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How important is high profit flipping to your reselling business?
The answer is very! We want to dive in why it’s so important to your reselling business. We had a lot of profit in an item we flipped recently, and we’ll talk about why that was helpful.
The transaction had something go wrong and it was helpful that we had so much profit in the item because it wasn’t as stressful to get something fixed. We were not strapped because we still had enough profit in the item. The item we’re talking about is one of the last freight shipments we did. It got shipped and delivered and everything was good. The problem was the freight company came back and said it weighed more than we said it did and they charged us an extra $324 for the shipment.
What Happened With Our High Profit Flip
If you don’t know, we’ve dealt with one freight company for years, but that company went bankrupt and we’re testing new freight companies. This is the first time we’ve shipped with this new freight company. The issue was we had the proper weight on the tracking or the BOL documents, but when it got to the freight carrier they said it weighed a lot more. They came back and recharged us and I found out about this yesterday.
I had already paid the original $231 to ship it. Two weeks after the package was delivered and the label was created, they came back and gave me an overage charge of $324. The cost of the item was $42. We sold it for $1,750 and we had $1,000 in profit after eBay fees and everything. Another $320 was not the end of the world for us because we still made roughly $700 in profit, but this was falsely done.
Following Up With The Carrier
I got the carrier on the phone and got everything submitted to them to have the overage charge refunded back to me. I had to show them what the weight of the item actually was. It was a lesson to me that this carrier was trying to do some crooked stuff on the back end. You have to look for these things.
It cost me a little bit of legwork to get the refund, but it was a lot less stress on us because we knew we still made a profit whether the refund went through or not.
If this was a $50 item that I paid $10 or $15 on shipping for, and they came back and charged us an extra $30 for saying it was an oversized box, it would be more stressful than the situation we’re in because we’d basically be losing all the profit. We always try to 10X our investments. So if I buy something for $50, I want to be making $500 to $1,000 on the item.
Even if I couldn’t get the money back in this scenario, the profit is still here. We still made good money on this flip.
Tips To Remember
The two things we learned from this experience are 1) make sure you’re buying your items at the right price and 2)make sure you’re monitoring what is happening on your accounts so you know when to get in touch with the shipping carrier or eBay.
I feel like these larger companies will expect you to roll over. Don’t do it. Sit there and stick to your guns. None of this is my fault. It’s the company’s issue so it’s important to stick up for yourself when something does go wrong.
Having fewer flips that are higher profit does make it easier to watch your books. When you have three sales in the last month, that’s a lot easier to keep track of so you know when something isn’t quite right. That’s another reason why we love high profit flips.