Q for dealers/flippers

[revat]

What is an acceptable margin for you to make back on a book?

 

You can't answer this question without more info. Where are you? What are your costs? Are you doing shows? Do you have a store? How long will it take you to sell the product? How much risk is involved in the product you are buying.

 

You can't sustain a business working on 10% margin unless you have an unlimited bank roll.

 

I'm only a part time seller so the big time dealers probably look at it differently than I do but it comes down to what is my time worth? I tend to shoot for $15 an hour since the comic business is fun to me. If it takes me on average 15 minutes to buy/scan/sell/ship a single book then I need to make $4 a book to have it be worthwhile. The only way I can do this is hit up comic shops on my lunch hour when I'm already out of town on business (like yesterday in Toledo)or buy in bulk when I travel out of town to buy books (Cons).

 

there's a huge difference for someone who relies on selling comics for a living. Then your margin is the difference between eating and not eating tomorrow, or your kids having enough warm clothes, or making a mortgage payment, which makes your priorities change (rightfully so).

 

But if you're just a dude who already has a job, and wants to flip comics on occasion for fun, do some quick basic math and try to calculate an ROI using the criteria that matter to you, then see how it turns out. Then tweak as necessary, depending how fun it is for you vs your return.

[1Cool]

http://www.investopedia.com/ask/answers/070914/how-do-i-calculate-inventory-turnover-ratio.asp

 

Basic learning curve will tell you how much time and money you are wasting

buying stock, books, or inventory that is not producing a ROI. If you are buying

and selling for money, take time to learn some basics of business. Ending up

with an extra $ 50 at the end of the day can be misleading.

 

Nice information!

 

I think the key in selling is not only managing selling your "Hot" books, the "Winners" in the lot, which is easy, but it's how to properly liquidate the "Losers" so your financial resources aren't tied up and money isn't working for you. It's the balancing of patience and strategy of knowing how to take a loss, and turning those pennies on a dollar into new fresh inventory than can potentially reap greater rewards.

 

Otherwise, what happens most often is people buy 100 items, sell 20, can't sell 80, and retain those 80, cycle, repeat 'til a backlog of "dollar bin" unsalable builds up, and sure, there's always those diamonds in the rough which emerge as those "trash to treasure" books you're blessed for keeping and digging out, but those are far and few between, so in the long run, being at peace with not being stuck with dead inventory and tying up your resources (space and money).

 

That's always a struggle.

 

But what is the extra inventory really costing you if there are no new books to buy? I get the principal of not wanting your cash locked up in case a big collection comes around and you may need to pass on it but I've not run into the situation yet. Lets say you sell all your "duds" at blow out prices then you have a stack of money but very little profit to show for those blow out books. I'm not talking about having a book up on E-Bay for 3 years but I think blowing out books after a couple months can be a bit premature in most cases. Why not hold on to the book thru the summer and hopefully it will sell either on E-Bay or at a Con you set up at?

 

Maybe I just don't have a large quantity of books fall into my lap but I've never been hard up for cash that I wished I had more money at that time. I guess the liquid cash could be put in the bank but what does that yield - 2%?

 

Hate to quote my own post but I guess having a large sum of money on hand does allow you to "muscle" better deals when negotiating. I've seen a few dealers walk up to a booth and offer $4,000 cash for $7,000 in key books and get some takers. I'm not very good at this approach but I can see where large stacks of cash makes it easier to flush out some deals.

[Michelangelo]

I love the different points of view that you guys all have. POV seems to change a little bit depending on how committed you are and whether or not this is your bread and butter, or a hobby.

 

It boils down to preference I suppose. How much time, money and effort are you willing to spend.

[Michelangelo]

http://www.investopedia.com/ask/answers/070914/how-do-i-calculate-inventory-turnover-ratio.asp

 

Basic learning curve will tell you how much time and money you are wasting

buying stock, books, or inventory that is not producing a ROI. If you are buying

and selling for money, take time to learn some basics of business. Ending up

with an extra $ 50 at the end of the day can be misleading.

 

Agree. For the most part, its only 'worth' it if you're having fun while doing (barring the occasional rare huge score).

 

If you're going to your LCS anyways, and you take an extra 15-20 min to flip quickly through the back issue bins for gems, not too bad. Or if you occasionally hit craigslist or yard sales and enjoy the hunt, and you get stuff you like and some stuff you can sell, then great! But if you're looking for sheer ROI, your time has value too...allegedly.

 

So then you have to factor in everything: Time, money spent on comics, other expenses (gas, show fees, tolls, gas, parking, shipping, possible tarriffs, exchange rates), time loading comics into your car. And that's just the acquisition costs.

 

Then there's moving the comics to your location, time unloading, bagging and boarding, sorting, grading, pressing, not to mention the space it takes up in your house (or paid storage), which may be an issue to your wife, kids, pets, parents.

 

Then for the actual selling, there's pricing, pictures, descriptions, various venues and fees, possible costs for going to shows (dealer fee, gas, staff, food, hotel, parking, time, insurance), taxes, credit card/paypal fees, then possible shipping, which ain't easy and returns, and what if it doesn't sell right away and i have to drag it home after a show and/or repost it for sale later?

