While you are driving around yard saling, make sure that you write down your initial and final mileage!
One of the most important things that i have learned is that a lot of opportunities present themselves at yard sales if you just talk to the people running it. Talking to them allows you to build rapport, and gather valuable information. If someone is moving soon, there is a lot more room for negotiations than if they have a yard sale every weekend as a means of making a little extra money. Great example, we got to a yard sale a little early one time. The woman was setting up, and as we talked to her she stated about 5 times that she didn’t want to go through the work of setting everything up. After the 5th time I (finally) got the hint, and made her an extrememly low offer for the whole garage. She accepted, locked the door, and we were off to the next yard sale. While you are talking to them, make some small statements that they can agree with. The gnats are really biting, the weather is great today, etc. Having them agree with you now makes it really easy for them to agree with you later!
People often ask us what we buy at yard sales. The easy answer is almost anything, if the price is right. What people really want to know is where we find our profit. The key for us is in bundling, and analyzing on site.
We normally skip dishes, Christmas decorations (except Hallmark ornaments), clothing (don’t know enough about it, yet), and loose toys. Our best deals have been on media, followed by kitchen items and electronics. Anything in a box with a barcode obviously gets a scan. While we are talking about scanning, another question that comes up often is what to do if people ask you what you are doing. Opinions differ, but I always tell them the truth. There are a few reasons I do this. One, I just like to be honest with people. I like what I do, I think it is interesting, and I find that a lot of other people like learning about the technology. They can use the same items to get better deals when shopping, so I am offering them valuable information. Second, when they know that I resale items, it gives me more room to bargain. They know that if I can’t make a profit on the item, then they are stuck putting it back in their garage! Knowing that you are reselling the items also gives you room to negotiate on missing boxes, roduct condition, etc. When they know you are willing to purchase a large number of items, they want you shopping with them.
If there are several books or DVD’s that we want, we will often make a lowball offer for the entire lot. What kind of offer? We like to get books for around .25 to .50 a piece, and DVD’s for under a dollar. One tip I learned from a very good presentation on real estate investing is that you should almost feel embarassed when you mention your first offer. Remember, the worst that happens is that they say no. Most likely, even if they say no, you can get the savings later on a different item because they feel guilty for “being ornery” earlier. Don’t be afraid to get extra inventory, we will talk later about how to maximize the profit on it. Say that there is a box of DVD’s, a few boardgames, and a few toys you want. Offer a bundle price for the DVD’s, then set them aside. Same for the boardgames (always price older boardgames, you will be surprised at the margins if you are willing to count pieces). Once all the different bundles are placed together, try rounding the total down again. If they can’t do that, mention that you are buying a lot of their items, and ask if they can throw in something else for free. If they say no to any of your offers, just leave your name and number with them. Make sure to browse a little more. You wuold be amazed how many times people say no, then call you back right as you start to walk away. They see the money walking away, and they know that they may end up stuck with the item. They are having garage sales to get rid of the items. Help them out.
One final tip on negotiating. Some people become overly attached to a certain item, and lose objectivity. You can tell when this has happened because they say something like, “Oh, I can’t do that, I got it at….” or “Well, I paid… so I really can’t take less than….” . The easiest way to still get the item that you want is to agree with them, offer to pay the price that they want. Then look for other things that you would like. They will often be even more willing to lower the price on other items. I know it doesn’t necessarily make sense, but it is true. Quick example, there was a pair of roller skates that we wanted. She was unwilling to come down 5$, and said she “MUST” get the asking price. On the way out of the sale, she threw a bicycle that she had priced at 10$ in the bed of the truck, without us even asking! Remember, all money is not even if people are attached to something. Find out the things they want to get rid of, and help them do so.
Stay out late. In our area, late is 1pm or later. When people are faced with the task of putting everything back in their garage, and they already have a pocket full of money, they are done with the whole idea. Often heavy items like books or furniture are given away on late afternoons, especially on Sundays. If you are willing to accept some less than excellent items, you can still get some really good ones.
While you are buying, track your inventory. The method that works best for us is itemizing items in a receipt book. we list “box of DVD’s – 5$”, not every single DVD. Experiment for yourself. The only important thing is that it is easy for you, and becomes part of your process.
Stay tuned for Part 3, where we talk about how to get rid of the great (and not so great) items that we found while out treasure hunting!