7 Things You Need to Take Your Flipping Business to the Next Level

When Dawn and I started reselling we did things very informally:

  1. Go to the store
  2. Buy a few items
  3. Take some pictures and create some listings
  4. Put the items away
  5. Pull the items out to answer any questions about measurements or condition
  6. Package and print a shipping label once an item sells

It definitely wasn’t the most efficient process, but we didn’t have a ton of inventory. With maybe 20-40 items in stock and listed at any given time, we didn’t need to invest in infrastructure or look for better processes.

But as our respective inventories grew, so did the amount of work. It wasn’t long before the flaws in our process started to become apparent.

We were spending too much time trying to answer product questions that we could have just addressed when first creating our listings. Once items sold, we were spending more time trying to locate them. And with higher sales volumes, finding packaging materials on the fly was proving to be both challenging and expensive. The new stresses made doing the work less enjoyable. All of that compounded, and before we knew it we were building a backlog of inventory that hadn’t even been listed.

We had two choices:

  1. Stop acquiring new inventory and keep things small
  2. Scale up with better processes and improved efficiency

The first choice wasn’t an option. We had lofty goals, and the only way we were going to achieve them was to re-evaluate our processes and invest in our businesses.

These are the 7 things that have taken our flipping businesses to the next level:

1. Additional storage

When we moved in to our current apartment, we didn’t have an online reselling business with inventory we need to store. When our operations were smaller, we could just tuck the clothes we were selling in a corner of the closet, on a shelf, or under a table (for shoes and bags at least).

As things grew we really ran out of space. Before we knew it we had piles of clothes on chairs or on the couch — they were taking over our lives!

Admittedly, we live in small apartment. It’s only 550 square feet, and there’s two of us crammed in there. But chances are you don’t have a ton of space sitting completely unused in your home. You may be able to go longer without the need for additional storage, but at some volume of inventory you probably will.

Reminder: I always advocate looking for great second-hand deals on Craigslist, OfferUp, or in your local thrift stores. See what’s out there!

If you’re looking for new products, these are some of the specific items I like:

KC Store Fixtures 04120 Mini Grid Clothes Organizer, 3-Foot by 4-Foot, Black

Cost: $65.99

With 12 14″ x 14″ cubes, you can store 16.3 square feet and 19.0 cubic feet of inventory. Just as important, the 12 separate cubed units allow you to compartmentalize your inventory, which is a huge, huge bonus. It’s a top-ranked item on Amazon with a 4.3-star rating. The primary complaint is that assembly can be a pain, but once it’s together it’s pretty much the ideal item.


Safstar Portable Clothes Wardrobe Garment Rack Home Closet Hanger Storage Organizer

Cost: $57.86

While similar in overall shape to the cubed unit above, this unit is better suited for hanging clothing. It can support up to 70 pounds of load, which is a fair amount of clothing (as anyone who’s ever stuffed a 50-pound-max checked bag for a flight can attest). Again, assembly will be a little bit of a pain, but for its overall strength and utility will be hard to beat.


Rubbermaid 1785784 Clear Roughneck Storage Tote Box, 50-Quart, Pack of 5

Cost: $61.99

Of course, you may not need (or want!) any fancy assembly-required storage racks or shelving units. Sometimes a good ol’ Rubbermaid tub will do. This five-pack of 50-quart tubs equates to 8.5 cubic feet of storage space.

2. Shipping scale

Owning a shipping scale has changed my life. Seriously. I can’t even remember how I functioned before knowing how much my items weighed. How did I ever ship anything?!

The benefits of a scale are twofold:

  1. Time savings by immediately knowing which type of shipping you need to buy
  2. Cost savings by buying exactly as much shipping as you need

When selling clothing, it’s almost always more cost-effective to select the ship-it-yourself option whenever you have the chance. And when you buy postage through eBay or PayPal, it’s incredibly important to know how much the package you’re shipping weighs.

Consider these shipping costs through eBay and PayPal:

  • USPS First Class shipping up to 8 ounces for $2.60
  • USPS First Class shipping from 9-16 ounces for $3.30 to $3.65
  • USPS Priority Flat Rate Envelope for anything over 16 ounces (and will fit) for $5.75

If you’re holding a packaged pair of pants and trying to guess whether it’s 15 ounces or over a pound. You’re probably going to bite the bullet and pay for the $5.75 Flat Rate Envelope. But what if that item could have been shipped for the $3.65 First Class rate?

Well, for pants that sold for $30, that $2.10 difference equates to 7% of the total sale price lost to unneeded shipping. With most sites taking 10% commission or more, plus PayPal taking 2.9% + $0.30 (not to mention the cost of packaging materials and other necessities), every little bit matters.

The scale we have only cost us $30. If it helps with just 15 of those borderline one-pound items (and it has) then it’s already paid for itself.

If you’re interested in adding a scale to your resale toolkit, I strongly recommend you go with the Smart Weight Digital Postal Scale (pictured here). It has a 100-pound capacity, measures in 2-ounce increments, and comes with a 4.6-star rating. It’s been incredibly reliable, and even with our borderline 8- and 16-ounce packages we’ve never had anything returned due to insufficient postage.

3. Measuring tape

You probably have one of these lying around the house. If you don’t, just go get one. One of the most important things you can do when listing items is to provide accurate and complete measurements for your customers. They can’t try your item on, so help them feel comfortable it’s the right item for them.

4. Packaging tape — lots of it

Dawn and I currently go through 8-10 rolls of Scotch brand packaging tape per month. At around $3.50 per roll at our local grocery store, that’s around $30 of tape per month!

