Mistakes I made selling online in March and April 2014

May 9th, 2014

Happy Friday Everyone! It’s been a couple of months since my last post about some mistakes I have been making so I think it is time for another one. Before we get started, later today I will be attending the college graduation of one of my younger brother’s at Winona State University.  So, congratulations Eli!

If you missed my last mistakes post you can find it HERE.  My goal with these posts is to help give you a more complete picture of selling online.  There is a lot of information about how great selling online is, including here on this blog, but it’s not always smooth sailing and this post will be about going through some of the rougher waters.

We’ll begin by looking at items that I sold at a loss.  In total for March & April there were 37 items that I sold where I lost money before factoring in inbound shipping.  The largest loss on an individual item was $10.51, which was a Fisher Price guitar and microphone playset.  This item was purchased back in December for $26.88 when the selling price was much higher (around $65 via FBA), but I was unable to sell it at that time.  As a result I decided to sell it in March for the current market price and took the loss.  My reasoning for doing this is that it is rather unlikely that the price will recover to anywhere near the December levels in the next few months.  Getting the item sold and receiving some cash for the item allows me to reinvest this cash into additional products to resell.  HERE is a link to the item, and HERE is a link to camelcamelcamel to see the price history if you are interested.   Sometimes you just have to take the loss and reinvest the proceeds.

In addition to the 37 items that I lost money on, there were another 20 items that I sold for $1 profit or less before factoring in inbound shipping.  So, after inbound shipping the majority of these items would also be items I lost money on or at best broke even.  In total there were 57 items in March and April that I sold at break even or a loss, overall not bad, but selling at a loss is never fun.

The second mistake that I will be sharing today is the mistake of purchasing items to resell and then letting them sit around unlisted.  You might be thinking, well Ryan, why would you ever do something like that? Here’s an example, I bought 12 of these Swiffer refills on clearance from Target, 5 of which can be seen here: 20140317_153736

I brought the bag in my house, set it in a corner with other inventory, and let the bag sit there for about 2 months.  Over these 2 months more than one thousand items were shipped into FBA, but not these Swiffers.  I kept buying more inventory that was “easier” to deal with or was more profitable and left these behind.  After they had been sitting around for a couple months I finally listed a 12 pack on amazon for sale merchant fulfilled, and they sold after being listed for 2 days! I had them at my house for over 2 months, and all except the last 2 days I had money tied up that couldn’t possibly benefit me.

I can’t tell you exactly why I chose to neglect this item.  But, in one of my inventory areas I had this item (along with others) sitting unlisted because for one reason or another I didn’t want to deal with them.  I am guessing I am not the only one who has some of these items sitting around unlisted.  It’s more fun to go shopping and keep buying more items, so it’s not overly hard to neglect some items that might take a little more time to deal with.

The morale of this story is that items sitting around unlisted are just tying up your cash in a way that is not beneficial for you (this ignores the possibility of investing in items for the long term).  When you buy items to resell be sure that they ALL get listed in a timely manner as it’s the best way to keep the cash flowing.

I am not proud to admit the 3rd and final mistake that I will be sharing today, but it happened and maybe it will help someone reading this at some point in the future.  We’ll begin by stating that the picture at the top of this post is of my work desk as of the middle of April.  Nice and organized, right?  Not at all!

So, I purchased a discounted gift card on eBay to a store that I shop at regularly for inventory at the end of March.  The gift card cost $100 for $115.51 in value to the store.  You might see where this is going, but that gift card started off on my nice clean desk, and now is nowhere to be found.  It’s possible it could still turn up, but I am not holding my breath at this point.

As I mentioned, I am not at all proud of this, but a lack of organization can be a real problem for this business.  It is essential to keep track of all receipts, inventory, etc, so that things don’t go missing and cost you money.  I have not completely solved my organization issues, but am in the process.  The first step I have taken is signed up for a free trial to Shoeboxed.  They provide a service where you send them all of your paper receipts and they scan them into an online portal which you have access to, and then send them back to you.  So far, I have found this to help decrease the paper clutter on my desk quite a bit, but I still have a long ways to go organization wise.  So, find a system that works for you to stay organized, and definitely make sure you keep track of your gift cards!

That’s all I have for today.  Do you have a mistake you would be willing to share that we could all learn from? If so, please share in the comments below, or send me email at grant.ryanj@gmail.com.

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18 responses to “Mistakes I made selling online in March and April 2014”

  1. Scott Mosley says:

    Ryan

    Great post. As you mentioned sometimes it takes a loss (the gift card) to get your attention and remember the small things that can easily slip. I always love the transparency of your post. It helps me to remember to not focus on the rough patches when they occur and remember all the wins, which occur way more often than the losses! Thanks once again and congrats to your brother. Much continued success to you!

    • Ryan Grant says:

      Hi Scott,

      Thank you, and that’s exactly right that sometimes an “event” has to occur to get you into action. I definitely agree that it helps to remember all of the wins along the way as opposed to any rough patches when they occur. Wishing you much success as well!

      Best Regards,
      Ryan

  2. Sean S says:

    I’m starting to suffer from lack of organisation too. My main problem is my bin isn’t big enough, and packaging materials fill it up so fast, so the floor ends up covered in tape, packaging bags, offcuts of bubble wrap and everything in between.

