255. He Built a $10 Million Reselling Business from His Bedroom

0:00Four years ago, Caleb didn't have a warehouse, an app, or half a million in YouTube subscribers. He had a car, a route of 12 pawn shops, and a hunch that video games everyone else had forgotten about were actually worth something. Nobody's making these old games anymore, but hobbyists still wanted them badly. So Caleb started driving from pawn shop to pawn shop, digging through thrift bins one cartridge at a time. That hustle turned into a real business, a private Amazon FBA operation, a buy list program that ships inventory straight to his door, and a$140 ,000 app built specifically for resellers.

0:39I'm Ryan Atkinson and you're listening to HealthFit Podcast, where we interview entrepreneurs to hear their advice on how you can start a business too. I am so excited to welcome Caleb of Quick Flips to the podcast today to talk about all things reselling. So Caleb, thank you so much for being here. This is going to be an awesome topic, so thank you for being here. Yeah, thanks for having me. One take on that intro, by the way, very impressive. I was going through it, but I appreciate that. For someone that's tuning in for Caleb from Quick Flips for the first time, give us a high level. What do you do?

1:04Who are you?

1:05Caleb:Yeah, so I own a video game buyback website called Quick Flips, where we buy people's use unwanted video games and Pokemon cards for fair upfront prices. We pay for them to ship it to us, and then we do whatever is necessary to clean up, refurbish the items, and then sell them either on Amazon as our primary sales channel, but we also have a retail store here in Kentucky and sell a little bit on eBay and TCG player as well. So amazing. And let's talk about the scale of operation. One, how many years have you been doing this? And then two, what do you guys do in monthly revenue? Obviously, you have a lot going on, but monthly revenue all in.

1:41What are you doing?

1:42Caleb:Yeah, monthly revenue these days is around the five to six hundred thousand mark. We're shooting for 10 million by the end of the year. So we definitely need to ramp that up a bit for Q4, but really proud of where it's come. But it didn't start out that way. It started in 2019, just as a little side hustle. I was completely broke and my wife was in law school and was just looking for a way to make some extra money. So what you see now is, you know, the fancier version, there's the website and the, you know, 30 person team and facility, but it started out much more humbly just in my spare room going to yard sales and thrift stores on the weekend, looking up games on my iPhone and trying to flip what I could on eBay or Amazon.

2:25Yeah, well, I do want to start there as well. So that's actually a great tangent and like how you really got started. And so is it you're just broke, like looking for more money? And of course, we're going to dive in how someone else can grow to what you are today. But is that like your story? Is like you're broke, like wanting to make a side hustle?

2:38Caleb:That's right. Yeah, we were living in a one bedroom apartment at the time. And I was working when I started full time at a nonprofit and not making much profit. So I had two people that I was trying to support on one salary. So I was like, I cobbled together 500 bucks of birthday and Christmas money and said, this is going to be my seed capital for this business. One thing that's incredible about reselling for people who have never done it is you can get started for very little money. If you're willing to go to the yard sales, the thrift stores, Goodwill bins is one that people will do. And I end up having a lot of luck specifically at pawn shops because pawn shops tend to have most pawn shops will have at least some video games.

3:23Caleb:Video games have a pretty decent average value, but the average pawn shop doesn't necessarily specialize in video games. So I made a habit of finding the ones that were most underpriced in the pawn shops relative to what they could sell for on Amazon, and then eventually would go to five, 10, 12 pawn shops in a single day in my Prius, just trying to find all the underpriced ones that, you know, cobble together a little side income that way. That's so cool. So the basic of this is like, we're literally just going to pawn shop looking for video games and we're reselling it. That's really what it is.

3:58Caleb:That's right. Amazon is a really good platform to sell video games on because the market price tends to be a little bit higher than eBay or especially like Facebook marketplace. And so I would buy them wherever I could at the lowest price point possible and then sell them on Amazon, which is the way that I knew to get the most for them. I love that. Well, let's dive in for someone that wants to get started. I'm interested in this as well. I played all the Pokemons growing up, the Sapphires, the Emeralds, like I had it on the DS. Like I loved Pokemon growing up. So let's dive into someone, how someone can actually start this.

