $171, Fees: ~$173, Shipping: $184 –> Gross profit: $899
Expenditures: $2457 –> Cashflow: -$1388
Hours: 9
Listed: 0
Notable sales: valve actuator $464, microscope $220.I feel as though I have made a breakthrough in my business, however.
Since I’ve been striking out finding good stuff in person, I’ve really hammered ebay looking for stuff to sell. And I think… I’ve got the hang of it this week? Like, every couple hours searching I can find a nice item with hundreds of dollars of meat on the bone. I even found what I THINK are a couple of home runs – I am just waiting to have them shipped to me. In one case I paid $800 for a lot of 8 thingies that sell for $1000-2000 each, can’t wait to get those.
If I can do this consistently it’s a big deal, because I have had some trouble scaling up lately – hitting the usual meatspace haunts, I can’t always find stuff. It also introduces new challenges, as it moves me from more time-limited to capital-limited. ($2457 of expenditures in one week is obviously a little excessive.)
OH and we just found out kid number three is coming in August. If ever there were a motivation to scale up!
I do feel like things are going well.
A big part of the equation is one particular source, which has been a bonanza for me for 1.5 years and makes up about 40% of my sales by dollars. Without that place things would still be good but not gangbusters.
Usually magic eraser type sponges do the trick for me in removing permanent marker.
I wish I could change my unparseable screen name but I can’t remember my blogger login anymore. Simplicio (sim-pliss-ee-oh or sim-pleech-ee-oh) was a handle I started using in uni because I liked the character in Galileo’s “Two World Systems”. He is the one that Galileo makes into the foil who is asking all the dumb questions, which was my avocation in uni physics & engineering classes.
I had a really good week on ebay again. However, I can’t find new inventory to save my life – mostly because I haven’t had the time.
Sales c/w shipping income: CAD$3791, 12 sales. COGS: $431, Fees: ~$520, Shipping: $278 –> Gross profit: $2840
Expenditures: $178 –> Cashflow: $3093
Hours: 7
Listed: $0 (ouch!)
Notable sales: kicking off the Christmas buying season with the perfect gift for dad, a $1200 boat grappling hook. I bought this for $200 on a hunch… basically because it looked expensive. Glad to see the gamble paid off.On that question of saying “Untested”, I think/hope that J&R mean they put that description on a “For parts/repair” listing.
On a “Used” listing, saying “untested” will NOT save you from an INAD because the definition of Used for ebay means Working.
I do sometimes list “Used-Untested” but my expectation then is that I am risking the shipping and will refund if the buyer tells me it doesn’t work. Obviously I would only risk the shipping like that for a really good profit.
It’s all about what your time is worth. Selling individually gets you more money (provided they do actually all sell – sometimes the best get cherry picked and the rest rot). Selling in lots gets you a better “hourly wage” since you list once and ship once.
ALSO, when shipping cost is approaching what people will willingly pay for the item itself, I find I get more action on lots, since it spreads the shipping cost around.
So if I had a bunch of, say, 25 sockets that people might be willing to pay $5 each for in person, if I break them up they’ll never sell (because the shipping cost alone is $5-$10) but in a lot of 25 a buyer might pay something like $100 for them and not mind the $20 shipping.
Glad to hear ebay isn’t the issue for most of your missing items. I have had an inventory system for a while but recently I have been re-inventorying some things (because I’m moving them to my main storage unit) and I notice most of the missing items are in 2 categories:
(1) Items sold, then cancelled (this is less of a problem now as ebay has introduced the “relist after cancelling” checkbox). One that was really frustrating is a GIANT FREAKING PIANO KEYBOARD that has been unlisted for a year, after someone made an offer on it then balked at the shipping, and I failed to relist.
(2) Items listed as QUANTITY, sold, then cancelled. The quantity stays what it was after sale, it does NOT go back up once the item is cancelled. This is still a problem. For me, it is fairly self-solving, since when I sell the “last” item of my stock it usually cues me to notice there’s still one left on the shelf. But a seller with a different system might not see that.
Sooooo…. what kinda stuff are you guys sourcing online? I have been devoting a lot of time to sourcing on ebay. There was one weekend where I spent like $1000 on ebay stuff. None of it has sold yet, but my instinct tells me there is one home run there, and the rest was not really worth it upon receipt and further research.
I had a great but weird week on ebay. Until Friday it was absolute crickets, then a huge sale, then more crickets till 5 minutes ago.
Sales c/w shipping: CAD$4110, 5 sales. COGS: $189, Fees: ~$552, Shipping: $228 –> Gross profit: $3369
Expenditures: $553 (mainly rent) –> Cashflow: $3005
Notable sales: about half a year ago I got a bunch of wall mounts for monitors (for medical settings) at $30 each, I sold 6 on Friday to one buyer for a total of $3500. Brand new so little risk of return. Glad to get them outta storage, they were big and heavy.Didn’t find much this week to scavenge really.
We did get a deep freeze so I’ve been doing a lot of meal prep. Forget if I mentioned last week. Really that’s more critical than scavenging since food costs are a big haemorrhage in our budget (no freezer space + picky kids + I don’t have time during the week).
I can’t discern much seasonality to my sales, but perhaps it’s there. I think when you’re selling as few things as I am your numbers are just super variable by nature. Last month was especially good mainly on account of one great pick.
Yep, I understand & like your perspective on rentals. I have always thought ROE is a strange metric anyway because your return is only “good” to the extent that it’s leveraged. But real estate investors do loooove picking up pennies in front of steamrollers.
OK, another question. Hypothetically, do you think you could make good money just buying, renovating & selling properties? Does that appeal to you at all? (It does occur to me you can only run SO many short-term rentals before you’re out of hours in the day.)
