The greatest part of this story is what Ryan accomplished personally. From reading, he went from someone who consistently had great trouble professionally, to someone who is successfully able to support himself and his family financially.
Ryan, if you're reading this, congratulations! This appears to be a major personal accomplishment and milestone for you. Best of luck as you grow into your next level of success.
I also like the part where Ryan sought out mentors and advice from people he trusts. There is no need to tackle your problems alone. Listening is a great virtue.
Personally I've always considered craigslist to be sketchy from a buyer or seller point of view. Since I live in Portland, I'll keep you in the back of my mind if I need to get rid of anything I don't have time to handle myself. I'd rather work with someone trustworthy then deal with the unknowns of craigslist.
If you go to news.google.com and type in Craigslist you will get a vastly disproportionate number of negative/positive Craigslist stories. Muggings get reported, smooth transactions don't.
Shoot me a message if you ever need help with something.
I didn't see any discussion about the cost of driving around town all the time to pick stuff up. Still, depending on his average distance, if he averages three items per day he might not be much worse than a lot of people's average commutes.
The van I drive, a Toyota Sienna, gets pretty good gas mileage . I factor distance/time and what I will be able to sell the item(s) for before pulling the trigger. I listen to music and relax while driving around. I avoid rush hour traffic if at all possible. I drove approx 15-20k miles this past year picking items up and delivering them. It's by far the biggest cost. However, that's pretty much my only overhead, as I sell the items out of our garage/house for now. (I've gotten pretty good at knowing what will sell and what won't, so I stay away from items that I will have to sit on for a while or are difficult to store.)
I'm surprised it hasn't been mentioned yet, but roseburg, have you considered packaging up this wisdom you shared on this blog post as a class and make some money teaching? I'd think you could get a bunch of students to take at least a one session 2 hour class or something learning this stuff from you. Or even some class online. You could video some of the interactions you have on the phone and in person when doing the deals etc...
It makes sense intuitively that heavy appliances would be the most profitable. People don't say, "sure you can have my iPod for $20" but I could see them being willing to part with a washing machine for that price if someone would carry it out of their third story apartment.
Yes. They will take a lesser fraction of the value in cash when there is a positive value in getting rid of it. Small items are easy to get rid of anyway (you could just throw it in the trash), and if they have value they may be willing to store them and wait.
My overall reaction to the article, though, was that he's doing a fair amount of work for a pretty so-so return, and it looks hard to scale it upwards. (That $1,000 for the week doesn't come with any fringe benefits, like insurance.)
$1000 per week is actually quite good, remember this guy was unemployed and was getting occasional construction jobs so he didn't have any money and insurance in the first place. The experience he is gaining running a successful business also has a lot of value. I know a similar guy who started dealing in used items, after working for 25 years he is one of the biggest antique and scrap metal dealer in town.
It definitely will take a lot of work to scale it, but I think it can be done. I could probably be watching 3-4 cities at a time fairly easily. Portland has a very active Craigslist community and I have a lot of down time waiting for new ads to come up. On the other hand, if I'm always at the computer, I lose a good chunk of profit on items I have someone else pickup, so I have to increase volume to make up for it, which is not always easy. I'd love to hear your thoughts and suggestions, as this is my main hurdle I'm facing right now.
I'd say that a netbook with 3g internet would be a worthwhile investment, so you could check for new deals even while your out on the job. Then you'd always have your next destination, you could plan routes efficiently, etc.
I have a 7" samsung galaxy tab with built in 3g from verizon. I also have a dash mount so I use it as a gps as well as to pull up emails, addresses and listings on the fly. It also acts as a hot spot to give internet to my laptop when I'm traveling.
Couldn't you make some application which scrapes Craigslist every 5 minutes and detects newly posted items, maybe filter them on some criteria, and SMS them to your phone?
The CL app can do that for you. Say, you save a search for "refrigerator" in a certain area, in the "Free" category, the app would notify you (it puts a # on the top bar of your phone) letting you know there's a new listing for "refrigerator". Same thing for "roommate" or "carpenter" jobs, etc.
It's pretty cool, wish I've known this app when I was looking for a free carpet.
Interestingly enough, just last month, I bought on CL and sold a pair of girl's snowboard boots for $15 more in a matter of 4 days. Mostly because I really didn't want it.I was just practicing on my selling skills. I'm more inspired after reading this.
Median income in the West in 2010 was $53K, according to the Census Bureau (via Wikipedia), and since "the West" includes California I'm betting it's lower in Portland. Considering he says he's only working 25 hours a week, 1,000 a week is pretty darn good, even if he does have to pay for health insurance.