4:31If someone's starting with a hundred bucks and zero knowledge today, what's like that very first place you tell them to go? Is it the pawn shops and what should they look for?

4:39Caleb:Well, it's interesting because the way that I got started, I actually didn't start doing video games until maybe a year or so in. I actually started primarily with used books. So I would go to book sales. Yeah, I would find them at yard sales if I could. I would email churches and say, hey, if you've got people that are looking to donate books, donate them to me. I'll go through them. You can support a small business. I'll donate what I can't use. And the reason that I did that was because books, even more so than video games have a very low perceived value. So you can very often pick up books for$1, 50 cents, 25 cents a piece.

5:15Caleb:And a lot of them are worth 15, 20,$100 online if you can find the right ones. And so one big thing that I would recommend to people is find categories that are in abundance around you that have a low perceived value and specialize in those. I eventually got into video games, but video games is a category that pretty much everybody loves to flip. So you are going to have to deal with more competition, which is part of why I gravitated towards pawn shops, because I realized a lot of other resellers didn't really love going in. They kind of have a mixed reputation. Sometimes people think they're kind of shady or like, I don't want to go to that part of town.

5:53Caleb:So I took advantage of other people's hesitation and found a way to get a pretty desirable product category more reliably. I love that. So find something with low perceived value. And I'm hearing books. What else falls in that category just to help the listener right now? Like, think about some things they should be looking for. Yeah, some other things that I would do is like used golf clubs. Early on, I did a good bit. They're a little bit harder to ship, but you can very often find them at yard sales for a buck or two apiece. I did a lot of hats. Oftentimes, you can get hats, same price range, people don't really care about them.

6:27Caleb:But especially the vintage ones or the ones with cool sports team designs, often 15, 20, 25 plus dollars on eBay all day long. And they can have a really good sell through rate. If I was getting back into it today, I would focus on something that is maybe a little bit more niche. I've thought about potentially like used electrical components, like all the things that go inside of like a circuit breaker. That's awesome, Caleb. Are they called individual breakers? I don't know, But I'd probably try to find every single electrician in my city, cold email them and say, hey, if you've got any used but working breakers that you've taken out of a residential house and you replace all of them or whatever, I'll pay you for those.

7:09Caleb:Because those tend to be even in used condition worth 20 plus dollars across the board. And if you could find maybe 10 electricians just to give you their unwanted ones for five bucks a piece, like that's a business right there. That is a business. But nobody grows up saying, I really want to flip electrical breakers. I love that. If it's a product category that would sound weird saying it at a dinner party, you're probably onto something. That's really good. Honestly, that's a good insight right there. Let's stick with one product because we're going to kind of go through like the whole life cycle of like buying it, evaluating it, selling it, like kind of shipping it if we can get there.

7:43What's one product you want to focus on for today? We're going to talk about that one. Yeah, let's stick with video games because that's what I know best. All right. So we're going to be flipping video games. So we're going to go to a pawn shop. We're going to actually let's start there. What's the best place to source video games out then?

7:56Caleb:Yeah, I loved pawn shops. It's going to depend a lot on how you're selling. OK, so if you can, I always recommend to people to dabble lightly in a bunch of things early on. Try selling some stuff on Facebook Marketplace. Maybe try signing up to sell at a convention, right, and get like a booth together. If you've got your own collectibles that you want to sell, try selling a little bit on eBay and try. Amazon's a little bit tougher because there are higher barriers to entry with who gets approved to sell games. I know other people that have a lot of success in flea market booths. So identifying where you're selling will help you understand what are the specific kinds of items that sell best for me.

