Reselling CDs on Amazon: How bought 1,000 used heavy metal CDs on Craigslist, and sold them for big profits on Amazon
The Craigslist ad
When I saw the Craigslist ad, I knew this was going to be big:
“1,000 CDs – Prog Rock, Metal, Psychedelic, More – $100.”
This one seemed too good to be true. And on Craigslist, that means it usually is.
The Problem With Reselling CDs On Amazon: Most Craigslist Sellers Lie
This isn’t my first time reselling CDs on Amazon that I purchased on Craigslist. It’s been an occasional Amazon inventory source, but its rife with risks.
Semi-regularly, you’ll see CD collections on Craigslist for pennies on the dollar. Generally, it means you’re getting a giant wallet of CDs someone found under the passenger seat of a used 1999 Saturn they just bought or something. Yes, you’re getting the CDs for a steal. But if you’re trying to sell the CDs on Amazon, you’re are out of luck. CDs with no artwork means no Amazon resale opportunity.
Interrogating the suspect
So I texted the seller to interrogate him for details. My expectations were low. Over the course of a dozen text messages, the details of this “1,000 CDs for $100” deal emerged:
First, upon questioning, the “1,000 CDs” became “approximately 1,000 CDs.” He admitted he hadn’t actually counted.
Astute readers of this site will know I consider everyone who posts on Craigslist to be an egregious liar, so I did the rough “Craigslist math” and estimated the “1,000 CDs” was closer to 600. (More on that in a second…)
Second, he told me there was “one catch…”: The CDs had all their artwork. However, the artwork and cases were in boxes, while the CDs were in giant CD wallets. For each of the 1,000 (or 600) CDs, before I could sell them on Amazon, I would have to hunt through every case to reunite it with its respective CD. This sounded like a massive project, but at 10 cents a CD, I could deal with it.
Third, he was being evasive about meeting, then cancelled last minute after we’d finally scheduled. I was getting increasingly suspicious. I don’t give second chances with being stood up. So I told him if he still wanted to make the sale he’d have to drive the 30 miles to my house.
This time, he showed. I looked over the collection in his trunk. While there was no way to do an exact count, I could safely say it was in fact a lot of CDs. I took my chances, gave him the $100, and in a moment I was standing on the curb with 6 giant boxes of CDs.
Surveying the CD lot
Despite my initial concerns, once inside my house I quickly realized this CD collection was a goldmine.
95% of the CDs were flawless, looking like they had never been played.
And the CDs were in two genres that had disproportionate value on Amazon: Obscure metal and classic rock. TONS of Grateful Dead and Yes CDs, and tons of CDs from bands you haven’t heard of like Emperor and Dark Throne. When you’re reselling CDs on Amazon, these genres represent big money.
Ever have an Amazon inventory buy that was so good you kind of wondered if it was stolen? This was looking like one of those scores.
(And the guy I bought them from seemed a little shady, so you never know…)
Sorting the CDs
The seller wasn’t lying: For each of the 1,000-ish CDs, I had to hunt through 1,000 cases. I quickly realized I would have to alphabetize the cases to cut down the searching time. This project took many hours.
Reuniting the CDs with their proper cases took many more.
As I got halfway through the collection, it was starting to hit me that my “Craigslist math” was right. The seller had definitely exaggerated the number of CDs, and there was no way there was 1,000. I was bracing myself for 500. There was no way I was losing money on this collection, but I was prepared for my expected Amazon profit being cut in half.
When all the sorting was finished, here were the totals:
- 780 CDs total. Not 1,000, but it could have been worse.
- 168 CDs missing artwork, and therefore unable to be sold on Amazon.
This left 612 CDs that I could potentially sell on Amazon. But I hadn’t priced them yet, and the potential remained that a lot of them could not be sold for a profit.
After some FBA Mastery readers took offense to me calling Craigslist sellers liars in the past, I feel vindicated here: I was told I was receiving “approximately 1,000” CDs complete with artwork, and in fact received just over 600. Under-estimating by 40% is never an accident. It was almost certainly some deliberate deception, but I still knew that by reselling these CDs on Amazon I was making serious money, so I was happy.
The challenges with reselling CDs on Amazon
I don’t do a lot of business in CDs, but have bought some collections to resell in the past. My general experience with reselling CDs on Amazon can be summed up as: They’re good for a little supplemental FBA revenue here and there, but CDs will never be a profit center.
What’s more, my (limited) experience selling CDs via Fulfillment by Amazon has indicated Amazon Prime buyers are not willing to pay vastly higher prices for FBA offers like they are with books. I’ve watched quite a few well-ranked CDs that were selling for a couple dollars, sit for many months at my $9.99 FBA price (which was still lower than Amazon’s price).
While my evidence is limited, I’ve made a mental note to price conservatively with CDs when selling FBA, and don’t price above the Merchant Fulfilled offer for all but the most well-ranked CDs.
