Tuesday, September 1, 2015

Turnover Tuesdays - XBox Saves the Day

For those who are not familiar, I started a series a while back called Turnover Tuesdays. Every Tuesday I like to highlight one item that I have resold. This will include profitable and non profitable sales. I hope that there is always something to learn.

Week 1 - First attempt at reselling
Week 2 - My second straight fail
Week 3 - My iPad mini collection
Week 4 - Bed Bath and Beyond
Week 5 - An iPad Idea for Your Staples Gift Card Collection

The Item - XBox and TV Bundle

On August 9th, I posted a deal for an XBox and TV Bundle from Best Buy.  The price was $500 for the 2 of them and I said they sell for about $350 each with potential to make about $70 on the bundle, which would equal 14%.  I thought it was a great deal so I bought 3 bundles (pigs get fat...).  Let's see how I did.

Each bundle cost me ~$535 with tax, but I used an American Express Offers for You of $25 off $250 to bring the price down to ~$510 per bundle.

Credit Card Points 

~$5.10 from my American Express cards.  I wouldn't normally use these cards but $25 off from the Offers for you makes it hard to pass up.

Shopping Portal

I used Shop at Home for 2/3 transactions at 2% cashback.  I earned $10 per transaction.  I used Be Frugal for the 3rd (before I realized that Shop at Home was 2%).  Currently it is tracking at $0, but I have submitted a ticket to have that increased.  It's been a few weeks without resolution so I will have to follow up on that.

So far, $20.

Loyalty Points 

I earned about $36 in Best Buy Rewards.  If you have no status with Best Buy you would have earned $30, but since I have status that went up by 10% to $36.  Since then I have been upgraded to a 25% increase in rewards with higher level status.  Another reason why reselling is awesome.

Fulfillment by Amazon Fees

I new the TVs would be expensive to sell on Amazon and the shipping would be expensive so I tried to sell them on eBay with local pickup or on OfferUp (an app that is similar to Craig's List).  Best offer I got was $250 (asking for $320 when I told them that new was being sold on Amazon for $380).  I even tried to sell for $550 hoping someone would offer $400.  That did happen but when the person asked for the model number, they said no thank you (...hogs get slaughtered).  So I shipped to Amazon.

The 3 TVs cost me $207 to ship and sell through Amazon ($14 per TV just for shipping!).  That's almost $70 per TV of fees!
The 3 XBoxes cost me $105 to ship and sell through Amazon.  About $35 per XBox  Much more reasonable.

Total fees = $312

The Haul  

I was able to sell each XBox for $345 and each TV for $348 (Used - Like New).  Everything sold very fast.  The XBoxes sold in hours and the TVs sold within a week.

I paid $1,530 for all 3 bundles.  I sold everything for about $2,080 before fees.  After fees that's $1768 or a profit of $238 - close to $80 per bundle or a profit margin of 15.55%!

Here is how the numbers worked out:

Cash = $235
Credit Card Points = ~$15
Portal Points = $20 (Possibly another $7.50 on the way, but let's not count that)
Loyalty points = $36

If you include the value of the credit card points, portal and loyalty points, the gain is ~$306, which is a beautiful margin of 20%!

Lesson Learned - I Don't Like Selling TVs

Technically, I did not reach the math I set out for since the $70 per bundle did not including the $25 profit from AmEx sync offer.  The math was off, not because the price went down, rather because I underestimated the price of shipping the TVs.  It is difficult to ship multiple TV's in one box and they are heavy.  $14 shipping for one item is the most I have paid to ship anything.  It was an important lesson.

My friend, @MilesWhip, is smarter than me.  He needed a TV.  He bought the bundle, sold the XBox and kept the TV.  Basically nice TV for really cheap.  That's the way to do it if you need a TV.

I strive to only talk about deals that even if everything doesn't go right, your margins will still be fine and that's what happened here for me.  Even if you didn't have the AmEx offer, your profit could still have been $75 per bundle after credit card points, portal points and loyalty points.  Not too shabby!