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 usedbookguy 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 Resellers Mindset Podcast.
I got one question for Johnny today. And Johnny,
where is my margin going? Because I feel like
every year, everything is going up in cost. And
I guess this kind of came to my mind because
I shipped a box of books the other day to my
grandmom because she likes the stuff that's no
good for us. You know, the Clancy. She likes
the courtroom drama stuff. My grandpa likes Clancy,
Kessler. And I shipped it through pirate ship.
Uh, they're not paying me to say their name,
but who cares? Um, and it was, dude, it was expensive.
It was actually cheaper to ship it ground cubic
or whatever. I don't like, I don't ship a lot
of stuff myself. Right. It was cheaper than media
mail. And like, I don't, I haven't shipped media
mail in a while. Like I remember when I sent
you boxes for consignment, media mail was pretty
damn expensive. Yeah. They're like 40, 50 pound
boxes, but I think it's crazy how much. cost
have increased over the past two years, I would
say. Yeah, we can sit here and say it goes up
every year, which it does. But I think the past
two years, I think we're seeing a huge increase
across the board with shipping, shipping supplies,
just overall platform fees with promoted listings.
Amazon raised their fees. There's a million different
fees on these platforms. I hate to say it, but
I do think it's the writing on the wall. they
are going to continue to squeeze every penny
out of us that they possibly can and they don't
care whether or not we stay in business because
there's always going to be another person to
replace us but dude i don't know maybe it's me
but i feel like the costs are just the costs
are crazy anymore to be a reseller yeah and that
kind of goes to one of our older podcasts we
did with us talking about maybe you sell higher
margin things because the the it catching up
to those higher margin things is a long time
the good old days i think of selling ten dollar
items and being able to clear five bucks are
long and gone um because i remember when i joined
or started reselling it was like i don't know
370 something to do maybe two something like
275 or something to do media mail you know what
it's north of five dollars these days to send
anything And yeah, we got Uncle Sam going in
our pockets more. We have the platform fees going
into our pockets. We got the postal service going
into our pockets. The shipping supply company
is going into our pockets. Everybody wants theirs.
And they want theirs, it seems, more and more
every year. And I think with the postal service
in particular, that's going to reach a critical
point. And this has happened in other countries
where the government really steps in. They're
like, nope, we're regulating this stuff now.
You guys are done. um this is astronomical and
it's no it's not really better at usps or fedex
or the other bajillion other little ones but
i don't know um it's harder to do our job than
it's ever been um harder in the aspect of we
have to do one of two things either we start
listing higher end inventory or we list more
inventory to make up for it so equilibrium return
um and a lot of people go the list more route
which is fine it works um but i'm kind of leaning
more toward maybe we should start doing higher
end stuff i think that's smarter yeah i agree
i think higher end's definitely the play over
listing more of the same crap we've been listing
it's it's just crazy how you know even if you
look outside the shipping like the line items
on like one typical amazon transaction for the
amount of fees you pay like in a month for all
the different amazon fees it is it's just insane
and it they try to like ease you into it right
like ebay and amazon like they try to make these
fee increases really not seem like a lot but
like when you're building upon it year after
year right and then they add something silly
like their promoted list and things on ebay like
yeah it's scammy but they can get away with it
and if we're going to continue to kind of be
on their platform like we have to deal with it
i guess i just get frustrated because the thrift
stores cost way more than they used to those
prices at thrift stores have gone up you know
in some cases in my stores i used to have a place
that would sell books for a quarter and now they're
like three dollars minimum three dollars plus
everything individually priced i mean thrift
store prices i'm pretty sure everybody listening
can say have gone up at least a hundred percent
in the past two years for anything on the shelves
And it's not necessarily their fault because
guess what happened to them? Their rent has gone
up. So in order to compensate that, the stuff
in the store has to go up. It's just like I was
saying, we have to raise our ASP. And they've
done that just to stay alive. And a lot of that's
still not good enough because, well, that causes
less people to come in the door and then they're
out of business no matter what. They may have
bought themselves a little time and still go
out of business. Unfortunately, that's what's
happening. Like my town, my small town, half
the buildings downtown are closed, opposed to
like last year, because the one guy who owns
the majority of the buildings, he doubled the
rent on everybody. And a lot of those people
were barely making it as is. And that's why half
of them are gone now. It is. And I think as long
as people are in the stores, like buying the
stuff, why not keep raising the prices, right?
