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Side Hustle Series: I Used to Host Estate Sales

by J. Money on Thursday, May 2, 2013

san diego estate sales

(Guest post by Robert Farrington – as part of our Side Hustle Series)

I am a full time manager who is married and expecting his first child this year.  I’ve been building up my side hustles for years, and eventually plan to make the leap to self-employment.  I’ve been side hustling since I was 16, doing all kinds of odd jobs for family and friends. Even before I graduated college, I focused on developing a side income by selling stuff on eBay.

street fighter video gameIt started with me selling my own junk on eBay. When I went to college and moved into my first “real place”, my parents brought over all my kid stuff and said, “here you go”. Well, I didn’t want any of this stuff, but I didn’t want to give it away. So, I took to eBay.

After about a year I’d exhausted all of my own junk to sell, so I started selling other people’s stuff. It started with friends and family, and soon it moved to buying items at estate sales and selling them on eBay. This is when my side hustle income really started increasing, and I was enjoying being able to do this in my spare time.

The Idea for Estate Sales

The more I bought from estate sales, however, the more I started feeling bad…  I felt bad because I felt like I was taking advantage of a situation. I would regularly buy items at estate sales for $1, and then turn around and sell them for $100.

But that gave me an idea – the idea to be different in the estate sale space. What if I could create an estate sale company that not only helped the owner/family maximize their profits, but I got to get “first dibs” on the good stuff and a cut of the profits? I did a bit of homework of local estate sale companies and realized that nobody was really offering this.

Founding San Diego Estate Sales

So, with that goal in mind, I founded San Diego Estate Sales and built a website to be legit. This was really my first foray into building websites, and I have to admit, the website sucked. I built it using a template that had my basic info – I didn’t know anything about SEO, and I didn’t really know what I was doing. I did design my own header though (admire the basics pictured at the top!)

Without even knowing it, there were only about 5 full time estate sale companies in San Diego, and only one other company had the name “San Diego” in their name. So my site ended up ranking very high in search, and I quickly started getting leads for customers.

Running the Estate Sale Business

As the leads started coming in, I had to actually figure out how I was going to do this. So, I started with my first client – and I’ll always remember her because she was selling her mother’s pottery and other miscellaneous items.

I went to her house on a Saturday for a consultation. She had taken home a lot items, but left furniture, a few cabinets full of knick-knacks, most of the kitchen items, and her car.

roseville potteryAs I was digging around, I immediately recognized something from my eBay days – Roseville Pottery (pictured on the right). The lady didn’t even know what it was, but I informed her that a lot of these items would fetch a nice amount if we sold them outside of an estate sale. She took my word for it, and I told her I would be in touch soon.

After figuring out some estimates and the amount of stuff (plus my time), I suggested that we sell the pottery online, and then we host a 2-day estate sale on the following Saturday and Sunday for the other items. I told her we could advertise the car, and if it didn’t sell, I could help her sell it or she could keep it.

She agreed to it, and we were on for our first estate sale.

The Estate Sale Business Model

The basic business model of estate sales is commission based on what is sold. My commission structure was 20% of online sales after fees (so the seller would typically net 60% or so). For physical estate sales, I charged 50% commission, and that included all of my fees.

I also offered a variety of add-on services, like cleanup after the sale. Basically, anything that didn’t sell, we would donate or toss.

Finally depending on the items, other venues would be a better way to sell them. My business model was completely based on getting the highest price – it benefited the seller and me.  As such, I’ve also done consignment (especially for artwork) and auctions (for coins).  Think Heritage and Teletrade (coin collectors will know what this means).

My First Estate Sale

So, for my first estate sale, it was just my wife (at that time she was just my girlfriend), her sister, and me. It was a very small house, and not much to sell, but it was a great starting point.

I learned the key to a great estate sale was advertising – online, Craigslist, and the local paper. While advertising in the newspaper is expensive (upwards of $100), it is totally worth every penny. Also, you need to litter the neighborhood with signs. For our estate sales, we typically had 10+ signs at all major intersections and routes towards the house.

estate sale invoiceOur setup was simple – table by the garage with my wife, who would take diligent notes on what sold and for how much. Her sister would be by the other door, and I would be in the house to answer questions and haggle.

My wife would keep diligent records in Excel on her laptop, which we would turn into an invoice at the end for the seller. We would put as much detail as possible, but for a lot of stuff, it was just a generic title (i.e. tools).

When everything was said and done, we would tally everything up and provide the seller with a detailed receipt and a check for the amount.