8:37Caleb:So for example, I just did a bulk deal with another reseller. He took all of my broken Guitar Hero guitars. So that was a category that even my repair team didn't really want to deal with. But he found a niche that almost every other video game reseller is like, I don't really care about this. And he'll buy low and sell high from other resellers. So crazy. Because that's what he specializes in. So all that to say, start with where you're going to be selling, understand that customer, and then reverse engineer from there. Are you working a nine to five, but dream of entrepreneurial freedom? Look no further than the Uflip Academy, the number one entrepreneurial platform with 20 plus step-by-step courses taught by active business owners, live workshops, hands-on skill training, a business idea database, and a thriving entrepreneur community to keep you accountable.

9:36Click the link in the description below to join the Uplip Academy today and make this the year you stopped dreaming and started building your business without guesswork. What I'm curious about for this is like, how do you know like what like what you should flip? I mean, you give the guitar hero. I love playing guitar. I was like, I like won a guitar hero. Like, I just have such great memories of playing guitar hero. But like, how do you know like what to flip once you like actually identify it? Like, like, I don't know if I went to a pawn shop just for that example, like how do I know something's going to resell for that value to get what I'm trying to ask there.

10:07Caleb:So the only tool that I walked in there with was my phone. And I'll have the eBay app, the Amazon seller app, both of those you can look up not only what an item is selling for, but also in eBay's case, what it has sold for. So you can sort by completed listings. And you can see this isn't just what some random guy in North Dakota is asking for this copy of say, let's see toy story 2 on the playstation 1 which i've got on my shelf over here that's so cool this is what it's actually sold for and you can see if there's a difference between what it's stickered at in the pawn shop and what it's sold for but here's the crucial difference that i think a lot of people wouldn't necessarily intuitively know i might see okay this toy story 2 is going for 20 bucks and the pawn shop has it stickered at 15 after fees and shipping i'm not gonna make anything right so that's not really interesting except if i can get the price down that's another thing that i love about pawn shops is everything's negotiable and if you can find the categories or the specific products in their shop that they've been sitting on for a long time or if you're willing to buy a lot at once oftentimes the price is very negotiable interesting so i might say hey hey, are there any gains that you guys have here that you're just looking to clear out?

11:28Caleb:And I'll start there. I'll start scanning those gains because I know they're gonna be likely to come down a good bit off of that sticker price. And then I'll take a bunch of those, say they're$10 games, and I'll say, hey, if I bought 10 of these, would you guys be interested in like half off? Suddenly that becomes really interesting because if they're a little bit under eBay and then I get it for half of that, now I can actually make my margin and have a really good deal. And it's a win-win because they're getting to make a large deal at once and clear out a bunch of stuff that's been sitting.

12:00Well, now I'm going to ask the big question. Is there like a target like margin you like shoot for? Because obviously if you buy something for 15, you sell for 20, that's not that enticing. You buy for seven and you sell it for 20. That's a little bit more enticing. Is there like a target like markup or like margin you like shoot for to resell a video game?

12:17Caleb:Yeah, generally I don't like to mess with items if I'm making less than a$10 profit. Okay. Even if I can buy something for a dollar, but it's only worth 10 after fees and shipping, maybe I'm tripling my money and I'm ending up with three bucks, but that's not really worth my time. And I think more resellers should be very cautious about what they're spending their time on, even if the margin can be really good. But on the flip side, if I can buy something reliably for 50 bucks, sell it for 100. And then after fees and shipping, I'm taking away 80, a$30 profit. I'll do that all day. as long as the sell through is pretty quick because that's worth my time.

12:56Caleb:So the margin that I'm willing to take scales as the sell price increases. Does that make sense? Yep, absolutely. Yeah, yeah. I know what you mean on that. So I would encourage people definitely think about not only how many dollars profit can I make in the best case, but also how long is it going to take me in terms of my labor? And also how long is it likely to take to sell? One thing I'm curious about as well here Mike is there a real different like I mean what separates like a five dollar item compared to like a five hundred dollar item like do you see that within the video games or like a game really could sell resell for five hundred dollars absolutely I think the most expensive game I ever sold was a sealed copy of Wolverine on the NES that I had great I don't even know if I know what the NES is yeah the original Nintendo okay okay there we go yeah Sorry, I'm using a little bit of jargon there.

