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It’s a bit of a fad (for lack of a better term) in the popular culture right now — people are gearing up for the end of the world. The television reality series “Doomsday Preppers” on the National Geographic channel is currently enjoying a period of fairly immense popularity. There’s no doubt that a good number of people appear to be quite sure that the proverbial doo-doo is about to hit the fan — and they’re getting ready for it. The interesting thing is that this trend is translating into hot markets in the military surplus industry.
Recently I ran into an old friend who had an interesting story to tell. He had recently happened upon a notice for an upcoming military surplus auction that would be taking place in the next state over from his own — the exact location of which happened to be less than a two hour drive from his house. He decided to spend the day checking out that auction. While there, he bid on, and won, an entire pallet full of military surplus ALICE packs (ALICE – All-purpose, Lightweight, Individual, Carrying Equipment) He managed to achieve the high bid with an offering of just $180.00. Turns out, there was just over 160 ALICE packs boxed up on that pallet. That’s a per unit cost of less than a buck and a quarter. Not bad!
So, he loads his purchase onto his truck, hauls it home and starts looking to move it as a complete lot. He was hoping that he might be able to move the entire lot for somewhere around four times what he paid. He figured that if he could unload the whole pallet for around $700.00, he wouldn’t have any complaints at all. And, at that price, a buyer would still be getting each pack for a little more than $4.25 — which should have been quite attractive for any buyer looking to again resell the packs individually to individual buyers. However, at first, he experienced some difficulty in trying to locate a buyer for the whole she-bang.
Originally, he tried offering the lot of ALICE packs around for a price of $900.00, with the intention of being willing to haggle down to his goal price of $700.00. But, he couldn’t find anyone that was interested. So, he dropped his offer price to $800.00 and intended to accept a counter offer as low as $600.00. But, again, no takers. He dropped his price again to $650.00 and resigned himself to being willing to accept $300.00 if it was offered (less than twice what he paid.) Still, he could find nobody who was interested in purchasing the lot — even at that price.
He wasn’t giving up yet, however. He kept trying to locate a buyer for the lot. But, in the meantime, he put one of the ALICE packs up for sale on Craigslist with an asking price of $10.00 for the single pack. Within about an hour of the ad being published he received an email from someone who was interested in taking a look at the pack. They made arrangements for the interested person to go by my friend’s house on his way home from work. The guy showed up, took a look at the pack and immediately pulled out a $10.00 bill and handed it to my friend.
“You got any other military stuff you’re looking to get rid of?” The guy said as he handed my friend the money.
“Just more ALICE packs the same as this one.” My friend replied, “I’m sitting on a whole pallet full of them that I’ve been trying to move.”
“Really?” The buyer answered back, “I’ll take four more, then.”
And, with that, he pulled out two twenty dollar bills and handed them to my friend.
A pretty good deal. He’d just sold five ALICE packs for $50.00 and his cost for those five packs was about $5.50 — he sold them for close to ten times what he paid for them. He quickly went back inside and put another add on Craigslist, this time listing one of the ALICE packs at $15.00 instead of $10.00. Again, within a very short time, someone interested in buying one contact him. That guy showed up and ended up buying two packs. My friend had just made another quick sale, acquiring $30.00 for what cost him a total of about $2.25 — a mark-up of more than 1300%
My friend told me that, after that, he kept putting up ads, and people kept buying the packs. He experimented with different prices, but ended up finding that they seemed to sell best at $15.00 per pack. He sold out of his entire lot in just under four weeks — pulling in a total of more than $2,000.00 in gross sales on his initial purchase of just $180.00.
My friend reported that, over and over again, when conversing with the people who were buying the packs off of him, the people would mention something about the show Doomsday Preppers, or something about being prepared for catastrophe. It became apparent that a good number of people were interested in, and buying these military surplus ALICE packs as part of their own doomsday preparations. This current trend in the popular culture — perhaps because of the TV show, or perhaps along side of it — had created a hot market in the surplus industry.
My friend with the ALICE packs, ever since, has been sourcing other such military surplus gear that would also appeal to the same sort of buyer, and he’s been making a small fortune doing it.
In the surplus business game, as with in any industry, it’s important to have an eye for marketplace trends. Hot markets pop-up sometimes seemingly out of nowhere. If you can recognize them, your pocket-book can benefit greatly. My friend sort of happened to luck into this current trend that’s going on in military surplus equipment. But, if you can keep your eyes and ears open, you can learn to recognize trends like these as they’re happening. You don’t need luck — just a keen sense for emerging market trends.