Great bootstrapping thread - how to create money.

[MJDeMarco]

Folks, there is a really great bootstrapping thread going on over at the Lambo forum.

I guess the story is this: A lambo guy has been helping a friend get over a job loss (or something) and started running a "pawn shop" type operation just by trolling Craigslist.

The short of it, buy stuff from distressed sellers and resell for quick 20 percent, 50 percent, 100 percent profit. I think the guy said he was able to to $17K/mo. Of course, you need some working capital to buy.

Here is the link.
Board Message
(YOU NEED TO LOGIN TO VIEW)

I’ve got nothing to gain here, there is so much opportunity out there to do this type of stuff in a variety of geographic and demographic. You can do it with $500 or $500,000.

So don’t worry about crossing swords.

A few of the questions:

Q: In your post you indicated that you wrote $500 on each day of the calendar...was that the profit goal for each day?
A: The goal was to essentially buy product that would yield $500 in profit each day, not necessarily buy a certain value amount. For example, you could buy 5 iPad for $100 profit a piece or buy one jet ski that had $500 profit in it. Not so much about volume of transaction, about margin.

Q: you also said that each day you bankrolled him $5000...was his goal to buy $5000 worth of "product" every day? or simply the cash made available to him?
A: No. Not necessarily, but sometimes on big ticket items he needed $5K to jump start the day or a transaction. Only rarely did we consume all $5K, I think maybe once or twice to buy a car.

Q: what was the daily purchasing goal?
A: None.

Q: what was spent gross earning the $17k?
A: $42,000 was the total spend

Q: Is the bread and butter in smaller things like cell phones and computers?
or larger things like used cars?
A: Bread and butter are the following, with stars on the heavy volume items

--$5000 and under passenger cars
--Motorcycles of every price
--Recreation vehicles (Jet skiis, boats, RVs, travel trailers)
--Bicycles of every type, especially high-end offroad and onroad cycles
--Oakley and other brand high-end sunglasses
--Women's purses (ultra-highend only)
--Time Shares, low-end only
--Land (acreage only, no houses)
--Rims and Tires
--Laptops (current models only)
--iPhones, iPads, and all other Apple branded products
--Flat televisions
--Guns
--Safes
--Broken Gold
--Consoles (Xbox, Playstations, etc) and video games
--High-end furniture in excellent condition
--Trailer, car haulers

Q: What kind of mark up are you shooting to attain? 25%? 50%? 100%+?
A:Not necessarily a percentage, just as much as possible. I used this as a guide: $100 or less: double the money. $500 or more, 50% on a 7-day turn rate.

Q: Same city CL relist or nearby city?
A: Same city, unless it was an eBay sale or unless it was much more appropriate out of town (buy a snow blower in Houston, sell it in Minneapolis for example)

Q: Wait a period of time before relisting?
A: Immediately relist it.

Q: What are the best most readily available and easy to sell items?
A: Apple Products, cheap cars and motorcycles

Q: DO you ever get stuck with merchandise that you cant move?
A: Haven’t yet. Sure I will

Q:How can you decide what to pay for items?
A: This is the tough part. Use your mojo, or if you don’t have any mojo then use eBay, it’ generally a good starting point. Don’t buy anything you don’t know what to pay for.

Are you looking to pay half of the going retail or some fixed number?
A: You have to find the right mix for your area. Don’t spend a ton of time trying to figure it out. Just go buy a bunch of stuff and try it out. If you are uncomfortable with that, stick to Apple products only - as they are extremely easy to sell and even easier easy to buy.

Q: Do you test purchases on the premises?
A: Yes

Q:All offers are face to face?
A: This is sort of the magic beans. You don’t want to waste your time running all around town, but at the same time you need to set the expectations for the seller. I don’t have the answer for this, but I will tell you that when I offer $500 for an item worth $1000 over the phone, I almost always get the item for $300 when I show up with cash. Make sense?

Q: $5k total for a month or daily?
A: Again, it’s a function of cash. The more you have, the more you can buy.

Q: Do you lowball people?
A: That's the whole point. 85% of the people will hang up on you. 15% will sell you something. You do the math. If you don't like rejection you'll fail, because it's 85% "go screw yourself" responses.

[garyfritz]

Love it! I'm sending the links to my 16-yr-old. He loves Craigslist and pawn shops. He's bought & sold a few things on CL before but he never had the ambition to get serious about it. Maybe I can get him to think about something besides video games.

[Robre]

What about adding wholesale items to this?

[Komelika]

Cool Idea! I might try this just to pass the time. One thing though. Carefull with cars and motorcycles. Your state likely has a limit to the number you can legally sell assuming that you register them under your name. It isn't legal but many people who "flip" cars try to get the seller to leave the date blank when he signs the title so the title can be floated to the next buyer in order to avoid a) the expense of titling and registering and b) the limit to the number of cars you can sell in a 12 month rolling period. NM says you can't sell more than 3 cars per 12 month rolling period, but you sell three under yours, another 3 under your spouse's name, and so on and so forth as long as you have people willing to register the vehicle for you.