Another solid week on ebay.
Sales c/w shipping: CAD$2534, 9 sales. COGS: $772, Fees: ~$346, Shipping: $250 –> Gross profit: $1417
Expenditures: $21 –> Cashflow: $2167
Hours: 7
Listed: $140, 27 items
Best sales were on 36 thermostats for $690, I’ve had these for ages. Also a light meter for $800, I paid like $500 for that, so way too much, glad to get my money back out.I was thinking about why people were calling you risky for not having investors, and the only interpretation that makes any sense to me is a logic of “you’re not diversified enough against the risk of your business failing”. Which is not a crazy thought, if they don’t know you have ebay AND contract work as well. Certainly one thing I dislike about real estate investing is that it makes one extra sensitive to the fortunes of the regional economy (by NOT working a day job locally, you guys are avoiding quite a bit of this risk). Indeed this is one big appeal of ebay, it’s not nearly as tied to local/regional conditions as many small businesses are, so it’s kind of a hedge against bad times.
A tangentially related subject: return on equity (ROE). This is how many rental property owners think about when it makes sense to buy and sell properties. Basically, your ROE is your yearly equity profit (rents minus all expenses EXCEPT mortgage principal), divided by your total home equity in the property. The idea is, if you have $200k of equity trapped in a property that’s only gaining you $2k per year, you’re only making 1% on your trapped equity, and you might as well sell & put the proceeds in a savings account. But if you’re just at the start of your mortgage and only own $20k of equity, that $2k/year is now 10%, a pretty good return. (Naturally, it’s good mainly BECAUSE it’s leveraged & so proportionally riskier.)
So my question is, is there a plan to sell your rentals when you reach a certain equity % on those properties?
“Scavenging is getting trendy so it won’t be as profitable anymore” = “Nobody eats there anymore, it’s too crowded”
Popularity of scavenging affects both our buyer base and our competition. Buying used goods on ebay IS a scavenger move, and if more people are doing that, so much the better. More selling on ebay is of course more competition. Assuming scavenging gets more popular, how does the ratio wash out?
My take:
-More buyers = a bigger pie for everyone
-More sellers = more competition BUT PRIMARILY on things that actually have competition (esp commodity goods). If Bob wants a vintage nut bowl, and you’re the only listing, it doesn’t matter if 3x the number of ebay sellers exist now as did in 2010.
-More sellers DOES NOT equal less stuff to find. At least, not in any significant/systematic sense. What’s a trillion minus a billion? A trillion. Now take the overflow of North America’s prosperity – the mountains of “waste” that are our items, and subtract the amount dealers get their hands on. And then double, quadruple, 10x that outflow if you like. It doesn’t matter. The dung beetles are worried there’s too much competition in the elephant paddock.Yeah, I thought a coffee machine too at first. Mind you, unless it was a real skookum one I wouldn’t expect more than a grand or two, which is a lot of cash, but not exactly scary.
I used to do index funds but now I figure investing in my business inventory gets me drastically better returns than anything else I could do. What money I “have to” put away through work RRSPs (i.e., 401k) for tax reasons, I just put into physical gold (stored at the mint so it can be owned in an RRSP).
-
This reply was modified 1 year, 9 months ago by
simplicio.
Morning guys, thanks for the podcast and the much needed memento mori.
I had a so-so week on ebay. Surprised I’m not selling more given how much I’m listing lately, but I’m sure it’ll come.
Sales c/w shipping: CAD$1456, 10 sales. COGS: $199, Fees: $203, Shipping: $212 –> Gross profit: $1054
Expenditures: $719 –> Cashflow: $534
Hours: 12
Listed: $748, 61 items
Notable sales: speaker thing $300, toners $300, plumbing rough-in $200.
The rough-in came from a little $10 box of random plumbing supplies at our dump thrift store. I must have listed like $600 worth of stuff out of it.This weekend I did a lot of infrastructure work too, mostly shifting inventory from our utility room to make way for a deep freeze we intend to get soon. We’re hoping this allows us to do a better job of meal prep and be more frugal with food, which has been a weak point for a long time.
Something to consider for your storage system: consider giving any mobile storage (e.g., bins) its own location in your spreadsheet, in addition to locating items within the bins themselves. I am embracing the idea that I can move bins from home to storage and it’s making my life a lot easier; previously I was trying to keep all bins at home.
Yep, your store definitely has more momentum than mine (I just hit 900 listings). To a point.
The problem is, your store has taken years to reach 8500 listings, so a big fraction of the 8500 listings are hardcore survivor items. These are items which have been able to avoid purchase for several years. They are not at all like a random sample of new items you just found in a thrift store — they are grizzled veterans of ebay, skilled in the art of avoiding buyers. All their young inexperienced comrades have already been bought, they’re what’s left over, the battling bastards of the ‘bay.
Now I think ebay fees are such that you might as well keep them listed, because they justify the listing fees and you are not really limited by storage at present. But those 8500 are not equivalent to 8500 newly listed items. Newly listed stuff is the reactor grade fuel that will really power your store, I suspect. (Hope you don’t mind switching metaphors a lot.)
I don’t think my returns are too bad. From what you guys discuss each week with clothing returns, it sounds like a MUCH lower rate than on clothes – maybe 1 in 20 or 30 items.
I don’t worry so much how big the return is, I worry how much I spent on it and how much shipping I have to refund. It’s all risk vs return. I think it’s a good tradeoff in general. A lot of the stuff I sell is new/NOB so there’s almost no risk there.
-
This reply was modified 1 year, 9 months ago by
-
AuthorPosts