Technical The State of the Union: How to Price Parts in This Crazy Economy; a Moral Dilemma

That can be a tough needle to thread....

 

Fast nickel or a slow dime. I grew up in a family business and it worked out great to have a good assortment of both.

Fast nickel, kept food on the table, lights on, basicly paid the bills. The slow dime paid for all the toys, vacations, basicly the luxury items.

Doing just the fast nickel can burn yourself out, flipping items fast enough to pay bills but you don't get ahead in life this way unless you do a gadzillion items and fatigue takes over. you never have a toy because you need that money now for other things.

Just concentrating on top dollar(slow dime) and then you fall behind on normal expenses because you are waiting for that 1 certain buyer to come thru some day in the future and that is not good especially raising a family.

But when you have a good assortment, selling that fast nickel items keep your bills paid and up to date and then sell that big ticket item, you can use that for other luxury things or like me you can take a few weeks off then and use it to work/play with my own toys before I need to start the process over again.

That said, I still like using auction sites for some items especially with prices being all over the board and list them at a starting price I would be happy at and see if I can score 2 bidders that just have to have that item and turn it into a bigger profit for me. buying storage units, I get plenty of items I am not a master in but I know about how much I have into each item so I can set a starting price that makes me happy from that. is it top dollar? no, but it will be gone and if the right 2 bidders show up and it can be more than what I thought top dollar would have been then.

 

I did read the thread, what it boils down too is your selling rare parts is really no different that the average hamb member selling his left over parts, when you start taking about the state of the economy it comes across as political, which is considered off topic.

I don't have a dog in this fight but my opinion is as valid as any, suffice to say we both have a difference of opinion. HRP

 

Just remember that turning your hobby into your career makes it necessary, and takes a lot of the pleasure out of it.

Devin

 

I’ve not said a thing about politics. Inflation is at a 40 year high, and that’s a fact, and while you can make it political, it also exists as a fact completely independent of politics.

I don’t understand why we have to have a difference of opinion about any of it. I wanted to see where people’s heads were at, given this somewhat unique time in our history. If I had just posted my latest estate sale find and asked what it’s worth, I wouldn’t have really gotten that information. I’m not trying to ruin anybody’s weekend by talking about parts prices on the main page; quite the opposite, in fact. I just don’t understand why you’re bothered by it. Even the mods have agreed that I’m not breaking “the rules”. So what’s up!? You just don’t like me?

 

One more thing about valuing your time, and I know I have posted this before.

Your time is not ever free, and you should never treat it as such. You can make just about more of anything in this world, except time.

Retired guys, this applies to you, too.

If you work, or worked in an established profession, and have any measure of experience, there is an established and expected rate-rate-of-compensation for your time (regionally adjusted, and if you are retired, you should inflation-adjust it).

Presumably you have agreed that 40-hours of your time in any given week are available to your employer, at that rate. That is the discount rate that you allow them, so that they can access your labor/knowledge, and cover their overhead, and maintain a place in which you can work.

After 8-hours, their overhead is covered, and now they lose the discount. That rate switches to 1.5x the discount rate.

After 12-hours, or on the 7th day, that rate switches to 2x the discount rate.

If you are working for yourself, either completely, or after-hours, the value of your time is no less than 1.5x that discount rate.

If your regular employer is going to infringe on your time beyond the discount that you give them to cover their overhead, the get to pay extra. If you no longer work for a regular employer, your time is worth what it takes to cover overhead. You are the business. Never discount your labor, even for yourself.

I hold fast to this, even when I am consulting, which automatically has a higher bill rate, due to the tax ramifications of self-employment.

Now, if you want to volunteer, that's cool. Just find a 501(c)(3) charitable organization, and do it there.

Oh, and there is no bill-rate for spending time with friends and family. Those relationships pay you in something far more important that money.

TL;DR: if you normally get paid $30/hr, and you have a $300 intake manifold (that you got for free, and have no intention of using) that takes you the equivalent of 10-hours to sell, guess what?! You just got paid your regular rate, and cannot get that time back. If that time came at the expense of something more important than money, you lost.

Carefully examine the P+L numbers for any business, and you frequently see items of value written-off and discarded. Why? It is a stop-loss measure. If you are the business, you need to conduct stop-loss measures too.

 

Have sold and given away lots of parts over the years. Have sold a lot on Ebay as well. Now with the new tax implications and Ebay fees it doesn't seem viable any longer. Say I sell an item for $100 then Ebay takes 13% now $87 taxable. Maybe end up with $60 max. Almost not worth the hassle any longer.

 

I can agree with much of what you say, but have to disagree as well
So say I have a part that in good shape is worth $100. Say I paid $60 for that part. Then after work, weekend, “free time” when I could be watching a ballgame, etc and getting nothing done, I dink around with that $60 part I bought to make it a $100 dollar part.
I made $40. Whether it took me an hour or 5 of my time, I wasn’t “wasting free time” watching TV. (BTW, game would be on the radio ).
Now, what I do agree with if you are self employed, even your time away from your shop or business should be compensated if you are doing the same after/off hours.
My dad used to help the neighbors kids out when they were building a
Pulling truck. He did a lot of welding for them. Fast forward 30 years, the one kid had his own welding shop.
I asked him over to see about Tig welding some aluminum for me, “ya, I can do that. I’ll drop a quote off in your mailbox “.
I guess my dad should have charged them back when.

