Setting a purchase money limit is a great way to control your spending and inventory size. If you’re not careful, reselling online can make you look like a hoarder or even put you in debt. By setting my spending limit, I know that I won’t go into the hole, and I know that I won’t be buried in new items to list!
On top of that, the weather’s getting warmer, and Spring fever is kicking in.
Don’t tell any0ne, but I may have spent a bit of money on new inventory this week. SHH!!!
Warm weather makes me want to be outside more – whether it’s working out or going to a garage sale. I’m sure this is how addicts feel, and I’m not trying to make light of a serious issue. I think we all have different levels of addictions, and luckily I’ve focused mine on a hobby/business that helps bring in some extra cash instead of one of the more nefarious recreational activities.
If I don’t watch it, I can get overwhelmed by the amount of stuff I bring into the house. Maybe I’ll end up having my own reject yard sale again!
This is a book at my in-laws house. My daughter loves looking at the shapes, and I couldn’t help but see if Mickey has anything valuable. All depends on what kind of magazines those are…
Purchase Money Limit
I keep $200 ‘on hand’ when I go out shopping.
EDIT for clarification: This is a $200 target that I do not budget for on a monthly/weekly basis. Once it’s filled, it stays at $200 until I start spending the money. I replenish this spent money when I have new sales.
We use YNAB, which is basically an electronic envelope system where all of your cash accounts gets budgeted down to the dollar.
I have some categories that are eBay related, and one of these is Purchase Money. I can spend money from either my wife or my cash reserves, any checking account, or a credit card (at a thrift store). The budget doesn’t care where the money comes from, just that you know how much you have in total and how you allocated it.
When I go out shopping, I may only bring $100 in cash on me, and I don’t think I’ve ever spent more than $150 at one single sale. Generally, $75 is the most I’ve spent, so this limit works very well for me. The goal is not to force yourself spending $200.
If you think that $200 isn’t a lot, you’re either buying very different things than me or you’re overpaying. $200 can buy a huge amount of inventory that will end up selling in the $30-$50 range.
The biggest downside of having a lower limit is the possibility of missing out on a huge score. I don’t really worry about this because we have so many different types of savings goals (like those damn heating/cooling appliances). If something were to come up that was too good to miss, I’d take a shot at it. I would only do this for a sure thing, though, and I’d have to be VERY sure.
The final question I have is when should I replenish this $200.
Say I spend $50 at a garage sale and then sell something for $75 the next day. Do I put the profits right back to the purchase money, or do I wait until the end of the month? This would further limit the buying I could do during an individual month.
That really still seems to be the problem. I can out-buy my capacity to list and/or store my items. It’s a constant struggle. It’s just that the shopping/buying is so much more fun than the listing.
I may try one of the listing prep-services geared towards eBay. Could be a neat experiment.
As for now, I’m going to continue on the normal path of 15 items per month and $200 spending limit, but if March’s sales end up anywhere near February’s, I may have to take a hard look at myself and have a focused listing month in April.