I have a really solid aluminum hand truck with stair skids on it. Most appliances weigh less than 250 lbs (I would guess average would be 175-200 lbs) and I'm able to move even the heavier ones up and down stairs by myself (not always easy!) It can be pretty physically demanding work sometimes, and I will ask questions to find out how difficult it might be to remove/deliver an appliance and bring help if I need it.
A nice story. This guy found his inner "hustler" - hustler in the positive sense.
I sell a lot of items on craigslist, and I have no problem with the idea that someone bought it from me to resell it because I underpriced it. Hell, if someone threw what I gave them in the garbage, they can do that too. I no longer want the item, I got what $ I asked for it, and I'm out of the equation.
The only thing I'd have a problem with is if someone contacted me with a sad story about being broke, student, unemployed, sick child, or something, and asking for a discount. And I find out later they lied. That's where the ethical line is for me.
I'm straight up with people. Sometimes people will pick up on the fact that I'm not the average consumer joe buying their appliance and they ask what I'm going to do with them. I tell them and no one has ever complained. I show up on time, do all the work myself, pay cash, and people are almost always happy. I've actually got a lot of repeat business from buyers that felt I treated them right. One guy turned out to own a large apartment complex and ended up buying 30-40 appliances from me this past year.
This sounds like a mess to keep proper tax records for. Assuming nobody's giving receipts on either side of the transaction, how do you keep proof of what price you paid and what price you sold for? Audits aren't that rare.
Not speaking for this individual in particular but in general its unlikely that businesses like this are going to report all of their earnings, are they? You can audit a cash business but with no receipts whole transactions never happened or have a paper trail.
I'm not condoning tax avoidance but remember most of the people on HN either earn six figures a year, will do in a few years and/or building startups that might be worth $millions.
This guy is making $15-30/hr, doing part-manual labor and has 4 kids and a wife to feed.
I guess it's a moral judgement but I feel less concerned if he was to not run all of his cash payments through his books compared to bankers and millionaires who put large amounts of money offshore to avoid tax.
At the same time, in that income range with that family, his taxes are gonna be 0-10% of his profits at most... without the threat of being imprisoned for tax evasion. If his "typical summer week" is his typical week all year, he alone is already earning more than the median household income for this country... lots of people are self-employed making similar income without benefits. Is it morally OK for a plumber to not report his income? An electrician? What's different about a CL arbitrage business?
Payroll taxes are 15.3% with no deductions. 0-10% on federal sounds about right, but that is not really an accurate picture for what taxes would do to his cashflow.
I agree that it is not morally OK to not report income.
I put in my own numbers for a complicated personal return (business income, capital gains, itemized deductions, etc) and the forecaster agreed with my actual taxes done by a CPA, so it's not making any guesses.
Put in married, $45k in business income, 4 kids. The total federal tax bill comes out to $3700 or 8%. Most of the tax bill was offset by the large EIC for having kids. In reality he'd have many deductions to lower that even further, from business use of a home, to any health insurance he buys, to part of his car expenses and mileage...
If the guy has $45k in business income, then he owes $6885 of payroll taxes (unless he is Amish). I don't care what tool you use, that number is the absolute floor for what he would have to pay out of pocket.
* 61: Add lines 55 through 60. This is your total tax.
* 62-72: Credits and payments, including the Earned Income Credit.
* 76: AMOUNT YOU OWE: Subtract line 72 (total credits) from line 61 (total tax).
That's where his $6.3k SE bill gets nearly wiped out by $5.5k in earned income credit.
Credits, unlike deductions, are subtracted dollar for dollar from total tax owed. If he files jointly with a spouse, it can actually reduce their tax bill to $0 on that income. There's no category of taxes that can't be reduced by EIC, including SE (payroll) tax.
But he gets those credits whether or not he reports his profit. On a cashflow basis, it will cost him 20%. You are right though, his tax bill at the end of the year would be about 8% of $45k.
All good points. Part of me, in making my overly-simplistic moral argument, is assuming that his summer months are reflective of seasonal fluctuations and not a consistant representation of his income.
I was just reading a long comment thread about craigslist on reddit yesterday. It seemed like most transactions take place over the phone, not e-mail. Whoever calls first at the right price gets the stuff, a good deal will be gone before the e-mail would be read.
Every one I've been to has a POS computer/register where they enter every sale, no matter how it's paid. Enter the employee ID of the person that did the cut, the service, cash tendered, money drawer opens, provide change if applicable, offer receipt. Same as any other legit business.
There's a grey market in "zappers", which are POS devices that keep two sets of books automatically. Lots of small retail businesses rely on this type of tax fraud to stay in business.
I don't see why some consider this unethical and abusive to the CL community. It's just arbitrage; same as in Foreign Exchange markets. It tends to pop up because values are just opinions and to forget that leads to misdirection.
