The Garage Sale Economy

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Our modern economy is based on the simple premise that advertising can brainwash even the brainiest among us to buy things we don’t need with money we don’t have. Each person’s unwieldy debt then keeps them working hard at making things that other people with too little money will purchase with their hard earned credit. Unfortunately, before any of us can even pay off the interest on our monthly statements, half the junk we bought is already migrating to holding space in our closets, attics, garages, basements, crawl spaces, and off-site monthly storage facilities.

It used to be that those ab-rollers, solar-powered breadmakers, megapixel cybershot paperweights, and radio-controlled dust collectors would keep piling up until we finally took out an ad in the local paper, and tried to get rid of our ill-advised abundance at a weekend garage sale. But the success of such events was always minimal. Even if the weather cooperated, it was unlikely that any neighbors would pay even a fraction as much as we did for the opportunity to store our Homebrewing semi-automatic bottle filler and 15 gallon kettle in their closets.

Then came eBay. Suddenly the whole world could come to our garage sale. Before, you couldn’t even give away the giant empty basket that looks like a fat lady’s rear end, that your ex-brother-in-law so graciously dumped on your doorstep last Christmas. Now there are seven bidders competing for the Large Woven Split-Buttocks Basket, and the price is up to $400 and climbing.

But becoming an eBay seller doesn’t work for everyone. My friend David is a typical example of eBay failure. “I posted some of my junk on their site,” he says, “but then my boss sent me on a two-week business trip, and when I came back I had so much to catch up on I forgot about it. By the time I remembered, my eBay sellers’ feedback rating had gone below zero. I’ll never get another bid again.”

My cousin Sara said, “I have way too much junk to ever be able to get rid of it all on eBay. I’d have to spend all my spare time taking digital photos, writing descriptions, categorizing, tracking items. When would I ever have time to shop?”

Now a new business has started to help relieve the burden of all that junk from all those shopping junkies. It’s called AuctionDrop, and enables people to dump their garage sale merchandise on consignment at various drop-off locations in San Francisco, where specialists take care of all the details of auctioning it off on eBay. In just seven months, AuctionDrop has sold 10,000 items, worth over $1 million, in exchange for a 40 percent cut of the sales. The company plans to open 100 new stores in the next two years, expanding from San Francisco to Los Angeles, New York, Boston and beyond. As opposed to the outlet stores that most of us are used to spending our time and money in, AuctionDrop calls their drop-off centers “inlet” stores.

“We are generating cash for people that is essentially found money,” said company CEO Randy Adams. “eBay is evolving into the Nasdaq marketplace for people who want to buy, sell and trade items,” he says. “We’re providing infrastructure for that, like a broker or investment banker.” Or a pawn shop.

Several companies are already battling AuctionDrop for this new second-hand market, including Quickdrop and Picture-it-Sold. Perhaps we’re witnessing the emergence of a new 21st century economy – The Garage Sale Economy. All our good paying manufacturing jobs have disappeared, and we’re failing to make ends meet working days at Wal-Mart and nights at the 7-11. Fortunately, we still have an unbelievable amount of untapped assets in our basements, garages, and mothers’ attics.

In the ’80s, brokers like Michael Milken made billions facilitating huge buyouts and mergers using “junk bonds.” Now all we’re left with is junk. Economists have estimated that there are already over 100,000 people employed full-time by eBay trading activity, and the number is steadily growing. Now AuctionDrop enables anyone with a cardboard box and a shopping cart to become an internet entrepreneur, by filling up their box with choice items from the curb and wheeling it to the nearest “inlet” store.

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