We don’t have to tell you that sourcing products is your greatest challenge as an online seller, but it’s also the lifeblood of your business.
Since you make your profit when you buy your item even more so than when you sell it, the quality of your sourcing channels is important.
The progression for many online sellers is pretty much the same. At first you start selling stuff around the house that’s collecting dust. Then, perhaps, you move on to selling some items for relatives or friends. It’s then that your sourcing challenges start. Where do you go next for inventory?“We have yet to lose money on a locker. We have profited at least a few hundred dollars on everything we’ve bought”
Closeouts, liquidations, tradeshows and websites like Alibaba.com and TopTenWholesale.com are among the many now familiar options. But another source is abandoned storage lockers, where the contents are up for auction.
If you have ever watched the reality show “Storage Wars” you know what we’re talking about, to a certain degree. The show being “reality” TV makes it appear that bidding on neglected storage bins is simple and fast, and yields sometimes tremendous payoffs. Maybe yes, maybe no.
Buyer shares tips
We decided to look into this lesser-known sourcing option and spoke with Jessica Oman, who, together with her boyfriend, regularly buys storage units at auction in Vancouver, Canada.
While storage wars—or locker auctions—aren’t as frequent in Vancouver as they are in many parts of the U.S., Oman says, “we have an opportunity about once a week to go auctioning, and we almost always buy a locker.”
The couple have purchased lockers for as little as $27 and as much as $450.
“We have yet to lose money on a locker,” she says. “We have profited at least a few hundred dollars on everything we’ve bought.”
Oman resells everything she can, often through Craigslist, but the duo is about to move to eBay auctions. They also sell to local buyers if there are specific items they want.
Our interview with Oman follows.“We try to paint a picture of the locker’s owner and guess at how long their things have been stored. If items are old and dated, it can be a lot of work to sort them … but it might also mean they hid a treasure”
Schepp: How do you go about locating the storage units? In other words, how do you find them?
Oman: Sourcing auctions is tough. There aren’t many of them, and most companies don’t use StorageTreasures.com (although a few do). We know an auctioneer who does some of [the auctions], so I check his website or tweet him to see what’s going on.
Some storage facilities advertise on Craigslist, but they say their ads often get flagged. The best strategy is to check the legal notices section of local newspapers, because they have to post notices of debts and identify when they will be disposing of the contents.
Then you can contact those facilities to find out if they’re having an auction. A few facilities have mailing lists as well.
Knowing what to buy, how much to pay
Schepp: Do you have any tips for people who have not evaluated lockers before? What do you look for when you are determining whether to bid, and how much to bid?
Oman: We try to paint a picture of the locker’s owner and guess at how long their things have been stored. If items are old and dated, it can be a lot of work to sort them—and several trips to the dump—but it might also mean they hid a treasure in there to keep it a secret, or pass along to someone else.
If lockers are nicely packed, it often means the owner cared for their items, so they may have been higher-end items and worth more in resale. If things are just dumped in without care, this indicates they were in a hurry. I like these lockers because they usually go for cheap.
People think they’re junky, so they don’t bid. Our first locker was one like this. We won it for $225 and it contained Royal Albert china worth over $700, plus many other resellable small items (and a whole lot of garbage).“I try to calculate where I can get my money back with the items I can see from the outside of the locker, and set my budget based on that”
Basically, I try to calculate where I can get my money back with the items I can see from the outside of the locker, and set my budget based on that. For example if it looks like there are a few pieces of nice furniture that I can resell for $500, then my budget is $500. I rarely gamble.
‘Little treasures’ can pay off
Schepp: You mention that you sell to various buyers around town. How do you locate those buyers?
Oman: We just search on Google for experts in specific collectibles. We have lots of work to do in this area. We don’t have many connections with collectors yet. Recently we found two bulky architectural models in a locker, annoying, big items we had no idea what to do with.
We located a guy who buys props for movie sets, and he took them off our hands for a small sum, but it meant we didn’t have to deal with things that took up a lot of space. If we need to get rid of something fast, we go there, and he’ll throw a few dollars our way if it’s something he doesn’t already have.
Schepp: One of your recent “gambles,” as you phrased it, turned up a Selmer saxophone, which you mentioned is one of the nicest models ever made. Do you have any other specific examples of things you bought, and were then able to sell at a nice profit?“Most times, we make our money primarily on household items, but little treasures are a great bonus”
Oman: The Royal Albert china we bought is a good example. We also have a huge stamp collection from the 1800s that we are having evaluated.
Last week we got a locker for $58 that had a nice stroller and a microwave in it that we knew we could get our money back on, but inside we also found a 22 karat gold ring, which we sold for scrap and got $130, so we doubled our money right there, and the other items were all profit.
We find a lot of silver, which we’re collecting until we have enough to sell for scrap. Most times, we make our money primarily on household items, but these little treasures are a great bonus; plus it’s fun to learn about the history of some of the items.
A good source of additional information on buying storage lockers is Glendon Cameron, a self- described recovering storage auction addict. Cameron was a full-time storage auction buyer in Atlanta. He shares his knowledge through his entertaining YouTube channel.