 

And what about the opportunity cost of doing all of this, financially and in terms of time I could have spent doing something else.

 

 

Of course there's other benefits, the thrill of the hunt, the joy of the big score, the actual money made, getting meet new people and make connections, filling holes in your collections while (hopefully) making money, actually reading some comics, having cool stuff to display, even if its temporary.

 

 

great points.

 

Space is a big factor too - if you're just doing this as a hobby (you don't have a store or want to rent a storage locker) you may be pickier with what you bring in. Perhaps more of quality and less of quantity.. (which is where I'm at)

[the blob]

Last month I bought two books from an auction for $1300, consigned them on another site before I had them in hand and sold them for a total of $827 profit. Deals are out there, but they don't sit there shining a spotlight on themselves.

Somebody this week offered me $250 over what i paid for the Cap book I posted, but I'm in no rush to sell it. That would be about 15% profit for a book I owned less than a week.

Wouldn't mind two or three of those a month while I sit around playing poolside blackjack during my retirement.

 

sure, you stumble into things, but getting a 50% profit AND it being worth $50-$100+ can be tough.

 

I bought an x-men 1 at a shop for $300 and flipped it here I believe for $150 more than I paid, so right at 50%, and it was within 2 days, so that was fun, but replicating that doesn't happen often (not with enough reliability to count on it as an income stream at least)

[the blob]

I don't have a yearly $$ amount i am for; I shoot to make back twice what I paid for the comic or toy.

Some days that does not happen; the market cooled, I over priced, etc.

 

 

Best formula might be to price it at 50% for a week or so, then 20% for a month and then liquidate it after that.

Your profit will be from churning books.Stagnant inventory does nothing but eat up space and cash flow.

 

Totally agree with this.

 

well, if your inventory is also your collection then there is some room to allow things to age like a fine wine or nice bottle of scotch.

 

 

[the blob]

of course, I will buy stuff like this out of a 3 for $2 box because hey, it has powergirl and firestorm in it and it is in nice shape, why not:

 

http://www.ebay.com/itm/Starman-5-1988-Invasion-Firestorm-Power-Girl-Tom-Lyle-DC-Comics-/191767793770?hash=item2ca640506a:m:msQohOTcDe0AXroU_z1bvcw

 

And then I wind up with 26 long boxes of comics that might one day be worth $2 each IF there is a powergirl and firestorm movie featuring starman...

[Rip]

I tend to buy something from a new OO collection at least once a month. The last group I picked up was a Star Wars 1, ASM 101, 129, 135, 139 Avengers 6, 20, 23, Ghost Rider 1 and a few other smaller books. I paid $360.

 

I'm guessing I'll double my money or a little more. Usually I want to at least be able to double my investment ASAP. If its over 30 books, I want to triple it. The harder it takes to sell, the more I want to be paid for my time and potential problems.

I had one guy give me two low grade Cap Timelys after giving him information about what his collection was worth. (He kind of felt bad because his wife seemed to mess up any deals we tried to come up with)

 

Time is valuable.

 

 

[gaz973]

Since I actually own my store, I'm quite happy to have a large inventory of cheaper books. Over time they all sell, either filling people's want lists or an unexpected increase in the popularity of a character and if I end up with a glut of a particular title or issue then they can go in my cheap boxes at a convention.

 

There is usually a far, far greater percentage profit on cheap books sold well than there is for most keys for anyone who is in a position to hold them. If I was having to pay rent for storage or needed the money back immediately then my business plan would have to be different.

[joeypost]

What is this "selling" you are talking about?

[vaillant]

I tend to buy something from a new OO collection at least once a month. The last group I picked up was a Star Wars 1, ASM 101, 129, 135, 139 Avengers 6, 20, 23, Ghost Rider 1 and a few other smaller books. I paid $360.

 

I'm guessing I'll double my money or a little more. Usually I want to at least be able to double my investment ASAP. If its over 30 books, I want to triple it. The harder it takes to sell, the more I want to be paid for my time and potential problems.

I had one guy give me two low grade Cap Timelys after giving him information about what his collection was worth. (He kind of felt bad because his wife seemed to mess up any deals we tried to come up with)

 

Time is valuable.

 

Right, time it’s valuable, but for that reason one can choose to spend it with others just out of friendship and care, even if he is a professional dealer or if these should be hours devoted to his business.

I mean, I know how many people here have given me advice without expecting anything in return, and the nice guy who offered you the Caps is a good example at that.

 

I believe we should never forget that the risk of the over-agitated contemporary life could be to "try to maximize" our time with profit or gain in mind, reducing the essential element which is at the core of each and every activity we engage in.

 

This of course, is not just about collecting and reselling to fund collecting.

[towards2112]

Basic business selling lesson # 2.

Again, what you think you know versus what you must know.

 

 

http://mathforum.org/library/drmath/view/65175.html

 

http://www.investopedia.com/ask/answers/102714/whats-difference-between-profit-margin-and-markup.asp