<<< Continued from previous page

Again, let's say that, in the first three months, you sell 100 of these books at $25 each, the second three months another 100 at $21.67 each (a necessary price reduction to stay competitive as values fall), the third three months another 100 at $18.33 each, and the final three months another 100 at $15 each. Your earnings for the year are $2,500 + $2,167 + $1,833 + $1,500 = $8,000. Minus your cost of acquisition, you're left with $8,000 - $500 = $7,500. The remaining 500 books, on average, are now going to continue to decline in value but as yet are far from worthless, unlike the $5 books in our previous discussion. Since your labor is already built into these, the cost of continuing to list them is less punitive than it would be if you were listing $15 books anew.

Now, if we take the remaining $7,500, and subtract the costs of selling them and reinvesting in new inventory, it's not unreasonable to assume a net of $5,000 or $6,000. Make 10 similar buys in a year's time - or do what most of us do and buy continuously in smaller lots - and you'll realize an adequate income. Continue to do this the following year, and things should improve because you'll be selling some of the $15 and under books that didn't sell the first year they were listed, though not at the same velocity.

Is this a sustainable business model? Yes, as long as you aggressively pursue the acquisition of inventory and develop reasonably efficient listing, fulfillment, etc., methods. If there's a downside, it's that the realities of this business - given in particular the nature of your competition, even if it has dropped off some lately - are that you won't have much, if any, energy/time left to take your business to the next level. You'll be working too hard doing the busy work of bookselling. If you acquire business-enhancing knowledge at all, it will more likely be by a sort of osmosis that occurs by way of noticing, for example, which books you have luck with and which you don't than it will be by dedication application.

Why is this important? Because if you want to increase your income beyond adequate, you'll almost certainly need to raise your ASPs even further, say, to $50, and frankly, this is where the demands placed on you change their spots. Most of you will not be able to get to this level without acquiring additional bookselling-specific knowledge via dedicated application.

More about this next time, when I look at $50 books.

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