For Maximum Profits Do What Your Competition Won't Do
edited: Saturday, February 23, 2002
By Sydney S Johnston
Posted: Saturday, February 23, 2002
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Anyone willing take more action than others, will make larger profits and we prove it with real life examples from online auctions.
We all want the easy way out. That's just human nature. But, if
we want to earn maximum profits in minimum time, we need to
consider doing what other people won't do.
Here are two general business principles that can make you a lot
1. The more trouble you go to, the more money you will make
2. The more risk you assume, the more money you will make
A perfect example is in the wildly popular online auction
business. Obviously, to sell effectively you need strong
products that many buyers want.
There are three general categories for non-specialized auction
1. Drop shipping
The EASIEST way to sell is with a dropshipper who has a website.
What could be finer? You pre-sell an item, then send an email
or call a toll free number and have it sent directly to your
buyer pocketing the difference. You never even see the
merchandise. No risk, no trouble.
Unfortunately, there is a problem with this beautiful business
model. First, the price reductions from dropshippers are
usually very low. They are selling convenience, and they know
Secondly, since most of them are online, your potential
customers may find them, too.
Third, if you aren't careful, you could be selling a product
that isn't in stock, creating a lot of problems with your
buyers and ruining your reputation on the auction sites.
Closeout is at the other end of the buying stick. The price
reductions are amazing – often 90%-95% off - but the work and
risk is higher because you usually must buy in larger
quantities and you definitely must take delivery of the
merchandise. No easy shipping here.
A personal story: I used to make regular expeditions to a
closeout warehouse near Atlanta. It was a real drag because
it was approximately 90 minutes each way. When I got there,
it was such a dumpy place. Concrete floors, glaring
fluorescent lights. There were big boxes and bags of "stuff"
stacked everywhere, with no apparent order. No display, no
description – just a big jumbled mess. The owner, who was about
65, inherited the business from HIS father, and his sons worked
there with him. The dad sneered at the internet and wouldn't
even talk about it.
When I went, I took a van and wore old clothes, because I knew
I would get dusty. I spent hours plowing through tons of
merchandise and made lists of possible items to sell. Then,
I would call my son who was at home on the computer, read him
my list and go have lunch while he did some research.
After his report, I would go back and buy certain things,
loading them all in the van myself. When I got home, I had to
unload it, store it, take pictures, write listings, then box,
wrap and mail. It was a whole lot of work!
But the profits were wonderful. For example, I bought a huge
box of miscellaneous Liz Claiborn purses for $3 each! They
were selling for around $70 at Macys. I got between $45-$50
for each one of those bags! Quite a healthy return on
Other lucrative goodies included all kinds of name brand sports
shoes and T-shirts; Revere Wear cooking utensils; Weider sports
supplements and exercise equipment; tons of seasonal
decorations; brand new books for 10-25 cents; more clothing
than I even knew existed; well known perfume and cologne and
huge numbers of items I can't even recall.
I wish I could say that I have made huge numbers of dollars by
dropshipping – but it wouldn't be the truth. It's only been a
minor part of my auction income.
Lots of auction sellers deal in large – even huge – volume.
It's OK to make a $2 profit if you're selling 2,000 widgets a
week and you don't mind all the detail work that goes with it.
But, if you want the really large profits, seek the out-of-
the-way little places, the ones that no one else has heard of.
That's where you will find the gold.
As in auctions, so too in any business. What will you do that
your competitors won't?