[darkjediii]

been doing this with bikes, but more of a hobby so I can ride em then sell. Just picked up a Ducati 848 for a steal not too long ago.. I think it's time to sell

[Brootal]

Speed +++ for this one.

Funny how there are a million threads asking "how do I get started" and then when MJ posts a surefire way to do so with little money, the thread gets 4 posts.

[gabrielpark]

Craigslist is not the only venue where this would work and you should definitely build a contact list using craigslist. There are also software and services that allow for mass cross posting on multiple craigslist sites.

My ex- used to do something similar on ebay with babies clothes and kids clothes. She had a really good handle of what items were selling for on ebay and which particular members would pay a premium for specific things. She would go drive to one Goodwill after another another, all across the state, buying up kids clothing. Then she would clean them (often removing "impossible to remove" stains) or repair them and resell them, inviting specific members to her auctions. She made hundreds of dollars in profit every week, sometimes over $1000 profit, but she worked insane hours because she felt like she had to answer ebay messages constantly or she would lose the sales. She burnt out after about 6 months. If I knew then what I know now she could still be in business, all she needed was a mailing list built from ebay correspondence, and a facebook page.

[theBiz]

i have been saying this for so long..... its stressful and takes alot of driving around but you can make real money doing this.

I generally drive hours away to get things at a real low value.


Buy a car that selling for 5k in your area go get it for $2800 somewhere and sell it for $4,200.

As long as you market it correctly, make it look like new whatever that takes, big pictures etc it sells.

The more you spend the harder it is to move but more money you make.

In this economy people are still buying used cars lets say for under 10k and after 10k its harder to get people to come up with the cash.


Buy and sell cars and truck under $8,000 think b2b trucks for businesses and such it really just takes research, phone calls, and real work (driving around, inspecting, negotiating, but its tough to make this type of money in this economy.

I personally have built a portfoilio of things ive bought and sold and people were so impressed they wanted to invest with me but i did not need the money so i declined. Maybe buying and selling planes or big ticket items is where the money is im too scared to try it though.

try to get the seller to leave the date blank when he signs the title so the title can be floated to the next buyer in order to avoid a) the expense of titling and registering and b) the limit to the number of cars you can sell in a 12 month rolling period. NM says you can't sell more than 3 cars per 12 month rolling period, but you sell three under yours, another 3 under your spouse's name, and so on and so forth as long as you have people willing to register the vehicle for you.

Plus actually moving the vehicle without registering it in your own name is a problem, and that means there is no insurance so if it gets stolen or wrecked in the middle of your sale your out.

this is the only problem with this business, but if it was easy... you know the rest.

[JayKim]

I do this with gold.

[Kung Fu Steve]

I do this with gold.

On Craigslist?

[Rawr]

bump..

there are deals everywhere, just do your homework.

Guy selling Mazda 6 for 6.7k

after ONE email he told me his bottom price is 5.5k = $1200 difference in ONE email.

When in person I bet you could get it for 5k.

looking at CL cars range right around 6k average. $1000 right there.

[Davidla]

I 've done some digging on old posts and came across a great thread with some more great advice from a forum member on bootstrapping Broke? Try Ebay

[oddball]

Looks like I have to step up my game. Pretty much what I do right now.

[Jcapuano]

I hope everybody is using searchtempest.com and not just craigslist, since searchtempest gets results from all surrounding areas.

[LightHouse]

Great thread, I am going to send this to a friend of mine, albeit a condensed version. This kind of grind could help anyone out. I know he does it with bikes already because hes been riding his whole life and knows the market well. But i think he could break out into other things and make some more cash, especially with a 1year old, he could use it.

[TK1]

Additional info: I registred at the lambo forum to check out the whole thread, you should sign-up and read it there, there are some golden nuggets more to learn inside, for example the "*" marked hot items and advices like "It's not about the product, it's about the seller". Plus the thread starter mentions keywords to look for that help you find something about a seller like 'need to sell asap bc i need money for my rent" etc.

Really good thread!

[wiredniko]

Only problem with this is:

1. Impossible to scale
2. Impossible to automate
3. You can never sell it as a business

Is $17,000/mo good money? Hellz yeah. But you got to think bigger than that.

...and yes #1 is debatable.

[bernieshawn]

Only problem with this is:

1. Impossible to scale
2. Impossible to automate
3. You can never sell it as a business

Is $17,000/mo good money? Hellz yeah. But you got to think bigger than that.

...and yes #1 is debatable.

That's not the point - I'm sure MJ meant this as a way to create money for better ventures.

[RichKid]

Everyone has to start somewhere. It's really as simple as that.

I'm not thinking about scale, or magnitude, or necst, or any of that other stuff.

I need the money, and I need the skills. So what am I doing? I'm finding ways that I can build capital, and learn business skills at the same time and doing something of this nature works for a lot of people.

[Reno]

I like it and need something like this right now to make ends meet while I work on getting my business fastlane. Only issue is I probably will not be able to do autos or motorcycles as I am in WA State right now and you have to pay a use tax on vehicles when registering them.