Welcome back to another episode of the Reseller's
Mindset Podcast. My name is Mike, also known
as the Used Book Guy on YouTube, along with my
friend and fellow full -time reseller, Johnny
B. We help people start and grow their reselling
businesses from the ground up. We also have a
weekly Zoom call and private Discord for all
YouTube members. Head on over to youtube .com
backslash usebookguy to join the channel and
gain access to the full -length podcast, Zoom
call, and private Discord today. Let's get into
this week's episode. What is up, everybody? Welcome
to another episode of Reseller's Mindset Podcast.
Special guest today, three years in the making,
basically. He had me on his podcast back in 2022,
Caleb Roth. Most of you know who he is, but I'm
going to allow him to introduce himself. We're
going to talk everything related to Amazon and
building a profitable book business and actually
understanding your numbers. This guy is an analytical
mind that you got to hear what he's going to
say today. I'm super excited for this. I have
kind of sort of been waiting for three years.
I'm glad he's kind of back in the fray when it
comes to doing different things related to books.
So Caleb, thanks for coming in and yeah, introduce
yourself and you know who you are, what you do.
Yeah, Mike, thanks for having me. It's good to
be back in the saddle when I sold Scout IQ. So
I'm a bookseller. I'm an entrepreneur. And, you
know, real quick, my definition of entrepreneur,
if I can push a little bit of philosophy on y
'all, an entrepreneur is someone who sees something
and does something about it. So I love people
that take action, that have agency, that believe
that they can kind of move the ball forward and
make. quality decisions in their lives. I just
so happen to apply that to the book space, and
I've just met incredible people like Mike and
many other people out there. We've had a lot
of conferences. We've kind of shared some of
the ups and the downs that come with any business.
Seems like there's more downs lately, and it's
kind of weeding out a little bit of the herd.
I'm the artist formerly known as the book flipper.
I had a community on facebook a little over 30
000 people matthew osborne and david chung and
cole and joseph and uh love neat we're all business
partners some of you know matthew um and david
of course they were very heavily in the space
david still is Matthew is no more. He's working
on other projects. But yeah, as Mike said, I'm
very heavy on the analytical side. I think knowing
your numbers, having a sense of an awareness
of where you are in the business, and then ultimately
having clarity around where you want to go. And
then it's just a matter of connecting those dots
from where you are to where you want to go. And
I believe that business is a vehicle that can
look like almost anything. Matthew and I used
to joke often that you can make money doing anything.
And I really believe that. And then it's just
a matter of trying to find something that is
in alignment with who you are and how you want
to show up in the world. So founder of Scout
IQ, founder of eFlip, founder of Reprice IQ,
and founder of Palette IQ. You can see the IQ
theme. We bundled all of that up, sold it to
three cults. at the end of 22 and they bundled
it further and connected it with inventory lab
and a bunch of other services and they've got
their own bundle and they're still you know running
in that space and serving amazon sellers so it's
been three years i had a non -compete uh kind
of took my foot off the gas i got married again
picked up uh we have six kids between us So beautiful
blended family and there's a little more to life
than just trying to build business at this point.
And I'm not mad about it. I thought I would stay
away from books. But I don't know. Once a bookseller,
always a bookseller. And so now I'm kind of dipping
my toe back in the water. I've got a blog. I'm
sure we'll talk about that. But I'm going to
be sharing more data, trying to help those of
you that are still in the game. There's about
20 ,000 booksellers that have sold 150 to 200
books last year. And so it's a reasonably sized
crew. I don't know if that seemed high or low
to you, Mike. That's who's out there. And if
you're watching this, you're one of the 20 ,000.
And I'm really eager to try and find ways to
serve each of you and help just build meaningful
businesses. Yeah, it's funny you brought that
up. The blog will be linked down below in the
comments and in the description to the podcast.
I thought it was way more than 20. 20k dude i
see nothing like only 20 000 like that is like
a speck of a speck and like because it's even
broken down by state and like pennsylvania had
like i think under a thousand i'm like there
really isn't that many people doing this but
like i still feel the opportunities there and
you you know just looking back you know three
years of kind of stepping out i'm sure you were
still like in the shadows like lurking and kind
of seeing what the different things were going
on because you know your friend david chung you
got all these relationships over the years of
these mega booksellers or people that are just
consistently the quiet ones in the background
that you're not going to see out there that are
absolutely crushing it but you just pop back
up with this blog post and i'm like oh this is
very interesting i'm like here we go down the
analytical route and i'm straightforward when
it comes to analytics like i just want my business
to be profitable i don't kind of look any anywhere
past that because I get carried away. I'm not
the best with the spreadsheets and things like
that. I have a spreadsheet that works for me,
but it's just next level analytics for you. But
you also, when you were knee deep in the business,
you backed up your actual business with the analytics
to help you make better decisions. I think that's
the big disconnect we have today is people just
want to go scan and sell things, but they don't
really understand how much money is coming into
their bank account or if they're even profitable
on a monthly or even a yearly scale. Yeah. And
net profit is all that matters. We talk about
vanity metrics and the orange bars on your Amazon
seller app are great. And, you know, I've seen
a lot of sellers that have crazy numbers, you
know, I'm talking, you know, five to $10 million
booksellers. And then of course there's, there's,
you know, people that do. you know way more than
that in terms of online arbitrage and wholesale
and everything else but if you don't have great
margins if you don't have a lot of room for error
then you can have a 10 million dollar business
that you know nets less than five percent and
it can be incredibly stressful versus a seller
that does maybe a hundred grand but is running
you know 30 margins they're going to be a lot
more happier about what they're trying to build.
So yeah, analytics are very important. And I'm
a big believer in what I call frameworks. A frame
is how you see the world. It's an idea. It's,
hey, if I do consignment, maybe this works. But
the trick is you have to go test it. You have
to put it into practice in the real world. So
it's not just ideas, it's execution. And a lot
of entrepreneurs are really good with ideas and
they struggle to put things into practice. And
then there's another camp who just is really
good at doing things. but doesn't stop to be
reflective and maybe think about why they're
doing what they're doing. And a really good entrepreneur
is someone who's integrated and can do both.
