The Internet has been buzzing the last few months about the latest round of price hikes from Amazon.
Like most other sellers, I was not happy to see such sharp increases in my selling costs.
Nevertheless, I pride myself on my ability to adapt to changing market conditions. So while I was out scouting for a couple of hours the other day, I noticed a curious affect to marketplace pricing as sellers adjusted to the new rates.
What I saw was that prices have increased to the point where book flipping is enjoying a resurgence.
That’s good news for small Amazon sellers who understand book flipping as a cash flow generating technique.
During a single two-hour scouting trip, I picked up 25 flips with an average sale price of about $11 (that’s $275 worth of books), for which I paid $31.25.
Initially, I was annoyed by the fact that I was only finding singles, an occasional double, and only one triple.
But when I got them home and ran them through Lightning Lister, I discovered that the average sales rank on those books was only 60,000.
I listed them all late Saturday afternoon and by Sunday morning I sold six for a 25% inventory turnover rate. I made a net profit of $27.69 and I wasn’t even trying very hard. That’s 89% of my initial investment in less than 24-hours!
In a few days, I’ll have no money invested in that book lot and the residual sales from the remaining inventory will generate ongoing income for the next few months!
Let’s take this little experiment a few steps further. In the above example, I only visited two stores. What if I had gone to 10?
Based on the limited results above, 10 stores would have netted at least 100 books. At an average sale price of $11 that’s $1,100 worth of books in a single eight hour day.
I would have paid $125 to purchase that inventory. My flip sales would have been at the same new listing sales rate of 25 sales in 24-hours, generating $275 in gross revenue.
My net profit of $110.75 is still 89% of my initial investment in less than a day.
Residual sales from the remaining 75 books will trickle in over the ensuing days, weeks and months as pure profit, leaving me in excellent shape
And that’s money that goes straight to the bottom line!
While I’m not advocating book flipping as your primary scouting strategy, it can certainly be an important technique for generating consistent cash flow to help fuel purchases of more valuable long-tail inventory at higher prices.
In the past, I’ve generated a new listing sales rate of 60% per month. Imagine purchasing 1,000 low ranking books per month and selling 600 of them within 30 days.
When I first started selling used books online it was difficult to find that many flips in a month that made nearly $3 of profit.
In the current market, it’s much easier.
Now book flipping is once again a key component of my daily scouting strategy in a diverse array of techniques I use to gain a competitive edge in the market.
If there’s a moral to this story you can say that Amazon has unwittingly caused the resurgence of this strategy that I originally advocated in Internet Bookselling Made Easy! in 2011.
I can’t tell you how long it’ll last, but I certainly intend to take full advantage of this window while it remains open.
Book flipping is once again a profitable niche that can be exploited as you go about your normal scouting day. Pick up those extra profits with very little extra effort and boost your income fast.
It’s easy, hassle free and can make a real difference to your bottom line.
In the end, used book buyers always make sweet tasting lemonade out of sour lemons by being alert, flexible and willing to seize new (or old) opportunities when they present themselves.
Joe Waynick is author of several eCommerce books covering the bookselling and publishing industry. His books are available on Amazon.com.You can also follow him on Twitter @JoeWaynick.
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