    Have you considered getting a document scanner? It’s more efficient that a flatbed scanner as it feeds a page at a time. Obviously not great for till receipts though. They’re also significantly more expensive than flatbed scanners.

    I’m finding the error I’ve made this month is thinking I can compete with Amazon, and not realising how much they are prepared to discount their price to maintain the buy box. Looks like the items like that will still sell, but significantly slower than I had anticipated (thankfully Amazon put their prices back up when I did so).

    • Ryan Grant says:

      Hey Sean,

      I have a problem with packaging materials all over the place as well. FBA is really starting to take over my house!

      I have considered getting a document scanner. I am going to see how I like using Shoeboxed for now, but if that doesn’t work out I think I will invest in a decent document scanner.

      Thanks for sharing the error of competing with amazon! It’s hard to find the balance when competing with amazon. I find that the best strategy for me is to match amazon’s price as to not trigger them to lower their price, when matching their price I find I still get some sales as well. Thanks for sharing!

      Best Regards,
      Ryan

  3. Sean S says:

    I’ve also been having problems with Amazon claiming products are unfillable this month for no apparent reason. For instance a fabric toy that I sent in, inside a polybag with the suffocation warning, with the polybag taped so it wasn’t larger than the product was rejected with no obvious reason. Similarly all the multipacks I’ve sent in in polybags have been either rejected or had their HASMAT status changed after they arrived. Has anyone experienced anything similar? Is there any way of finding out what I’m doing wrong here, as I followed the Amazon videos on this precisely yet they are still being rejected with the cryptic ‘Distributor Damaged’ mark, and when they come back they’re not damaged at all.

    • Ryan Grant says:

      Hey Sean,

      That sounds very odd. I would probably call amazon seller support and ask see what is going on especially if it’s a repeated issue.

      Anyone else noticing a similar issue to Sean?

  4. chad says:

    How much do you account for inbound shipping? Mines usually pretty cheap like 50 cents an item .

    Also how many items do you try to keep in your invemtory at a given time?

    • Sean S says:

      Mine is usually £5 (equiv of $8) per box, no matter what the weight or size of box, so I usually go for the largest boxes UPS (Amazon’s preferred carrier here) will take and fill up to the 15kg limit. With dvds or video games you can fit so many in that the shipping is like 10 cents per item, but with larger boxes toys it could easily be $1 each due to only being able to fit a few per box.

    • Ryan Grant says:

      Hey Chad,

      It’s usually about $0.50 an item just for the weight handling. Then it’s usually $0.10-$0.25 in box costs, occasionally a cost for polybags, and warning stickers, plus I had to drive to go get these items. So the $1 I mentioned is a rough figure, but anything that I make $1 on before accounting for the costs of acquiring the product & the cost of shipping supplies is basically at break even.

      Currently, I am trying to continually grow my inventory. Right now I have about 2,000 items at amazon, but I am still in the growth stages and don’t plan to try to level it off for quite some time.

      Best Regards,
      Ryan

      • chad says:

        I am just starting out so my inventory is
        No where near yours. I cannot imagine keeping it growing from where your at as fast as stuff seems to sale . I am having trouble just getting to 200 items.

        I see a lot of people mention the warning labels I bought a group of
        400 poly bags with the warning printed
        On them . Am I required to do another label aswell?

        Also when shopping i prefer to buy products I can just scan In and throw in the box to ship , I only bag if it is necessary. Is this kinda the plan you follow or do you find that you bag everything ?

        • Ryan Grant says:

          Hey Chad,

          With consistent efforts you will see your inventory continue to grow. If you buy polybags with the warning label already on them, then there is no need for an additional warning sticker.

          I am completely with you on only poly-bagging if it is required. I definitely don’t bag items that aren’t required to be.

          Best Regards,
          Ryan

  5. Phebe says:

    Mistake #2. Guilty. I still have sitting around 2 products I purchased for Easter. I knew as soon as I saw them they would be good sellers. At the time of purchase, the first item was doing pretty well already with only MF sellers; no FBA. The second item did not have a product page and I procrastinated, waiting for someone else to create the page so I wouldn’t have to. Then Amazon decided to join the party. I had this item in my hands for three weeks before AZ got in the game and what did I do with it? Nothing. Now I have to sit on it until next Easter or AZ stops stocking it. Lesson learned.

    • Ryan Grant says:

      Hey Phebe,

      Thanks for sharing! Sometimes the only way to learn these things is the hard way unfortunately.

      Best Regards,
      Ryan

  6. sally says:

    Hey ryan…

    Are you consistently getting 100% roi on your toys?

    • Ryan Grant says:

      Hey Sally,

      It varies based on each toy as I will sometimes go down to 40-50% ROI if it is a quick seller. I would say the bulk of my toys I am making at least 75% ROI, with a many being over 100%.

      Best Regards,
      Ryan

      • kalki says:

        All retail arbitrage? what’s your favorite store for this? I have a hard time finding anything near that ROI… thanks for your help!

        • Ryan Grant says:

          Hello Kalki,

          I am selling mainly via retail arbitrage, with some liquidation, and thrifting mixed in. I don’t have one favorite store, but some that I go to quite often are: Wal-mart, Target, Kmart, Shopko, and Big Lots.

          Best Regards,
          Ryan

  7. […] been a little over 2 months since my last mistakes post so it’s time to share some more instances where things haven’t gone as planned when […]

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