Real Profit on Refurbished Units, Unit by Unit

Real profit on a refurbished unit is its sale price, minus the marketplace fee and the label, minus everything that unit cost you: what you paid for it, its share of freight, and the parts and labor that went into it. Work it out per serial number, not per product. Two phones of the same model from the same lot can cost you very different amounts once one of them needs a screen, and a per-product average will tell you both made money when one of them didn't.

Why doesn't an average work for refurbished stock?

New stock is interchangeable: every unit of a SKU cost about the same. Used and refurbished stock isn't. Units from the same lot arrive in different condition, take different repairs and end up in different grades that sell at different prices. Averaging them hides the units that cost more to fix than they sold for, and those are exactly the ones you need to stop buying.

What goes into the cost of one unit?

• Purchase price. What you paid for that unit, or its share of the lot price.
• Freight and landed costs. The lot's inbound shipping, spread across the units.
• Repair. Parts, your technician's time, or the invoice from an outside repair shop, added to the unit that got fixed, not spread across the lot.
• Testing and data wipe, if you pay for it per unit.

Grading doesn't change what a unit cost you; it changes what it sells for. When a unit moves from one grade to another, its cost should move with it, so the grade-B listing carries the real cost of the units in it.

What does that look like on two units?

Two phones of the same model, bought in the same lot at $180 each. One needs nothing, the other needs a $45 screen and $10 of labor and ends up a grade lower. The figures are an invented example, with a 12% marketplace fee standing in for yours.

Averaged across the model, the two units cost $207.50, sold for $295 and made about $43 each. Both look fine. Unit by unit, the repaired one lost money, and the lesson is specific: at that sale price, a cracked screen on this model isn't worth fixing for resale. Part it out, sell it as-is, or bid less for lots with damage.

How do returns change the number?

In our experience refurbished electronics come back more often than new goods, so a sale isn't final until the return window closes. When one comes back, the refund comes off, the label you paid for is gone, and the unit needs testing again. If it goes back on the shelf, its cost returns to stock and it sells again. If it can't, it's a loss at everything you put into it.

Check the serial number on every return. In our experience a different unit coming back in your box is common in this category, and the serial is how you prove it. More in the buyer who refunded 8 orders to one address.

How do I do it by hand?

1. Record the serial number of every unit as you receive it, with its share of the lot cost and freight.
2. Log every repair against the serial: parts, time, outside invoices.
3. When you change a unit's grade, keep the serial and its cost; only the listing changes.
4. When it sells, record the serial on the order and subtract fee, label and the unit's full cost.
5. Review profit by model and by condition when you received it, to decide what to buy and what to fix.

Same method as profit per purchase order, one level deeper: the unit, not the batch.

How Rilk shows it

Rilk tracks cost down to the serial number, from the purchase order it was received on to the order it ships on. Repair cost, whether parts, labor or an outside repair invoice, is added to that specific unit's cost. Moving a unit to a different grade moves it to the right product and keeps its real cost, instead of resetting it to an average.

When it sells, the order's Financial tab shows the sale, marketplace fees, shipping and that unit's cost, and each purchase order has a profit report that includes its repair cost. Full cost tracking and the reports are on Pro and Ultimate, and every account gets one 14-day Pro trial to run them on your own stock.

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