Frankly, personally if I knew someone like this locally who I could call to dispose of old appliances etc. and get a little bit back for it, and who was trustworthy and I knew would do pickup, I wouldn't bother with CL even if I knew there was a difference.
Someone who appears trustworthy + guaranteed quick turnaround would be worth the difference in return for me - I've disposed of old appliances by paying a removal company to take them away on more than one occasion because I didn't want to deal with the hassle of something like CL even if it meant I might make some money back.
I think in the long run there's a lot of opportunity for repeat business there from people who don't need to make the most cash out of the sale as opposed to either make it quickly or just want to get rid of the item without fuss.
That's exactly what I was thinking reading the post. It's nice that he is able to make a living and support his family, but he does that on the back of people looking for things on craigslist without providing anything of value (besides maybe transportation). The bad part is that I'd assume people buying things of craigslist tend to be on the lower part of the income spectrum and he's charging them more money by "playing the market".
Does he actually tell people that he's just going to resell whatever he picks up? I'm sure there might be some people that are uncomfortable with that.
Plenty of people just want to get rid of stuff. They need the room or they need to move and they don't care what happens to it. If this no-one takes it it'll go to landfill.
He's providing a service to them. He takes the stuff away, and doesn't charge them to do so. He might even give them some money. (Compare that to hiring a dumpster / skip.)
I don't know what Americans throw in landfill but in England there's plenty of furniture or working electrical items that end up in landfill (or the modern equivalent).
But not if they were on craigslist in the beginning and apparently there are buyers. From what it seems to me, he just tries to be the fastest buyer rather than taking things that can't find buyers
Interesting story, it's fascinating to see what people are doing to make ends meet in the new economy.
Similarly, I know someone who makes well over $100,000 a year buying, fixing, and reselling things on Craigslist and eBay. They found a very specific (and obvious) niche that is highly profitable to be in, I imagine if this guy specialized more he will see greater returns as well.
I always wondered how much one can make by buying AC units on Craigslist in December and selling them off in June, in a place like NYC where weather gets very hot/cold :)
I do that in NYC with bikes (buy winter, from people who made impulse buys in summer and have nowhere to store them, sell summer, to people making impulse buys.)
I think the NYC market has so many constraints and peculiarities (plus money!), its rife with these kind of opportunities.
I built a free webapp that may be useful for such Craigslist arbitrage. It constantly crawls Craigslist for search terms in your price range and emails you the results (instantly or in a daily digest):
Appreciate the feedback. No one likes blocking signups, myself included.
Trouble is, the app can't serve the user without having his or her email address on hand. I suppose I could rework the process so the user can give an email address after seeing how the interface works.
For those curious, the emails it sends are simple lists of links, sorted by keyword.
What you should do is ask them what they want to search for, then go and do the search and show the results. (It's OK if you show old results - not sure what your technical architecture is.)
Then invite them with: Have these results emailed to you every day, enter your email here:
Also, I tried to sign up using the login form - that's not cool. If there is no match put up a page say, no such account, would you like to create it?
I wonder if it would be possible to scale the business. If you wrote a script that could flag potentially lucrative items for manual review, you would likely be able to cut out much of the searching, allowing you to target CLs in multiple cities. If he's making $38/hr in one city, he could hire someone for $18/hr in another to drive around and pick up / drop off items and pocket the $20 difference.
I'd be interested to see how well this would work out.
As he mentions several times in his posting, time sensitivity is critical. Minutes, even seconds can make/break a deal... automation may be much slower than a human who's constantly scanning.
Furthermore, it's clear that it's not just "pickup" and possibly "delivery"... the author is making a clear buy/sell/bargain decision on the spot... what happens when the pickup results in a fraudulent item?
Clearly this means that whoever is driving around needs to be trained, and once trained, can be your competitor (I see few barriers between a trained pickup-person and the author scanning craigslist)
Kudos to the entrepreneurial spirit here, but I highly doubt it's scaleable.
With sufficiently good automation, he could be running the automated search while he's out driving around on pickups/deliveries. The search could send alerts to his phone (SMS, email, dedicated app?).
Eventually, you scale to having multiple drivers in multiple cities who spend their work time on the road, with the "back office" alerting them to new potentially valuable postings. Maybe even tracking their general location, and alerting them to lower-value postings that happen to be near their current location?
Given the entrepreneurial nature of the buy/sell/bargain decisions that need to be made on the spot, maybe it should be structured something like a franchise? You sign drivers up, they get a territory, and get sent alerts for their their territory. Several people mentioned paying the drivers hourly wages; instead, you could charge them (per month or per alert?) for the alert service, or you could do some sort of percentage profit sharing (though you'd have to trust the drivers to accurately report all transactions).
