Q&A: Is it getting harder to be a full-time bookseller?

QUESTION: Can a person just starting out in the bookselling field today still make a full-time living at it -- like people used to be able to do about 7 to 10 years ago?

I hear so many booksellers on eBay complaining that books sales are so bad, and that they can't make a living with the new fees. Is your book still congruent for today's seller, or has the market really changed since you wrote it?

ANSWER: I got into online bookselling six and a half years ago, right about the time it got popular. Third-party selling had just been introduced on Amazon, and Half.com was going like gangbusters.

Back then -- and ever since then -- there has been a vocal contingent of sellers who've said, "Things used to be great, and now they're terrible."

Personally, I never felt like there was a gold rush in Internet bookselling. And there's no doubt, things have gotten a lot more competitive. Sometimes I feel like I'm working harder and harder just to keep my head above water.

As far as being able to do it full time, it all depends on whether you have access to plenty of stock at reasonable prices. I'm lucky in that sense because I live near Washington D.C. and there's several libraries within easy driving distance. It's pretty unusual if I can't find two or three good library sales every weekend of the year. I suppose someone who lived in a very rural area without lots of nearby libraries would have it much tougher.

I still think online bookselling is a revolutionary way for an entreprenuer to have a viable home-based business with very low risk. But you have to put a lot of time and labor into this. It's not a get-rich-quick plan. For long periods, I've worked 10 hours a day on this, and I've never netted more than $40,000 a year selling used books. But I would never work 10 hours a day for someone else, so I don't complain about the way things are too much.

Regarding eBay, I prefer selling at fixed prices, so I do about 80 percent of my business on Amazon and the rest on eBay/Half, and I don't auction books anymore. I'm sure it's much harder now to auction common books on eBay for profit than it was five or six years ago because eBay has lost some of its novelty for people -- there are lots of other places to shop online now. (Collectibles are another story. If I specialized in collectibles, 80 percent of my business would probably be from eBay auctions and the other networks.)

Nevertheless, I stay active on eBay/Half.com because I don't want to have all my eggs in one basket. Sales on Amazon have been crummy lately for a variety of reasons, so I've stepped up my activity elsewhere.

And you're right -- I think there was a time when you could sell practically anything on eBay and make great profits. But that was before my time.

What does everyone else think? Is it still possible to make a full-time living as an online bookseller?

Q&A: How often should I reprice my books?

QUESTION: What is the best frequency for repricing? I used to do it every two or three months, then monthly. Now I do it every two weeks, and I still don't know what interval is best. I drop prices just a penny below the lowest matching my condition. What have you found to be the ideal timing?

ANSWER: That's a tough question, and there are countless ways to approach it.

No seller likes to lower their price, but sometimes it's necessary if you realistically expect to make a sale. Sometimes your repricing chores can pay off nicely -- when you find an opportunity to raise your price.

At one point I repriced at least once a day, usually twice. Nowadays I probably reprice once every couple of months. I have never sat down to figure out which is the most profitable. Sometimes I sell my books at a higher price because I haven't chased the price down -- and the market price eventually comes back up to where I've been sitting. On the other hand, sometimes my books become totally worthless -- and maybe I could have gotten a sale, but now I have junk that will never sell.

Sometimes I use automated repricing for books worth less than $10 or $20, but I usually take the time to individually consider price changes for books worth more. The higher the price, the more likely the buyer will consider factors other than price -- like feedback. Especially for these pricier books, you need to go with your gut instinct: Will demand for the book probably rise, or fall?

My hunch is it probably doesn't hurt to lower your price at penny or so at a time to keep your visibility -- as long as it doesn't eat up other time that you could be devoting to getting new stock, etc.

However, by lowering by "a penny or so at a time," I don't think it's smart to use software to lower your price by a pennies several times a day. For example, I was recently watching one book on Marketplace where there is a short supply of used copies, and the book normally sells for around $18. There were two sellers battling to have the lowest price. They were lowering their price by 6 cents each time -- every several minutes! It had to be automated repricing. The point is, over the course of an afternoon they chased the price down almost $3 until one of the copies sold. The price went right back up, so one of those seller left $3 on the table. That's just one example I happened to see with my own eyes. I'm sure there's lots of cases where automated price-cutting is leaving a ton of money on the table for some sellers.

Does anyone else care to share their strategy on optimal repricing?

Q&A: Should I ignore books that sell online for less than $10?

QUESTION: My business model is simply to avoid buying books that sell for less than $10. Though this has worked well for me and I'm bringing in a steady income, I wonder if I'm missing out on some profit.

I've considered lowering my minimum price to $5 or $6. But even assuming I'm only paying about $1 per book, I wonder if this is worth the time and effort. I don't want to invest hundreds of dollars only to make a small return. However, I have plenty of storage space and time to work on my business.

ANSWER: I agree in principle with your notion of ignoring books worth less than $10, but I think you've set the bar a bit too high. Lots of people would probably disagree with me, but...

I think you should experiment with making your cutoff $6 or $7 instead of $10.

Here's the way I look at it: Say I'm at a library sale, and I spend 30 minutes there. I find five books worth an average of $20 apiece. All of the books are priced at around $1 or $2, so of course I snap up those gems in a heartbeat. Assuming I sell them all for about $20 apiece, I've earned a profit of about $100. Not bad.

And, let's say, at the same sale I come across another 10 books worth an average of $6 apiece. Let's say I'm buying those for $1 apiece, so assuming I sell them all, my profit margin (before listing fees or commissions) is $5 apiece. So, I've picked up an additional $50 worth of stock. I'm going to end up with 50 percent more profit without much more time or expense -- my time spent traveling to the sale and the transportation costs were spent already.

So I'm willing to snag those "commodity" books when that's the best option I see. And this gets to the real weakness of selling used books online as a business: The supply is finite -- there's only a certain amount of opportunity. Online bookselling is not something to get rich at, but the other side of the coin is, it's extremely low-risk and easy to start on a dime.

If you were willing to go to the trouble, you could analyze exactly how profitable this part of your business (lower priced commodity books) is for you. I've done this several times myself to judge how profitable certain inventory sources were for me, although I've never done it to analyze the effects of selling price alone. My tracking mechanism is to assign an SKU suffix to all the books in the category I'm considering. For example, I'll add an X to the end of all the SKUs for the category of books I want to track, so their SKUs are 1X, 2X, 3X, etc. Then when I want to run the numbers, I search for sales containing that SKU suffix and compare the sum of the sales to how much cash I've spent acquiring those books. How do I determine success or failure? Generally, I want to double my cash within a certain number of weeks.

Having said all this, these days I am ruthless about getting rid of low-value books that don't sell after a couple of years, and that adds considerably to the labor involved in this. Also, I've raised my bar considerably since I started selling six years ago. I remember when I'd be tickled to death to sell a book for $6.