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Thursday, February 3, 2011

Strategies for buying second-hand goods

Second hand goods
Second-hand goods are available at thrift shops, flea market and garage sales

Depending on what you're buying, strategies for buying second hand goods can vary. For example, a second hand or used car involves different buying strategies than a used home or used furniture. Despite this, several similar buying strategies can also be applied to several different types of second hand items. Before purchasing any second hand goods, acquiring a tool box of strategies for buying second hand goods can assist in lowering cost, improving utility, increasing potential, boosting value, meeting needs and in building satisfaction in one's purchase.

Assess durability

Most second hand goods can be tested for durability. Utilizing a strategy that identifies how long a particular item will be useful for helps improve its total utility and value. For example, a used product purchased for $100 that is expected to last two years can be valued at $50 per year. However, if that same item lasts for ten years, it's annual cost is reduced to just ten dollars. Durability is also related to obsolescence and future cost savings, therefore the ideal second hand goods have functionality in addition to utility over time.

Determine necessity

Deciding if the purchase of second hand goods is even necessary is a good strategy to apply to any purchase because it can reduce mismanaged spending. This strategy for buying second hand goods also helps reduce non-essential purchases and can save money for more beneficial second hand goods. For example, by creating a prioritized list of needs one can identify how important a second hand item is as they are located. The list serves as a spending map and reminder to weigh decisions financially rather than psychologically.

Reduce cost

Even if second hand or used goods seem to have a low cost this does not eliminate the possibility of acquiring the same products at an even lower cost. A good strategy for purchasing used goods includes alternative purchase options for the same or similar product to allow for price comparison and negotiating strength. For example, similar models of used computers may be available in multiple locations; investigating the computers, sellers and cost may take a little extra time, however that time may convert in to cost savings. Paying all cash is also a method that may help lower cost.

Manage time

If buying second hand goods is a regular practice and method of acquiring items of need, time management becomes increasingly important. This is because used goods may require greater amounts of research, negotiating and locating than new products. When searching for used goods a useful strategy is to put a value on the time spent in the search. For example, if item two on the necessity list takes three hours to locate and item two takes two hours, item one should be a higher priority because it's higher on the list and because it costs less in time to locate. Similarly, item three may only take half an hour giving it an overall higher purchase value than item two.

Build worth

Another strategy that can be used when purchasing second hand goods is worth building. All this means is consider items for dual purpose where the first is individual use and the second is resale. Multiplication of use is proportionally related to intangible and tangible worth of a second hand item. In light of this, the more uses a used item has, the higher its potential worth and market. For example, a used car has considerable intangible value because it can be used for transportation, resold, applied to earn income and used as collateral for loans that may leverage other income earning opportunities.

Image license: David Hawgood, Creative Commons