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Hi all, had a good week and long weekend despite the cold. Almost finished going through the last of my auction inventory so I’ll be on the hunt again soon.
Sales: CAD$4145, 15 sales, COGS: $305, Fees: ~$559, Postage: $473 –> Gross profit: $2808
Expenses: $191, New inventory: $198 –> Cashflow: $2725
The past year I have been heavy into buying on eBay. I decided that although I will continue that, I will be raising the bar on what is a buy vs pass on eBay. It is easy to nickle-and-dime yourself to death there, buying things that are profitable, but not overly so, “so the time wasn’t wasted”. Ultimately my constraint is money, not time, so I will be only buying if it’s a really great deal.
It’s pretty handy to have it all in one place. I have all my shipping cos set up in Shippo, the recipient address automatically imports from ebay, I fill in actual shipping dimensions and then see all the options, & pick (usually the cheapest). Especially nice as sometimes customers ask for a quote on one, two day or overnight service and I can just check there.
90% of the time Canada Post is the choice but especially for international shipments it helps to shop it around easily. I guess with GSP that’s not an issue for you. Still, even domestically or to USA, cheapest option is sometimes UPS.
Congratulations on Episode 500! That is some follow-through all right, and a testament to you guys that everybody still wants to hear what you have to say after 500 episodes.
I had a great week on ebay, despite issues with my phone, which is integral to my listing process (power and home buttons are going haywire). I bought a new (used) iPhone SE which should be here soon. This was a bitterly cold week here and good for just listing indoors, I got a lot up. I am about 3/4 through my last auction haul.
Sales: CAD$7257, 26 sales, COGS: $2004, Fees: ~$979, Postage: $869 –> Gross profit: $3404
Expenses: $540, New inventory: $0 –> Cashflow: $4868
One thing I didn’t understand on the pod… you guys were talking about ebay phasing out parcel select? So I don’t really know anything about that particular shipping option, being in Canada, but it seems weird to me to say that *ebay* is phasing out a particular parcel service. My postage is bought through Shippo, which I can hook up to any service whatsoever I have an account with – Canada Post, DHL, Fedex, UPS, etc etc. Ebay is not involved in that transaction at all, Shippo just gets the shipment info from ebay and then uploads tracking when I’m done. Are you just talking about not being able to calculate shipping in ebay for that option?
Not really, it’s not that I have discipline, I just don’t buy very many SKUs normally. This sort of auction is a 1-2 times a year exception. It’s quite a novelty to have so much stuff to process, usually it’s maybe 20 things per auction.
I have now listed most of the really valuable stuff & am forcing myself to “eat the vegetables” and list a lot of $20-30 items that are still worth selling. And throw out the rest.
Good to hear from you guys again. Yes, I have been thoroughly amused by the gamestop saga as well.
Had a good week on ebay. My big auction haul last Saturday is still being processed, I think I’ve done 175 listings so far and I’m almost done… maybe another 50. It was a great haul and I’ve already sold about 10 items from it.
Sales: CAD$3255, 20 sales, COGS: $651, Fees: ~$442, Postage: $565 –> Gross profit: $1597
Expenses: $355, New inventory: $0 –> Cashflow: $1893
Certainly my region is one that has been very busy with oilfield and other industrial activities but is now in decline. Not sure about yours but I’ve got to believe there are some such auctions. I just found them by googling I think.
Wouldn’t say there is no competition, I just try to find the lots other people don’t want. Typically, tools in good working order get bid up very high. They sell fast so resellers like them. I am getting longer-tail stuff typically, and taking on more work to sort through messy boxes and dusty greasy items that nobody bothered to catalogue by name for the auction.
The big ticket items in these auctions like the CNC lathe I mentioned above may sell for hundreds of thousands of dollars. I think the right way to see it is I am just a bottom feeder. Or a scavenger if you like. 🙂
Hope all are doing well. Busy weekend! Finished up a sliding barn door to make space for our 6 month old to have his own room. It’s only temporary (eventually I’ll need to renovate a “sun room” into a bedroom), but it works pretty well. Also, had a big auction pickup, spent about 8 hours on that on Saturday. Liquidation sale for a large and impressive machine shop, now shut down as the oil industry here sputters. I took a picture of myself with a CNC lathe the size of a small house. Being small fry I mostly bought little things like chucks, but even they turned out to be larger than they seemed in the pictures, and I had to leave one behind that I simply couldn’t lift.
I also bought my old favourite kind of lot, the “shelf” lot where you get everything on the storeroom shelving unit. I paid $2500 for 4 or 5 such shelving units absolutely chock a block with parts. A lot of it is garbage or marginal but there are tons and tons of little $40-500 items in there, plus a few big ticket ones (keypads for CNC machines, a lathe ballscrew). All told I spent $6000 on this auction and wish I had had more to spend. It was a bonanza and I will be listing for a week or two from this.
Luckily ebay sales were good and at least partially funded all this. NOW I need to cool it and pay off my taxes.
