CD heist: Buying 1,500 CDs for $100 (to sell on Amazon)

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Lessons learned hustling over 1,500 CDs for $100 at a rummage sale – total expected profit, selling leftovers on eBay, most profitable CD categories, and more.

Video: I bought 1,500 CDs (mistakes were made)

Part One: Me + a church rummage sale in a rich neighborhood

It was among the biggest rummage sales I’d ever been to.

If you don’t know what a “rummage sale” is (there may be some regional differences in what these are called), essentially they are an infrequent (usually annual) events where a non-profit organization collects donations, and then sells everything for cheap. Like a massive garage sale.

Key details about this rummage sale:

1. I found it on Craigslist.
2. It was at a church.
3. It was next to the biggest gated community in the region.
4. It was outdoors.

(This last detail will feature heavily into what’s to come.)

This sale was so insane, you couldn’t park within a half mile of the actual parking lot where the sale was. It was pandemonium, bringing out thousands of people. Clearly a big event in this part of town that people look forward to every year.

Part Two: It starts raining

Like apocalyptic, almost biblical rain.

It started almost the moment I got out of my car. As I approached the football-field-sized outdoor lot, the volunteers (at least 100 of them – again this was a HUGE sale) were panicking, grabbing anything they could to cover tables. There just weren’t enough tarps to go around to the hundreds of tables, and the effort was mostly futile. One of the first sections I passed was Electronics, with a defeating looking volunteer just standing behind a table of soaked stereo equipment.

Of course I went right for the books. And what I saw was tragic. Not a tarp in sight. Just thousands of books totally destroyed.

No time to mourn. I did the quick math: What has resale value that is least impacted by water damage?

DVDs are hit-or-miss restrictions-wise. But I was mostly unrestricted for the next best thing…

I sprinted for the CDs.

Part Three: I find the huge CD section

The CD selection spanned multiple tables. And the volunteers who were managing that are had covered them in tarps. So far so good.

Challenge was, to see anything you had get the upper-half of your body under the tarp. It was like scanning in a cave. But I quickly determined there was value here. And I was willing to bury myself under the tarp for hours to extract it all.

Part Four: “Everything is half off”

It was about 7 minutes into Rainpocalypse and volunteers (apparently getting a call from higher up on their walkie talkies) start yelling:

“EVERYTHING IS HALF OFF.”

The rain was destroying everything, and they were desperate to unload their wares as quickly as possible. But it was an impossible task. Most people were fleeing the sale, and the sale was just too big to sell even a small portion of what was left.

I had already decided I was going to capitalize on this desperation by offering a small lump sum for the entire collection. I had no idea how many CDs I was looking at, but it was at least 1,000. I decided on offering $100. That was 10 cents per CD, at the most.

This is my “offer a lump sum and ask them to throw a blanket over the table” technique. Not exactly innovative, but I don’t think sellers attempt it enough. If it was going to work anywhere, it was going to work here. The volunteers were essentially in panic mode at this point, trying to get rid of everything.

Part Five: “Everything is free”

Almost as soon as I decided I was going to offer $100 for everything, the volunteers start yelling again:

“Everything is free.”

This was about 5 minutes after the “half price” announcement.

Sounds great, but this was actually the worst thing that could happen. Because I didn’t want free. “Free” attracts vultures. And I wanted everything, all for myself. With everything free, I would now be splitting 1,000 CDs among dozens of other scavengers, who were now panic-grabbing everything in reach simply because it was free.

People were advancing on the CDs and stuffing them in bags. I had to make my move. I approached a volunteer.

“Can I offer you $100 for everything here?”

“Everything is free.”

“I’d feel better giving you $100.”

I’m looking over her shoulder and there’s a guy shoveling CDs into plastic bags. This volunteer wasn’t getting my hint.

“Let me give you $100, and you can help me secure the tables while I get my car?”

I didn’t have to say any more. She took the money and immediately began telling everyone they had to leave.

“These CDs have been sold.”

One guy got testy.

“I was here before he was.”

“Sir, these CDs have been sold. They are paid for and they’re no longer available.”

This was exactly what I had paid for. She shooed away the remaining vultures and began standing guard at the table. The $100 had already paid for itself.

What’s more, she called over more volunteers to help move all the CDs to a “volunteers only” area and cover everything with tarps while I figured out how to get everything to my car.

(Lesson: When you’re making a bulk buy in an active environment with shoppers – make it clear you’re also paying for help securing everything. This pays for itself).

My personal team of CD-bodyguards even got on their walkie talkies and summoned me a security person in a golf cart to chauffeur everything to my car a half-mile away. Spending $100 for “free” CDs was a very good financial decision.

Part Six: Developing a CD pricing & listing strategy

Once home, I immediately started listing.

I don’t do enough business in CDs to have strict listing criteria, but here were the standards I settled on:

• Minimum FBA selling price: $7 (This is approximately an 85 cent payout).
• Maximum Sales Rank: 399,999 (inspired somewhat by the CD sales rank advice from this expert).

