Why Cutting Your Losses Isn’t Always a Bad Idea

6 Minute Read

Time to Cut My Losses?

It was time, finally time to let go of the clutter! I’m referring to my reselling clutter, of course. Making this decision was about as hard as the last subject I wrote about, (Why I Decided to Stop Editing My Photos), but alas, it needed done. I needed to just suck it up and cut my losses.

Month after month items would sit around, taking up precious space that those new, bright and shiny items could be possessing. Therefore, it was time to let go of the excess. When I talk about “my reselling clutter,” I’m simply referring to all of that stale inventory (that I’m sure we all have).

I kept holding on and holding out for someone to come along and offer on these items, or bundle perhaps. But no, there they sat, staring back at me all sad and without a home, through the clear bins they’re stored in.

Sometimes, you just gotta let go of these items and move on!

Dropping A LOT of Prices

This definitely hurt of course, dropping this massive lot of prices. But it needed done, moving stale inventory was now necessary. As of late, the hubs and I have been sourcing more with his extra time off. This means a lot more items, that will of course need a lot more bin space.

My office space is pretty small for being full-time in my opinion, but hopefully it’ll increase whenever we find our forever home someday. *Fingers crossed!* So this means I have yet a smaller space in which to store my bins. This post is mostly referring to Poshmark, since dropping prices is something the platform is pretty pushy about.

I always make sure to offer to likers throughout the day, and try to keep up with doing so every few hours. Although, now and then, I like to price drop a bunch of older items, to try and get them moving. Well, this is exactly what I did this past Sunday…price dropped nearly everything in my Poshmark closet. Oof.

Related: Why I Changed My Mindset About Small Profits

What Was The Outcome?

The outcome? Well, I’ve got mixed feelings about it. This is because most of the items that sold (quite quickly actually) were bundled and were out the door. That was fantastical! I was super happy about moving my stale items, and making space in my bins for newer and more sought after brands/styles.

After over 2 years of reselling, studying, learning, and studying some more, I’ve finally got a grasp on what does a little better than others. This isn’t always the case of course, but for the most part, I’m much better now than when I started out. This usually means I can fetch a higher profit margin on the newer items, and can move them much quicker as well. Win, win.

The downside to doing this massive price drop, was that I had to take a loss on some items. That was a bummer, but that’s also business. This was due to too high of COG, (cost of goods), or too heavy to ship under the 5lb Poshmark $7.11 flat rate. You see, after 5lbs on Poshmark, the price will increase per pound, and maxes out at 10lbs.

Related: 8 Things You Need to Do to Decrease Your Expenses While Increasing Your Profits

*Tip: If you ever encounter a package you need to ship, that weighs over 10lbs, I recommend reaching out to your customer, and kindly asking if they wouldn’t mind splitting it up into two packages instead of one.

Would I Do This Again?

Yes. Most definitely. Cutting your losses is a little painful at times, but I like to look at the whole picture. By doing so, you can gage if this price drop ordeal would be worth it for you and your business, or not. I don’t think I would have done it in the past, not on my whole closet at least. But now that I am further along in my business, I feel as though I can absorb the losses better than I could have before.

I would much rather get these items moved out and into good homes, than have them sitting around in my bins for the next 2 years or whatever it may be. It is always good to keep your inventory flowing and fresh, than stuffy and stale. Don’t get too attached to any item, and don’t hold onto it for too long.

*Tip: Another option is to relist! If you prefer to hang onto the item a little while longer, but maybe it doesn’t have any likes or interest, you can always relist it! (On Poshmark,) you simply copy the listing into a new one, and wa-lah! You’re good to go, and have fresh eyes on your product. Try not to do this unless the items is over 3 months old, this way, it’ll be seen as a new listing to the algorithm, and back up to the top you’ll go!

What Did I Learn?

I learned a lot, actually. One of the things I really am glad to have learned is that I do a much better job nowadays keeping my COG low. I’m really grateful for this, because of two things.

One, I can list my items more affordably, which also results in faster sales. Two, my profit margins usually increase as well. I’ve managed to lower my COG from the start of my reselling journey to now, by about two thirds. That’s a major difference, especially when you’re selling $10 and under items.

Related: 10 Unlikely Places to Source From

The second thing I’d like to mention that I’ve learned, is that doing your research really does pay off. I make sure to go sourcing on sales days instead of regular priced days. I also call ahead to see if there’s any new discounts they may be offering around holidays, etc.

Plus, as I’ve said in previous posts, the more knowledge you have with more items, the more chances you have to snag a really good item out in the wild. Keep your eyes peeled and your reselling brain on top of new trends and styles, and you’ll succeed! You just have to keep moving forward.

Thank You!

A giant thanks to everyone that has supported me this far into my journey! I greatly appreciate you returning to read my posts hope that you will continue to drop by in the future.

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Happy selling friends!

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We have also created a Merch Store that donates 10% of profits to the National Resources Defense Council. If you are interested in helping out to promote Rooted Drawers Stores, please stop by to contribute! Remaining profits will be put towards our ever-growing business and are always genuinely appreciated.

Please feel free to drop any comments below that you would like to add! I am always open to advice, suggestions, or even hearing related stories of your own! I stay as active as possible in the comment section, therefore I will reply to any questions asap.

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My Top Ten Tips to Getting Started on Poshmark!

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