And so the idea of frameworks is take these ideas.
You can find them from anybody you look up to.
There's a lot of great influencers and people
that are sharing their actual business experience.
And so you find things that work for them, a
frame that works for somebody else. And then
it's up to you to figure out which ones to sort
of try and borrow and steal and put into your
practice, into your business. And ultimately,
if it works for you, awesome. If it doesn't,
you know, rinse and repeat and try something
else. Yeah, I agree. And the big question everybody
wants to know is probably. Since you've been
away, we've had issues with the buy box and it
kind of changed the whole algorithm of the buy
box. So I guess I'll just throw you on the spot
here. What are your thoughts? And I guess because
nobody knows really what's going on. What is
your conspiracy theory about why the buy box
is the way it is today? And as much as it pains
me to ask this, because I've been talking about
nothing but the buy box for the past three months,
people are going to want to hear it from you
and what your thoughts and ideas are behind it
moving forward. Yeah, jumping right in with the
zingers. I love it. Let's go, dude. We won't
even make them wait till the end. Let me clarify
first that, yes, I've been lurking. Yes, I've
been talking to a lot of sellers. I've gone to
Books and Beyond the last few years. I've been
at Miami Seller Conference with Avery and Taylor.
And so I'm still pretty connected. And I still
get a lot of calls from people and just checking
in and seeing how things are going and what's
going on in the book world. I still sell books.
So I've got books left over from my warehouse.
I take my kids out. We go to garage sales, especially
in the summer here in Indiana. It's super fun.
I don't have a very substantial business. My
business at one point was over a million dollars
a year, primarily a solo operation with me and
my wife. And then we ramped that up with consignment
and a whole bunch of other methodologies. This
past year, 2025, I did just over 10 grand and
I netted close to five grand. It was almost 50
% margins, which is very healthy. I had a very
high average selling price. And so I'm not an
expert anymore. So I'm just going to start with
that caveat. And I'm all merchant fulfilled at
this point. So the buy box fiasco, if you want
to call it that, here's what I know from talking
to people. We can make some conjectures or conspiracies.
Who doesn't love a good conspiracy? But the buy
box blipped, I think, two or three times in 2025.
The buy box changed kind of overnight. There
was no mention of it. It didn't really even update
in the API, so it was fairly confusing. And basically,
it shifted. And the way the buy box used to work
was it was the lowest prime seller with good
seller metrics, quality feedback, good scores,
et cetera. You had to kind of meet a certain
quality threshold. But pretty much the buy box
or when you go to the Amazon page and just click
add to cart for used, which most of us sell used
books, it would just add your offer. And so the
game used to be sending everything to FBA or
a lot of things to FBA. And Amazon would handle
customer service. They'd strike out negative
feedback if it was in any way related to the
fulfillment experience. And they charge a little
more for the experience. But your sales went
up and the buy box. There's different metrics.
Amazon doesn't share specifically, but it's estimated
that as much as 70 to like 82 percent of the
sales in media and books come through the buy
box. So it's a big deal. And it was really common
to have what we called the prime bump. And so
a book could be selling for 10 bucks, merchant
fulfilled. And it was very common to get, you
know, sell that book through the buy box for
anywhere from 12 to 15, sometimes 20 dollars.
So getting a few dollars used to be what the
prime bump was. So all the extra costs of. using
the Fulfilled by Amazon program, we're sort of
offset with this prime bump. Now, the fees have
changed significantly. When I started back in
like 2014, 2015, there weren't even long -term
storage fees. Now those storage fees are substantial.
And if you're sitting on a book, a long -tail
book that sells a few copies a year, and yours
sits there for a while, it's going to get pretty
costly. And secondly, if you go in and sorry
i got some notifications popping up uh distract
my train of thought secondly on the buy box um
man i completely lost that train of thought let's
uh let's read the condition matters now right
so i used to be the everything good right because
if it was good or above nothing mattered whether
it was good very good like new that 100 is completely
flipped upside down with the current new everything
the condition matters like i There is actual
listings where I go in and I look because I actually
wanted to see like what's really going on. And
I have listings where I am a used FBA copy. Good
price, cheaper than the merchant copy, which
is very good. And there will be two buy boxes
on the page. But the merchants gets the big buy
box up top, even though I'm prime and I'm cheaper.
Mine is good. There's is very good. So they're
definitely conditioned. One hundred percent matters
now. And it never used to matter up until this
change. Yeah. And that makes sense because what
happens is Amazon used to make it very easy.
And I remember my last train of thought. Removals
and disposals used to be fairly inexpensive.
You could dispose of a book when I started for
15 cents, one five cents. And getting it shipped
back to you only cost 50 cents. And now it's
weight based. It's the same price whether you
dispose of it, remove it. You can liquidate,
but that doesn't often. yield you anything. But
it's somewhere in the $1 .50 to $2 range and
higher depending on the weight of the book. And
so the round trip for a book that's a dud is
way more expensive than it used to be. So couple
that with the buy box used to sort of offset
those extra fees. And now exactly to your point,
fulfillment method doesn't seem to matter whether
you ship it from Amazon's warehouse or your garage.
It's price that mostly matters. And a lot of
this is probably due to what's going on in the
EU, European Union. They're way more careful.
I think there's been several lawsuits over there
in terms of Amazon favoring higher prices. So
the consumer expects low prices. And when they
go in, sure, if they want to go in and click
through the offers and pick a prime price because
they want it quicker, they want to get free shipping,
that's fine. But most of the time, that was a
higher price and people got rightfully pissed
off. And there was lawsuits. And the buy box
has been very different in the EU for quite a
while, probably since we started selling back
about 10 years ago. And it's just a matter of
time before that caught up in the US. So the
way the buy box seems to work now, it glitched,
blipped a few times, seems like Amazon was testing
it out in 2025. And then I believe it was late
October when the changes sort of stuck. And I'm
guessing they're here to... to stay. And so exactly
to your point, it really favors the lowest price
and condition does matter. Acceptable books almost
never win the buy box unless only acceptable
offers are available. So good is always going
to be featured. And that makes sense. If sellers,
you know, three quarters of the time are clicking
add to cart and it's just the cheapest price.