They'd be stupid not to, you know, we can charge
five hours a book and people are still going
to buy them. I mean, we only got to sell one
book at $5 versus having to sell, what, 20 books
at a quarter to make the same amount of money.
So to them, they see, I've even seen it at library
sales. For the past year, I used to go to library
sales and it would be 50 cents a dollar, 50 cents
paperback, dollar hardback. The books now at
most library sales are at least $2 and it's usually
$2, $3. So $2 paperback, $3 hardback. That is
a crazy shift from what it used to be. And that
cuts out a lot of the low dollar fast moving
stuff that I used to like to buy. But I'll tell
you right now, I go to library sales. Another
benefit of not, you know, running to the books
is the DVDs and CDs are still super cheap, but
that's just a matter of time. That's short time.
That's short time. Yeah, exactly. I mean, everything's
going to continue to go up here and you just
have to. As much as things suck and everything
goes up in price, I think we have to account
for it and figure out ways to mitigate losing
our bottom line profit when things do raise.
Because, I mean, the post office is like, what,
three times a year now, right? And think about
how big of a thing free shipping used to be on
eBay. Everybody did free shipping because it
wasn't that much. The margin, the cushion was
there. When you charge shipping, you've got to
keep the extra. Nowadays, eBay is like, no, no,
no. We share that now. That's part of our money.
There's no workarounds, I guess. There's no way
you can... beat the system anymore and try to
like finagle your way to getting less or getting
more of the money and them getting less like
they have every idea figured out planned out
so like they're they are super maxing every penny
out of the resellers and where else can we go
there's nowhere else we can go and if there is
a new platform that says i think i forget what
platform it was like no fees for a month or whatever
like It's not sustainable. So eventually they're
going to come around and you're probably going
to be paying just the same amount, if not more.
And promoted listings, that used to be 1%. What's
up, Amazon tellers? We wanted to take a second
to talk about GoToLister, the software me and
Johnny both use to list and manage our inventory
and grow our businesses. With the fastest listing
speeds out there and built -in profit analytics,
it's a no -brainer. Easily and quickly have items
available for sale using 2D barcodes and get
more for your items with its built -in smart
pricing. Make sure to check out the 30 -day free
trial at gotolister .com backslash Mike or using
the link in the description below. Mandatory
to turn that on, which made sense. Now it's 2%.
There's nothing stopping them from continuing
to raise that minimum 25 % to have your items
promoted. I know, I know. And especially with
the new, like if somebody clicks on your listing,
it doesn't have to be the same person. Oh, that
pay -per -click, no way. I'm not doing that,
no. Yeah, it's pretty crazy. I mean, even just
the recommended promoted listings, because I
list like a few things here and there, and I
always just do the recommended because my buy
cost is zero. And the recommended is never under
like 9%, dude. It's always like 9 % to 12 % for
any category, don't matter what category it is.
Most of my items, it's like an average of 11
.2 or something. If you're not keeping track
of that and you're just clicking the button,
you don't even realize how much money is going
out the window because you sell something for
$100. Well, if you're paying 12 % promoted, that's
$12 right off the top. So it adds up quick. Right,
and people doing that priority pay -per -click
thing. let's say the iPhone guys, right? I wonder
how much money is just being given to eBay just
to have iPhones clicked on. That must be insane
to get that number one slot. Dude, I thought
about that. When Deb used to be on Etsy and you
had to like run your daily ad budget and it was
based on clicks. So you could put in like how
much you, at first they would let you pay how
much you wanted per click. So you could put a
max, right? Like me and you were bidding. I only
want to pay 25 cents. You want to pay 35 cents.
You're going to get clicks before I do. And then
they changed it. So then you didn't decide how
much you paid per click. You just set a daily
budget, right? So all of a sudden your clicks
now are like a dollar. Your whole budget can
be one click. One click, right? I always thought
about this. What if a competitor or somebody
out there would just go through and click all
the promoted listings and just basically waste
everybody's money? Exactly. You can set up a
bot to do that. I'm not saying that's ethical.
