June 15, 2012
Last month, for two days only, the Southwest Airlines shopping portal (Rapid Rewards Shopping) offered 15 points per dollar when shopping at Sears.com. In the post “Sears 15X: Leveraging the deal” I showed a number of ways one could capitalize on the opportunity. In the post “Sears 15X: Free Southwest Companion Pass” I showed how one could earn a Southwest companion pass by buying and selling gift cards. And, in the post “Sears 15X: Shopping for 110,000 points” I showed how one could earn 110,000 Southwest points by double-dipping: buy gift cards for 15X and then use them to buy merchandise for another 15X.
Frequent Miler’s Plan
I used the double dip technique to earn 30 points per dollar for my purchases. In order to get to 110,000 Southwest points (so that I could earn a companion pass), I bought almost $3400 worth of tablet computers for resale and I bought some items for myself to make up the difference. In the rest of this post I’ll give the details of what I bought for resale and the results so far.
What I bought
I bought 8 Asus Transformer Tablets for $399.99 each. They were listed pretty high on Amazon’s best seller list and, at the time, they were selling on Amazon for the same price advertised by Sears. Most importantly, I tested to see if Amazon would let me list the item as new. Many brands don’t allow resellers to do that, so finding one that allowed it was a huge plus.
My total cost after 6% taxes came to: $3,386.37
Fulfillment by Amazon
Once I received the tablets, I shipped them to Amazon for their Fulfillment by Amazon program. This is a great service in which Amazon handles all of the headaches of resale for you. They take a cut, of course, but it’s well worth it in my opinion. Usually, they take a 15% cut, but they charge less for electronics, and even less for computers. Since the tablets were considered computers, I was charged only 6% for each sale. I listed each tablet at $399 – only 99 cents less than Amazon was charging at the time. I figured that if these were hot sellers, I had a chance of reselling at retail value.
Pretty much the moment the tablets were scanned in at Amazon, they sold out! Unfortunately, one guy ordered two of them and then canceled his order. That’s when Amazon messed up. They only put one of the two tablets back into my inventory. The one that was returned to inventory also sold quickly. The remaining tablet currently shows as “receiving” in my shipping queue, so at least some part of Amazon.com believes I still own one more tablet. I opened a problem ticket and have since received several messages saying simply that they are still researching the issue.
Ironically, this Amazon mess up is exactly opposite of one that happened to me a while ago. At that time, Amazon thought I had far more watches in inventory than I had sent. You can read about that adventure in this post: How Amazon paid me to collect miles. Amazon still hasn’t attempted to get their money back for that mistake!
Let’s look at the results in two ways: first let’s assume the tablet is a total loss, second I’ll assume the remaining tablet reappears and I manage to sell it for the same price as the others. In reality, the price for this tablet on Amazon.com has dropped $15 so I may not do that well, but it should be close.
Total points earned: 3386.3 * 30 = 101,589 (remember, I earned additional points for personal items to get to the 110K mark)
Total costs for Sears’ purchase: $3,386.37
Total earnings from Amazon after shipping and fees:
- $2618.86 (without final tablet)
- $2993.92 (if I sell final tablet for $399)
- $767.51 (without final tablet)
- $392.45 (if I sell final tablet)
Cost per point:
- $767.51 / 101,589 points = .76 cents per point (without final tablet)
- $392.45 / 101,589 points = .39 cents per point (if I sell final tablet)
Southwest points are worth 1 cent each when used for regular fares and 1.67 cents each when used for “Wanna Get Away?” fares. Even if I don’t want to fly Southwest at all, I can exchange the points for various gift cards at a value of 1 cent per point. So, even if I never use the companion pass (which I should get in July), buying Southwest points at .76 cents each was a bargain. If my tablet reappears and I sell it for a decent price, it’s clear I’ll have made out like a bandit.
What if I sell the final tablet and take full advantage of the companion pass and “Wanna Get Away” fares? In that case, I can theoretically get $3393 worth of flights for roughly $400 in expenses!
How did you do?
I know others bought and sold items like I did. How well did it work out for you? Comment below.