Hope everyone’s week is off to a good start! With this blog I am often sharing things that go right and the best parts of selling online full time. What is often “swept under the rug” are some of the issues that come up when the sailing is not so smooth. I have been very fortunate to not have had very many items that I have lost money on up until this point, but there have been a few.
Before we get started into 3 items that I lost money on, I will add one more comment regarding the lifestyle that selling online allows that is often assumed, but is not always discussed. This past Friday through Monday was a good example, as I was able to leave mid-day Friday to head home (I live a little under 2 hours from my family) to watch one of my younger brothers high school basketball games that night, my little sister’s dance competition on Saturday, and hang out with my other younger brother at his house at college on Saturday night. Over the course of the rest of the weekend, I hung out with my parents, and the 2 younger siblings that are still living at home, and ended up arriving back at my house around 9PM on Monday. Less than one year ago, all of this would not have been possible as I would have been in the midst of “busy season” working 55+ hours a week with Saturday’s required. The freedom of time aspect of being completely self-employed is arguably more or equally valuable to the potential financial benefits. It is a great feeling to be able to do what you want, when you want, and not have to check in with an employer or boss for permission. I am not claiming being self-employed is for everyone, just be sure that you are spending your time in the way you want, very few others are going to be looking out for you in this regard (particularly not most employers).
Items I Lost Money on
Alright, now let’s get on to some items that I lost money on. You could call them mistakes, but I would prefer to think of these items as “tuition” and learn from them in the future so that they will not be repeated. For all 3 of the items I will be showing you today, I lost money on. This was a choice, as I could have decided to hold out for a higher price that I may or may not have received in the future. I went through my inventory in early January and looked at items that prices had dropped significantly on, and either decided to hold prices steady, or to sell them at the current market prices to get my cash out to reinvest elsewhere. So, item #1 that I lost money on is a Play-Doh set that I paid $14.99 for from Target. I ended up buying 3 of these, so this loss was multiplied by 3 (click to enlarge this screenshot, and any others throughout this post):
Per item I lost $2.98, plus inbound shipping charges to amazon. I purchased this item in December of 2013, and at the time I bought this, the price was significantly higher. Let’s take a look at the price history from www.camelcamelcamel.com to see:
If you’ve never used this site before, I would recommend checking it out, it’s free and provides some valuable history for price and sales history. It’s not 100% accurate, but it can provide some valuable information. As you can see, this item was selling for $40+ in December and that is likely the price I saw when I scanned this item for potential resale. The takeaway for this, is that prices can get out of equilibrium in December with all of the Christmas buying, and this must be considered when buying items in December. HERE, is a link to the current product page on amazon if you want to take a look. The low price is now higher than what I sold these for, so if I was more patient on these I could have received more.
Next up for an item that I lost money on is this Megabloks set that I purchased 2 of from Toys R Us for $26.24 each:
So, I lost about $1.50 each on these items, plus the cost of inbound shipping to amazon. Let’s also take a look at the price history before commenting further on the loss:
This item was purchased in November, and prices at the time were in the $40-$42 range. I purchased this item as a speculation play, hoping that some of the lower priced sellers would sell out of the item as Christmas grew closer, and that I would be able to sell at a profitable price. Another factor contributing to the loss is the $4 per unit fulfillment fee as the item was oversize. I likely did not factor that in when purchasing the item. The takeaways here are: if you speculate, you expose yourself to possible loses if what you think will happen doesn’t, and be sure you know what fees you are subject to ahead of time, as oversize items incur more fees. HERE is a link to the current amazon listing.
Let’s take a look at the third and final item for today, which I purchased at Walgreens for $10.77 each. I purchased 3 of these in January 2014:
As you can see, I lost about $1.80 each plus inbound shipping charges to amazon. Now for the price history:
At the time I purchased this item, it was selling for about $18. So, why would I have paid $10.77 to sell for $18? Well, because I thought I was buying this item for $5.34. The item was found in a Christmas section with a sign saying 75% off all Christmas items. This item did not ring up at the right price, and I did not notice until I was going through my receipts. The takeaway: make sure to pay attention to the prices that items are ringing up at when checking out at the stores you go to, if you don’t it will cost you money. HERE is a link to the current amazon listing.
Hopefully seeing these 3 items that I lost money on will help you avoid similar mistakes in the future. If you enjoyed this read, check out my last “mistakes” post! If you have any questions or comments, please leave them below, or send me an email at email@example.com.
8 thoughts on “Items I Lost Money on in the Last Month on Amazon”
By Omid Morad
I lost 49 Euro for unknown payment by amazon france. I never bought anything but it decreases from my account. How can I return this money to my account?
04/06/2015 030615 CB:*678028761 AMZN.FR/PREM 75PARIS2051143/ 74ER7EI 04/06/2015 04/06/2015 49,00
please help me. I am student and it is so much money for me.
I would recommend contacting amazon or your bank/credit card company for this issue.
Walgreens is notorious for putting up clearance signs across the toy section, yet only a few of the items are actually on clearance. They don’t put price tags on everything either. You have to be very careful there, or you will get burned.
Thanks Lisa! That has been exactly my experience at Walgreens as well, you have to be very careful about what price items ring up at.
I really appreciate this type of article telling the pitfalls of selling this way.
I recently found Jessica Larrews site via Pat Flynss podcast. So since then I have been trying to read every little bit of info I can to learn about what to do and what not to do and trying to find a reason not to do this, but everything seems like it is pretty straight forward and that I would love this business.
I actually have been in retail for about 15 years and am a manger for Walgreens. So locating products would be something I would be comfortable with just not sure how much time I would have to put into something like this. If I wanted to start on a small scale would it be worth my time? Whats the least amount of products that you would suggest starting off with? How much did you initially invest in products to get you started?
What are some other pitfalls you have experienced with this business?
Thanks for any help you can give..
Glad to hear you found my blog! If you were to start on a small scale I definitely think that it could be worth your time. I would suggest starting off with at least 15-20 items for your first shipment to amazon for FBA to make the shipping cost effective. Just know that the more you put in the more you will get out of selling on amazon, but you can definitely get your feet wet with pretty much any number of items. As far as my initial investment, it’s a little hard to say as I didn’t put a set amount aside for inventory and use that, but I would estimate it was around $5,000. As far as other pitfalls, I will have another post coming out in a few hours that will share some additional pitfalls I have experienced thus far, so keep an eye out for that.
Thanks that was a very informative post. I just started selling on Amazon last August so I am still working out the bumps. I also didn’t know about the http://www.camelcamelcamel.com website which looks like a good resource.
Glad to hear it! Camelcamelcamel.com can be a great resource, especially when doing research to try to identify trends around certain holidays or times of the year.