How much should I pay for that?

Seth Godin made the insightful comment that everything you buy, you bought it because you thought it was a bargain. The value you anticipated getting was greater than the cost.

But sometimes it doesn’t work out that way.

So what can you do to minimise the risk of waste?

The most common answer is to reduce the purchase price, either by getting a discount or buying second hand. But that’s just the start. The other part is how much you can get back when you decide to part with the item.

Purchase price - (resale price + selling costs)

For example:

Buy an item for $40, but has no resale value = costs $40

Buy a similar item for $80, but can be resold for $50 = actually costs $30

The key is to know what types of items don’t have great resale value e.g. used shoes. For these things, focusing on lowering the purchase price is a financially wise decision. However, for everything else, resale can offset your initial outlay.

More than that, reselling can assuage the guilt of owning something, realising that it’s not for you, and moving on.

Next time you look to buy something, why not start by having a quick look on eBay / Poshmark / Gumtree / Depop / Fashionphile / The Real Real (i.e. wherever you would look to buy the item second hand) to determine if resale should be factored into the price.

Further reading:

2018 Was The Year Resale Went Mainstream

The Real Real IPO S1 filing