Usually the cheapest price is an acceptable copy.
It may even say like former library book. Maybe
there's slight water damage, which you're not
really supposed to sell anyway. But return rates
have gone up because seller or buyers are not
as sophisticated. They're not looking at the
description notes. They're just adding it to
cart and they assume it's going to be a quality
book. And if it's beat up, they get frustrated
and return it. So Amazon sees all these metrics
at a macro scale and probably said, we've got
to make customers more satisfied. And so good
almost always wins over acceptable. And to your
point, very good. We'll do some more analytics.
I don't have exact numbers, but talking to people
that I trust that have looked at it, at least
spot checked it. It seems like very good offers
if they're within 9%. So if you've got a book
for 10 bucks. uh good you could theoretically
list yours around 10 .90 so you could still get
a small condition bump not necessarily because
you're prime. But if you do have very good books,
you do get featured a little more heavily, again,
because Amazon cares about a satisfied customer
at the end of the day. So we'll do more in -depth
analytics. We're setting up a new data pipeline,
getting ready. Keepa's got amazing data. And
so we're going to start sharing more of that
data and kind of help you then, you know, one,
with sourcing decisions. Two, that's going to
be really useful when it comes to selling and
repricing decisions. I'll tell you what I used
to sell this past year when a buy box used to
be the old buy box. I probably sold close to
a thousand items where there was no FBA offers
and the merchants were supposed to say $8 and
under. I would sell those items all day long
at $17 .99. All day long. Right. So we're talking
a big like most cases, more than ten dollar price
difference just because I was the prime offer.
That business model is 100 percent toast. Right.
So when I'm outsourcing now, I basically had
to say, hey, I got to leave this stuff behind
now unless I can compete with the merchant offers
that are currently on the listing. So it's kind
of been a big change. And I think. I think it
gets confused with people that are like, well,
your whole business relied on the prime bump.
I understand that argument, but that's the way
it was forever, right? So like, why would we
not take advantage of something that existed?
Now that it's changed, does it suck for us? Yes,
everything we have sitting there, all my 1799
stuff, most likely isn't going to sell at 1799,
but that's the way things were. So of course
we were going to source and I probably made thousands
of dollars off of that. I think there's always
something on Amazon. You know, even when you
were back knee deep in it, like every year there
was always something, right? We had the restock
limits. We had, they were raising the fees back
then. It might not have been a lot, but 15 to
50 cents. They were doing like, I remember you
had this one software. Cause I remember I utilized
this shit out of it. It was like, you could.
you could create a removal order and Amazon would
have like this free window where you could do
free removals. And you had something that could
like analyze your inventory and like you upload
the file. I remember I removed like 1500 units
to get underneath the restock limits and it didn't
cost me a penny. Like today that would cost me
like $5 ,000 to do that. Well, and because Amazon
always had to offer that, I think otherwise there
would probably be lawsuits. Because if you sent
inventory in with the expectation that removals
were free or very inexpensive, you know, 15 cents,
and all of a sudden they change it and say it's
$2. that's a different agreement than what you
signed up for. And sure, it's their sandbox,
but they also are afraid of lawyers and everything
else and class action type stuff. So Amazon,
to their credit, would often give you that flexibility
and that ability to jump in. And again, using
data, we'd kind of go through and find your old
stuff, long tail that the price had tanked or
it was unlikely to sell and say, hey, let's free
up space and take advantage of this before 1
,500 books could cost you $3 ,000 to remove.
And 3 ,000 bucks is not nothing. That's substantial.
Yeah, it's pretty crazy. Just every year, you
know, we got rid of the restock limits. And I'll
say this, there's new inventory systems way better
than the restock limits. It was basically a unit
based thing. You can only have 1000 units. Now
it's based on your actual cubic feet that you
use. And you easily can bid for more storage
and you can get credits towards that storage.
So it doesn't even wind up costing you anything.
They 100 % improved on that. But I think the
big problem is like. What is the path going forward
for your average bookseller? I will say this,
this new buy box thing, the way it works is great
for new sellers because prior you had to earn
the buy box and there was no set rules or definition.
And I've had people in my group take. It's taken
somebody 18 months to become buy box eligible
in the used book category, which is absolutely
insane, right? There's no, you've got to earn
it. And then you can be in this buy box we're
talking about. But now that it favors merchants,
I'm seeing a lot of newer people, if they have
the lowest price in a good condition, whether
they're FBA or merchant fulfilling, they're not
buy box eligible. They're getting more sales
as new sellers because now they actually can
participate. And I guess the rodeo to try to
be the main person on that page when somebody
goes to it. Yeah, and it's worth noting, it looks
like there's two different buy boxes. One would
be for prime buyers, which is almost everybody.
Most people have a prime subscription. It's something
like 260 million prime subscriptions out there.
So it's a lot. But if you don't have a prime
subscription, you're going to potentially see
a different buy box. Again, we'll analyze that
and kind of get into the weeds later. But it's
worth noting that there probably are two. buy
boxes. So depending on who you're trying to serve,
again, most people are prime. Most people will
buy through the buy box. And so if you can sort
of target that, that's the goal. Again, Amazon's
favoring price, quality sellers and condition.