Sales: CAD$3571, 17 sales, COGS: $436, Fees: ~$486, Postage: $600 –> Gross profit: $2060
Expenses: $819, New inventory: $4597 –> Cashflow: -$2931
I agree, J&R’s honesty about their business is refreshing. From most resellers you get bravado, and from most small businesspeople I talk to you get what I can only describe as the triumph of hope over accounting (“We’re losing money on each sale but we’re doing great volume!”).
Super interesting, thanks for posting.
One of the things that concerns me about my business is that although my profits have been growing at a healthy rate, my storage costs have been growing at an even faster rate, and although they’re currently manageable, at some point they will catch up. Is the 10k-22k sq ft needed for expanding your operation and dealing with current inventory, or do you, like me, have a lot of long tail inventory that is starting to pile up? How do you deal with stuff that doesn’t sell?
Yeah, I research probably similar to any other item – I have terapeak/watchcount ready to go on a browser tab on my phone/computer and check for solds. Usually that turns up some sales history. Failing that, I see what other sites have the thing listed for – that is a bit more of a crapshoot but if it seems like it might be high dollar I’ll usually roll the dice.
Normally I am a little leery of buying as large a QTY as 200, for the exact reason you’re suggesting – it may be a small enough market that they never move. In this case, the price was (very) right, they weren’t too large, and there was at least some sales history.
Hi guys, great to hear from you as usual – and thanks for the kind words about my business! especially from you from whom I’ve learned so much over the years it means a lot. Most of what you said is basically correct, including the listing over poutine, lol. My business has become very capital intensive and most of my effort goes into scavenging, which is how I like it. But it is eating a lot of my time lately.
I happened to have the first really good week in a while after a slow December and January.
Sales: CAD$7812, 18 sales, COGS: $967, Fees: ~$1054, Postage: $592 –> Gross profit: $5198
Expenses: $123, New inventory: $101 –> Cashflow: $5942
Biggest sale was $3800 for 20 new HVAC controllers, from the great HVAC controller pick of May 2020. I still can’t believe this windfall, I have now made about $6000 off of this $10 investment and I still have 180 of the units left to sell. May not strike it this lucky again in my ebay career. Anyway it was most welcome as I am still trying to work off the big 2020 tax bill and get caught up on my prepaid taxes as well.
Yeah, it definitely depends how cash intensive your business is. I spent CAD$44k on new inventory in 2020 so it’s critical to my numbers.
Cool! Minus COGS as well, I assume.
I have thought hard about how I display my numbers and the philosophy is as follows.
For each week I like to consider two perspectives on my business.
First: which items I sold, and what I bought them for. This is a very natural way for a reseller to think; I call it “tell a story” mode – “I bought that widget for $5 and sold it for $100!!” Formally:
(Gross profit) = (Sales) + (Shipping Income) – (COGS) – (Fees) – (Postage)
This is also more or less how Uncle Sam sees your numbers. Note that your COGS, which is an important part of this story, typically occurred a long time ago, not this week!
However, there is another perspective on your business that is useful – cashflow. Consider: it is possible to make good money on every item you sell, and yet still lose money. This usually occurs either because your fixed expenses (storage, supplies, etc) are too high, or because you’re buying a lot of bad inventory that doesn’t sell at all (or both). So to see how much cash your business is generating for you on a weekly basis, you can also calculate cashflow:
(Cashflow) = (Sales) + (Shipping Income) – (Fees) – (Postage) – (New inventory cost) – (Expenses)
Note that “New inventory cost” is whatever you spent *this week* on new inventory, not the COGS for the items you actually sold. Strictly, fees come out every month but I estimate them in these weekly numbers as a % of sales.
IMO, cashflow is often the more useful perspective to take for improving your business.
Hah! I like your comment about process. Process really is where it’s at. You start thinking carefully about that and you can often improve your business nearly overnight.
I had another slow week on ebay… December and January have been very quiet, and what I am selling is mostly low dollar (I am trying to blow out some 2+ year old marginal inventory).
Sales: CAD$1074, 9 sales, COGS: $691, Fees: ~$154, Postage: $181, Gross profit: $48
Expenses: $203, New inventory: $342 –> Cashflow: $194
Managed payments is finally coming to Canadian ebay. I signed up and it looks like it will be activated for me by Feb at the latest. Hopefully whatever learnings came from the US rollout will be duly applied.
Slowing down on the scavenging till my tax bills are all paid off. I’ve got zero working capital at the moment… still, might do one auction this week.
Hello again and happy new year to all!
I like your taxonomy of sellers.
I think I may have mentioned before, but ebay effectively financed our buying a used minivan a few weeks ago, which was very helpful. Since our 3rd came it had become very very cramped in our old station wagon (which I am now taking over, and gave my hatchback to family).
Another slow week on ebay, but I went on an inventory buying spree. Rather stupidly, as I forgot my LLC would shortly owe taxes. Next few weeks I’ll just be hoping for good sales and trying to scrape together my $7k tax payment.
Sales: CAD$899, 8 sales, COGS: $325, Fees: ~$85, Postage: $135 –> Gross profit: $354
Expenses: $1731, New inventory: $4922 –> Cashflow: -$5974