I'm just saying. That's the first thing that
came to my mind. Click everyone but mine, please.
Well, now it's the same thing with eBay because
if somebody clicks on any of your promoted listings
and then it sells, you have to pay the promoted
listing fee. Yeah, the only difference is we're
in charge of how much we're promoting. It's not
a blind thing. That's the only real difference.
Yeah, so you're only paying the percentage that...
I wish there was more data about that too. I
think there needs to be... I don't think we'd
be as upset about increases across the board
if there is more data, right? If they gave us
analytics that said, hey, here's how much more
you're going to make if you promote your listings
at 2%. Amazon, here's how much more money you're
going to make. If you send in this type of inventory
or like actually fact -based raises, even the
post office, Hey, we have to raise it again in
January because here's how much we paid for gas
and wages and whatever. But it's just like, they
just say we're going to do it. And they give
you like the most half -assed explanation or
no explanation at all. Or like they'll give you,
Amazon gives you like this two paragraph, like
almost AI written thing. I'm like. Oh, due to
rising costs, we really love you and your family
and your bank account. But due to rising costs,
unfortunately, we're going to have to raise fees
by 25 cents and 50 cents. Like they try to lay
it on so easy. And no matter how easy they try
to put it on us, we're always like. just cut
out the bs and just be like hey we're raising
fees by 50 cents promoted listings are going
to two percent here's why we're going to do it
because we think doing this is going to get you
more sales which means more money in your bank
account instead of just trying to do like the
corporate style uh garbage that they put out
to us when they decide to raise fees and the
post office is just like this is a temporary
increase and we all know it's not temporary this
is just for the holidays well for the past six
holiday seasons the holiday increase stays it's
not the holidays every day all year long yeah
the best we get i had a Go on to a listing to
see the exact percentages. But for my general
thing, which is what I only use, you get 90 %
more visibility on average, it says. And that
priority, which is that pay -to -click nonsense,
170 % more visibility. Yeah, I guess. And you
can set the daily budget. But again, it's like
we were saying, one click and your whole budget's
gone. You just put in the dollar amount you want.
Visibility don't pay the bills, dude. Uh -uh.
I don't think it does. If it did, I sell one
-offs, right? It's not like I'm selling Replens,
Oprah's book club list over and over again. If
I was doing that model, I may have to do that
priority thing, but I'm going to have super slim
margins doing so. Yeah, I think it's, you know,
not just the actual platform side of it. Look
at... How much everything else costs to run your
business? You know, the labels. I buy the cheapest
damn labels I can off Amazon. I don't know what
country they're from, but I'm like, all right,
this one's five cents a piece. This one's six
cents a piece. Give me the five cents a piece
labels, right? Because I actually tell you like
how much per label in the listing. It's just
crazy that. A lot of that stuff gets overlooked.
And I think it takes real business like sense
to actually try to start seeing where you can
possibly save money as costs continue to go up.
I mean, we've got a guy in the group that dumpster
dies. We talk about him all the time. I feel
like because you don't want to pay for boxes.
I don't know anything mad about it. Right. I
think, you know, especially if you're just starting
out or the box, you work at a place and get the
boxes. I used to do this. I used to when I was
an eBay everything seller. you used to be able
to find guitar hero guitars and every goodwill
for like three or five dollars and they could
sell for fifty dollars a piece all day long well
finding a box that fit a guitar hero guitar was
like impossible impossible luckily i was privileged
with being a cbs store manager and we got tons
of boxes in so i would you know i look like a
guitar hero box setting that thing aside for
when i need it right so like i see i seen even
back then i was like trying to finagle my way
to kind of make things you know i guess cheaper
for me it didn't make it necessarily easier because
the easy way would have been measuring that box
and just buying them you know, online and getting
a pack of 10 of them. Like I do now with the
Lowe's boxes. I know the box size. I know what
I can fit in there. It makes my life easier.
Do I pay for it? Yeah, but it's a business expense.
I think there's a balancing act too when it comes
to trying to be a cheap ass and just being completely
inefficient. And I'm not saying a dumpster diving
guy is being completely inefficient or being
a cheap ass. Well, you're being a cheap ass irregardless.