And that makes sense, right? You want to have
a happy marketplace. And now if the buy box,
if people aren't spending $17 .99 to buy a book
from Mike. and they're buying it for $9 now,
the laws of supply and demand and price elasticity
and everything say if price goes down, volume
should go up. So the volume of sales may go up,
and people say, well, it's just favoring the
mega sellers and the better world books and the
thrift books and the world of books. And yes,
they can compete at a different scale, especially
because most of them have discounted shipping
rates through bound printed matter. They're saving
anywhere from $1 to $1 .50 a book compared to
what... smaller players are doing. So they have
economies of scale that we don't. But it is pretty
much equal footy. They're not getting featured
and having a huge benefit. They can drop the
price for sure. But as newer sellers or if you're
playing the game now. It does sort of simplify
it because before you sort of had to read between
the lines and look at the lowest used price,
look at the buy box, see if you thought it might
happen, see if the e -score and the sales velocity
was high enough to support a large prime bump.
And so there was this kind of internal calculus
or algebra that you were doing. And now I think
it's going to be streamlined. It's very simple.
Just the used buy box is really the price you
have to target. And if there's five acceptable
offers at eight bucks and the lowest good offers
at 12. you're good until that gap gets closed
so there still could be that condition bump but
the prime bump is is mostly gone so that means
you're going to be sourcing fewer books But it
also means you're going to be sourcing better
books. And for the vast majority of sellers,
especially if you're a small player, only selling
less than probably let's call it half a million
bucks a year, you're going to be better suited
by being a little more intelligent, being smarter,
and sourcing fewer books and just trying to bump
your average selling price higher. Because you're
going to work less hard and make almost the same
amount of money thanks to the 80 -20 rule. So
yes, it stinks. It does kind of... taper the
ceiling that you could have achieved using FBA.
But I think it's going to push more sellers to
be merchant fulfilled. I've been merchant fulfilled.
I added merchant fulfilled during COVID with
some of the restrictions and never looked back.
And my business has been 100 % merchant fulfilled
for the last three years. And again, it's a very
small operation. I maybe have five or 600 books
listed at any given time. But it's really easy.
I sell a handful a week. It takes me no time
at all to find the book on the shelf, throw it
in an envelope, drop it in my mailbox. I don't
even have to run to the post office. Technically,
we're supposed to since it's media mail, but
we have a big mailbox. We have a country route
out here, and our mailwoman is awesome. And so
she takes everything. I've asked her about it.
I don't make trips to the post office. I walk
to the end of my driveway, and that's it. So
the game is simpler. Um, yes, it stinks because,
um, you know, you're not getting all the benefits
in that prime bump and you're not kind of having
your elite class if you're a prime seller, but
it'll be interesting to monitor. Um, and we can
jump into the blog post if you want, or I don't
know if you want to take it. Yeah, we can now
go, go for it. Take, take, hit me with some of
your big takeaways when you were making that
blog post. Cause for me, the big one with that,
there's nowhere near as many sellers. I thought
about this. I went to this one library sale last
year here in central Pennsylvania and I got there.
I was like, all right, I'm going to get there
like 45 minutes early. Usually I'm only like
a 15 minute early type guy. You know, I don't
got to be first in line here. I don't get that
crazy. I get there, you know, I pull in the whole
parking lot's full, dude. I'm like 350th in line.
Like I can't even see the door of the place.
And the blog post says there's like, you know.
There's a thousand booksellers in Pennsylvania.
Now I'm thinking to myself, like, damn, how many
of the thousand booksellers in Pennsylvania were
at this actual book? So there might have been
all of us there. And I still did really good,
though. But yeah, jump into some of these these
blog points that you kind of discovered and maybe
something that surprised you when you actually
started diving into some of these numbers. First,
I'll introduce the title. It's called Upstream
Pursuits. I really wanted upstream ventures,
but a lot of the upstream slash blank, you fill
in the blank, was already taken in terms of domains.
Upstream Pursuits it is. The reason I call it
upstream is two reasons. One, we're trying to
fix the source, not the symptom. Imagine a factory
that's polluting water. You live on the river.
You don't have access to the clean drinking water.
You're pulling what typically was healthy, clean
water and using it. to cook and drink and bathe
and whatever else. If you're a half mile downstream
of that factory with pollution, you now have
to boil the water every single day in order to
use it. That's extra work, it's effort, it's
energy. Or so you can do that every single day
for the rest of your life. Or you could sort
of meander upstream, find the factory, call the
EPA, knock on the door, destroy it, whatever
you want to do. But if you fix the problem and
you find the source of things. You're going to
just have so many more benefits downstream. And
now you don't have to boil the water every single
day. It's way healthier. It's way more efficient.
Many of us in business just get stuck doing tedious,
repetitive, boring tasks every day. And it feels
great. It feels like we're working. It feels
like we're accomplishing things. But if you zoom
out and sort of reflect and look at what you're
doing. Often there's some sort of leverage upstream
that if you go fix and spend time working in
the business, sorry, on the business, not in
it, then there's things you can fix and sort
of save yourself half hour a day for the rest
of your life. AI is going to help with a lot
of that. And just being curious and creative
and trying to find things to do a little bit
differently are going to help you. So that's
reason number one is going to the source, not
just dealing with the symptoms over and over.
Part two of it is how do you go against the current?
Anybody with a smartphone and a sourcing subscription,
you know, scouting app is your competition. Books,
they are a little more gated than they used to
be. It used to be like you could just sell any
book, but it's still a pretty easy category to
start in. Again, everything's getting a little
harder, a little more difficult, which does weed
out some competition. But if your primary business
is go to thrift stores, scan all the books, sell
them on Amazon, anybody with a smartphone is
your competition. So you are very crowded. And
depending on where you are, you might have a
fairly blue ocean. That's kind of a term. But
you may be able to just kind of build a business
that works. But as soon as more competition enters
the market, you're going to be splitting those
books with two, three, five, ten other sellers.
So the idea of going upstream is how do you be
strategic? How do you paddle against the current
and go find some more sustainable models? In
my business, that looked like offering consignment.