13:49I was scared.

13:49Caleb:I might have just dated myself. Yeah, there was a bit of a boom during COVID in sealed games, especially games that were graded as there was for a ton of stuff. So anyways, I bought this game. Forget this. $1 ,100. I paid$1 ,100 bucks. What? For a sealed because these games are like 35 years old. Yeah. They have that really high level of collectability. And this one was graded similar to you might see like a graded baseball card. if you're familiar with that it's cased in plastic and it's authenticated ended up selling it for $5 ,500 that was to this day my best flip but that you will almost never see but it is very common I've probably got so we have a video game store here in Kentucky and I've probably got 12 maybe a couple dozen games that are worth over$200 wow yeah it's not that hard to find them and what dictates that is the same as in any market.

14:43Caleb:It's the supply versus the demand. So oftentimes there's a confluence of it didn't sell that many copies, but it tends to be very popular with gamers. Okay. So we have bought our first game or he bought it for 50 bucks. We have a chance to resell it for 500, whatever. Where are we putting this out? Are we putting this on Amazon? I kind of knew, I know you already kind of highlighted, but I really want to take people through this journey. We put it on Amazon or we put it on eBay or put it on Facebook. What's the best place for a high markup like this. Yeah, I jumped around a little bit. It's going to depend a good bit on what the game is.

15:15Caleb:That's where it gets a little bit tricky. The platforms that I would recommend the most for beginners would be eBay, just because there's broad appeal. You know what, as I'm saying it, I might honestly recommend Facebook because they just launched a seller portal. I don't know if you've heard about this to start competing more with eBay. So previously, Facebook marketplace has really been known as sort of like Craigslist 2.0. It's local listings. It's a lot of large stuff. It's like sketchy meetups at gas stations, right? It seems like Facebook is going in the direction of making more long distance sales and giving their sellers more support, more tools.

15:55Caleb:And that's very interesting to me because eBay actually has a reputation for being a bit of a dinosaur. They're very slow to adapt. They're slow to change. So I would honestly look very seriously at Facebook Marketplace right now, because if you can establish yourself as a seller somewhat early on in a platform's life cycle, granted, Facebook Marketplace has been around forever, but not really in this form. So I'd consider that very seriously. Also, another trend that is really on the rise is live selling. So platforms like whatnot, like eBay Live, like I don't know if drip is really very active anymore, that might be more of a hard thing.

16:30Caleb:We have at this stage, we're not doing a lot with live selling, but I would not be surprised if we get back into it a good bid because the cash flow is so excellent. The downside, though, is if you're just getting into it and you're auctioning items, there is a higher risk that it might not sell for top of market value. So I wouldn't be surprised if the Facebook marketplace side, eBay is more beginner friendly. If someone is buying, how long should you have? Like, what's the goal? Like, are you trying to resell us within 20 days? Like, what's kind of your KPI there? There's a lot of variability within the category.

17:07Caleb:But one thing that I love about video games is they tend to sell very fast. And if you price them right, almost all of them will sell very fast. So I'll give you an example. Super Smash Bros. Melee on the GameCube has been like a 50 to$55 game, basically for the last like seven years. And if you're highly concerned with cash flow and your sell through rate, you can price it at forty eight dollars and it will sell within probably 20 minutes. So we're talking extremely fast. Now, granted, everybody wants Smash Bros. Melee. If you've got Toy Story two on the PlayStation one, that's a little bit more niche, but still everybody knows it.