Your spot on with what I've been wrestling with over the past months. It's difficult, but possible. I did a trial with a friend in Houston and it worked out well. We made a little over $200 in a day on one laptop. Communication wise, it's definitely labor intensive at first as I'm trying to make wise decisions over the phone and looking at pictures.
It is possible to pull it off, it's just going to take a lot of work finding the right detail oriented/trustworthy person in another city that's in the right situation to pull it off. Hopefully in a year I'm writing about how I was able to scale it to multiple cities.
Could you hire people on www.taskrabbit.com to go pick things up for you? You'd have to probably pay them on retainer to get the responsiveness you need, but it's a way to recruit in different cities.
uhh, automation is going to be much, much faster than a human who is constantly scanning
of course, it can't analyze the data as efficiently, but it would definitely be faster to have an automatic filter that saves time in looking through obviously overpriced or useless postings
With automation it could be much better, with a lot of machine learning: trusting users with whom you have already made good deals, the cities/neighborhoods most trustworthy, the articles more profitable, etc.
He's got the spirit of a hustler and the swagger of a college kid. I love stories like this of people doing not ground breaking jobs and just hustling and making it happen.
I work in a high skilled tech job that requires lots of thinking and analysis, and sometimes I over think and over analyze everything I'm doing, which is why I think I admire a job that requires pure hustle. Not saying that's my cup of tea to do full time, just something that I could apply to my everyday job to make me more productive and focus more on doing than analyzing!
Thanks man. Sometimes I over think things, or am too cautious. Out of 600 or so buys that I made this past year I would have probably been better off being a little more aggressive and taking a few more risks.
I've learned more this past year of grinding it out than from all my years of school. (and some college) Thanks for the comment!
People also used to do this with eBay. I also sometimes sell on Craigslist but I work full time so it has to be larger scale. Sometimes I buy event tickets and sell them on Craigslist for a profit if I know there will be high demand. The profit margin is typically at least 50%. And I make at least $100/ticket for simply printing a piece of paper and meeting someone at Starbucks.
I do the same thing with tickets. And since I can make Internet, I made a site to handle accepting the payment and getting them their PDF ticket: http://www.boxrowseat.com
Great post good for you for hustling to take care of your family. Lots can be said from various moral points of view however simply put he's taking care of his family and not drawing on struggling Federal and State governments (while actually paying his share).
A couple great points having grown up in the antique business the skill he's developed is the ability to know the local market (buy and sell-side) for a variety of local items.
Roseburg - a suggestion that may help you're right about a clean listing good pictures etc... However one interesting twist I've experimented successfully with is using Copywriting techniques to drive attention to your ads. Mainly I did it for practice but its seems to work well having helped sell the items far more quickly than previous CL sales I've done. I'm happy to share/email a few examples of ads I've written with you if they would help.
Not sure the best way to connect off the comments here (since I've just registered to leave this comment)
What about operating in bigger markets, like cars, trailers, RV's, etc. ?
Or are those markets too competitive? Having sold cars on Craigslist before, I know that there are people who are offering low values, fast sales, shortly after posting in hopes of finding a desperate seller, so maybe these people make profit much less likely for a trader.
Laws vary, but you can only flip a few cars a year, like a dozen or so, before you're required to get a dealer license. These generally cost thousands of dollars a year and come with a lot of paperwork overhead.
I did this in college, however, since graduating and getting a full time job I've quit.
I mainly stuck with electronics, and even then it was mostly TVs. I found that I could very easily purchase TVs for $100-$200 less than what I could sell them for.
It was fun, and I've seriously considered doing it on weekends again, however now that I live in a large city (Atlanta) I feel like there is a lot more research that has to go into an item... Mostly because people from an hour a way from the city center will claim they are within the city and so on. In college I was in a city of 150k people, and could get to the outer "suburbs" in at most 30 minutes.
My current TV was one of the first 1080P 50" Plasmas... It still works perfectly and looks great. I bought it from a couple for $750. (Bought with the profits from selling buying and selling TVs)
The predicted numbers seem way off to me based on spot-checks. For example, I searched for "chair" in NYC, and for a number of normal office chairs listed at $30-50, the "Ed's list" price predicts that they're really worth $180-500!
I really like your story man, and I'm glad you're succeeding but I just wanted to voice my opinion on one of the things you said-- "Back at home I immediately found out the cards were worthless. I had paid the kid $100 for the cards, and eventually pestered him". Even if the kid knew, I think it's wrong for an adult to come back and reneg on a deal with a child. There's a big power imbalance there. You seem like a great guy, I just kind of found that a bit unethical.
Exactly. The kid was a junior in high school. I'm 30 years old. It wasn't like I was picking on some little kid. The sooner someone gets called out for stuff like this the better.