It looked like backroom access, building relationships
so you could get access to the books before everybody
else, all the other thousand sellers and PA came
to the sale. It's just trying to be more strategic
in what you're doing. So again, fixing the source,
not the symptoms, and then going against the
current is sort of what we're after. So it's,
you know, I love entrepreneurs. I love people
that want to better their lives. But I really
love people that say, hey, I'm in the game. It's
working. I've kind of put my time in and I figured
out things that don't work. I'm ready to be strategic.
I'm ready to build something more sustainable,
more meaningful. And that's that's really kind
of the heart and the ethos behind the title.
So post number one, we went through and I say
we I'm so used to saying we with business partners.
And unfortunately, I couldn't coax anybody back
in. So when I say we now, I mean, me and Claude.
Claude is Anthropics LLM, kind of like ChatGPT.
It's amazing. We've been able to build a lot
of scripts. It's a great thought partner. And
what we've done is we went through about 75 ,000
book listings on Amazon and pulled every single
seller that's on those listings. And it told
me we have a 99 % chance of capturing anybody
with an inventory greater than 185 units. So
almost every seller should be in this report.
And we pulled about I think it was like 27 ,000
unique seller IDs that are on all those book
listings and then ran them back through Keep
as Analyzer. And we're able to figure out who
is selling books as a primary category and sort
of distill it down from there. When we look at
active booksellers, meaning you've got a feedback
rating in the last year of at least one. And
typically, this gets a little nerdy, but the
ratio of feedback to orders is about 150 orders
to generate one feedback. Mike, we ran your numbers
before we started recording. I think you're on
the better end of that, closer to like 82. And
so basically, mega sellers especially don't get
as much feedback. Smaller sellers do. I think
my average was closer to 50 to one. But on average,
I've talked to a lot of sellers, about 150 to
one. So we can get an idea of the volume of sellers.
And so in order to sell or to get one feedback
last year, you had to have sold around, let's
call it 150 units. And there was just a sketch
under 20 ,000 active booksellers on Amazon that
met that criteria. I'm with you. That kind of
stood out to me that that was a little smaller
than maybe I thought. I know when we sold Scout
IQ, I know the number of customers we had. And
if that was the market three years ago, ago uh
we had way more of the market than i expected
um and i'm guessing it has tailed off significantly
especially with the changes on amazon so about
20 000 out there 40 of the sellers do use fba
in some capacity that was a little higher than
i thought Once you get north of a few thousand
units in inventory, that number dropped significantly
down to about 13%. And even among the super mega
sellers, you know, sellers with over 50 ,000
to 100 ,000 units in inventory, it still holds
steady about one in eight, 13%. still use FBA,
at least in some capacity. So it'll be really
interesting. We're going to redo this analysis.
We'll see how many new sellers are entering the
market. We're going to do this quarterly. So
the first report we shared, if you go to upstreampursuits
.com, you can check out the first report there.
Of course. i'd say like and subscribe you can't
really do that but do sign up for the email list
um really i want to build that community again
and sort of listen to what are the struggles
what are the pain points what are the the challenges
i'm going to be doing a little more consulting
i'm not going to be selling as much And I'm not
going to probably be doing a lot of software
necessarily. I'll probably more advise and consult.
And so if you are stuck in your business, if
you could use an analytical minds, please reach
out. You can hit me up on the website there or
just Caleb at UpstreamPursuits .com. I'll pull
the post. Mike, did you have any other questions?
I'm curious what stood out to you from that first
post. I think the 2080 rule, dude, I don't think
people even know what you're talking about when
you talk about the 2080 rule. So hit everybody
with it because it's so important. And I never
even heard of it until you brought it up years
ago. And I'm just like, it's actually true. Like
if you actually look at your numbers, like it
100 % makes sense. Yeah, so the 80 -20 rule is
also called the Pareto Principle. It's named
after, I think it was a farmer or an economist
that sort of figured this out. But they were
looking at, I think, bean plants. And they looked
at the yield and they said, hey, 20%, like a
very small number of our bean plants, produce
80 % of the yield of the actual beans that we
can eat and sell and whatever else. And they
looked at this principle and they started looking
across lots of various domains, not just business,
but this 80 -20 rule, meaning that we work five
days a week. So one day of work, one focused
day of work. typically yields most of the results
in your business. We've done this in booksellers.
I analyzed a mega bookseller back in like 2016
and it was crazy. It was even more leveraged
than that. I think it was something like 50 %
of their units sold only generated 5 % of their
profits. And so you look at that and you go,
man, half of their business is incredibly inefficient.
And this particular seller was trying to sell
books and if they could make a nickel, I think
5 cents was their profit threshold. And of course,
prices fluctuate all the time. And as soon as
the price deteriorates just a little bit, a lot
of those books weren't profitable. And so looking
at that seller, it's like, man, you're working
so hard and half of your sales are hardly making
any profit. And so what that means practically
for most booksellers is probably your top 20
% of books, your most expensive 20, the highest
average selling price, are yielding most of your
profits. So what does that mean? Should you just
stop selling the other 80 %? Not necessarily,
but I think it is a really good case for saying,
hey, if I'm happy to sell books where I think
I'm going to net $2, maybe start to raise that
floor price, that profit target, maybe raise
it up to $2 .50 or $3 and see what happens. And
for most of you, your business won't hardly change.
Your sales won't really struggle. And your profits,
more importantly, will probably be very similar
and you'll be working way less hard. And so it's
really about saying, hey, how do we build a business
that's efficient? that works for me where i don't
feel stressed out and i feel like i'm rushing
all the time and just you know i'm fragmented
and distracted and trying to build a business
when i could back up be a little more strategic
which is that upstream idea and and you know
sell fewer books but sell more of the right books
yeah i agree you said it earlier um i i said
it's funny i said the same exact thing on one
of my calls i had i plan to source less this
year the way that things are but In theory, my
ASP should be higher, which means I'm going to
have more money coming into the bank account.
So I create less work for myself. But the problem
with this, man, is we live in a world where it's
like you need the dopamine, the gratification
to like when you're out of the store. Right.
