This is the grand finale of posts by guest blogger, Frank Giovinazzi. If you’re interested in writing for SYBO please let me know via email or the contact form. I always pay $10 for a 500 word minimum post that entertains yet educates on the nature of selling books online.
This is a story about how answering a simple Craigslist ad turned into the biggest deal I’ve ever done.
In March of 2010, a fellow placed a Craigslist ad for 275 specialty military books. He was asking top dollar, $275 for the lot and I had to look up the publisher to make sure I wasn’t buying boxes of junk. I didn’t have any experience with the particular line, so I did some research and determined it was okay, if a little high for me. The books were clean and in good shape, and the seller was a good dude. We got along, even if he wouldn’t budge on the price [!], and we had a running conversation about books and publishing, as he is an editor/artist/writer/publisher. He mentioned who he worked for, a known entity, and that there was a possibility the foreign-owned parent company might shut them down after years of losses.
I mentioned at the time that if there were ever books in a warehouse that had to be liquidated, that I would be interested in purchasing some. At the time it was all small ball, and I thought maybe I could get as many as 5,000 new books pretty cheap. The months rolled on and we stayed in intermittent contact. A couple times I checked in to say hello, a couple times I inquired after the status of the company. Like I said, we genuinely got along and I was being more friendly than mercenary. When he finally told me the company was going to close, however, I again made the play for acquiring warehouse inventory. He said he would look into it and I went back to buying and selling.
He got back to me eventually to tell me there were about a quarter million books in a warehouse that had to be liquidated. It took me a second to make the shift before I blurted out, “I can broker that lot, no problem.” As my lips were saying it my brain was countering, ‘that’s a whopper.’ I did have a vague idea about how a deal like that was done but no real experience. More back and forth followed, more buying and selling on my part, with a note from my friend saying that there might be more books involved, because his company handled distribution for other lines, but that he had to check on permissions. “No problem,” I repeated, now thinking about how the hell to actually do it.
More time passes and I buy some books from a guy who tells me he is going to the CIROBE conference. I had a vague notion of that organization, which stand for The Chicago International Remainder & Overstock Book Expo. When my friend gets back to me it’s late October. When I ask him when the books have to be out of the warehouse, he answers, “Thanksgiving.” Okay, I figure, somebody’s got to want a quarter million books in the next three weeks.
“How many books did you wind up with?”, I asked “I’ll send you the list, but it’s about four hundred and twenty-five thousand,” he answers. At this point we hadn’t talked about my compensation, but the atavistic greed organ sure did kick in at this point, even while I was thinking about how to pull this off. This is when I thought about the CIROBE conference and I called my colleague to see if he had a list of exhibitors. “Go to their website,” he said, and I did.
My friend told me I could start soliciting potential buyers and I sent out an email to everyone from the CIROBE list, plus some other players I knew about, mainly job lot chains, and I even dared to send it to a contact I have at Amazon. The first email was exploratory, saying I could return a spreadsheet file to anyone who responded to this initial inquiry. I still didn’t have the spreadsheet file, but with three weeks to move the books figured I should get started.
The email had a subject line announcing 425K books available. When I got the spreadsheet file of publishers and titles, there were 648,328 books on it. I amended subsequent messages and hoped for the best. Most of the people who responded after the first email responded with silence after the second. Not only was the deal extremely short term, there were thousands of books for each title, meaning they couldn’t effectively be sold online. The buyer would have to be able to move them to a brick and mortar chain with hundreds of locations, to spread the quantity around.
In our favor was that these were really good books, brand new, from a reputable company that was being liquidated. I even played as much hardball as I felt was appropriate, by telling people that the seller was willing to pulp the entire lot if a reasonable offer was not received by the deadline. Even though this had about as much credibility as an empty brown bag I used it anyway. After a couple weeks of back and forth, it gets narrowed down to two parties. Along the way I made follow-up phone calls and emails, and got the selling party to agree to a decent sized commission for me if the deal went through. Bear in mind this is November, the first month in my new place, sweating making rent and finding new sources of inventory to keep my retail operation going. I am not sleeping much.
One buyer seems the most serious, and capable of closing, but he needs extra time to move the books and to pay, and at this point I have to walk him to the buyer’s front door and make the introduction so they can hash it out. It’s out of my hands and I go back to hustling boxes of books.
Then the first and second buyer both need samples and I make that happen in concert with my friend at the company and his warehouse manager. More waiting. The first guy is ready to buy but he wants 60 days to pay. Which is kind of funny because since he knows the American division is closing he can theoretically take the books and stiff the German owners with a one-fingered salute.
More back and forth, but on the day he gets the samples he apparently is convinced and makes the deal.
My friend tells me it’s for $100,000, with half due in 30 days and half due in 60. The buyer gets all the books for approximately 15.4 cents each, but that is kind of misleading because they are going to destroy about 200,000 units. And when I say destroy, I mean send to the recycling plant, which pays by the ton. At about a pound a book, that 100 tons of paper, so whatever the recycler pays for that will go into the new owner’s pocket to offset his costs. And with 400,000 books to ship, costs are going to be considerable, given that there are going to be about 20 tractor-trailer loads going out the door.
I sent out the first emails on November 4 and got the word the deal was done on November 30. So I effectively sold 648,328 books in 27 days. It felt good in and of itself, if not quite real because I never saw or put my hands on any of the merchandise. Plus my friend thanked me for making it happen and told me I made him look good with his boss, so there was some real psychic reward there. As far as my commission is concerned, I am still waiting for it as of this writing, but my friend’s boss has promised to pay me out of the first $50,000 received, which is pretty generous considering this is a company that is being liquidated. BTW, the check is for $6,500, so I basically earned a penny a book.
The deal happened so fast nothing was ever put in writing, but I trust the people involved to make good on the payment. The hurry up and make it happen nature of the deal certainly played to my advantage, because if there were a longer timeframe I doubt they would have just given the responsibility to a guy whose total previous experience amounted to selling books out of the basement.
But then again it turns out I wasn’t bluffing when I said, “I can broker that lot, no problem.”