You know what, I agree but there's a right and wrong way to approach the problem, especially with kids. I mean that's why parents should be involved in the first place in situations like this.
The kid was old enough to engage in meaningful financial transactions. There's always _some_ power imbalance in any kind of meaningful transaction - that doesn't mean that the person on the weaker side has the prerogative to act unfairly.
This is much more common than everyone here thinks. I posted a car for sale two years ago. My first two replies were people offering half my price in cash. While I didn't actually check with them, I assume they were dealers (self employed or part of a business) trying to buy something below Blue Book so they could sell it at Blue Book. It seems unlikely there are many people sitting around looking to buy any car as long as it was a "deal".
It's very impressive that he's able to earn so much money and support his family via Craigslist, but I can't help but think about how useful (or not useful, really) his job is for the overall economy. Basically, he's another middleman - buying goods for a low price and selling them higher. Without him in the picture, buyers could have purchased their items for less and saved money. I just don't see how this job adds a service to society.
People appreciate me being prepared to remove their appliances without damaging their house, showing up on time, paying cash, and often times I will buy all their appliances (and other items they might be selling). Sellers appreciate me cleaning out the appliance, changing out 220v power cords for them, delivery and setup of the appliance as well as the price, which I usually set at just under the going rate. Many times people will come to me asking for me to find a used appliance for them and want me to deliver it. Buying on craigslist can often times be like buying a used car. You never know who your dealing with. One of the skills I've picked up is how to read between the lines on craigslist ads. If you don't know what your doing, it can be quite a frustrating experience.
Well, he is delivering them, and taking old appliances away when he delivers them. There is a lot of value in that.
He is also adding "liquidity" to the "market" by immediately buying new listings, and holding them for a few days until the right buyer comes along. Without someone like him the seller would have to wait several days to find the right buyer.
I doubt very much that sellers would appreciate this liquidity "service" if it were spelled out for them. They would feel cheated, as would the buyers.
There is nothing to "spell out" for the sellers since nobody knows at what max price an item will sell. When the original seller sets a price, they are balancing their need to move the item with how much they think they can get. When the arbitrageur buys an item they are offering immediate liquidity and accept not only the item but the risk that they will not be able to move it at a profit (or break even). Liquidity and transferring risk away from original sellers is the value this offers to the CL community.
Does it matter at all that buyers and sellers ought to have that choice, to determine whether this really is a value to them?
If liquidity and risk transfer is such a value, wouldn't you want this service-for-sale to be clearly visible to all?
This is my theory: If a person doing this were clearly distinguishable on Craigslist from regular individual sellers (and buyers) a great number would be swayed away from doing business with him. I think most people on Craigslist see it as the lubricant between buyers and sellers, intended precisely to replace middlemen like him. I think his ability to sell that liquidity and risk-transfer for profit would depend on his ability to blend in.
You might reasonably argue that I'm wrong. But if you do, then not only would you not object if (in a hypothetical universe) we were to clearly and involuntarily distinguish dealers and Craigslist profit-makers like him from the regular buyers and sellers, but you would see it as beneficial to him.
Note that eBay provides this sort of distinction, in the form of feedback history (someone who's got feedback from 100s or 1000s of transactions is probably making money at it), and people generally prefer to deal with the dealers and middle-men (in part because dealers have more to lose if they rip someone off and get bad feedback).
Feedback histories show that eBay dealers are active users with the greatest number of transactions, and that those with the longest histories are successful because they continue to conduct themselves well. But it doesn't say much of anything about whether individual buyers or sellers anywhere (but especially Craigslist) would prefer to transact with dealers rather than other pedestrian users when given those choices.
But most of all: Amazon and eBay are themselves middlemen. They take a cut. Every time you buy or sell, a cut goes to support the platform you used to find and buy or sell. Active dealers with more transactions give more support to those sites. If you like using them you're probably okay with those dealers.
Craigslist doesn't take a cut (outside of certain job postings in certain big cities). It's a community platform for individuals. Dealers profit only themselves, contribute nothing to support the site, and offer little if any dubious "value" with their interference. This is not exotic knowledge for users of Craigslist.
Let me put a personal spin on this to explain it better.
3 years ago I was broke and bought stuff on craig's list, (specifically camera equipment) and sold it on eBay and held some and sold it on craig's list later. I negotiated hard on the phone and only bought stuff far below market value.
I only sold stuff for far above market value and I ended up with an extra $300 a month or so which was a huge difference in my lifestyle.
I noticed something with the sellers I dealt with. Most were wealthy, or made very good incomes and just wanted to get rid of the item. They didn't want to deal with a bunch of buyers, they wanted someone who would give them cash fast in a straight forward transaction. That is the "service" I did for them.