Anything with a rank above 400,000 went in the discard bin. Yes, I probably left money on the table with this approach.

Pricing strategy:

• Match the lowest FBA price for any rank over 100,000.
• Position myself higher on an as-appropriate basis for ranks under 100,000.

Like I said, I don’t do enough business in CDs to have tested this or know if this is an intelligent strategy. But I went with it.

Part Seven: Listing 1,000+ CDs on Amazon

I started listing. And listing. And listing.

Early observations:

• Lots of $7 CDs. Many FBA sellers seemed to share my same criteria.
• The collection leaned heavily towards music favored perhaps by people somewhat older than myself: Jazz and classical were disproportionately represented.
• The classical CDs had a noticeably higher average listing price than all other genres.
• CD listing goes a lot faster than books.
• Amazon gating for CDs in my account was annoying, but not too bad. Approximately 50% of the CDs required me to request approval to sell. Of those, approximately 20% asked for invoices (on the high end). Which meant a total restricted rate of somewhere in range of 8% to 10%. I expected worse.

Part Eight: Notable finds in the haul

Unlike books, very few CDs had outlier-level value (value outside the normal range). 90%+ all the CDs I listed were in the $7 to $15 range. The range was very narrow. However there were a few notable gems:

• A Time-Life folk music box set selling for $60.
• One box inexplicably lined with books on the bottom, one of which was a rare book on Incan religion selling for $60.
• A Pink Floyd CD that I was restricted from selling, but regularly sells for $60 to $100 on eBay (auction still running as of this writing, but it’s up to $30 now).
• Several sealed “Great Courses” DVD sets that snuck their way in, selling for $30 to $60 (if you know, you know).
• A Beach Boys vinyl box set (also accidentally ending up in the CD tubs) selling for $200 on Amazon, with all completed eBay listings closing at $150 minimum.

Part Nine: The final tally (Amazon)

According to Scanliser: here were the ifnal numbers:

• 626 CDs listed on Amazon.
• Expected payout: $3,400 (Sounds fake or rounded, but that’s the actual number from Scanlister. I rounded to the nearest dollar for each of the 6 shipments, and it came to exactly 3,400.)

Part Ten: The final tally (eBay)

I went through the approximately 1,000 CDs that either had no Amazon value, or I was restricted from selling on Amazon, and grouped them by genre.

It didn’t take me long to regret spending so much time on this, but I wanted to try eBay-ing my leftovers as an experiment. After grouping as much as I could while still keeping the lots over 30 CDs each, I settled on these categories:

1. 1970s
2. 1980s
3. 1990s
4. 2000 to present.
5. Classical
6. Jazz
7. Soundtracks
8. Christmas music

Here were the final results:

(Notes: I offered “free shipping” on everything, so shipping costs came out of the closing auction price. And two auctions were won by the same buyer, hence the grouping of some results).

Considering the amount of time I spent on sorting, listing, packing, and shipping; I regret every second I spent on the eBay experiment. What’s more, I would kindly ask that if you ever hear me mention eBay on this site ever again, that you assume I’ve either been kidnapped or hacked.

Net profit (after all fees and shipping): $164

Part Eleven: Final final final total tally

• Total number of CDs: 1,500 (approximate)
• Cost per CD: $0.06 cents
• CDs listed on Amazon: 626 CDs
• CDs sold on eBay: 646 CDs
• CDs discarded: 250 (approximate) These were either uncategorizable, restricted, or damaged. Donated them to a thrift store.
• Expected Amazon payout: $3,400
• Hours spent: 16 (approximate)
• eBay net profit: $164
• Total expected net profit: $3,564
• Dollars per hour: $222
• Dollars per hour if Amazon value drops a full 50%: $116.

Top Four Lessons Learned About Reselling CDs

1. Approximately 30% of a mixed CD lot can be sold for $7+ via FBA. Hard to know what to call a “mixed lot,” and it’s possible this collection was slightly above average, but it didn’t feel especially high quality. And over 30% could be listed on Amazon for $7 or more.
2. Bundling for eBay is (mostly) a waste of time. In the future, I won’t be attempting this again unless I can keep the lots to 100 CDs or more.
3. I would now pay 10 cents per CD for any mixed lot. I paid a little under 7 cents and the results were good. In the future, I’ll be willing to pay up to 10 cents per CD for any lot that I have evidence is medium quality or higher.
4. Someone is making money on eBay buying bulk lots for 50 to 75 cents per CD. Four of my lots sold to two different buyers. And one of the buyer’s names was “Media Buyer’s Inc” (or something like that). I don’t know what the business model is, but almost certainly they are resellers who have a way to average more than $1 per CD.

Biggest lessons:

1. CDs are an underrated category.
2. If you see an opportunity to make a lowball offer for a bulk CD collection – do it.

-Peter Valley

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