Like I went out last week for the day and like
I'm used to filling up the whole damn car with
stuff. And it's like only like half a trunk full.
But like to the average person, you're like,
man, this sucks now. But to me, I'm like, well,
I know everything that's in this trunk. is quality
and it's probably going to sell within a month
of it actually getting there and i don't have
to wait for it to sit there for six to twelve
months and possibly have to get rid of it Well,
I've looked at some of your content and I think
there's a couple of posts where you've just had
one box held up and you go, Hey, this is just
one box. It's not very sexy. It's not very glamorous,
but this one box is going to net me $700. And
so I think that's exactly what we're after now.
It's not about filling a palette and the glamor
shots of a full shopping cart. That's great.
And again, it depends on what your metrics are.
A lot of people got into the game and started
selling and they used our hundred book challenge
that Matthew and John Troutman put together.
And if you're goal is to get a hundred books
a week, sometimes, especially if it's getting
to Friday or Saturday and you're not quite there,
you sort of lower your criteria and say, yeah,
I need to make $3 a book. This one's only 210,
but yeah, I need more books. So you start to
take, you know, books that don't really meet
your criteria. And so it's just about, yeah,
and it is less dopamine. You're not filling that
up. Scott Galloway had a great post and he, instead
of DOPA, he called it SLOPA. It's how do you
do things a little more slowly. a little more
intentionally and do things that can compound.
And so it's kind of looking into that and trying
to build a business that's meaningful versus
just busy and hectic. Yeah, it's crazy because
I sent the most inventory I ever have last year
to get to my 185 in sales for the year. I just
think this year, like imagine if I could just
send like, you know, 20. 30 less inventory and
still keep the same numbers or maybe even do
160 in sales but my split is closer to like the
50 50 you had right like instead of being the
38 % after Amazon and then after your buy calls,
like you raise your profit. You don't, you can
make more money with a smaller sales number on
Amazon, I guess is what I'm trying to get through
to people. And I think a lot of people just,
and you see it now, what would happen with the
buy box? We go out and source and there's people
that are using the repricers and they're matching
like the lowest merchant, but like, it's not
profitable FBA. You can't sell the book at $6
and make money. But to them, they see the orange
bar, like, Hey, look, I'm selling stuff now.
But in theory, they're We're probably losing
money on every single sale, but our brain computes
it as, oh, it's a sale. So we made something,
didn't we? Yeah, the sale feels good. The three
years off, I've done a lot of research and just
kind of looking at myself in terms of dopamine
and cell phone addiction. And, you know, our
society is built off things that make us feel
good in the short term. Drinking coffee, you
know, whatever, nicotine, whatever else you're
trying to pump into your system to just get that
quick hit and feel alive and feel good versus
saying, hey, what's the actual work here to build
something that matters? Going back to the 80
-20 rule real quick, again, there's just under
20 ,000 sellers that have one or more ratings
on Amazon. Again, there's booksellers that sell
completely off of Amazon. There's booksellers
that didn't reach one feedback last year. There's
just launch booksellers. So, of course, the number
is higher than that, but 20 ,000 on Amazon. Can
I share your rating count for last year? Yeah,
go ahead. It was 145. We looked at your data
before we started. To get into the 100 -plus
rating club last year in 2025, there was only
690 sellers that reached that criteria. So you're
in the top 3%. You're in the top 3%. You heard
it here first. And to get to a thousand ratings,
there's only 92 sellers, top half of 1%. To be
in the top half of sellers, you just need to
get to four feedback. So selling 600 books a
year, that really is, you know, half the market
does less than that. Half the market does more.
So it doesn't take a lot. And again, a lot of
booksellers are in it for a little extra spending
cash. For me, we're going to Universal, taking
the kids down there. I made just under five grand
last year. That's going to cover a very fancy
vacation and hopefully create some good memories
of standing in line at a theme park. That's what
the kids want to do. It's not my idea of fun.
But my Amazon business did that. So it met a
pretty cool goal, going to a handful of garage
sales, shipping out a few orders a week. um you
know not a lot of work i worked very very part
-time in the book business but it's something
meaningful so even though i think i had eight
feedback last year so i'm in the top like 40
% of booksellers. I'm just over half. Yay. Good
for me. But there's a lot of people like that,
that if you understand your numbers and you can
source, again, I'm not selling a lot of eight
and 10 and $12 books. I'm trying to sell, you
know, 20 and up. And so I pass over a lot of
books, even though it's a quick seller and I
might make $3, it's just not worth the effort
and the time. And so being disciplines has allowed
me to build a business that it's very, very simple.
and is meaningful. That's a few thousand dollars
that I can use for whatever that is in your life.
For me, it's an extra vacation. Yeah, I think
you can definitely talk on this is when, especially
if you're doing FBM, because FBM is like the
big swing now, right? Everybody FBA wants to
do FBM. And I try to tell you people, you have
to value your time in this, right? Because maybe
you do have to take yours to the post office.
You got to buy the packing supplies. You're not
just slapping a label on the book, right? You
are taking the time to make sure it's in there
correctly. There's more steps to it. So I think
if you are going to be somebody like, hey, I'm
going to start doing FBM. put some value on your
time. Don't go for the low level stuff. And what
he said, you know, the 20 plus ASP, it makes
sense because we've, we've looked at it before.
You have, there's a certain breaking point on
Amazon where you sell a book and you make more
than Amazon makes. And it's right around the
$20 mark, right? So you sell a book at 20 bucks.
Maybe you make 10 50, Amazon makes nine 50. That
is where you want to be in the media world. And
for a CD or DVD, it's $17. You make about $10
before your buy cost at 17 on a CD, DVD and a
book. little bit higher because they're heavier
and the fees are based off that. So every book
he sells over $20, he makes more than Amazon.