Buyers wanted the item, but wanted someone who would tell them it worked, and back it up, provide good photos and description etc.
---
Fast forward 3 years and I make enough money that when I buy and sell stuff on craig's list I am primarily interested in a fast, easy transaction where I'm saving money over the new price, but not concerned about getting an extra $20 out of it.
I basically changed places and I am happy that middlemen are able to provide me with fast, easy transactions.
---
One tip too. To get the absolute best deals put up WANTED ads on specific items. I bought stuff for ridiculously low prices that way. 60% off the mean. And you don't have to be the first to respond to the ad. A lot of people search for the item they are about to sell before they post it and when they see your WANTED ad, you provide the service they want and they are happy to get less than the item is worth.
I know when I moved out of my last apartment, I sold my washing machine for a couple hundred dollars less than I could have made, because it needed to be gone by the end of the week. I don't have storage, I don't want to keep something that size sitting around my new apartment. I totally understand and appreciate what we're both getting out of the deal.
People rarely feel ripped off buying goods from retail stores, even though everybody knows that retail stores just buy goods for less money than what they charge and make their profit based on that difference.
Given how many utter flakes I've experienced when selling (or even giving away!) stuff on Craigslist, I think liquidity here actually has tremendous value.
And unlike modern stock trading, not all Craigslist listings are created equally. He seems to be doing the dirty work that sellers don't want to bother with. Besides, everyone knows that if you want get paid a reasonable value, you put something on eBay, but that's too much hassle for these sellers.
Exceedingly useful. He's providing important information to the market and matching buyers and sellers who otherwise wouldn't have met each other. There was a recent Econtalk podcast with Mike Munger on this subject: http://www.econtalk.org/archives/2008/10/munger_on_middl.htm... , in which Munger and the host, Russ Roberts, discuss the role of middlemen and making markets.
Without him in the picture, buyers could have purchased their items for less and saved money.
Without him in the picture, buyers might not have found the items and wouldn't have the benefit they think buying the items at all will give them. He's doing a major public service.
> Without him in the picture, buyers could have purchased their items for less and saved money.
And yet, they didn't. The items he's selling are still cheaper than they would have been brand new, and he's in effect connecting people with items they want, for cheaper enough for them to afford them, for a relatively small fee.
You ought to rally against real estate agents, brokers, etc. harder than against this guy.
Considering he's getting these items off Craigslist and turning around to sell them on Craigslist, the only reason people aren't saving money is that they aren't beating him to the initial purchase.
Well, that and managing to ferret out poorly displayed/marketed items and re-post them with better advertising. That is a valuable service, but I'm not sure how much of his activity can be meaningfully characterized as doing so.
Real estate agents and the like bring an awful lot of time, skill, experience and special knowledge to their problem domains that their clients don't have. What does someone like this Craigslist middleman contribute?
Do buyers and sellers go to this man the way people go to real estate agents for their services? What would Craigslist buyers and sellers think of what he does if they knew about it? Respectfully, I think they would strongly prefer he weren't interfering.
> What would Craigslist buyers and sellers think of what he does if they knew about it? Respectfully, I think they would strongly prefer he weren't interfering.
Having tried to buy things on Craigslist, nice, clear photos are amazing - it saves me the trouble of shlepping somewhere, looking at the clearly mis-represented item, sighing, and shlepping back home.
As far as the sellers, what exactly are they losing? They stated the price they wanted to sell for, and they got it. You could argue that they could have gotten more with a better camera, some cleaning, and a better ad, but at that point you can argue that nobody should hire ad agencies.
Who hired this guy for his "services?" The buyers or the sellers? Someone at Craigslist?
If he's in the business of helping people buy and sell things on Craigslist then he should go to prospective buyers and sellers on that basis. And if he did, he would not make the kind of profit he's making.
Not to mention, when i give something away on cl, I'd like it to go to someone that needs it, not a wheeler dealer parasite living off the goodwill of others. Imho
The reseller needs the money he makes too. This guy was clearly in a bad situation when he started and being a "wheeler dealer parasite" provided for his family that needed the money.
How is this worse than someone who needs the item getting it for free?
Respectfully, I would encourage you to find someone personally to give your item away to. Craigslist is not a charity, it's a marketplace for people to buy/sell goods. Giving away an item on Craigslist is like throwing bread to ducks at a duck pond. If you indiscriminately throw bread up in the air at a duck pond, would you blame a squirrel for coming by and snatching a bagel every once in a while?
Nobody forced you to give him the stuff. As long as he's not lying about what he does - and we have nothing to indicate that he is - the seller is free to make that decision for themselves.
It's low-end Goldman Sachs market-making. Tinman Sachs, maybe. Not extremenly different from panhandling. It's definitely abusive of the Craigslist community.
