Today I’ve asked my friend Lynn Rafter to tell us about scouting at Target. You may have read part of her story in my book. I never thought of Target as a great outlet for inventory until Lynn introduced me to some hot toy deals this past holiday season. Even though the season has passed, she still sells a lot of Target merchandise every week. She uses FBA Scout on her Android phone to help her find the most profitable deals. She sells new items exclusively.
Hi there, I wanted to give you all a few tips and ideas on how to pull profit out of a Target, or any big-box retailer. Even though there may not be tremendous sales going on (just wait until November!) there’s always profit to be made shopping at these stores.
Before you go, don’t forget your Target credit card, which gives you 5% off all purchases. Bring your sales tax ID #, and coupons, too. Target has coupons on Target.com, and they take manufacturers’ coupons.
I buy toys, video games and small house ware items. I mostly sell toys because I LOVE TOYS! I can spend hours analyzing the toy section of a store (just ask my family), learning about the merchandise and figuring out what is a hot seller.
One reason I shop Target is because they focus on HOT SELLING ITEMS! They have limited shelf space and will quickly dump items that don’t sell well. Go ahead and scan almost any item, and you will see that it ranks high on Amazon. Your job is to find the item that will bring you the maximum amount of profit, regardless of whether it is on clearance, been discounted or is selling for full price.
When I shop Target, I start in the electronics section. I hit all of the clearance areas, and each Target usually has an electronics clearance section located one or two aisles away. Scan ALL the items marked clearance; you will be surprised at what sells at Target for $14.95 may be selling on Amazon for $65.
While I’m in this section, I will scan the merchandise for new items. Many times Target carries items before Amazon, and you can make a nice profit scooping up a few games or electronics for full price that are selling for 3X−4X that on Amazon. Be cautious though. I usually don’t send up more than three of any item if I am unsure of whether it will sell or not.
Next, I head into Toys. Target usually has multiple clearance toy sections and will have good discounts on toys throughout the department. I have shopped Target so many times I am immediately aware of new merchandise and always scan new items to see what they are retailing for on Amazon. Again, new items at Target may not be available on Amazon, so you could make a nice profit before Amazon gets a chance to sell it at a lower price. Again, don’t be put off by the retail price. You never know!
If you find an item at Target that is on clearance and will make a nice profit for you, check out the other Targets in your area, as they usually have the same items on clearance. Be aware though, one Target may list a video game on clearance for $4.95 and another Target will clearance the same game for $14.95. Even though all Targets carry roughly the same items, they set different prices based on the store location.
Double-check all prices before purchasing, and don’t feel too bad about returning items that don’t fit your margins; Target has a great return policy. You can even return items without a receipt if you have the credit card with which you purchased it.
One thing you should look for is the “Only at Target” sticker. Items with this sticker are exclusives and not available to be purchased by Amazon. They are usually only sold by FBA sellers on Amazon for a nice margin. You can do this too!
If you find something that you’d like to sell, please do not get into a “race to the bottom” price war with other FBA sellers. Know what you need to price your item at to get the return you need. With Target exclusives, there is no reason to go nuts – your units will sell because there are no others. Amazon won’t come in and compete with you; you are only cutting your own prices for no reason. This “race to the bottom” strategy hurts all FBA sellers, and customers come to expect everything to sell cheaply no matter what – it is no way to run a successful business, believe me!
Stick to Brands
Another bit of advice that I follow is to stick to name-brand items. Target and other stores carry items that are “private label,” meaning that Target has developed this product to be sold only at their stores. Wal-Mart does this a lot, too. Although less expensive than its national brand version, it will have a generic name and label. Think “Thomas the Tank Engine,” a name-brand item, vs. something like “Toot Toot Train,” a name that means nothing to most Amazon customers. The generic version is cute in the store, but Amazon customers won’t buy it.
Trust Your Instincts
I will spend the rest of my scouting trip looking at baby items and small house ware items. I look for anything that has a recognizable face (Elmo, Hello Kitty, Sponge Bob, etc), is on clearance, or just seems to be wrongly priced. After a while, you will be able to guesstimate in your head what you think an item should be selling for, so if you see an electronic baby toy that retails for $7.95 and you think would sell for much higher, go ahead and scan it. Odds are you’re right! Target carries many baby “must-haves” that are “luxury” items, at a low price.
Amazon customers don’t shop at Target as much as I do, and are happy to pay a higher price for the convenience and great service from Amazon.
Hope this helps you navigate around Target more efficiently. Have fun and make money
How about you? Do you have insider Target tips to share or fun experiences scouting? Please post them!