I've been buying and selling Stocks for over a decade and love sharing my tips and tricks of the trade.
What I Started Out With
I didn't start with much, but I had a few things going for me. For one, I was desperate, and desperation makes people try strange things to make a buck. Also, I'm not afraid of using tools. To install, uninstall, repair, and freshen up appliances, you really don't need much more than a screwdriver, some vice grips, and a sponge—and that's about all I had.
Another nice thing was that I had a truck. While not really essential, it did allow for me to take on some more daring purchases and raised the bar on the amount of crap I could haul around at a time. That being said, I still hustle appliances here and there and no longer have a truck. It turns out, the hatchback Mazda 3 can fit dishwashers, ovens, and even a washer or dryer without too much hassle.
Everything else I bought, including installation supplies as needed, parts as needed, and a heavy duty dolly made for dragging appliances up and down stairs and loading/unloading them.
This article will break down how I did it and provide information on how you can too.
Where to Start Looking for Used Appliances
Keep in mind, you're buying used things. I found two places to start looking for them were far superior to any of the others: Craigslist and auctions.
The auction site eBay wasn't useful for playing the local appliance game and neither were the bazillions of local garage sale apps. Facebook's garage sale groups aren't terrible, but I can honestly say that I've listed plenty of merchandise on there and never sold anything through Facebook. Everyone just wants something for nothing on Facebook, but on Craigslist you can charge a perfectly reasonable amount and people take it happily.
I would begin by looking at what different types of appliances go for on Craigslist for a while until you get an eye for valuation. You're going to notice that one plain Jane white dishwasher will be for sale for $20 and another will be for sale for $90. Sure, maybe the $90 dishwasher sells because people negotiate the seller down to a better number. But as someone who has sold over a hundred appliances there, many people don't even try and haggle.
Key Elements That Affect the Value of Appliances
- Missing trim pieces, shelves, or racks (I try and avoid these, as it drops their desirability immensely.)
- White vs. black vs. stainless (Stainless is best, and white is considered econo-tier.)
- Operational quirks and noisy, squeaky, or leaky things (These are best avoided unless you like repairing things.)
- Scuffs, rust, crustiness, or discoloration (It depends how bad it is—appliance paint can fix some stuff.)
Be Professional and You'll Generally Be Treated as Such
You'll get familiar with what is disproportionately valuable, and a pattern will emerge in front of you. Some people just want to ditch their old appliances. They might be moving out of town next week and their stuff is nice and works fine and even looks new, but they're letting it go for almost nothing. Sometimes, these things are cluttering up their garage, and they just moved in with their girlfriend and her stuff was nicer, so they're letting them go for next to nothing.
These are the best, and you should call if they give a phone number, text if they prefer that, and email if that's all they give you. Be as prompt as possible. You can try and negotiate further on price, but if I get two offers and one is higher, I talk to that person first and snub the lowballer. Be fair and most people will be fair with you. A bit of professionalism and reliability goes a long way on Craigslist.
Be on the Lookout for Package Deals and Add-Ons
Sometimes you can get add-ons. If they look like they're selling other things, try and get a package deal. Keep adding things you like the look of onto the ticket, and try and bump your margins up while you tack things on. One time I went to get a $40 dishwasher that I was planning to flip for $100, and I ended up getting a refrigerator for another $20 and the over-the-range microwave for another $10. The fridge went for another $150 and the microwave for another $50.
Sales can work the same way. If someone says they're a landlord, ask for repeat business in the future and for referrals if anyone they know needs an appliance.
Now, take your purchase home and make it pretty. Spending 15 minutes cleaning up the grease spots and buffing off the crud makes a $20 stove into a $120 dollar stove, believe it or not. Take nice, clear pictures of both the outside and the inside of whatever you have, and sometimes even a picture of the model/serial number helps. Be honest about the condition and, if possible, plug it in to make sure it works.
How to Manage Storage and Sales
If you're in an apartment like I was when I started, your options are few. I called around and found a storage unit for a decent price (about $230 a month) and rented that. This is called overhead expense. I also considered my apartment rent overhead, as well as gas and equipment expenses. Just keep a detailed spreadsheet and get good with Microsoft Excel or OpenOffice spreadsheets.
Consider Getting a Generator to Test Appliances
I tested the appliances in the storage yard by wheeling a generator out in front of my unit. I had one with a 220V socket, and the generator ran me about $500. But luckily when I was through with it, it also resold for $500. These things have a nice resale value, and the same goes with dollies and pick-up trucks.
I spliced a 220V extension cord with a variety of three- and four-prong outlets, which made me nervous at first. But as long as you follow good electricity safety habits, you'll be fine. This allowed me to both test the units I was buying and also demonstrate them for people. No one was weirded out by the generator, miraculously.
Keep Your Inventory Moving, and Keep Margins Above 50%
Price them to profit, but to also sell relatively quickly. After holding onto something for over a week, I'd start getting itchy feet and shopping around to see where people were buying if not from me. The important thing is to keep inventory moving and keep margins above 50%.
Buying a black dishwasher for $50 and selling it for $100 a couple days later feels pretty OK, even if it's not as good as selling one for $120. But waiting two weeks for someone to take the dishwasher for $120 instead of $100 is what you might call an "opportunity cost." In the end, your profitability is determined by how much space your inventory takes up.
Go Big or Go Home
Auctions are great places in general, but for the small business, they can be absolute heaven. If you have some extra space and extra time, watch restaurant equipment auctions. I try and keep myself limited to things I can actually test, but the sky is really the limit.
In-Person Auctions Often Have the Best Deals
In-person-only auctions tend to have better deals than online auctions, because too many people are watching and bidding online. If you go in person, maybe there's 100 people there, but only a few of them want the thing that you want. Don't be afraid to take something kind of goofy, because it wouldn't be for sale used if people didn't occasionally buy them.
Demolition Crews and Uninstallers Can Be Goldmines for Cheap Appliances
Find uninstallers and demolition crews. Often times, they'll bulldoze apartments and condos and take out the working units if they know someone who will buy them *hint hint*. I got 15 dishwashers for $100 last month from a demo crew that was overjoyed that they weren't going to be thrown away. Honestly, they were plain but all worked fine, and they looked nice enough to sell fast. One time I bought an entire apartment worth of stoves. I had storage units piled 10 stoves deep and 2 stoves high. One time I bought 30 ping pong tables and was flipping them as fast as I could for double what I bought them for.
Little deals pay the bills and keep you hustling, but big deals make you feel good inside.
I leave you with a quote by Warren Buffet:
"Opportunities come infrequently. When it rains gold, put out the bucket, not the thimble."
This article is accurate and true to the best of the author’s knowledge. Content is for informational or entertainment purposes only and does not substitute for personal counsel or professional advice in business, financial, legal, or technical matters.