In the reselling world, talking about how to source for inventory through non-traditional means is somewhat of a “faux pas.” There is this constant fear that if someone reveals their secrets, then they will lose their competitive edge over other resellers. As a business owner and full-time reseller myself, I definitely understand that mindset. However, not every place that we source for inventory is secretive and has to be “hush hush.” Personally, I source for inventory through many different avenues and they are all places that anyone could shop at if they wanted to. Today, I wanted to discuss the basics of sourcing for inventory online and on Wednesday, I will break down a specific example of how you can use online sourcing to find great inventory.
How to Source for Inventory Online as a Reseller
Set a Budget
Before sourcing for inventory for your business, I would highly recommend setting a budget. This will help you to figure out exactly what items will provide you with the best return for your investment. Generally speaking, whenever I source online, I can expect that my cost of goods are going to be higher than when I source at a local thrift store. As a result…
Be Selective
Since my cost of goods are typically higher, I have to be more intentional when selecting items through online sourcing. Although my budget might be the same as when I go thrifting, I am unable to buy the same number of goods. This is not necessarily a bad thing but I have to be sure that the items that I am buying are worth the higher cost of goods and will yield a substantial return on my investment.
Make a Checklist
Personally, I find it really helpful to evaluate your inventory and have a checklist of needed items prepared before sourcing for new inventory. I like to be a specific as possible in my list as it helps me to figure out what filters to use and categories/brands to look for. Additionally, I like to jot down trending styles within each category along with popular patterns, colors, and styles.
Another factor that I like to add to my list is how many items I need to source. This is not a number that is important to everyone but if it is important to you, this will greatly impact how you source for goods. If you are needing to source a large amount of items, then online sourcing may not be the best option for you as you may not be able to buy as much as you would thrifting or shopping at the bins (unless of course you are looking to buy a pallet).
Decide Where to Source Online
When it comes to online sourcing, there are many different options available. Where you look for items will heavily be influenced by what types of items you are looking for. Some popular places to source for inventory online include:
Reselling Platforms- Poshmark, Depop, Ebay, Mercari, Kidizen, Vestaire Collective, etc.
Online Consignment Sites- ThredUP, The RealReal, etc.
Retail Site Sales/Clearance- Nordstrom Rack, TJ Maxx/Marshalls, Saks Off Fifth, etc.
Liquidation- Any auction bidding website or company selling liquidation pallets
How to Shop
This is something that I will cover in more detail on Wednesday’s post but I will share a some general insights on how to shop for inventory online in this post. Simply put, you will want to use your filters to search for items through specific categories, pricing, sizing, etc. Once you have found the items that you are looking for, be sure to compare those items against your checklist and narrow down your results.
Finally, the most important step in this process is to look up comps on everything! This will allow you to establish profit margins and sales prices, in addition to, provide insight on the item’s demand/ position in the market (aka over saturation).
Should I Buy?
Personally, I like to look at 2 specific numbers before making online sourcing purchases:(1) my average sales price and (2) my profit minimum. These numbers are going to vary from reseller to reseller and can be easily calculated using your data and some basic math. When it comes to my average sales price, I will only buy an item if I am confident that it will sell for my average sales price or greater. Additionally, I will look at my profit minimum. Essentially, I will set a minimum profit requirement for all items that I purchase for my business. If I am not confident that I will be able to at the meet that number when selling the item, then I will not purchase it.
Overall, I would highly encourage you to be selective in what you purchase through online sourcing and ALWAYS do your research and run comps. Sourcing online can be a great way to find inventory, you just have to know where to look!
I hope that you find this post helpful! If you have any questions or just want to chat, please reach out!
If you are interested in seeing some other items that I have found while thrifting, check out THIS post and THIS post.
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