17:47Caleb:And if you price this thing at, say, five percent under market, you'll probably sell it within a week tops. And there are, I would say, probably 60 to 70 percent of the video game category is like that. If you price it right, you don't have to price it down all that much to get a very fast sale. Is that kind of the key? Because I also wanted to ask about like pricing. So would you recommend doing like a 5 % discount on like the top price there? Like, how do you price this like strategically? Yeah. So my company is called Quick Flips for a reason. There's a little bit of a debate in the resale world of the quick nickel model versus slow dime, right?

18:24Caleb:Are you churn and burn volume, lower margin, or do you want top dollar for everything and you're willing to wait a little bit longer for it? That's fair. One of my mentors in the space has a really great phrase. He says, I'm happy getting some of the money all the time rather than all the money some of the time. And that's the philosophy that I stick with as well. If I can discount something 5 % and move it twice as fast, that's absolutely worth it because I'm confident that I'm going to get that item again. I have enough confidence in my ability to source more product that I'm not worried. These things are not precious to me, right?

19:03Caleb:I love them and I love being able to do what I do. It's fun being able to, you know, have such a nostalgic career, but I don't have a scarcity mentality of I'm never going to find this thing again. Therefore I have to get a hundred dollars for the hundred dollar game. I'm happy with 95, especially if I'm buying right. And I paid 50, you know what I mean? it's always interesting like what the pricing like how people do that but i love the the nickel and dime speed or whatever that was that's a really good one there so also i know we talked a lot about that we just like quickly took people through like the buying like selling and like how to price there real quick anything with shipping that people should know is there a right way to ship should they cover shipping what are some of your best practices yeah resellers go back and forth all the time free shipping no free shipping like what's better people like free stuff that's not a secret.

19:50Caleb:But the thing is, I think ultimately what matters is your price plus shipping, like people are not stupid, they know how to do basic mental math. And I think it's kind of six one way half a dozen the other it makes you if it makes you sleep better at night, charge shipping, the way that we do it is anything that's under a pound, we offer free shipping, because we know that it's going to be capped at like six bucks is really the most we'll pay even if it's going to Hawaii, because there's a different designation, which is first class mail, anything over that threshold, it's kind of a toss up whether we'll do free shipping.

20:21That's fair. OK, so we talked a lot about video games and we really went through like the quick lifecycle of it. What are the categories is it's working? Obviously, baseball cards like football cards are really hot right now. Are you guys in that space? Would you recommend people start in that space? What does that look like?

20:35Caleb:We're in Pokemon cards. That's a category that I've expanded into only in the last year just because it is really helpful to have some diversification outside of just video games. Video games is, I would say, long term, a sunset industry. We just got news earlier this summer that Sony is shutting down production of physical games for the next generation. There will be no PlayStation 6 discs, which is bad news in 20 years or potentially a lot shorter than that for people like me that own game stores. If for subsequent generations of these consoles, all people can buy from us are the consoles and controllers themselves.

21:14Caleb:There are no games that we could put out on the shelves. Sony will be the only ones that you can buy that from. So for that reason, it's really helpful for us to be in other collectibles categories. And I do recommend that if you want to be in this industry a long time. But as far as what else can this be done with? It's being done with everything. Anything that you can collect, somebody is making a ton of money flipping it as their job. So that's something that I just think is so cool about the world of reselling. and honestly the more niche your interest is you likely will have less competition to deal with so one good thing about the video game store business that i've realized is most other video game stores like they love video games they don't love business that much so we have a really good time like competing with other local and regional chains and i think there could be a very similar dynamic if you are just obsessed with like antique spoons you probably aren't going to have that much competition if you get on whatnot and start flipping antique spoons, right?

22:16Caleb:You might be a category of one or three people. Now, granted, you might not have a lot of people in your shows, so you might have some trouble on the demand side. But I just think one of the biggest things that I say all the time is opportunity is everywhere. Opportunity is everywhere. All kinds of platforms. It's at every yard sale, every thrift store, every pawn shop, every estate sale. America has a stuff problem. So if you can lean into the stuff that you're interested in, or even maybe even the stuff that not only are you not interested in, but a lot of people aren't interested in, right?