This is where Amazon Subscribe & Save comes in handy. If you’re not familiar with it, here’s the quick and dirty:

  • Subscribe to an item and have it shipped to you at whatever frequency you choose
  • Save 15% by subscribing to five or more items

So you get a discount for buying bulk packages of tape, you potentially get another discount for subscribing to multiple items, and your item is shipped to you completely hassle-free.

We have a monthly subscription to six-packs of Scotch Heavy Duty Packaging Tape for just $11.08 per month (including our 15% discount!) and we make sure to keep at least two of these six-packs in stock at all times. This is great, reliable tape but the drawback is it makes an unsettling, noisy, ripping sound when you’re using it.

(Did I just review packaging tape?)

5. Brown paper

For items under one pound that you want to ship using USPS First Class postage, you’re going to have to find something to wrap them in. Brown paper is my material of choice.

Because I’m very protective of my profit margin, I do everything I can to keep costs down. That means my favorite type of packaging material is the free kind, and my favorite source of free brown paper is my local grocery store.

Every time we go to the grocery store, we make sure to get our groceries double-bagged in brown paper bags. Once our groceries are unpacked, we store the paper bags away to eventually be turned into packaging material for our First Class sales.

I’ve shipped hundreds of items in re-used brown paper bags, many of which have the grocery store’s logo on them. To date, not a single person has messaged me complaining. I have 100% positive feedback on all of my reselling accounts and have never paid for packing materials that aren’t tape, printer paper, or ink.

Of course, if you’re not as cheap as me or don’t have as much access to brown paper bags, rolls of brown packaging paper aren’t that expensive.

Pro tip: If you get the six-pack of packing tape linked to above, you can save the boxes they’re sealed in and use those to ship an item. I once took two of those tape boxes and combined them to create a single box in which I shipped a baseball cap. Nothing goes to waste!

6. Inventory & sales tracking system

In my day job as a business analyst for a health system, I spend a lot of time working with data. One of the things my co-workers and I frequently say is, “garbage in, garbage out.” That roughly translates to mean, “how the heck are we supposed to make good business decisions when the data we’re using to make those decisions isn’t accurate or complete?”

The problem I run into at work is that the data I used is massive and comes from myriad sources and is managed and logged by thousands of people. The good news is the only person you need to rely on for good data is yourself!

Do yourself a favor and keep meticulous records. Even if you’re a computer novice, it doesn’t take that long to open up Microsoft Excel and enter an item description in column A, the cost of the item in column B, how much you sold it for in column C, and any shipping or fee details in column D. Is it the most comprehensive, beautiful inventory and sales tracking system ever designed? No. But it’s far better than buying stuff, listing it, selling it, shipping it, and forgetting about it.

If you’re flipping items as a part-time hobby just for a little extra cash, you’re probably OK not doing much tracking. If you have any aspirations of having a reliable second source of income, you need to keep some records. If you can’t tell me exactly how much you made on every item, you’re more vulnerable than you should be. Even that simple, four-column Excel file will get you on the right track!

Why is it important to keep complete, accurate records? I can think of a few reasons:

  • Are you making more selling on one site over another?
  • Is one brand of clothing more profitable than another?
  • What’s your return on investment (ROI) from items bought at garage sales vs. items bought at thrift stores vs. items bought on Craigslist?
  • On average, how much money do you make per item?
  • If your goal is to make [insert amount], how many items do you need to sell per day, week, or month?

Those are all crucial business questions, and that’s only the tip of the iceberg. I completely understand that this part of flipping items is often the most daunting for people, but it doesn’t have to be. You can learn how to answer all of those questions (and I want to help you!) but in the meantime you have to be keeping the proper records so that when you do learn how to answer those questions, you can look back at your numbers to do so.

Garbage in, garbage out. If your record keeping is good, your answers to those questions above will be good too!

7. Dedicated bank account

Compared to the other six tips above, this one could most accurately be categorized as “personal preference,” but I wouldn’t do it any other way.

When I got serious about my reselling, I decided I wanted to keep all of my flipping finances separate from the rest of my finances. I flip clothing and other goods to pay down debt, pay for vacations, and save for my future. I find it easier to focus on those things and track my progress by having a dedicated bank account that I only use for flipping. This means all money I use to acquire new inventory comes out of this account, all revenue generated from sales goes into this account, and all fees and related expenses are paid out of this account.

Doing this helps me answer the big question looming over everything I do: how much money am I making?

Of course, having an inventory and sales tracking system helps answer that question, too, but I’ve taken this extra step to protect my business (especially when the IRS comes calling). After all, how hard is it set up my direct deposits and payments to this account versus another and to make all of my purchases with this debit card instead of another? For the peace of mind and ease of accounting this provides me, not hard at all.

Disclaimer: Debt Free Dawn is an Amazon affiliate and makes a commission off all sales resulting from the product links above. If you want to purchase those items but don’t want us to get any credit, feel free to go to Amazon and search for the items directly.

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Bryan

Thanks for reading! In my full-time job as a Business Analyst for a health system, I apply analytical rigor to everyday business questions. My goal at Debt Free Dawn is to bring some of that rigor to the business of online resale but to do so in a fun and understandable way. Please ask me anything as I love to chat with fellow flippers!

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4 Comments

  1. Tinkerbell

    Awesome..I will be setting up my business soon using your tips!

  2. Julianne

    Great! I never thought about the brown bags from the store that’s an awesome idea!

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