In my experience, a typical sale that I hosted would break down as follows:

  • Gross Sales: $5,000 (with $500 to $1,000 coming from online)
  • Fees: $200
  • Advertising Expenses: $250
  • Labor (Wife’s Sister): $200 (I would give her $100 per day, about $10 per hour)
  • Seller Net: $2,400
  • My Net: $1,950

My best year was about three years ago, and saw us net about $10,000 running 5 estate sales.

The Pros and Cons of Estate Sales

old vending machineRunning estate sales was a lot of fun!  As someone who loves going to them, I find that I’m in my element buying and selling, haggling a little, and just talking to people. Plus, you never know what you’re going to find – I’ve encountered just about everything, from rare coins to nasty molded furniture. Given my background, I’m also very frugal, so I like getting a good deal – both when buying and when selling.

Given the market and lack of competition, I think that it’s pretty easy for anyone to get started with estate sales – if you have the time.

And that’s the biggest con – time. Estate sales take time, from finding clients, to putting everything together, to giving up a weekend to do the event. I found that the max I could do was one per month, and even that was pushing it. Working full time and trying to balance this was tough. Plus, I never even got that many going. The most I ever did was five in a year, plus a variety of other selling online or elsewhere.

However, the income for the amount of work, I felt, was pretty decent. To earn the $1,950, I would say that we put in about 50 hours of work between my wife and I, including the day of the event. That’s about $39 per hour, which isn’t too bad. Plus, I considered anything I was able to sell online as a bonus, since the time commitment was less and the reward was a bit higher!

Side Hustles and Estate Sales Today

As I mentioned, the time constraint for doing an estate sale is the biggest drawback and roadblock to getting started, and for us, continuing to do them. I wasn’t able to host a single estate sale last year, and so I finally decided to let my website lapse and fade away. I was getting leads and felt bad not being able to respond to potential clients.

However, it just shows that the market is there. I’m finding that more and more people are searching online for estate sale companies, and yet, many of the “older” estate sale companies haven’t made the move online yet.

It doesn’t mean that I’m out of the side hustle game just yet. In fact, I’m totally about developing multiple income streams, and am working towards a new goal of beating the nine to five by becoming an entrepreneur. I’ve just moved towards activities that require less time, and are more flexible around my schedule. With a baby on the way, you can’t be giving up full weekends for estate sales, even if it is a lot of fun and makes a nice side income.

Are any of you fans of estate sales? Do you ever buy to resell?

————–
Robert Farrington is passionate about helping young adults and college students get started with investing, and blogs about it at thecollegeinvestor.com. He is working on a new project with the goal of moving towards solopreneurship by 30 at his new site, Beat the Nine to Five. Be inspired to develop your side hustles and follow his free Quitters Checklist to start your journey with him!

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{ 26 comments… read them below or add one }

1 Lance @ Money Life and More May 2, 2013 at 7:24 am

I’ve never been to an estate sale… but I have a question since you have so much knowledge on the topic. How do you get the best deals from estate sales? Show up the first day? Show up the last day?

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2 The College Investor May 2, 2013 at 1:08 pm

I’ve gotten the best deals on the last day since the sellers usually negotiate more, but it’s harder because things are more picked over. I’ve also gotten great deals on the first day, but only if the sellers don’t know what they have. Tough call – almost 50/50.

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3 J. Money May 3, 2013 at 2:30 pm

GREAT question and answer! And usually why I won’t go to sales that are on it’s 2nd or 3rd day – all the good stuff is picked over :(

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4 cashRebel May 2, 2013 at 8:25 am

Great guest post! Thanks for laying out exactly how you got your side hustle started. So many people recommend that you get a side hustle for money, but this was the how ti manual I’ve been looking for. It also seems like a really actionable hobby. Just get to know the ins and outdoor and pretty much any one can do it. Cool!

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5 Jacob Erickson May 2, 2013 at 9:47 am

The only estate sale I’ve been to was my Grandpa’s and it was exciting to watch it all take place. I love what you did, but I could see how the time constraint would be tough. Although, I’d take $39 an hour for a side income gig if I could. Hopefully my wife and I can get into going to more estate sales in order to buy for cheap and sell for more. Thanks for the great story!

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6 Skint in the City May 2, 2013 at 10:32 am

Love this idea. I’ve often thought of estate sales as a way to make cash, but they’re not as common here in the UK. Great step-by-step tips though – I’d give it a shot in the future.
And yes, I do buy to resell, all the time. Currently got my eye on a new way to do it: buying up lost luggage: http://skintinthecity.com/buying-lost-luggage/. Ever tried it? I hear it’s bigger news in the USA than in the UK – especially around Alabama!