But for me, I'm out, I source a quick moving
book that's going to sell for 12 bucks. I'm only
going to make $3, right? So that is kind of what
you want to steer clear from if you're going
to be wanting to do this part -time and have
higher margins and actually make more money because
I'll sit here in a minute. How many items I sold
last year where I literally just wasted my time
and spun my tires, sourcing it, buying it, putting
it in a box. having it repriced, paying the storage
fees. I mean, thousands of units last year, 100
% I probably broke even on or lost money on.
For sure. And I will say there's one caveat.
If you are a brand new seller, you do have to
sort of put the reps in to get your feedback
to sort of, I don't know if you can qualify for
the buy box on day one. That's something we'll
look at. Before with FBA, it used to have, I
think it was 10 ratings you had to get before
you were buy box eligible. Amazon never stated
that, but that just kind of seemed to be the
magic number that once you hit that, but again,
at 150 orders per rating. you would have to sell
1 ,500 books to get to that level. So I will
say the caveat used to be, and it probably still
is, it's okay. to list some books that are cheaper
and fast moving, especially because it is sort
of building that capacity. You're proving to
Amazon that you can ship things out on time and
you're building that seller rating. And that
is useful. And then over time, you can sort of,
again, move the needle, move the goalposts and
make sure you're being smarter. There's no brownie
points for or bonus points for hitting 100 grand
in sales or 50 grand in sales or whatever benchmark.
It's dollars in your pocket at the end of the
year. And again, it does take several months.
This is not a get rich quick thing. Again, it's
a I love that term from Scott. But it's how do
you build a business and make sure you're putting
the right inputs in and putting the right quality
of books in, knowing that as they begin to sell,
you're doing something that actually helps you
meet your goals. Yeah, it's pretty crazy. When
I started, dude, I remember like textbooks were
like. gold to me right and then like I heard
horror stories of people getting banned about
textbooks and like I just quit selling textbooks
cold turkey on Amazon and I thought like when
I first started like you if you would have told
me hey Mike you could still make money on Amazon
not selling textbooks I'd have been like get
the hell out of here there ain't no other books
worth anything right and like I the fact that
I haven't sold a textbook in three years and
I'm just like I don't even need the textbooks
and you know you've talked about it you know
relationships it's all about you got to do a
little bit more than just walk into a thrift
store keep your head down scan the stuff sure
you can make hundreds maybe even a couple thousands
of dollars a month doing that but if you want
something that's sustainable it's getting the
library it's doing the commission type business
with another you know brick and mortar and i
have seen more brick and mortar bookstores pop
up this is another thing people refuse to go
in and source at these places and they're literal
gold mines because they don't want to deal with
online so they just put their stuff out on the
shelf oh yeah our paperback are two, our hardbacks
are four. They never scan anything for online.
But us as thrifters, we just assume if it's not,
if thrift store isn't in the name of the place
we're going to, there's nothing there for us.
Yeah, you're onto something there. Bookstores
are opening. I think there's 422 is a stat I
saw opened last year. So there is kind of a move
back toward brick and mortar, back toward physical.
And just to put some industry stats out there,
I think there was just over 700 million. physical
books sold last year in the US. So it is still
a huge market. It's growing very slowly. It's
not growing double digits or anything. It's very
low single digits. But books are still alive
and well. There's a lot of them being sold. And
that's something you're looking at and trying
to be strategic with it. Do you think there's
going to be more? So like nowadays, if you're
a brand new seller and you start selling books,
you're probably gated on like 90 % of the category.
But most of them come down once you send your
first box. You got to like prove yourself to
Amazon. You got to send a box, sell a few, then
all these gates start coming down. But there
are bigger ones that are gated for people like
Scholastic nowadays. Do you think in the future,
just Amazon overall with the way that's kind
of trending, do you think there's going to be
like more of these hard gates that we're not
going to be able to get past? Personally, I've
done it enough and I don't know how they decide,
like when they rolled out Scholastic. Like I
wasn't affected by it. Like they automatically
pushed me through for whatever reason. I wish
there was like some type of analytics behind
that. Like, Hey, if you don't sell a hundred
scholastic books in the last 365 days, then unfortunately
we're going to make you, you know, get an invoice
to get ungated. Like what's your thoughts behind
the gates going on right now? Again, I'm not
as into the weed, so I don't have a crystal ball
and I'm not as familiar. So I don't want to just
say something like I don't want to hallucinate
like AI tends to do and just tell me something
that may not be true. But you're exactly right.
People that have been in the game longer to have
more sales history and kind of prove themselves
are certainly going to be grandfathered through.
Again, 20 ,000 booksellers, those that have sold,
you know, have 100 feedback. There's only, you
know, just under 700 of them. So it's a very
small group. And Amazon for sure is going to,
you know, cater to the sellers that have already
proven themselves versus saying, hey, and again,
there's counterfeit books out there. I don't
know why Scholastic in particular is maybe clamping
down on that, but maybe they've been pressuring
Amazon and Amazon said, you know what? We're
going to put some sort of a gating requirement
and we're going to let the best of the best through.
Now, that doesn't mean you can't keep going.
So one of the things we looked at is what's the
launch date for booksellers? And you can see
that on the blog post again over at upstreampursuits
.com. But we looked at sellers who sold at least
10 ,000 units in 2025, again, based on 150 orders
per rating. And there's a little, basically 100
sellers a year. since 2018 so keepa started tracking
data uh late 2016 early early 17. so there's
about a thousand sellers that started pre pre
-17 2017 that meet that criteria but there's
over a hundred sellers a year since 2018 all
the way up except for 2025 because it's hard
to establish yourself that quickly but 2024 had
just over 100 sellers that have met that criteria
so it doesn't mean there's no room for sellers
to kind of build an operation and ramp up quickly
you can But you have to prove yourself. And so
getting higher volumes is certainly going to
push you higher up on Amazon's, you know, totem
pole. And it's it's it's crazy, like the fact
that. I mean, 95 % of the book community had
no idea like these were the types of numbers
because usually when I talk to people and I have
people I talk to like, man, I'm only doing $1
,000 a month. And I'm like, wait a minute, you're
only doing $1 ,000 a month. I don't think you
realize like you're way up there in the percentile
of people that actually are doing $1 ,000 a month.