Pricing the CD lot
Considering this, my pricing strategy was to match the Merchant Fulfilled price for all CDs except for those with an Amazon Sales Rank of 5,000 or better. I chose this Sales Rank number somewhat arbitrarily, and will be watching the results closely. I hate to price anything on Amazon too low. And I won’t hesitate to reprice higher if I notice CDs with an Amazon Sales Rank worse than 5,000 start flying out the door. Like they say: “If they sell too fast, you priced too low.”
Here is my FBA CD pricing formula for reselling CDs on Amazon:
Sales Rank 5,000 or better: Price high, all the way to within 50-cents of Amazon’s price.
Sales Rank 5,000 or worse: Match the lowest Merchant-Fulfilled price.
Pricing and listing the 600+ CDs on Amazon took 2.5 days. It was grueling, but I powered through it, expecting a big payday.
The final tally
I’ll start with the most shocking result: Of the 612 CDs, only 35 had no value on Amazon
This is a staggeringly high percentage of CDs having Amazon value. This was a very high-quality collection. Note to self: Obscure metal CDs are worth money on Amazon almost every time.
There were about 65 CDs with an Amazon Sales Rank worse than 200,000, that were also “penny CDs” I was pricing at $4.99 (my rock-bottom pricing threshold).
So it remained to be seen how quickly, if at all, CDs of this sales rank would sell on Amazon at this price point. This was an experiment (Though not a risky one. After all, I only paid about 15 cents per CD).
I emerged from my 2.5 days of pricing and listing with these results:
- Total CDs listed on Amazon: 577
- Average Amazon Sales Rank: 128,000
- Total sales price: $5,232
- Average value: $9.06
- Average payout: $4.87 (According to Amazon’s FBA revenue calculator, $4.87 is the net payout for a $9.06 CD).
- Total estimated net profit: $2,809
What’s the real net profit?
Hold on Peter, shouldn’t you subtract the $100 cost from your “net profit”?
No. Here’s why:
I used my “eBay leftovers bundling technique” with the 168 CDs that didn’t have artwork (missing covers, back covers, or all artwork). I divided them up by genre, and found there were 83 CDs I could classify as “classic rock.” Then I put them all into a lot and listed them on eBay. There was a bidding frenzy, and I got $68 for the set. Meaning that after my first $32 came in from FBA sales, profit from the rest of the 600+ CDs was pure gravy.
So, to be fair, my expected net profit was $32 less than $2,809.
Bringing my expected net profit to, drum roll….
The reselling CDs on Amazon experiment: Epilogue
Lately, reselling CDs on Amazon seems to lead me to one big Craigslist score a month, on average. But this was by far my biggest CD FBA shipment to date.
The CDs hit the FBA warehouse just before posting this. In the first 6 hours my listings were live I made over $150.
So it’s alllll profit from here on out…
Did you test the CDs at all? Understandably it was a huge lot to go through. IMHO with CDs being even riskier than books for negatives, isn’t there a risk for negs you took if they weren’t all checked out?
Peter Valley says
There’s really no way to test so many CDs. So I do a visual inspection and won’t send anything in that is too scuffed.
I just read this story for the first time (seven months after you first posted it) and was curious about the results you have had with the 577 CDs you sent in. Do you have many left at this point? Great post, by the way! I find all your stories to be so entertaining and informative – keep up the great work!
Peter Valley says
I’m pretty sloppy about tracking exact results for each shipment, but I know positively at least 60% of them have sold, based on a cursory look at my inventory.
Patrick G says
What do do for prep on the Cd’s
Do you put them in clear Cd envelopes of just send in with the jewel case . naked ………
With sending in several hundred would like to know your advice for prep of the CD to FBA
Peter Valley says
Label, put in box, ship. That’s my formula.
Anyone have advice on if it’s necessary to use something to keep the CD cases shut when it feels like they open easily? For CD cases that open easily I put rubber bands but I’d love to stop doing that if others have found it’s not necessary. I’d love to hear when it’s worked well or not well to just send in the CDs with nothing binding the case closed.
A plus side of using the rubber bands is it seems that they add some cushion to reduce damage to the CDs while they’re being shipped to the FBA warehouses.
Similarly, how to people determine if they are so loose that they need something to help keep them shut? One guy says he grabs the top edges of the CD and shakes it a bit. If it opens then he uses something to keep it shut.
Here’s a question for CDs with a “case” that’s mostly only made of paper, so no hinges, and nothing to keep the front paper cover flap closed. There is plastic on the inside of the case only, which the CD snaps into. For those kinds of CDs, have people had OK experiences not putting anything on them to keep them shut?
Carol Ellen Myhill says
I emailed you Peter but I’ll copy my question here as you may prefer to answer where others can benefit! Aren’t CD’s a gated item? I thought you could only sell them if you had receipts. Thanks in advance!