My friend Nick, who writes Personal Finance Digest asked me a great question, that I think really weighs into this whole reselling stuff that I write about. It was in response to my FBA Beginner’s guide.
I don’t have a feel for the logistical aspects–how much time does it take to pack stuff, mail, shop for packing material, etc? How much extra space do you need to handle everything–does a corner of the garage work?
So let me break that down into a couple of points:
Shipping
I spend way too much time thinking about shipping. For me, the golden goose of shipping, is figuring out how to get Amazon to let me ship my stuff to the closest Fulfillment Centers. In fact, even after writing Shipping 101 and Shipping 201, I still play around with options, and don’t see myself stopping anytime soon! So, from the perspective of putting the items in and creating shipping plans, I sometimes spend more time than I should, because I’m doing the trial and error approach.
As far as packing stuff up, and mailing it. I like to think I’m pretty efficient. Every week I pack stuff up once. It is an anomaly when I do this more than once. Why? Because I like the idea of batching things together. I’d rather spend a half hour once, getting 15-20 boxes together, than 10 minutes every day. I normally don’t bother actually taking the packages to UPS or Staples anymore either, I usually schedule pick-ups for my normal work from home day (since my employer rocks like that). So, for that purpose, lets say the actual “shipping” takes about 5 minutes, just enough time for the UPS guy to pick up the boxes from my front stoop. I usually like to offer him a bottle of water, just because it is usually a bunch of stuff.
Warehouse Space
I think I’ve shared some photos in the past of the TaggingMiles’ Warehouse.
My staging center, used under Creative Commons from Wendell.
Ok, kidding, here’s my real staging area.
Yes, I like to have a beautiful oriental rug in my warehouse, because, it keeps the employees, and the guard dog happy.
But, in all seriousness, the way I resell, I average shipping out about 15-20 boxes per week, it doesn’t take more than about a 10×20 room that at least in my house, never really had a purpose (other than to house books and a really nice oriental rug). Would I operate such an operation out of my garage? Heck no! Garages are for cars, Charlie Brown! Besides, I wouldn’t want to leave laptops, tablets, or really anything in a garage during the heat of summer or the frigid wastelandness of winter. That and, it would be a much less comfortable work environment when I’m trying to pack stuff up, and we hear at Tagging Miles care about providing a comfortable work environment.
Wrapping Up
So, I hope that has answer Nick’s question, and anyone else’s with regard to how simple it is to start your own shop. Oriental rug optional. Guard dog, less optional.
Awesome post – I had a feeling I wasn’t alone in constantly jiggering shipments and quantities to NOT get frikkin’ Phoenix all the time (I’m in FL and almost *never* get my local warehouse 2 hours away). Boxes and packing materials – I just reuse what things come in, sending out the smaller boxes for recycling. I get good tape when Staples has a great deal on packing material; last time I got 3 years’ worth for about $32. And I probably go through 5-6 pairs of $2 scissors a year. I recently bought a house with 2 rooms that don’t yet have a purpose, so I’m just all spread out because I can. Right now it looks awful because I was away for 2 weeks but didn’t stop ordering stuff. As for UPS pick-ups, I check my UPS My Choice delivery calendar and put boxes out on my front stoop on days when I’m receiving packages – I’ve done this from 4 different homes in 3 states and Brown has never complained, they seem happy to help. Every now and then, usually when I have an especially large outgoing batch, I tip them $10 because I totally appreciate not having to lift 30-40lb boxes. Light high value boxes like tablets, I either hand to them personally, or drop off myself at the UPS counter at Staples or the UPS Store where I have a mailbox. Advantage to Staples: They have shopping carts to wheel in all your stuff easily. Disadvantage: Sometimes when you’re shipping something you ordered from them online, it still has the security tag that sets off the beeper at the door.
Hah! I’ve totally had that awkwardness of the beeper at the door going off walking into Staples with product! I will say, as far as rejiggering shipments, its a fine line, I’ve heard of folks getting nastygrams from Amazon when they go to far. Sometimes I just take it, but, such is life. I’m surprised you don’t use a box cutter by the way, a couple bucks and the occasional switch out of the blade and you’re good to go, at least that’s what I’ve found. Rather than scissors (I always seem to hurt myself with them!)
Here is a second data point:
When I did FBA (revenue of ~$30k/month in the peak), I shipped out on average once in 2 weeks. Each session took about 3-4 hours (depending on how much beer I simultaneously had and the trial and error to get minimum cost/nearest warehouse). Towards the end of two weeks the boxes would take up all the space under the hallway side table (about 8 feet by 3 feet of space). On average I shipped out 8 boxes in one go. I live in a condo building so after labeling the boxes, I just left them with the doorman for UPS pickup and they would be picked up the next day. easy peasy.
Wow – you must’ve been doing pretty small (sized), high priced products to be doing $30k a month with a space of 8’x3′! I’d love to know what products you were selling (assuming that you no longer do FBA based on your tense).
Hi Trevor, I mostly sold hot items like ipads, ipods (when they were on sale at staples a few times), tablets like Nexus, chromebooks, an occasional laptop or two, portable memory drives (WD 2TB, for example), SD cards (once I made $300 in one day selling 20 of those), etc. Make sure you have some safety net in your margins in case price drops, try to price items just below the lowest (unless you get buy box, where you go after the lowest buybox price). I usually would end up with a stack of boxes 2-3 boxes high and 3-4 boxes side by side before I shipped them all off. I no longer FBA because with large revenues like those, it is recommended to start collecting sales tax in nexus states, and registering in all those states, etc etc too much work. I might start it up again next year but will do it completely legit with a registered business in each nexus state and collecting and remitting sales tax from day one.
I work out of my office from my other business. Things were slack, so I got my secretary into finding things to buy and helping me pack and ship. She keeps the speadsheet of orders, goods received and goods shipped to Amazon, their cost and what I get for them from Amazon. I ship whenever I get about 30-40 things to send out. I am reluctant to hold items very long after I get them because it takes SO LONG for them to get to Amazon after they are shipped and get listed so they can sell. I have tried playing around with my shipping plans, but no matter WHAT I have done, I ALWAYS send a load to CA from FL where I am, and it is usually the heaviest items! Laptops almost always seem to go to CA. I spend very little time packing and shippingh, about 1 hour per week , max. Most of my time is spent hunting down deals and buying them. Still experimenting on what sells. Anything Apple seems to fly out the door, Samsung does OK., other stuff, not so sure yet. I under priced an item for 429 instead of 479, and it sold out in 5 minutes! So, under pricing your items really sells them. However, lesson learned – check your list price on your FBA inventory when you send out the item!