Blah blah "price discovery is a service in a free market blah blah" does not apply to Craigslist.
There are a few ways a job like this could be ethical and productive, respecting the hippie community culture of Craigslist but improving efficiency in exchange for a share of the profit, instead of merely siphoning gains out of the system:
* Buy items that fail to sell (perhaps because they are geographically remote), and resell them from a more accessible location. http://craigstruck.com is a variation on this model.
* Buy junk, fix it up, resell it. ("Upcycle"/ "speculative repair work"
* Take good stuff that doesn't sell, and re-market it better.
[0] "spec" is a funny auto-antonym: "Speculative" or "to specifictaion"
For the purchased items I think it's fine, but for the items people are donating, the intent is usually that they be claimed by someone who plans to use them, not someone who plans to flip them. Though it does depend on the item; sometimes people give things away because they just want to get rid of them, especially with hard-to-move things like appliances. You can sometimes tell by the tone of the listing what the intent is, and I suppose it's up to each person's ethics whether they want to respect that.
It's a big controversy in communities like freecycle that attempt to maintain a certain charitable ethos and actively say that flippers aren't welcome, sometimes with exceptions for people who repair things (it's usually considered okay to take something broken free with the intent to repair and sell it, because that isn't pure flipping). Probably less controversial on Craigslist, which is a bit of a free-for-all.
I'm just now leaving an apt and put up stuff on CL. Some of it I'm willing to give for free (donated a bunch to charities, but they won't take everything)
As long as someone takes care of moving out of my place, I'm happy. If it goes to someone like this guy who flips to make a living and support his family, that's cool with me.
I think the point is that Craigslist itself is supposed to connect buyers and sellers, and he's inserting himself aggressively between them for profit, adding no real value.
1) He retakes clear photos of the merch at a variety of angles - something that many craigslist postings lack
2) He himself has a threshold of quality, and inspects the product before picking it up from the original seller - I would much rather trust a guy who buys 10 cordless drills a week on craigslist to know the drill is bad, than relying on my limited knowledge of cordless drills and their common defects.
I'm willing to pay a few extra bucks for his vetting.
What kind of "value" is added that is secret? Don't you think buyers and sellers alike should know up front what they're paying for?
To the seller: I'm going to make probably $100 on this washer in a couple days by Windexing it and taking some good photos. That's your fee for my pickup and selling "service."
To the buyer: I bought this washer a couple days ago for $100 less. That's your fee for my delivery and vetting "service."
As the previous poster observed this is essentially what Goldman-Sachs (and any other investment banker) does. When I squint and ignore scale, I can't see the difference between the two businesses.
Yes, but if you dig a little deeper, this guy is also running a blog. Stories like these raises his blogs profile and if the story gets picked up by a news outlet that can do wonders. With enough following he can write a book, publish articles in news papers or in very extraordinary case start his own reality TV series. History channel runs a popular TV series called American Pickers following two people who go around buying and selling antiques.
Exactly, I'm not worried about raising up more competition. A very successful business owner friend of mine said the same thing to me when I first ran it by him.
I love the blg post. It's very inspirational and I emailed it to a couple of friends that might benefit from it.
Question: What about buying on Craigslist and selling on eBay or other listings? I use both at times and noticed that each tailors certain genres better. Do you do that or have an opinion on that?
> I started the year with almost nothing and ended with a used van, a new utility trailer, less debt, fully paid bills and money left to take the family to Hawaii.
More context. Paid cash for the van and the utility trailer. Paid off a good chunk of debt on top of those big purchases and didn't use credit at all this past year.
Hawaii: We used to live here, and have spent the past few years saving for this trip. We came to see friends that we haven't seen in 4 years. They are meeting two of our children for the first time. Airfare: $400/ticket round trip purchased months ago at the lowest price of the year. Van: Our friends are letting us use their van for free for all 16 days. We are staying at three friends houses while we are here, also free. Our expenses while here are food and gas. Everything else we are doing here is free, surfing, swimming, snorkeling, hiking, going to the lava etc. The entire trip is costing us less than $2,500 for our family of 6 to fly to Hawaii and spend 16 days with our friends. I've saved money money on just about everything. I'm not sure it's possible for this trip to have cost any less than it has. We valued this trip over paying off a chunk of our debt for many reasons. Having money and being debt free is important to us, but recognizing that being debt free is a few more years out, we saved and paid cash for the trip. The rest, sunshine, body boarding and time with friends is worth a lot more to us than the money.
Why should it be your highest priority? As long as you're not in over your head and are paying it off on schedule, all you lose is a little future money to interest payments. If what you get by not paying it off faster is sufficiently valuable to you, it might very well be a good bargain.
