Start by separating revenue from profit
If you buy an item for £10 and sell it for £30, your revenue is £30. The £20 difference is only a simple gross difference before any other direct costs.
Depending on the sale, you may also have marketplace charges, optional promotion, packaging, postage you absorb, cleaning, repairs or other item-specific costs. Platform charging structures also change, so use current official information when calculating a real sale.
Estimated net profit = expected selling proceeds − purchase cost − expected direct costs.
Be precise about what is included in “selling proceeds” and “costs” so you do not accidentally count money that never reaches you.
Cash profit matters
Percentage returns can look impressive on very cheap stock while producing little money for the work involved. Turning £2 into £6 is a large percentage increase, but the cash difference may not justify photographing, measuring, listing, storing, negotiating, packing and dispatching the item.
That does not make low-cost stock bad. It means percentage return should not be the only measure.
ROI matters too
Return on investment helps compare the profit with the money you put at risk. A simple purchase-cost ROI can be calculated as:
Use the same definition of profit consistently when comparing items. A gross ROI before other costs and a net ROI after costs answer different questions.
Two items can tell different stories
- Item A: buy
- £5
- Item A: net profit
- £10
- Simple ROI
- 200%
- Item B: buy
- £40
- Item B: net profit
- £30
- Simple ROI
- 75%
Item A produces the stronger percentage return. Item B produces three times as much cash profit. Neither is automatically the better opportunity without considering effort, risk and selling speed.
Selling speed changes the decision
An item that produces £20 profit in a few days can be economically different from an item that produces the same £20 after sitting in storage for a year. Money tied up in slow stock cannot be used elsewhere, and unsold stock consumes space and attention.
Reliable sell-through evidence is therefore valuable when you have it. Do not invent demand from asking-price listings alone.
Effort changes the minimum worthwhile profit
A straightforward item that is easy to identify, photograph, list, store and post may be attractive at a profit that would make no sense for something requiring research, cleaning, repair, complex packaging or repeated buyer questions.
Your own time has value even when it does not appear as a marketplace fee.
Risk should affect the margin you require
If identification is uncertain, comparable evidence is weak or condition is difficult to judge, your expected resale value has more uncertainty. A larger apparent margin can provide some protection, but it cannot turn poor evidence into good evidence.
Sometimes the strongest decision is simply not to buy. See Is It Worth Reselling? for the full pre-purchase framework.
So what profit should you aim for?
Rather than adopting an arbitrary universal percentage, establish your own minimum decision criteria. Consider both a minimum cash profit and a return threshold, then adjust for time, selling speed and uncertainty.
A purchase should still make sense if the eventual result is somewhat weaker than your optimistic case. If the deal only works when you achieve the highest asking price you found, the margin may be less robust than it appears.
Measure actual results
Your own sales history becomes increasingly useful. Track purchase cost, direct costs, sale proceeds, profit and time-to-sale. You can then discover whether the categories you believe are profitable actually are.
For pricing the item itself, read How to Price Items for Resale. If you are just beginning, start with How to Start Reselling in the UK.
Make the margin visible before you buy.
Buyer Assistant is designed to combine your shop price with available comparable asking-price evidence to show an indicative resale range, evidence confidence and potential gross profit while the buying decision is still yours to make.
See how The Resale Coach works →