Quote:
Originally Posted by raulus
Not so sure that it’s really this rich.
This analysis ignores the cost to ship back and forth from the grader. Also ignores selling costs, and the cost of capital or time value of money while your cash is tied up waiting for the piece to get graded, and then waiting for it to sell once it’s graded. Throw in some overhead for salaries to pay your people to manage all this stuff, a little rent to store everything and have a site for your people to work, some insurance to cover your operations, and it gets a lot more tight.
On a good day it’s more like a 15-20% profit margin. On a bad day it could be less than 10%. Still not nothing. But probably not nearly as fat as it might seem at first blush.
Of course, if the market is rising, particularly if it’s rising aggressively, then the time spent waiting for grading and for the piece to sell works to make the math a whole lot better. But as much as it pains us to admit it, cardboard doesn’t always go up, and go up bigly.
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I’ll concede the points about opportunity cost of sitting inventory and playing the waiting game
That is real risk for any business owner.
That said, I know several people operating this way and they are churning inventory a number of ways: card shows, Facebook, Instagram, Discord, Twitter, and last case scenario, 7 day eBay auctions.
Shipping adds little to the per unit cost basis if you are sending 50-100 cards at a time for example. Or if you are dropping off at card shows where you only pay for shipping on the way back.
If you are getting 15-25% return on your $ while doing this on the side, it can be very fruitful