1) Specialize in smaller profit items, and sell a lot of them.
If you sell a Porsche, it is easy to make $1000 in profit. If you are selling $10 books, you need to sell 100 of them to make the same amount of money. Of course, you can use a combination of these methods. For example, you might want to sell trucks, books about trucks and toy trucks.
Like everything else in life, each strategy has its advantages and pitfalls...Fewer items mean simpler choices. Choosing to sell expensive items narrows your choices immediately. There is only a relatively small handful of items that can gross thousands of dollars in profits -- vehicles, art by famous people, expensive jewelry and so forth. By contrast, there are thousands and thousands of inexpensive items to choose from.
More expensive items require more specialized knowledge. Generally, those who sell the more expensive items need greater knowledge. I don’t need to know much to sell Star Wars posters. A valuable painting is a whole different ball game.
Inexpensive items reduce risk. If my $10 book doesn’t sell, it is an annoyance. If I have bought a $10,000 piece of equipment and don’t sell it, that can be a financial disaster! There is a safer way to auction expensive items, and we will discuss that approach in detail in later chapters. Briefly, it involves selling goods that belong to others for a fee, and not assuming financial risk of your own.
... sweat-inducing if you are working with larger numbers. Obviously, there are fewer of those kinds of transactions than there are the smaller priced ones. It is much like commercial real estate. Each deal is much more lucrative but there may be twenty successful residential closings for every commercial one.
You can begin more quickly with inexpensive items. It is harder to get started with bigger money deals. And this isn’t only because of the increased knowledge that you must have. It is often harder to find those opportunities than smaller ones. Also, once you get a reputation for successfully selling certain kinds of goods, you will have people seeking you out. But at first, no one knows who you are and no one has any reason to believe a word that you say.
Fewer transactions mean less record keeping. Larger items usually mean no shipping and handling. You can almost, or entirely, eliminate shipping and handling when you are dealing with large items. Those folks who buy a Lamborgini are going to come pick it up themselves. No UPS for them.
Cheaper items mean a much larger audience. You have a much greater audience if you are selling lower priced items. Nevertheless, this doesn’t mean that there aren’t lots of folks who want to buy expensive items...
This particular item didn’t sell because the reserve wasn’t met but it is an astounding auction, nevertheless -- $102,100!What does it all mean? Choose a selling strategy that “fits” your needs. Know its pros and cons. If it feels right to you, go for it.