I mean, do you really think that as soon as you buy a house (which pretty much anyone not absurdly rich — and many who are — will take on debt to do), you must immediately neglect your family and pursue money at all costs? That hardly seems like a tenable position. People who have grave problems with debt have those problems not because debt is inherently a grave problem, but because they took on debt they couldn't handle.
Your absolutely correct that we all have different perceptions of "extravagance"
I think a vacation to hawaii from portland for a family of four while still in debt is clearly extravagant, and unaffordable. But's thats just my opinion, and I dont expect you, or anyone else, to share it.
Debt shouldn't be seen as ok to have but I think that is sadly how most Americans view it now.
Depends on whether the Portland in question is in Maine or Oregon, and whether the trip was an extravagant package or little more than a cheap-deal flight and minimal accommodations. At a glance http://www.cheapflights.com/flights-to-hawaii/portland-OR/ shows a flight package of $1548 for 4. Camping, hostels, or - here's a thought - Craigslist might open some cheap options.
The problem isn't debt but debts that aren't paid back. Debt itself serves a useful purpose. As long as he's able to service his debts under the terms agreed upon, the rest of his money is his to use as he pleases. I don't think we know enough about his finances, like the cost of the trip, to be able to say that the trip was clearly unaffordable.
If someone pays their debts according to the pre-agreed schedule (e.g. meets the mortgage payment every month), there's absolutely no reason to make moral judgments on how they spend the rest of their cash.
I think you're being a bit harsh and missing something here. Creating a wonderful vacation and memories for your family is priceless. And as seems to be the case, he is paying off his debt on a schedule and is not over his head. I'm pretty happy for him.
It might not be the most logical thing to do, but it's not like it's necessarily an immoral thing to do (as "Let's rephrase your statement: 'Paying back on things you've already purchased...'" implies).
It's one thing if the money is borrowed from a friend or family member (as a charity or with extremely below market interest rates). But the 2.43 trillion dollars of debt that you cite is almost entirely with institutions which make a profit off of debt. [not bashing creditors]
It probably isn't even illogical. He makes money in a way that heavily depends on him--his morale and how much work he is willing to put in. I would not be surprised if going on a vacation actually motivated him enough to be a good deal from even a purely fiscal perspective.
Oh yeah, I can totally see that being the case as well. I almost shared a story in my last comment about a guy I knew who, though constantly struggling to stay afloat (most likely below poverty with a wife and three kids), would do his best to buy something nice for his wife (something small, but thoughtful) and sometimes rent a movie that they could all watch when he got home from work.
My dad pointed out "Your family's wellbeing includes their morale."
Either way, only Ryan (and possibly his accountant [probably his wife]) can make that call.
I have a mortgage, yet go on vacation and buy nice stuff. Debt is OK if used wisely, paid wisely, and does not impose economic jeopardy (i.e.: net assets vs. net debt).
Maybe he was given the trip to Hawaii for free or got it at an amazing deal, plus he said he's doing deals in Hawaii on vacation so he'll probably have a good portion of the trip paid of from his working vacation. Plus you can't measure the boost in happiness and a new perspective of the world that this trip to Hawaii will have on his business.
He might see ideas and get new perspectives on things while on vacation in a new land that he otherwise would not get while at home in work only mentality.
This makes sense to me. I bought a house full of furniture when I moved to North Carolina, all from CraigsList. Two years later I sold those exact items for a $300 profit.
even with electronics built with planned obsolescence in mind, it's doable somehow to fix them. My uncle will fix things like mini-stereos by ordering the parts, something that most people don't think about doing. It's easier to buy a new one.
I find it interesting that you start off the article with a sob story about having no money and end with a vacation to Hawaii a year later. Shouldn't you be saving some of this and investing rather than spewing what would assumably be quite a bit on vaca? I am definitely not stingy and blow my money as I please, by my debts are dropping, investments growing, and I haven't(by choice) brought any hellions into this world to support that will need college tuition soon.
Sorry to be a Debbie downer, but it irks ne to see people who have their long term priorities all out of whack(and they usually have way more kids than they can support)
" I started the year with almost nothing and ended with a used van, a new utility trailer, less debt, fully paid bills and money left to take the family to Hawaii. "
At some point you need to make the decision to actually enjoy life too.
> Sorry to be a Debbie downer, but it irks ne to see people who have their long term priorities all out of whack(and they usually have way more kids than they can support)
Everyone hits tough times sometimes, but this is someone who clearly can support his kids, enough so that he's been able to afford investing in a van, a trailer, pay down his debts, and take the family to Hawaii. In that context this comment just makes you seem like an ass.
Ryan, if you're reading this, congratulations! This appears to be a major personal accomplishment and milestone for you. Best of luck as you grow into your next level of success.