Wednesday, June 3, 2015

American Express $20,000 Reselling Challenge - Update 2

Recently, I joined Miles Per Day's $20,000 spending challenge.  The idea is to spend $20,000 on the American Express Platinum card within 90 days for the greatest amount of profit and the least amount of effort/time.  The full sign up bonus of 150,000 Membership Rewards Points is earned when you spend $20,000 in 90 days.

A couple of notes to start with:

- I have bought a lot of merchandise.  I have had problems with receiving some of the merchandise which has resulted in a delay in reselling attempts.  I have about $6,000 worth of inventory that arrived today (some will arrive tomorrow) at Amazon so the next update will have a lot more good information on profit margin.  I have about another $6,000-$7,000 of merchandise from various merchants on its way to be delivered to me.

- I still have a lot of merchandise gift cards which I trying to unload slowly.  It means my float is greater than I'd like, but I want to cautious.

Here is some info from some of the other contestants:

Noah from Money Metagame gave his 4 week breakdown and he is still killing it.  11% profit so far.  Great job Noah!

Chasing the Points updated as well.  He finished 75% of his spending with by far the least amount of work.

Vinh at Miles Per Day gave his first update.  He finished a lot of the spending with good margins, but got banned from Bloomindale's along the way.    That's annoying.

Big Habitat joined as well.  His 13.6% profit on over $9,000 of spending is looking awfully pretty to me.

The Numbers Breakdown

  • Spending Complete: $20,376.53 - this number may decrease.  More on that in upcoming days or weeks
    • I've finished the challenge, but I still have plenty of merchandise to buy

  • Inventory Total: $13,333.81 - I have sold very little.  As I mentioned before, I had some delays in receiving many shipments so everything is taking a bit longer than expected.  

  • Pending Earnings Total - $4,101.56
    • Cash from Sales - $3,978.04
    • Shopping Portal Cash Back (Top Cashback, etc.) - $93.52 
      • This does not include cash back from unsold items 
    • Store Bucks (eBay Bucks, etc.)  - $30
      •  This does not include cash back from unsold items 

  • Cost Basis for Sales: $3,806.51
  • Cash from Sales: $3,978.04
    • Profit from sales - $171.53
    • Profit margin - 4.5%
    • Additional profit from shopping portals and store bucks - $123.52
    • Profit margin after shopping portals and store bucks - 7.75%

  • Total Times Spent: ~10 hours.
    • I think it is taking me the longest.  I need to work on that.

Thoughts and Looking Forward

I made a couple of poor choices in terms of profit margin.  In one sale, I made a profit of $13 after spending over $1,600.  That's less than 1% and I didn't get any shopping portal money or loyalty points.  I actually even lost almost 2% on one sale that was slightly less than $500.  They weren't great sales but I was able to at least buy and sell the items quickly.

If you take those two sales out, my profit margin would be significantly higher.  I haven't made that same mistake again, but I have taken some risks on same sales.  We'll see how it works out for me.