A lot of this may seem obvious to you, but believe it or not there was a time when I was completely oblivious to the practice. I generally don’t condone reselling, because it has affected my ability to buy deal items in the past.
I learned about reselling when I went to a store to buy (1) of an item I saw was on sale in-store only at a great price, only to find that “we had 10 but some guy just bought all of them.”
This year’s Home Depot Black Friday tool deal was a Dewalt 20V Max 9-piece cordless power tool combo kit, for $499.
Now, that same tool kit is a special buy for $699, which is discounted from the “was” price of $899.
Over at Amazon, the same tool kit is currently priced at $1,099 with free Fulfilled by Amazon shipping.
It seems to be that one can make a mighty good profit buying a couple of these kits from Home Depot and selling them on Amazon. That’s why Home Depot often has quantity limits on their tool deals.
I believe I have seen limits of 3 per customer on some tool, and today’s Ryobi nailer deal of the day has a limit of 5 per order.
Over at Amazon, the product description appears to be copy and pasted from Home Depot’s page. It’s the same copy, but there’s a lack of formatting, leading to a long run-on sentence where lines were taken from Home Depot’s list.
If any of these kits are selling at $1,099, that’s a $600 difference. An ambitious reseller could easily get around Home Depot’s quantity limit and buy many multiple kits.
By my estimate, it should cost the seller around $188 or thereabouts in Amazon fulfillment and commission fees to sell this $1100 cordless tool combo kit. If the reseller bought the kits at $499 and sells them at $1099, the bottom-line profit would be a little more than $400.
There are a bunch of ebay and Craigslist listings for the same DCK940D2 combo kit.
This was just one example. You can be that scores of resellers took advantage of Home Depot’s holiday cordless combo kit savings, which is still going on by the way, to buy up some of the most popular cordless kits at deep savings.
The Milwaukee M18 Fuel combo deal is still going on, although the minimum add-on tool price has been bumped up to $59. There are a number of $59, $69, and $79 add-on options for that combo. With the $59 add-on (an M12 vac), the price of the M18 combo and add-on is $399 + $59 – $150 = $308.
Some will go so far to return the add-on, (a practice we don’t condone). The $150 discount is split among both items, which means that $59 item is returnable for around $40. This means a final cost of $268 for the M18 Fuel combo.
I’m sure there are plenty of resellers who can make a good profit by buying a couple of kits at $268 and selling them for between that price and the $400 regular retail price.
Accessories are also being resold by resellers, such as this 8pc Bosch Daredevil set that’s $18 on Amazon. These sets were sold for $10 during the holiday season, and you can still find them for the same price at Home Depot.
You’ll see lots of other accessory sets, such as this Dewalt 135 pc assortment, which is now $39 at Amazon.
Resellers buy up these kits from Home Depot and other resellers in bulk, with coupons or other discounts, and then ship them off to Amazon for reselling.
For reselling to work, a seller often needs higher quantities of product, and that could impact the availability of a deal for everyday customers like you and I.
Resellers minimize their costs, but to maximize profits, they’re not just going to sell 1 of an item, they’re going to buy and try to sell as many as they can.
Resellers have made it impossible for me to find certain deals within a 50+ mile radius, and the same is true elsewhere.
I’m guilty of buying more than my fair share of deal items before (a few years ago I bought several Rayovac camo flashlights to give to friends and family), but I try to be conscious about not overdoing it.
For the next couple of months, resellers will be offloading a lot of their hauls on Amazon, ebay, Craigslist, and elsewhere.
Some tools will be sold at prices higher than you would have paid during the holiday season, others will be sold at lower prices than currently available.
If you spot an appealing deal at any online marketplace, take 5 seconds to see if you can buy the same thing from the direct source for less.