I'm not bad about it. I'm in the dumpster dive
guy's camp. I have a dollar store. They just
put them in a stack for me on the side of the
door, and I just go around back and pick up my
stack. But it's free, and they're less than a
minute from me. There's one traffic light between
me and them. So it's efficient for me. I don't
know if he's actually – I'm not getting into
dumpsters. If dumpster guy is, that's a lot more
work than I'd be willing to do. Lazy, dude. I
guess I'm lazy and a cheap ass. You're right.
I'm trying to think, man. What else is going
up a lot? I mean, I still have my resurfacing
machine. Thankfully, this thing's lasted me years.
Labels really are pretty cheap. You really don't
need that many, I guess. What's your printer,
your thermal label printer, if you get one of
those? I don't know if those have gone up or
if they stayed the same. They've gone, if you
want like name brand Dymo or Rolo, they've gone
up, but you can get cheap. They got cheap knockoffs
now for like 50 bucks that are basically the
same exact thing. There's more options, but if
you want the Primo one, they've gone up. Gotcha.
yeah yeah i just think across the board everything
you know it's like the thrift stores crush us
you gotta you gotta drive your car to get to
the thrift stores gas ain't cheap no matter where
you're at and i know we're talking about this
right now when gas is through the roof because
of the crazy world we live in but um you know
gas has never been cheap even if it's 250 a gallon
it's still it adds up when you're driving tons
right it it quickly adds up you don't think because
you just go in you fill your tank you think it's
just part of the job when you actually look at
your you know for me i use quickbooks i can see
how much i'm spending on gas in a month and i'm
like holy shit like this is a lot of money coming
out every and you don't fact we don't factor
that in when we're making a buying decision it's
not like well i drove you know i spent an extra
200 bucks on gas today i go out 10 days a month
that's an extra 20 bucks a day i'm out right
we're not factoring that in when we're buying
the item to resell it we're just factoring in
what we're paying for it in the store and what
the sold comps are Most of us are not factoring
in what the actual profit is after we sell it
after all the fees because we don't have the
software to do it, right? On eBay, we're looking
at sold comps. Sure, you can run the quick numbers
of like the overall eBay fees, 30%, 25%, whatever
it is. So you kind of can get an estimate, but
we're really not running our business decisions
based off of actual profit after everything.
We're just running it off of what it is at face
value. Right. And toying into that, I mean, if
you're on the road, you're going to have road
food, right? So gas station food, or if you're
stopping at a takeout, or maybe you go into the
$6 hamburger joint. What's your go -to fast food
when you're out thrifting for the day? It doesn't
have to be a meal. It could be a snack. Those
candy orange slices that come in those clear
bags. They put sugar on them, but their orange
slices are so good. All right. You ready for
mine? Yes. Buffalo hard -boiled eggs. Interesting.
Are they warm or cold? They're cold. They're
in, like, the little fresh wraps that are in,
like, the grocery stores. Okay, okay. Never had
them. I can't say they sat. I would give them
a try. I don't know if I'd like it, though, but
I would try it. I also, there's one thrift store
chain that sells the sour gummy worms. Oh, there
you go. I get me a little bag of the sour gummy
worms. They're only like 99 cents. Those things
are absolutely amazing. So I feel what you're
saying with the orange slices. Yeah, they're
so good. You got that sour and the sugar thing
happen at the same time. It's great. Full disclosure,
I do not factor in the cost of my buffalo -style
eggs when I'm buying things at the store, but
it is an added expense that we really don't think
about or take into consideration. And no, I don't
write off my hard -boiled eggs for tax reasons.
You should. That's why I wind up in jail. Storage
unit cost, if you're doing the storage unit game,
that's gone up on me twice this year. Not happy
about it, but it's out of my options are find
a non -storage unit solution or drive 30 minutes
away. So right now I'm eating the bill. And if
they get up on me anymore this year, I've already
talked about starting to move out of there. But
they're really nice people. For some reason,
they think we live in Dallas. But it's with the
mentality of where else are you going to go,
motherfucker? Where else are you going to go?
I went from 105 to 126 last month. So, I mean,
it doesn't sound like a lot, but it's like –
When you're dealing in multi -units, it adds
up. It's a 20 % increase for no reason. And the
funny part is if I just go on their website and
get a new unit, I'll get the first month free
and then the next three months like half off.
