Show #90 Starting A Sports Card Supply Website + Jeremy Lin

All out talk recently on the show has focused mainly on selling boxes/singles as the way most people get into starting a sports card business. However, the low hanging fruit is in supplies – not the actual cards or boxes themselves! Think about it, every collector, no matter how serious needs supplies to protect their cards. Not to mention that there really hasn’t been much change or innovation in the sector for quite some time (the magnetic snap on cases is the most recent I can think of). Finally, and most importantly, there is no clear online retail leader in the sector.

Here are some reasons why I think selling supplies is the much more feasible way to break into the business:

• Your Inventory Doesn’t Go Up/Down Like Boxes/Single Cards
  Sure, it’d be great if you had stacks of Jeremy Lin rookie cards laying around in your inventory – as those have certainly gone up in value. However, at the same time your Peyton Manning and Adrian Peterson inventory has probably lost value too. The same holds true for sealed boxes – as 2012 product is already rolling out, making 2011 stuff much less attractive at the moment.

  Now think about sports card supplies … the soft sleeves, cardboard boxes, binder pages and top-loaders all cost about the same as they did 5 years ago.Theoretically you could have bought your inventory years ago and it’s still worth about the same as it was then. While you don’t get the benefit of rising prices on hot rookies or boxes, your inventory won’t depreciate in value – meaning a much more steady business from month-to-month compared to selling singles or boxes.

• You Can Stock Everything
  Like I said earlier, there really hasn’t been much innovation in the sports card supplies space for a decade (or longer) … which is great for a re-seller because you don’t have that many items to stock. You could easily stock every thickness of top-loader & case available … as well as every cardboard box size and dimension that is manufactured. Binder pages, soft sleeves and other plastic cases/sleeves can round out your inventory.

  Even the ‘online leaders’ in the sports card box/singles game can never stock everything available. Even eBay and Check Out My Cards don’t have every single card available. DA & Blowout don’t have every box (or even most) that are still available for purchase. That being said, you could easily open an online website that carried every supply imaginable for a start-up cost that is a fraction of trying to compete with the companies I mention above.

• No Real Market Leader
  Instead of trying to compete with sites that have been around for a while selling boxes/cards – there really isn’t a one-stop-shop in terms of supplies (which is surprising considering how essential they are to everyone that has cards). While DA Cards, Blowout & others sell supplies – they are attracting customers that are ordering boxes and the shipping rates are not catered to someone just needing $30 worth of supplies. Sports card stores are really the place get supplies, but considering how little of them exist – the market is still big enough to become a market leader on-line in a short period of time.

• You Only Need To Setup Product Pages Once & You Never Take Them Down
  Think about it, with boxes & cards you’ll spend countless hours creating ‘product pages’ for items you might only have 1 or 2 of … and once they are gone – you have to take it down unless you want a bunch of “Sold Out” items on your site. With supplies – you setup up the pages once – and theoretically you never run out because supplies don’t really change. You can continue to optimize your pages as time goes on, but the up-keep on a supplies website would be a dream compared to boxes & singles.

Lets Take A Look At The Online Competition

Below Fold

As you can see, despite lots of companies paying to show up in these results – they really aren’t very impressive. The first result is in part because it’s an exact match – but the site looked dated and I’m not even sure it had SSL protection. It’s appearing at the top because no one else serves the market well enough to appear in that position. The second result is the most relevant – however they do big business to other card shops & retailers so they are never going to compete on price because it would alienate their best customers. The third result is essentially more ads, however you can easily appear here by submitting your items to Google for free.

Below the fold you find UltraPro – who you will probably purchase from, but an average consumer cannot purchase from this website … so for other Google searches, it might not even appear. DA Card World has a good supply & prices, so no need to under-cut them … in fact you can probably get away with charging a little more if your shipping charges were reasonable. The rest of the results you can almost ignore – as if you started an online shop you could get to the 7th or 8th position in a few short months.

Some more complex ideas include manufacturing your own supplies, given that the market it under-served on both the retail and innovation side. Custom binders and cases that hold book cards are often what people want – but can’t find. Keep in mind if you go this route – don’t use team names or logos, just use city names when referring to teams.

Jeremy Lin has taken the hobby world by storm & it’s wonderful for collectors, fans and people just casually following the NBA. It just goes to show you that athletes can come out of nowhere and become household names (especially if you play in New York). Would Jeremy Lin be as hot if he won games for Golden State or Houston – we’ll never know, but it just goes to show you that where you play probably has a huge factor on how hot you can get.

Lastly we touch on getting kids into collecting – which always seems like something the card companies want to do. I think the formula is simple. Kids are in school 8 month out of the year – so that’s where you expose them to cards. Topps had the ‘sketch card’ concept last year – and that would be a perfect thing to turn over to school and let kids design cards in class for some kind of prize.

Listen To Show #90 Below

{play}http://norcalsportshop.podbean.com/mf/play/d8yk8/ShowNinty.mp3{/play}

Download this episode (right click and save)