I agree with you though – it’s always time constraints that limit the potential of side hustles, but the hourly rate you pulled in isn’t bad at all!

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7 The College Investor May 2, 2013 at 1:09 pm

Never tried to buy lost luggage, but that’s been a popular trend lately, with there even being a show about it on TV here in the US.

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8 J. Money May 3, 2013 at 2:31 pm

WHAT REALLY??? I hadn’t heard of this yet – so crazy!!! I wanna try!!! (And SO blogging about this soon – thx guys!)

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9 Nick @ ayoungpro.com May 2, 2013 at 11:49 am

That is really interesting. I’ve always been interested in Estate Sales, but I have never been to one. I think it would be really cool just to see all of the different items that people have!

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10 J. Money May 3, 2013 at 2:34 pm

It’s even more interesting walking through people’s homes like that :) Cool to see what it’s like to live like them.

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11 Cat Alford (@BudgetBlonde) May 2, 2013 at 2:33 pm

Oh my gosh I LOVE estates sales. I went to undergrad and grad school for history and I did a lot of work with antiques so estate sales are totally my jam. Great side hustle, Robert!

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12 J. Money May 3, 2013 at 2:35 pm

Ooooh was part of your assignments/papers/etc based around antiques?? That would be fun!! What type of history?

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13 @debtblag May 2, 2013 at 3:12 pm

Wow. This is definitely unique. I have to say that as exciting as it got, the thing that most piqued my interest was having the first shot at all the stuff :)

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14 J. Money May 3, 2013 at 2:35 pm

Exactly!! I told him I hated him when I found out cuz he’s a coin collector like me and that’s the best thing you can hope for – seeing them first before anyone else :)

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15 Lisa E. May 2, 2013 at 3:28 pm

Great post! Never been to an estate sale, but I’d love to go!

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16 Matt @ My Coin Blog May 2, 2013 at 8:38 pm

I love going to estate sales with the intent of reselling. Great post!

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17 J. Money May 3, 2013 at 2:37 pm

Do you ever find coins at the ones you go to? I do at times, but they’re usually too expensive and/or spot on with prices… which is fine if you’re looking for something specific to fill out a collection and what not, but always so hard to find true *deals* with coins. Theo only times things are super cheap is when the other side doesn’t know what they have! And then you feel too bad cuz you don’t want to rip them off! Haha…

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18 Mike@WeOnlyDoThisOnce May 2, 2013 at 9:55 pm

Brilliant niche market–I’m surprised it’s not more widely practiced. Do you have any competitors!

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19 The College Investor May 3, 2013 at 8:24 am

Yes, there are a few other estate sale companies in my area. However, none of them are online! This is a great example of where businesses need to adapt to the modern Internet era!

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20 J. Money May 3, 2013 at 2:38 pm

I’ve started following some online here in the DC area, but it’s still pretty messy and doesn’t do much other than give you a picture of some of the stuff you’ll see there. You can’t usually buy or anything online :( Would be great to take over the space and just kill it!

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21 Shafi May 2, 2013 at 10:23 pm

About 12 years ago, we wanted to sell our furniture. We advertised it. One consignment store owner came to see it. She advised us to have an estate sale. We did and we sold it for a profit after she got her cut.

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22 Cat May 19, 2013 at 8:21 pm

I’ve been selling my clothes on ebay, which are not high ticket items, and I can’t decide if I am loosing money or making it. On one hand, I am cleaning out the closet, and getting money for things I didn’t want anymore anyway. On the other, I am still buying new stuff! Work outfits, cute shoes, workout clothes, etc. It’s never ending! I guess I try and think of it like I would have been buying the stuff anyway, so why not sell some of the old stuff before it becomes too old that no one wants to buy? It’s a tough one! Interesting side hustle, and interesting start!

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23 J. Money May 20, 2013 at 10:39 pm

Haha… Maybe you could implement a “only spend the money you make off eBay” type deal? that way you have a limit and you know 100% you’re not going over :) (Would also make it challenging but even MORE worth a good deal when you find one!)

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24 Cat May 21, 2013 at 7:47 am

Challenging! And then the shipping costs factor in and everything! :) It’s fun, I should just put a ban on buying things in general for awhile.

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25 linder August 1, 2013 at 8:25 pm

I hope you didn’t let the domain expire. You had a relatively valuable domain and could have sold it for at least a few hundred bucks, perhaps a thousand or more.

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26 Tatiana April 12, 2014 at 10:45 am

Did you need a license or permit to host your estate sales?

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