And I've done this. I've done it multiple times.
And I would just literally carry my shit to whatever
unit they put me at. And all of a sudden, I'm
back underneath $100 a month for the next four
months. They don't even offer a move -in free
month, or I would totally do that. I'd move everything.
Hey, employee, you'd be working a lot harder
if they offer that. They don't offer that. Fortune
for him. But it would be so much work to do that.
It goes back down, dude. I went up even after
the half -off. It starts at like $90 a month,
and I'm already up to $1. 25 and i just moved
like four or five months ago like they like johnny
said they know they got you right most people
most people aren't gonna be cheap asses like
me and johnny like deb's like i'm like hey deb
you got to come to the storage unit she's like
shit we got to move everything don't like yeah
but like when you factor it in over four months
five months you're saving an extra 200 bucks
like that's a lot of damn money to me i mean
i know it's not exciting to some people but 200
is 200 exactly and then If you're dealing multi
-units, you got five units, that's a grand. That's
real money. It's ridiculous. But those storage
unit people, they got us by the balls, honestly.
What choice do you have? We're the cheapest in
town. We're the only in town. It's the same with
platforms, dude. Where else are we going to go?
You got to sell somewhere. You got to sell on
the bigger platform if you want to actually get
visibility and sales. We don't have options.
All we can do is try to figure out how we can
work it in. And there's really no definitive
way to fully account for everything, right? The
store subscriptions and Amazon land, all the
damn software subscriptions that we have. There
is just so many nickels and dimes that add up
quickly. And I think a lot of people wind up
really not getting off the ground because they
have so many nickels and dimes coming out of
their bank account that they didn't properly.
Plan for or account for, because a lot of it,
you don't know until you know. Pretty much. I'm
trying to think of what else we spend money on.
I think even tapes got up. And tape's like one
of the most inexpensive things that we deal in
reselling, right? Yeah, I hate my tape. Deb got
me the Duck brand tape, and it sucks. It's the
worst tape ever. I'm never getting it again.
But, I mean, dude. It is the cheapest tape. But
it's the crappiest tape as well. Yeah, it sucks.
So now I got to find a new tape. Yeah, that goes.
I mean, it's funny, too, because Deb will do
this when she'll buy something again. And she'll
be like, it went up again. Like, because you
can see what you previously paid for an item.
And you're like, wait a minute. It's gone up
how much? I just bought this thing two months
ago. And it's gone up. It's crazy how fast everything's
gone. But yet again, if there's somebody willing
to pay it. then of course you're going to keep
increasing your prices. If I had a product and
I could sell it for more, of course I'm going
to keep raising prices as long as sales support
that. And if you raise it enough, you actually
can have less sales and make more money than
having all the volume. Right. I mean, if you
go down the cereal aisle or the milk aisle, they're
all within a penny of each other, right? But
they're always going up because people always
continue to buy cereal and milk. There is never
going to be a state in the world where Americans
stop buying cereal and milk. It's not going to
happen. Yeah, that's so true. I think you just
got to do your best to. give yourself almost
like a padding amount of dollars in your business,
almost like a slush fund to account for all these
expenses, especially if you're newer. You and
me have been doing this for years, so we kind
of know what to expect when it comes from all
the expenses that come with this business. We
know the storage units are going to raise their
rates every two or three months, and we have
to make plans to get it back down to where it
needs to be. But a lot of people just jump in,
they get a storage unit, and then in two months,
What they thought was a great introductory rate
of $100 a month is now $150 a month. And you're
like, well, I wouldn't have got this if it was
$150 a month, but you're already there. And instead
of trying to decide a way to get it back to where
it was, you just say, well, this isn't worth
it no more. And then you just don't even give
it a chance. Well, we've talked about the problems.
