Aiming for Efficiency in Selling Cards
Historically, I've been pretty precious about my margins when selling cards, but I'm starting to lean more and more towards maximizing for efficiency.
I don’t consider myself a card “flipper”, nor an “investor”. But I do like to make a little money on the hobby I enjoy so much. I have a lot of fun buying cards, grading them and selling them. Some of that money goes towards fun things like building my personal collection. Some of that money goes towards things my family needs. And a good chunk goes towards buying the next batch of cards.
When I first started doing this, I was very precious about my margins. I still am to some point. It’s painful to look at a card and see that you took a loss on it. And it’s always so tempting to hold onto a card that you think may go up in the future.
But profit today is better than maybe profit tomorrow and there are so many hobby stories of folks left holding the bag on cards that they held onto too long. I personally have definitely seem margins dip, particularly when a card doesn’t sell before the post-release hype cycle dips.
So I’ve been trying to talk myself into being a little less precious about my margins and work more on the efficiency of moving my inventory.
I built a simple (and free) little “Now or Later” calculator for whuppit to help me (and hopefully others) make some better decisions there.
I figured a specific example might help, so let’s use one that I literally sold this week.
Now or Later, JuJu Watkins Inception Auto
JuJu Watkins is the real deal. Last year, as a freshman, she was second in the nation (behind only Caitlin) with 27.1 points per game and set the all-time record for most points by a freshman with 920 (yes, even more than Clark had in her freshman year). In this year’s opener, she dropped 27 points, 20 rebounds, 4 assists, 3 steals and 5 (!!) blocks. She’s a baller.
I had a PSA 10 2022 Bowman U Inception Autograph of JuJu that I had listed for $475 or best offer. I’ve had a few lower offers that I turned down, but just got an offer for $420 which is right in line with the last few sales.
I was really tempted to hold. The margin on the sale would be nice as it is, but barring injury, there’s virtually no way this card doesn’t go up substantially as the season goes along. The only question is how long would I have to hold?
So, I ran the numbers to see how much I was potentially risking by holding out for a higher offer.
I ran two scenario’s:
A conservative scenario based on a 10 week buy/sell cycle (I’ve had the card for 8 weeks, so adding some buffer to acknowledge it might take longer next time), and 20% margin with each round (my lifetime is ~30%, and this card itself is around 90% so this is pretty low)
A more aggressive scenario based on the same buy/sell cycle, but bumping the per round margin to 50% to account for being more aggressive about getting more of her stuff in particular.
Scenario 1: Being conservative
For the first scenario, I used a 10 week buy/sell cycle (it’s been 8 weeks since I purchased this card, so 10 weeks would allow for slower cycles in the future) and a 20% margin on each subsequent cycle (my lifetime is ~30%, so this is pretty low).
The initial profit is around $200 (93%), so the calculator uses that as the starting point. Every 10 weeks, it adds another 20%, but it also tries to account for the head start you would get selling today by providing a portion of that margin during each projected month.
So in the conservative scenario, if I held out for another month before selling, I would need to sell for ~$450 (an increase of 8%) to match where I would be if I sold today for less. If I waited 2 months, I’d have to sell for $487. I think those are actually possible outcomes, but still, it’s hard to bank on a 8% increase in a card’s value month over month.
Scenario 2: Being aggressive
The first scenario was super conservative, so I wanted a more aggressive scenario to compare against.
This time, I used the same sales cycle of 10 weeks, but I bumped the per round margin to 50%. I’ve often told folks that with players/cards I believe in, I try to remember that if I sell today for profit, I can directly put that into more cards of that same player. So in this scenario, I was imagining just putting this directly back into more JuJu autographs.
Even 50% here might be conservative, as my initial margin is around 93%. But I wanted to play it safe on the chance that some of these cards may not gem, or if her cards do dip for any reason.
Under a more aggressive scenario, the decision as to whether to sell now or hold for later became even more clear. If I think I can get 50% or so on each cycle (which is very achievable for this card), then even waiting just a single month would require a 20% increase in the value of the card to make holding worthwhile.
The decision…
So, long story short, I accepted the offer and immediately went out and bought one more Inception auto, and made an offer on another. I think there’s a lot of upside on this card, but in this case, it’s probably going to be easier to grow that profit by buying more than it is by waiting for a better price later.
I’m not saying I’m completely sold on being less precious about my margins yet—I need to play around with this more. I also need to get over the emotional/irrational part of me that gets involved, but I’m going to start using this little calculator to try to make my decisions going forward a bit more rational and rooted in data.