I’ve recently started buying and reselling a specific tangible good for fun and profit. I won’t go into specifics of what it is, because the market isn’t big enough for many competitors and it would cut into my bottom line. I’m writing to share general tips and tricks that can be applied to other markets.
The process is:
- Buy a used collectable item in my market
- Clean up and refurbish item
- Resell item at a profit
These are my guidelines:
Pick an item that you know something about and are very interested in so it doesn’t feel like work. Perhaps you enjoy vintage swingline staplers. And you know that in the year 1972, they changed the crimp style on the hinge area and then in 1985 they changed it again. You know that beige was offered in 1963 and blue was not offered until 1975. You can go on eBay or walk a fleamarket and within a few seconds of looking at a stapler, know it’s value based on an estimation of year and rarity.
Pick an item that is small relative to value. Staplers are small but likely not worth a lot per volume of space. You will need to store these items in your home and having a whole room dedicated to vintage staplers worth $50 each is cost-prohibitive. Vintage stamps or coins worth $500+ each are a better value proposition.
Pick an item that has intrinsic value. This creates a floor beyond which the value cannot fall below. If you spend $20 on a vintage stapler, the floor might be $1 since a Chinese-made modern stapler is worth $1 and your vintage stapler is still a stapler. If you buy a rare numismatic coin with one ounce of silver, and pay $50 for it, the coin is at least worth the melt value of the silver. If you buy collectible paper currency, and the collectible market dries up, there’s no floor. It’s not worth the half of a cent paper it’s printed on since you can’t even use it as paper.
Pick an item that has a large, growing fan base and is likely to grow over time. Stamps might not be so good because the median age of a stamp collector is very old and once that generation dies, few will be interested in collecting.
Pick an item where you can join an online community, which allows you to buy, sell, and trade that item, at a profit. People like to form tribes. It’s evolutionarily hard-wired into us because a solitary human in the wild would die. There’s all sorts of online forums for every hobby. Find the vintage stapler forum and make friends with people.
Pick something that you can clean up and refurbish, adding value in the process. If you can buy a stapler for $20 and resell for $50, then why didn’t the person who bought it from you just buy it from where you bought it? What value did you add? The two types of value are informational and ability to refurbish. Perhaps you can quickly clean up the stapler or add in a new spring with minimal effort and justify that $30 profit. Or perhaps your value came from finding it at a fleamarket, whereas the person who ultimately buys it from you for $50 might not want to spend several weeks looking for one cheap, and would be happy giving up the $50 to you for putting in the leg work.
Pick something that has reasonable levels of availability so you can scale profits. If you have to spend 6 months searching fleamarkets to get one of these items, then the profit needs to be enormous.
I encourage sharing of general principles around similar endeavors without sharing the actual product you are buying/selling because market arbitrage will reduce your profits. Please share your stories and general principles.