There are some solutions here. If you buy enough,
you can get things reduced in cost. Like if you
bought enough labels or you bought enough bubble
mailers or enough boxes, you can get the cost
per unit down, but requires some upfront money,
a bigger thing than you buying a smaller quantity,
sure. But you can get your costs down. Same for
your bubble wrap. I use Do Not Bend stickers
for my eBay business. I've gotten those down
to a cent each instead of eight cents each. Little
things like that, that can add up on the overall
big picture of your business, even though it's
a small cost per unit, but times X amount of
units a year, it really does add up. Yeah, Deb
used to get like thank you cards and business
cards for all of her cat and dog toys on Etsy
and Vista print. The more you buy, the cheaper
it is per unit, right? So exactly what you're
saying. So she would just one time a year buy
50 ,000 and it costs you like half a penny instead
of buying a thousand at a time. And they're like
15 cents a piece. It doesn't seem like a lot,
but it adds up, especially if it's something
you know you're going to be using again and again.
Margins are tough and margins what matter? What's
going into your actual bank account? Nobody in
reselling cares about sales anymore. If somebody
cares about their overall sales numbers, they're
an idiot. I'll go on record right now. I don't
care if you're living in a world of what your
sales are and not what's going into your bank
account. We can't be friends because it's all
fake. It means nothing to me. I don't care what
your actual sales are. I don't care if you're
selling a trillion dollars. Right. I've seen
it so many times over the years. These people
that post their sales numbers are bankrupt, making
absolutely no damn money. And if you just took
them after sales, you think they are the most
successful person in the history of planet Earth.
And it's the furthest thing from the truth. So
the reason we talk about margin is because we
want you to be aware of what's actually going
into your bank account after everything. What
are some ways you can increase that or at least
try to stay at pace with everything else going
up around you? What are you doing on your business
to go up to make you more money? to account for
all of the rising costs. I think that's the big
kind of thing you really want to think about
here is not so much your sales are up every year,
is your bank account up every year? Is your bank
account up every month? Right. I saw somebody
do 90 ,000 in revenue, but they're only taking
home 10K. I told them right then and there, your
business is broken. I don't know where, but if
you're only taking 10 out of 90, something is
broken along the way and you need to figure that
out because... Your margins are way too slim
to do 90 grand in sales and only be taking home
10K. That's ridiculous. Yeah, I mean, in a reselling
world, that's bankruptcy waiting to happen. Yeah,
and they had employees too. I'm like, how do
you pay them? They're like, I don't know. I'm
like, there's so many problems here. So many.
Yeah, I mean, in reselling, we should have a
healthy margin compared to... uh comparative
to any other type of business model because we
can get our stuff for so cheap but the problem
with that is we buy a lot of crap we shouldn't
buy and it just costs us time and money so like
you got to refine everything to get your margin
up it's more than just worrying about your buy
cost and what you're selling an item for it's
what else do you have going on in your business
that can add to your bottom line give you some
time back to focus on the more you know money
producing task in the business it's not just
well i gotta buy things cheaper to increase my
margin That is not always the answer. And a lot
of times it's usually not the answer. If you
have to decipher, if there's 10 people that sit
down and they say, well, the way I increase my
margin is buy things for cheaper. And then we
actually have their whole business, every aspect
of their business. I guarantee you nine out of
10, it's not going to be them having to buy items
cheaper to fix their margin. It's going to be
something else somewhere in the business that's
related to them actually making more money when
it's all said and done. Right. I mean, there's
two. Well, there's three ways to make money in
business. That's to double down on what you're
doing, more volume essentially, increase your
ASP, or cut expenses. And not a lot of people,
I think, do the third one. So once you've got
your thermal printer, go shopping around for
the cheapest labels at some point. I guarantee
you can find them cheaper than what you've found.
You found what works, great. Now find the exact
same thing for the cheapest possible price. Whether
that means buying more units to get the cost
down or finding that one seller out there on
the most obscure website that you think you're
going to get scammed from that's actually legit,
fine, do it. And that goes with everything. Just
do a full audit of what you're replenishing every
month and see how much money you can save annually
by doing that one simple procedural task across
all your replens. I agree. I'm going to wrap
it up here. Remember. Actual money in your bank
account is what matters in reselling in any business,
not your sales. And there's ways you can increase
it over time. And just be prepared because three
months from now, the post office rates will be
going up again. Next year, eBay fees will go
up along with Amazon fees, along with everywhere's
fees. And just try to start preparing for that
change in the future. And I appreciate you all
listening, watching over on YouTube. We'll talk
to you all in next week's episode. Thanks for
listening to another episode of the Reseller's
Mindset Podcast. Today's full episode and all
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