Tuesday, January 19, 2016

Turnover Tuesdays - Sometimes a Return can be Very Profitable

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.

You may have noticed I'm talking about returns a lot lately, that's because I've had a lot of returns.  It is not unexpected but it is a part of life as a reseller on Amazon.  It's important to know what to do in different situations of returns.

The Item - Miles from Tomorrowland 6 Pack

There was a while where Target was offering 20% off toys during the holiday season.  That was awesome.  In addition, they were offering another 10% off if you added something to their wish list.  You could add almost anything to your wish list but it was only able to used once (didn't realize that when I used it).  These discounts stacked.  Of course, you still got your 5% RedCard discount which stacked as well. 

In this scenario I bought 25 of Miles from Tomorrowland which are normally $30 for about $22.45 after tax.

I used a discount gift card (3% off - not much available during holiday season.  So final price is about $21.80.

Credit Card Points

I earned 2% back from my Credit Card for buying the discounted gift cards.

That's $.43 a unit or almost $11 for the entire purchase

Shopping Portal

I used eBates for the purchase which was 2% at the time for Target purchases.  That's $0.42.  Not much but not nothing.

Loyalty Points

Target does not have loyalty points.  I would have so many!

Fulfillment by Amazon Fees

I sold 23/25 of them for $37.94.  The other two I sold for $36.99.  Fees on Amazon were about $8.35 at the $37.94 price.  Shipping was about $.50 a unit.  That's a lot when the toy only costs you $22.  Let's call fees about $9.

Prices are actually closer to $40 now. I have no idea how to know which toys will get more expensive and which less expensive.  Many of my toys tanked after Christmas.  Any theories out there?  

The Haul  

The ones I sold for $37.94 netted about $29.  That's a gain of about $7 a unit or about 32%.  Not bad at all, especially when you consider that it is $7 x 25 units for not much extra work.

Here is how the numbers work
Cash = ~$4
Credit Card Points = $.40
Portal Points = $.40
Loyalty points = $0

The extras are equal to about $.80 so with the extras the take home is about 35%.

A Return

That['s a nice return on investment but then I got a return!

Not the worst thing in the world since I can easily return it to Target.  I lose the Amazon return fees and other fees but really not too bad but then something interesting happened.

I got the item yesterday and it was completely broken.

Many may not realize this but when a customer destroys an item, Amazon will usually reimburse you for the return and in the reimbursement it will say "Customer Return".  For example

You may remember the frozen sheets from week 29 ;) - thankfully I got a bunch reimbursed.

In my scenario, Amazon did not reimburse me but I won't stand for that!

I took pictures of my broken toy and started a case with Amazon via email with the pictures uploaded as an attachment told Amazon how disappointed I was that they accepted the return from the customer when the item was destroyed.

The response from Amazon:

Thank you for contacting us with your concern.

I understand your concern regarding the Order # in which your buyer receives the damaged item and you'd like to get reimbursement for that. I assure you to provide with necessary information and take needful action to help you out in this issue.
I really apologize for the inconvenience and disappointment in this regard.
In this case you need not worry, since I have reimbursed you for the damaged Order # with the reimbursement ID: The amount will be reflecting in your account within 3-5 business days.
Your understanding and co-operation in this issue is very much appreciated.

The next day I got this beautiful email

I've been fully reimbursed (the remaining money not reimbursed are the return fees) and now I have the item.  That's an interesting scenario.  Theoretically I could still return it to Target and be reimbursed again.  Hmmm, is that ethical?  I put a lot of stock in what my wife says and she was kind of bothered by the idea.

I have no clue.  What do you guys think?

Either way, don't abuse this, only use it when you are legitimately sent a damaged item (not just opened).  You don't want to jeopardize your Amazon account but you may surprised how much a quick email can do.