The Ephemera Business Model

I’ve avoided writing about this a while, because I’m not a pro, but here goes. This only reflects my experience.

The ephemera biz is all about storage and listing quickly. To make money, you need a huge inventory of at least 10,000 items, and a way to list a hundred or more items a day. You also need a website to offload the stuff that won’t sell on ebay. The business model is about hoarding and selling long-tail items. It’s the opposite of a quick flip.

For clothes, conventional wisdom and Ebay say the average store sells 1% of its inventory each day. So, if you want to sell 1 item daily, you need 100 items. To sell 10 items, you need 1,000 items. To sell 30 items, which is enough to live on, you need 3,000 items.

For ephemera, the rate of sales is much lower. My current inventory is floating at around 5% a month. For comparison, an inventory of clothing will sell off at 30% per month. A real pro can sell off 100% of inventory by spending more time picking, and leaving behind slow-selling items.

With an inventory of 10,000 items, you sell 500 items per month, or 16 per day. This is just enough in sales to live in poverty. It’s poverty, but it is way more than “nothing”, and as a long-term supplemental income, it’s a good business. You can “bank” thousands of items over a couple years, and then watch it sell off for three years, bringing in money every day.

Now, these numbers are based on selling off a sloppily “curated” or picked hoard. This wasn’t a collector, but someone who selectively hoarded. So there is some quality there. The storage, however, wasn’t good, so a lot of items are basically rendered nearly worthless from decay.

If you source curated, higher quality items, they will sell faster, and for more money.

Of course, curated stuff is sometimes more expensive.

If you just source things generally, and it’s almost all long-tail, so there aren’t any sales records of identical things being sold, you need to list them to find out if there’s a market willing to buy the item. (Or you can subscribe to an archive of sales listings.)

To do that, you need to be able to list many items quickly. I’ve been using the multiple listings tool, but I suspect the only way to scale up as a solo operation is to use an offline lister. The web-based application is just too slow.

Aside from this listing challenge, ephemera is a lot easier to store than anything else. It’s booklets and sheets of paper, and you can store them in file boxes or file cabinets. The 10,000 items could fit in a row of filing cabinets, and be out of the way. Unlike selling clothes or hard goods, ephemera is small, and you can operate the business out of a few to several filing cabinets.

That’s what I’ve learned, and projected out, so far.  A lot of this knowledge is entirely derivative of John of Popeye’s Postcards, who sells postcards, and does a lot better, because he’s a better picker and sources within a community of collectors.

Author: John

I can be reached at johnk@riceball.com.

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