Does anyone here invest in Lego for a living or make great money per year?

[siddji]

Trying to save for kids college. Hopefully another 10 years to go.

[TheOrcKing]

I swear we had a topic on the same exact question.......it was during your hiatus I think. If I find it I will merge them. Good question though.

Yes we had. About four different times and once where emazers gave his honest opinion about selling Lego on the side. All of them are now merged with this one which beefed up the thread quite quickly! A pool of knowledge and thoughts to found here.

[4cs]

I've been selling sets on Amazon and parts on Brick Link and Brick Owl for the past few years and keep asking myself if this business can be scaled up to make $100k per year. Not $100k in gross sales, but in profit. I'm curious what everyone else thinks. 

I've had an issue being able to acquire enough sets (at the right prices) to feed my side business over the past few years and have to split my time with my main job (I own four retail brick + mortar stores selling apparel, gifts, and food in Michigan). For those of you doing this full time, are you focused on flipping sets? Selling retired sets? Parting out? A combination of those strategies?

If you read one of my previous topics, I had a break in at my warehouse and had $41,000 worth of sets stolen in September and I am trying to decide if I should go all in with the insurance money and try to grow this business, or pull back.

Your thoughts?

[DadsAFOL]

$100k profit is tough. Supply is the constraining factor whether it's parts or sets. You would probably need a full time buyer, and if it's not you then that's a salary you have to cover.

[Mos_Eisley]

42 minutes ago, 4cs said:

I keep asking myself if this business can be scaled up to make $100k per year. 

Yes, it can. But it requires a lot more resources than most people have at their disposal. 

[4cs]

1 minute ago, Mos_Eisley said:

Yes, it can. But it requires a lot more resources than most people have at their disposal. 

Let's say someone had the resources, how would you do it? I've purchased bulk lots, sets, and figs online, in store, at LegoLand, Craigslist, you name it. Since there doesn't seem to be an "easy" source for purchasing wholesale quantities with any regularity, I wonder if sources to acquire inventory is the biggest factor initially?

[Mos_Eisley]

3 minutes ago, 4cs said:

Let's say someone had the resources, how would you do it? I've purchased bulk lots, sets, and figs online, in store, at LegoLand, Craigslist, you name it. Since there doesn't seem to be an "easy" source for purchasing wholesale quantities with any regularity, I wonder if sources to acquire inventory is the biggest factor initially?

Sorry, I'm just saying that it's possible. Since you've been doing this a few years you should have a better idea than most of what it would take.

[jaisonline]

we have blogs and a nice existing forum relating to this subject.  i will do a thread merge.  thanks all.

[justapilgrim]

I don't think would be too hard. Just depends on expectations

How many of us have a mom and pa type Lego store in their town? Biggest expense would be the retail space. However....get it the cheap industrial part of town. Your retail space will double as your storage unit, so no cost there.

Only be open one or two days a week so your payroll stays under control with open on saturdays for birthday parties. Your minimum wage or slightly above HS kid can part out sets or plow though bulk when there are no customers.

Bulk Lego probably has one of the highest profit margins but requires time. If one is doing this full time they will have plenty of time. The birthday party crowd will be your bread and butter customers on your retired and high ticket sets and you will have much better margins with no shipping or fees

[Lego Templar]

We have a few heavy hitters here. To make 100K I would assume you would need to have like over 1 million (fees, storage, employees, rent, etc)

I'm sure the more $ you have the easier it is. You don't need 200-300% ROI to be profitable sell at 50-100%.

I do it for fun and even if I had 7 figs laying around I would not invest it in lego. That money can be more Profitable in other areas.

[Seal Cutter]

How would you physically buy enough product? Surely you'd get banned from every source fairly soon if you wanted to deal in real quantity?

Would Lego themselves be your only wholesale source? And i think they'd be quick to shut off supply if they felt you were doing something they didn't like e.g. reselling other sets from other sources

[4cs]

4 minutes ago, Seal Cutter said:

How would you physically buy enough product? Surely you'd get banned from every source fairly soon if you wanted to deal in real quantity?

Would Lego themselves be your only wholesale source? And i think they'd be quick to shut off supply if they felt you were doing something they didn't like e.g. reselling other sets from other sources

I think it's been discussed before on other threads, but I'm pretty sure buying from Lego directly is out of the question for just about everyone at this point. Besides, I think the margins were too slim. If I max out the comfort levels with Lego online and other online retailers, that leaves brick + mortar stores which involves some time driving, hunting, and travel.

 

[Guest TabbyBoy]

I'd be very surprised if anybody on here is relying on LEGO reselling to make a living. First of all, you need a B&M shop before LEGO even consider giving you a wholesale catalogue. Also you have to buy the crap like Nexo/Chima/Friends/Moana/Elves/etc. The 3-for-2 sales by the likes of Tesco will have to be ignored as you can only source from LEGO exclusively.

When I sold those hundreds of sets from Tesco's 3-for-2, I only made about £3.5K, about half of what my previous job paid me during those 6 weeks.

I've not had a job since April 2016 but, I've made some good money but, LEGO is a very tiny fraction of what I make. To be honest, I do NOT recommend anyone to invest in LEGO in the current climate as it's too much risk and work for very, very little reward.

