What is YOUR pricing and buying formula
I started eBay 8 years ago and when someone on Youtube told me about the power of "sell-through rate" my selling performance really took off. I simply took the 90-day's worth of sold data and divided it by the currently active. I would base my buying decisions and pricing on this. For buying, I would stick to buying only things above 70% sell-through. As for pricing, I would price in the middle of solds (sorted by highest to lowest price) if it were 70% STR, and towards the top if above 100% STR. A method like this still works great today.
The problem with that method though is that you miss a lot of things that actually would sell well. There is a particular brand of women's tops that does very well. I have about 30 sold in the last 2 years, at an average sale price of $15, and the average days til sold of 90. For this brand, if you do the sell-through rate method as I described above, you only get 20%. By my old method, I would pass on this item. Thus, passing up opportunity.
I am trying to figure out a new method.
I've been doing a lot of Product Research (formerly Terapeak). I've been trying to see if the sell-through rate stat it reports is of any use. I was thinking I was on to something but then I tested some other brands and they don't seem to fit the pattern I thought I found. A few observations though:
- Many low performing items have sell-through rates of 10% and lower.
- Many mid performing items have sell-through rates of 15% +- 5%.
- Many high performing items have sell-through rates of 20% and up.
- The sell-through rate formula they use is different than the method I mentioned above
- The Product Research sell-through rate formula is Sold / (Sold + Unsold + Active).
- That formula will never return a number higher than 100%.
dbfolks166mt
·1 year agoYou have nothing listed on this account so I am assuming it is a posting account, which there is nothing wrong with, but not really much advice to offer since I have no idea what you are selling. I put little stock in the flow thru metric I am not that big of a seller and there are way to many factors that can impact the rate especially if you are looking at it from a single optic rather than an industry perspective.
uniquebarginss
·1 year agoIt’s great that you’re revisiting your strategy and adapting it based on insights from tools like Product Research. The discrepancy between your traditional sell-through rate calculation and eBay’s formula reflects different perspectives on market performance. Here are some considerations and tips as you refine your approach:
Understand the Different STR Formulas
Your original method (sold divided by active) provides a clear snapshot of current competition versus demand, which is excellent for real-time decision-making. eBay’s formula, which divides sold by (sold + unsold + active), accounts for a broader historical context, which can be helpful for assessing market saturation and longer-term viability.
Identify Niche Opportunities
The example of the women’s tops highlights the importance of looking beyond STR for specific categories. If an item has consistent sales over time (even with a low STR), it could still be worth sourcing, especially if the average days-to-sell and profitability are acceptable.
Incorporate Additional Metrics
Consider blending STR with other factors to make a more nuanced decision:
Average Days to Sell: Helps you understand how quickly your investment turns into profit.
Profit Margins: A low STR item with high margins might still be a good buy.
Price Consistency: Stable prices over time suggest reliable demand.
Segment by Category or Brand
Certain items or brands behave differently in the marketplace. You might develop unique thresholds for STR or other metrics depending on the category. For example, women’s tops may have a lower STR threshold compared to electronics or collectibles.
Weight Historical Sales Data
Incorporate historical sales data to adjust for seasonality or long-tail opportunities. Items with sporadic but high-value sales could skew your traditional STR calculations but might be worth listing if storage costs are minimal.
Test and Iterate
Use small test batches to see how new metrics influence your buying and pricing decisions. For example, if a low-STR item sells reliably within 90 days at a decent margin, consider expanding your stock in that niche.
Balance Speed with Profit
Your original method focused on faster-selling items, which is ideal for turnover. If you’re expanding into categories with slower sell-through rates, ensure the pricing and profit margins justify the longer wait.
By combining the insights from Product Research with your historical STR strategy, you can develop a more flexible, category-specific approach that captures hidden opportunities without straying too far from your core efficiency principles. Let me know if you'd like help formulating a detailed decision-making framework!
chapeau-noir
·1 year agoI use sell-through rates, too, but what they pertain to is always changing (I sell mostly pre-owned clothing, media and computer peripherals so have to stay agile). It has worked quite well as long as I stay on top of things - I've never thought of using any other method (I've never thought about it much at all, actually), so curious to read other posts.
stainlessenginecovers
·1 year agoUsing 'sell through' rate is absurd.
Because what may sell good at first, or today, more than likely won't tomorrow (people get bored, fashions move quickly)
Watching videos on youtube about selling/making money- is absurd.
People make videos to get likes so they tell you all sorts of things just to get you to do just that.
As @biggymoe stated- by low (really REALLY low) and sell high. Also, know what ALL your selling costs are (fees, shipping, shipping materials, taxes on profits) to figure out what you are REALLY making.
inhawaii
·1 year agoMy pricing is not set in stone but I price/sell things to that after all fees and expenses, I need to double my money.
That's 100% profit.
Some of my items a little less.
Some of my items a little more.
Some of my items way more. 😉
biggymoe
·1 year agoI use the old reliable, buy low, sell high.