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Cyber Monday Crash Course: How One Online Shopping Habit Can Turn a Hustle Into a Headache

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buying reselling inventory on Cyber Monday
Image Source: Shutterstock

Cyber Monday is a goldmine for savvy shoppers, and a launchpad for thousands of side hustles. From flipping discounted electronics to reselling limited-edition sneakers, many people use the day’s deals to stock up and sell for profit. But what starts as a smart move can quickly spiral into a logistical headache if you’re not careful. Here’s how to make the best decisions on Cyber Monday for your side business.

Avoiding Costly Mistakes on Cyber Monday

To find the best deals for reselling on Cyber Monday, you have to be smart from the beginning. Set up shopping alerts to score the best items. But, you have to be aware that making a profit requires you to be picky when selecting inventory. Not all deals are resellable. You’ll have to track your cost of goods,  look up price comparisons on resale marketplaces, and calculate margins to decide if sales are worth flipping. Tools like Terapeak can help you make informed decisions. If you overbuy, you could be left with a ton of stale inventory.

Often, liquidation companies run sales on Cyber Monday. But that doesn’t mean that boxes or pallets of inventory are worth buying. Always look up reviews on the company you are interested in buying from. Many companies sell goods that are heavily damaged, not on trend, or don’t hold value. You don’t want to be saddled with inventory that you have to take a loss on. Do your homework and don’t buy just because it’s a good deal.

If you are buying from traditional retailers with the intent to resell, you also have to consider that your consumer may be aware of these deals. Shoppers are more savvy than ever. If you try to resell items for a higher price, the market may not support it. Make sure to purchase items that are scarce and desirable for the best profit. You’ll want to consider things like sell-through rate and brand reputation before making purchases.

Platform Considerations

E-commerce platforms like eBay, Etsy, and Facebook Marketplace are under pressure to enforce stricter seller policies. That means verifying identities, tracking inventory, and flagging suspicious activity. If you’re buying large quantities of items on Cyber Monday and immediately listing them for sale, algorithms may tag your account as a commercial seller. Make sure that you have the proper documentation to resell certain brands, or your account could get flagged. In addition, always make sure that your items are authentic. If you list counterfeit goods that you bought on sale, your accounts could get suspended or you could get banned.

The Tax Trap You Didn’t See Coming

Most people use the same PayPal, Venmo, or Cash App account for everything: splitting dinner, buying gifts, and collecting payments from buyers. But when Cyber Monday purchases intended for resale flow through the same account as personal transactions, it creates confusion. Always keep your business purchases separate.

The IRS doesn’t care whether you call it a hobby or a hustle. If you’re making money, it’s taxable. Many Cyber Monday resellers forget to track their expenses, keep receipts, or report profits. But once a 1099-K is issued, the IRS expects a matching income report on your tax return. If you don’t file correctly, you could face penalties, interest, or an audit. And if you’re using personal accounts for business income, you may lose access to deductions that could lower your tax bill.

How to Protect Your Hustle

If you plan to resell Cyber Monday purchases, treat it like a business from day one. Use a separate bank account or payment platform for all transactions. Track your purchases, sales, and shipping costs. Save receipts and document buyer communications. Consider using accounting software or a simple spreadsheet to stay organized. And most importantly, understand your tax obligations.

The Bottom Line: Smart Hustles Need Smart Systems

Cyber Monday can be a launchpad for profit, but only if you treat your hustle like a business. Mixing personal and commercial activity may seem harmless, but it can lead to serious consequences. With a little planning and discipline, you can flip deals without flipping out.

If you’ve turned Cyber Monday into a side hustle, leave a comment. Your tips could help others avoid costly mistakes.

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Avoid Temptation on Black Friday

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November 16, 2006: I See Crazy PeopleIf you’re like almost every other American, after you’ve gorged yourself on all the Thanksgiving day feasts, you’ll be headed out to do a little gorging of a consumer variety.  Black Friday is well known as one of the largest shopping days of the year.  Most every retail store has some huge deals for the turkey-drunk shoppers that wander to their doors.  And, like most every other American, you’ll likely spend way more than you had planned on spending.

 

 

 

 

 

As your favorite personal finance blogger, I urge you to not do that.  I’m all about buying what we need at a price that is below the normal retail price.  Sales, coupons, and rebates are the way to go when buying things that we need.  But, chances are, the things that will be on sale on Black Friday will not be things that you need.  In fact, they’re likely to be things like big-screen televisions, computers, and the hot toy of the day.  You’re going to be tempted to buy them all, because the marketing department makes it look like such a incredible deal!  Here’s some tips for avoiding that temptation, and coming away from your Black Friday shopping with a happy account balance.

  1. Have a budget.  This should be the only tip you need.  But, you’ll get in the store and be tempted.  But, having a defined budget for how much you are planning to spend is still a good thing!  Even if you go over that budget, you’re much more likely to at least stay close to it if you have a budget, than you are if you don’t have one at all.
  2. Make a list.  You’re likely shopping for gifts for everyone, hoping to make them all happy while saving some money on what you buy them.  Make a list of the people you’re planning on buying for, compare it to the flyers that will be inundating your vision over the next week, and then make a master list of people, with the things you plan on buying for them, and where you’ll be buying them.  Now, stick to your list!
  3. Be aware of prices.  Just because the marketing department put the price in big yellow letters over a big red starburst does not mean that it’s really a good deal.  The stores will be full of items that they are marketing as a big savings, when they really are not.  Be aware of the prices of competitors, sure, but also be aware of what the price for that item was last week and be wary of artificial sale prices that aren’t really sale prices.
  4. Don’t fall for the swap.  Many of the places will have a very limited amount of the big sale items on hand.  When they run out, they’ll “swap” the sale item for a similar item that’s more expensive.  You’re there for the big sale item, and you can’t leave without it, so you pay the little bit extra to get the similar item.  Usually, that “swap” item is regular priced, and not on sale at all.
  5. Free can be bad.  More than any other day in the year, the stores will be pushing free items.  “Buy a tickle-me-broke, and get a free tin can!”  The free item is usually a low cost item (loss leader) that they can afford to give away, while the item you have to buy is usually not on sale for as much as they’d like you to believe, and is a much higher profit item.

The biggest thing to remember while you’re doing your shopping next friday is to be aware.  Be aware that the store isn’t out to save you money.  They want to make money, so they will do what they can to bring you in the doors with a huge sale and then sell you all the high-profit items that aren’t on that huge sale list. We’ve all seen the videos each year of the people trampling each other trying to get one of the ten of those super cool kitchen gadgets, or video game systems.  Don’t be that person.  Be conscious of what you want to buy, how much it sold for before, and what the price should be the day you’re buying it.  Have a set amount you want to spend and stay close to that amount.  You’ll be happier that you did.

What are your plans for Black Friday?  Gonna be in the crowds at midnight?  Or wait until it cools off later in the day?  Or, are you a Cyber Monday shopper?

photo credit: Matt McGee