Every month I chronicle my reselling highlights and touch on major winners and losers, the good and the ugly. Naturally, with any business, you are going to take some loses, don’t be discouraged! The key to minimizing those loses is to cover all your bases by being well documented.
In the month of July I ticked a bit over $1,000 in net profit by reselling on eBay. The points I earned from purchasing my resell product was well over 10,000 in July.
Believe it or not, I buy about 50% of my product on eBay just to turn-around and resell on eBay. You do have to be very calculated with this but it can be very profitable if done right. My first rule of buying on eBay to resell on eBay is to make sure the item is HIGH volume. You don’t want to purchase niche items on eBay to try to resell on eBay.
High volume items would be popular cell phones like iPhones and Galaxy’s. Another high volume item I consistently do well on is GoPro’s. I like GoPro’s because their warranty is really good if you get stuck with a bad item and you don’t have to worry about any shipping damages. (they are made to take a beating)
Every few weeks eBay will target select users for an eBay Bucks promo. You earn a base 2% eBay Bucks on almost all eBay purchases with the opportunity to earn more during promo periods. If you haven’t enrolled in eBay Bucks, you can do so here. During the 10% promo I bought a bunch of new iPhone 5s that were marked down to $199 with no tax and free shipping. Because the eBay Bucks promo was at 10%, I earned $20 per iPhone I purchased! eBay Bucks can be spent quarterly and I have already earned close to $500 this quarter from buying things to resell (for a profit) on eBay!
Many people use their eBay Bucks to buy gift cards on eBay so they can go spend their money how they’d like. Last time I spent my eBay Bucks I bought a Apple Watch for $190 and then sold the Watch for $225. I effectively cashed out my eBay Bucks and made a little profit in the process.
Where does the point earning come into play?
This is where it gets fun. In addition to the eBay Bucks and the points you earn from each credit card purchase, you can also earn points through the shopping portals for eBay purchases. Be sure to check out CashBackMonitor to see which cashback, airline, or hotel portal is offering the best bonus. You will need to make sure you are logged into the shopping portal once you get there and follow the referral link. They can only give you credit for a purchase if you click on the referral link so make sure to do that before shopping on the site.
American Airlines gives you one point per dollar spent on eBay, this is IN ADDITION to the eBay Bucks and the points you earn on your credit card. You can use any credit card you’d like once you click on the referral link, with the exception of the United Airlines portal that states “UA CC”. I use a number of credit cards when I click the American Airlines portal referral link with no issue. American Airline points are worth about 1.5 cents a piece, meaning the 4,000 AA points I earned during the eBay Bucks promo are worth about $60 towards airfare. The points post to your AA account about three weeks after the purchase.
There is one other major piece when making large purchases online, which credit card to use. There are two major factors I will lay-on-the-table to help you decide which card to use. The first thing to consider is using a card that earns you something significant for hitting a large spending bonus. The Chase United Airlines Explorer card earns you a bonus 10,000 miles for each calendar year you spend $25,000. The Delta Platinum card gives you 10,000 redeemable miles and 10,000 MQM’s (which count toward elite status), once you spend $25,000 in a single calendar year on the card. If I put all my eBay purchases on one of these cards I would hit the $25,000 threshold in 3-4 months.
Another piece to consider when making large purchases and carrying large balances is your credit score. If you buy $4,000 worth of goods and you do not pay off that charge before your credit card statement close date, it will show $4,000 in balances on your credit score and will likely bring your score down. I highly recommend getting a business credit card (you don’t need a business) for this reason: Business credit cards DO NOT report statement balances to your personal credit report. This is very beneficial because you won’t have to worry about paying your credit card off before the statement closes.
Your payment due date is typically three weeks after your statement close date, so just be sure to pay your new statement balance off in full by your due date so you won’t be charged interest. By allowing you to carry a statement balance with no effect on your credit score, it gives you much more flexibility for large purchases. On the flip-side, don’t get a business credit card if you are looking to improve your credit payment history since it is typically not reported to the bureaus.
I highly recommend the Chase Ink card if you are looking for your first business credit card (or third!). Chase Ultimate Reward points are very valuable as they transfer to Southwest, Hyatt, Marriott, British Airways, and United (to name a few). You also earn 60,000 points as a sign-up bonus, those points are worth well over $750 towards travel. You also earn 5x UR points on purchases at office supply stores, cell phone, television, and land-line bill payments and purchases.
Another card I really like, a personal credit card, is the Capital One Venture card. It earns you 2% back on all purchases. You use your points to “erase” travel charges such as: Airfare, hotels, rental cars, vacation packages, etc. I earned over $150 in the last month (which means I spent about $7,500 on the card @ 2%) in travel credits which I used to wipe out some flights and an AirBNB stay! Sometimes it makes sense to pay cash for a flight, like when I paid $40 for a flight on my way to New York rather than burning a bunch of points. Just use 4,000 Venture points to wipe out the $40 flight purchase.
To recap, I will give you just one batch purchase example from last month and outline how to maximize your future product purchases.
— I purchased $4,000 in goods on eBay during the 10% eBay Bucks promo (9x iPhones and three laptops), here is what I netted:
$400 in eBay Bucks
$80 in Capital One Venture “travel credit” (2% back on $4,000)
4,000 American Airline points from the shopping portal
I made about $190 profit after reselling the goods I purchased
That is $670 in cash/credit/bucks + 4,000 points!
If you can do this just once a month you will have some points and cash for a fun weekend trip (every month)
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