There are a lot of non-LEGO products that are easy to get hold of and sell on eBay for 2x immediately without holding or having to worry about a speck of dust on the box. Obviously, I can't share that information on here. Don't buy wholesale lists or buy pallets of catalogue returns as you WILL lose a lot of money.

[c_rpg]

3 hours ago, 4cs said:

Let's say someone had the resources, how would you do it? I've purchased bulk lots, sets, and figs online, in store, at LegoLand, Craigslist, you name it. Since there doesn't seem to be an "easy" source for purchasing wholesale quantities with any regularity, I wonder if sources to acquire inventory is the biggest factor initially?

There's some semi-wholesale guys on bricklink that ship sets by the pallet. I'm not saying you're getting wholesale prices, but buying large quantities at a fair discount is possible.

[Jackson]

1 hour ago, justapilgrim said:

Bulk Lego probably has one of the highest profit margins but requires time.

Where would you buy most of the bulk? Craigslist?

[LandAhoy]

i think you would need serious resources backing you to get a decent market share.To Hit anywhere near 100k profit inventory would be a nightmare add on top storage shipping insurance fraud if you are selling online. 

[bagalux]

35 minutes ago, TabbyBoy said:

I'd be very surprised if anybody on here is relying on LEGO reselling to make a living. First of all, you need a B&M shop before LEGO even consider giving you a wholesale catalogue. Also you have to buy the crap like Nexo/Chima/Friends/Moana/Elves/etc. The 3-for-2 sales by the likes of Tesco will have to be ignored as you can only source from LEGO exclusively.

Would one really need a B&M store for wholesale access? There are several, major online-only shops here in Sweden offering a broad range of LEGO, can't imagine they buy anywhere but through LEGO wholesale?

[Ed Mack]

Would one really need a B&M store for wholesale access? There are several, major online-only shops here in Sweden offering a broad range of LEGO, can't imagine they buy anywhere but through LEGO wholesale?

In the US, yes, you need a store. They might be more lenient outside the US. Regardless, you will have to sell two other major toy brands for them to consider you.

[Voltron]

57 minutes ago, TabbyBoy said:

I'd be very surprised if anybody on here is relying on LEGO reselling to make a living. First of all, you need a B&M shop before LEGO even consider giving you a wholesale catalogue. Also you have to buy the crap like Nexo/Chima/Friends/Moana/Elves/etc. The 3-for-2 sales by the likes of Tesco will have to be ignored as you can only source from LEGO exclusively.

When I sold those hundreds of sets from Tesco's 3-for-2, I only made about £3.5K, about half of what my previous job paid me during those 6 weeks.

I've not had a job since April 2016 but, I've made some good money but, LEGO is a very tiny fraction of what I make. To be honest, I do NOT recommend anyone to invest in LEGO in the current climate as it's too much risk and work for very, very little reward.

There are a lot of non-LEGO products that are easy to get hold of and sell on eBay for 2x immediately without holding or having to worry about a speck of dust on the box. Obviously, I can't share that information on here. Don't buy wholesale lists or buy pallets of catalogue returns as you WILL lose a lot of money.

Drugs are bad mkay 

[AirborneAFOL]

1. Yes, you could make $100k profit a year.

2. It would require roughly $750k-1M in capital, accounting for your product & overhead (space & payroll required, as others have said).

3. If you have that kind of capital, there dozens of far better investments. LEGO is high-risk. There's easily a half-dozen strategic risks to the business model, and not nearly enough strategic advantages to mitigate them.

4. Therefore, treat LEGO "investing" like you do betting at the horsetrack. Enjoy the scouting and picking of winners/losers, strategy of placing your bets, thrill of the race, joy of victory - if you take pleasure in that, it can be the most profitable hobby you'll ever have, but don't fall prey to illusions you could make a living at it.

Yes, there's always stories of someone who "wins big at the track". Or some old timer who lives there in the smoking lounge and actually does make a living on it. But that simply isn't the norm.

[Jackson]

5 minutes ago, AirborneAFOL said:

3. If you have that kind of capital, there dozens of far better investments.

Such as?

[AirborneAFOL]

Such as?

See the Speculative Bubble thread. Just to name a few:
Acquiring inventory in the quantities needed (banhammers, etc).
LEGO manipulation of market values (re-releases, retirement schedules, etc).
Knock-offs.
Competitors (small time folks with virtually zero barriers to entry).
Sales platform vulnerability (Amazon gates, eBay requirement changes, etc).

[Jackson]

1 minute ago, AirborneAFOL said:

See the Speculative Bubble thread. Just to name a few:
Acquiring inventory in the quantities needed (banhammers, etc).
LEGO manipulation of market values (re-releases, retirement schedules, etc).
Knock-offs.
Competitors (small time folks with virtually zero barriers to entry).
Sales platform vulnerability (Amazon gates, eBay requirement changes, etc).

I was asking what are the better investments.

[AirborneAFOL]

My mistake.

Consider that $750k-1M annual outlay, that's returning $100k profit. You're looking at a 10-15% ROI. Ask your financial advisor for options that have a shot at that ROI - they'll have a dozen options for you. They'd all be considered "high-risk" in finance terms, but nonetheless lower risk than LEGO.

I say this as a guy who did $28k in gross revenue ($7k in profit, not accounting for my 300 hours of time) in 2016, and put serious consideration and math into my scaling potential.

[exciter1]

Where would you buy most of the bulk? Craigslist?

Pick a brick