I think everybody just has this idea that everybody's
out here crushing it. Everybody's in the thrift
store. Everybody's making all this crazy money.
And it's like the furthest thing from the truth.
Like people sell themselves short so much in
the book selling business. And I'm like. no like
you're doing this one day a week you got an extra
thousand two thousand dollars coming into the
bank account there's not many businesses out
there that kind of allow you to make this kind
of money with as little bit of effort i'm always
full transparent i may i do two full sourcing
days a week i only go out two days but these
are like i'm locked in i'm going out i got my
route i'm hitting all the stores i'm scanning
all the shit there's nothing else going on i'm
not cutting halfway through whatever it may be
so like The fact that you can still make this
type of money, even with this new buy box change,
it's not like I'm scared and I think this is
the end of Amazon. Like you said, we're businesses.
We got to figure out how to fix the problems.
And I don't want to FBM, dude. Listen, I know
you're trying to convince me like everybody else
for the past 30 years, I'm not doing FBM. But
for me, that means I'm going to find less inventory.
And I got to be better at the stuff I'm buying.
The stuff I get, I probably need another library
in my back pocket. I probably need another clean
out company. But I also think people overanalyze
how hard it is to get these. Like I cold emailed.
I did it probably in the middle of summer. I
went in Google, typed it all in. clean out company
near me, library company near me, cold emailed.
I literally got an estate sale company, a library,
another thrift store. And they didn't even know
who the hell I was. I just said, hey, you have
media you don't want. I'll pay you for this stuff.
And they're like, wait a minute, you actually
want this junk? Like, it's so easy. But if you
don't know, I guess you don't know. Yeah. And
a lot of it's just telling people what you do.
So I love, again, you are the definition of upstream.
You're very strategic with your routes. You're
very strategic. You're doing things that are
going against the current. Most people aren't
going to reach out and put themselves out there
and get rejected. And you did. And look what
happens. Something as silly as I walk my dog,
you know, try to every day right now, it's, you
know, 12 degrees outside here in Indiana and
it's, it's tough to do, but walking my dog, we
have a neighbor one street over, they have a
huge dog and we got to striking up a conversation.
asked what do I do I said well I used to sell
books I still kind of do and her eyes lit up
and she goes I'm an interior designer I studied
I've done all these houses she designed her own
house it's amazing she had me over we sat down
for tea and coffee and whatever and she's like
can you teach me how to sell I said sure I'd
love to so we go and I start kind of explaining
and showing her how to scan the books and what
the next steps are her eyes start to glaze over
and she goes Why don't you just do it for me?
I said, awesome. I have a consignment program.
I can track everything. I'll pay you half of
the profits. You know, I'll just come over and
take the books I need. Well, she had a collection
of several thousand design books and most of
them were profitable. And we're talking, you
know, 20 to $50 books. These are, that's like,
that's the dream. So my buy cost is zero. I'm
literally driving my car less than a quarter
mile away, picking up books at her house, building
a relationship with my neighbor, and every month
I just pay her half the profits. So those deals
are out there. She probably has designer friends,
and I've done this for two months with her now.
And so by the time I go and pay her one more
time, it's like, hey. What are your referrals?
You know, what other books do you got? Because
she still has rooms we haven't touched yet. So
how do we go back and keep going? But again,
putting yourself out there and just telling people
what you do, even though it's weird and different
and some people don't quite get it, like people
still read. That's still a thing. Doing that
leads to really cool relationships and opportunities.
All right, man. What else you want to cover before
we wrap this up? Man, that's pretty much it.
Again, a big thing with me is just know your
numbers and know your goals. Again, you're going
to hear so many great ideas, whether it's on
Mike's podcast or any of the other influencers
out there. And it's awesome to kind of chase
shiny and see what's possible. But ultimately,
if you have a business you're proud of that's
accomplishing your goals, that's all that matters.
If you're trying to make $1 ,000 a month. and
help augment your social security if you're partly
retired if you know whatever that might be you're
trying to help pay for your kids school or insurance
or whatever that is if that's your goal and you
can find a way to do that as efficiently as possible
you've won like you've built something that works
for you and you should be very proud now do you
want to scale and grow and try and turn that
into 2 000 or 5 000 or 10 sure maybe maybe you
do but a big part of business is just defining
enough getting really clear about what is success.
and then just ruthlessly going after that. And
so, again, if that resonates with you, if you
want to build a business that's efficient and
strategic and kind of explore your curiosity,
come check us out. We don't have a community
or anything yet, just a free blog, but it's upstreampursuits
.com. Caleb at upstreampursuits .com. Please
reach out. I reply to everything. I love connecting
with entrepreneurs. You're my people, and I'm
excited to sort of be back in this space and
to serve the community. I'm going to clip that.
So when anybody asks me, Mike, when are you getting
a warehouse? Mike, when are you going to be the
million dollar seller? I'll just say, hey, wait
a minute. I got a guy. He said something for
me. Just listen to this and then you can leave
me alone because I'm literally the definition
of that. I know exactly what I need to put into
retirement, how much money is coming into the
bank account. I want to live comfortably. I want
to enjoy my time here on planet earth. I don't
want to be out there living in the gay lords
and having, you know, there's nothing wrong with
doing that. It's just not the type of life I
want to live. All the links for everything he's
talked about will be in the description and down
in the comment section below. Caleb, I appreciate
you returning the podcast favor three years later.
I'm glad we're both back together now. Soon enough,
the Avengers will all be back together and we'll
be good to go. That sounds amazing. Mike, thanks
for having me. And thanks for doing, we talked
about it in the pre -show, but thanks for doing
business the right way. And I'm excited to kind
of see where all this leads us. Appreciate you,
man. Thanks for listening to another episode
of the Reseller's Mindset Podcast. Today's full
episode and all previous episodes are available
to all YouTube members, along with the weekly
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