 

If you are operating a hobby, volunteering to work at losing money is perfectly acceptable.

If you are expecting it to be a business, volunteering to work at losing money is how you lose your business.

In my world, if ANYTHING takes me away from my friends and family, it better be mutual-aid of those in need, or it gets billed.

 

That I can see. Guess what I’m really saying is my employer pays me for 40-60 hours of work each week. Anything done while “not on the clock” is a little extra and more productive time as well.
But I see where the OP is coming from as well, he quit a Corporate job, and pretty much (as I can tell) wants to make a go of it himself.

 

In this state of our time's, I have to bill for almost any time, and material. Virtually nothing is free. Maybe that will change?

 

As an example, I’ve a friend coming by next Saturday for me to make him some wood ramps. He doesn’t have a way to haul 8 foot long boards, so I’ll take him to town in my pickup, get boards and deck screws, then we’ll use my tools to put them together. I’m certainly not going to charge for time, gas or tool usage, nor will I ever get it back because basically he has nothing I need, nor anything he can do for me. Just going to help him out.

 

Yep. Good on you to help him. I do the same thing for close friends, just can not at this time for everybody that approaches me. Its a sad state of the world.

 

I’d lend him my skillsaw, but afraid he’d cut a finger off. His job will be to pre drill some holes in them.

 

I sold car parts on ebay for 5 years. I parted out 3 or 4 cars, but the majority was swap meet finds. I was at every swap I could get to and from in the same day. it was a lot of work and I wanted maximum bucks for everything I sold. friends would come by and want deals since I had all this junk just sitting on my shelves, like the junk fairy dropped it off in the middle of the night. I told them to bid on ebay with everyone else as this was the "golden age" of ebay where everything good was a bidding war.

there was no moral dilemma for me. it is hard work getting the good deals, this was my job along with doing some body work as well. giving an off ebay deal is the equivalent of asking someone for 50 - 100 dollars you don't have to pay back just because we were buddies.

one deal I did give was a 32 Ford rear end a guy needed for his car, he bugged me for months. a month later he sold it to someone else at a profit. he at least should have split the $$ with me. I would have sold it piece by piece and made good money.

buying and selling vintage Schwinns and parts now. they take up much less room

 

That's precisely why I still have a full time job. If I have a good week selling, great. If I don't, it's not the end of the world.

 

Maybe move it to a Small Business Forum or Economics 101.

 

I just like tinkering with old things…and good beef/pork BBQ.

 

Maybe it will. But until it does, the bill is the bill.

 

That falls under the category of mutual-aid. In the event that you come to need, you should be able to rely on that person for assistance.

 

He’s younger than me and probably still lift heavy things

 

Keep that guy around!

 

Then and now price comparison on anything from burgers and cokes to Offy intakes has to factor in what an hours worth of work at a specific job would buy you then compared to what that same hour of work will buy you now.

Since I started driving legally in 1962 an hours worth of work at minimum wage has bought right at 3 gallons of gas. It didn't matter if it was the 1.10 I made as a box boy in 1964 at age 18 or what the kid doing the same job at the store in town gets now which is right at 15.00 an hour. Our hour of work buys the same amount of gas at the pump 65 years later.

I bought a gypo Sparko-matic floor shift for my 51 Merc in summer of 1963. Paid 19.00 for it earned at a buck an hour stacking hay. It takes 9.90 of today's dollars to have the buying power of a 1963 dollar so today that 19.95 floor shift would cost me 197.50 but would only take 13 hours of work to buy rather than 20.

 

Believe I'd have to remind the "welder" of your dad's interest in him when the welder was a kid. People forget so easily, don't they?

 

I hold no malice with you, we just don't share the same opinion, I come to the Hamb to absorb the hot rods & customs and escape the day to day insanity or as you put it, economic out look. HRP

 

See, and just like that, I understand where you’re coming from. Well, sorry to wreck your escape. Hopefully not much harm done.

 

Gave a friend a pair of 32 roadster rear fenders as he said he needed them,he sold them the next day and wondered why I wanted nothing to do with him

 

Several years ago there was a NC based smaller hot rod forum on the internet. Don't know if it still exists. Anyway, some guy was asking about finding a banjo rear end. Said he couldn't find anything in his area. His location was about a hundred miles east of me.

Anyway. I messaged him and told him I had a complete one from a 40. Drum to drum, with torque tube and radius rods still intact. Been sitting on some blocks behind a storage building at my parents house since about 1970. Free if you want to come and get it. I'm 5 minutes off of I-40 so it's not like some off road trek up a mountainside to pick it up.

He responds that he's real busy but can get a friend to come pick it up if I can get a couple more guys here to help load it. My immediate thought was Yeah, just hold your breath till that shit happens dickhead. Maybe I should deliver it to you for free and buy you a meal when I get there.

I didn't even respond and ignored further PMs from him, but my attitude is If I offer to give you something, that offer doesn't include free labor from me so you can sit on your ass at home.

 

Your tax math is only correct if you got the item for free. You'll only pay tax on the profit you made. If it's a part you bought years ago for $100 and you are just re-selling it, the tax liability is $0. If you bought it at a swap meet for $40 then the $47 profit is taxable.

And that profit has ALWAYS been due, no laws have changed there, only that eBay and other online selling formats are telling the IRS how much money sellers brought in because it was too easy for dishonest people to avoid the tax. With proper bookkeeping and accounting, the tax implications aren't nearly as bad.