Million Dollar Paperclip

It takes 8,460 bolts to assemble an automobile, and one nut to scatter it all over the road. — author unknown

Wouldn’t it be exhilarating to drive the car of your dreams to work each day, without having to worry about payments? Believe it or not, I’m going to teach you how anyone with gumption can buy a Porsche 911, Corvette, Mustang, or Jeep Rubicon with only a few hundred bucks (and a little elbow grease).

Now, before I get started, I’m going to admit that I would never buy a Porsche 911 with this method, but that’s because my two dream vehicles are a Delorian and a 2006 Jeep Rubicon Unlimited. 🙂

This method isn’t new, it’s been around for thousands of years. The reason not every one does it is because it’s hard.

A “Bigger and Better” story:
Back during college, my friends and I would plan group dates. One particular date involved a game called “Bigger and Better”. To begin, we each started with a paper clip or other worthless item and set out. The goal of the game was to bargain for something bigger and better. We would knock on doors and begin a sales pitch

“Hi, we have this fine green paper clip that we are interested in trading. Do you have anything bigger and better that you would like to trade for it?”

With few exceptions, the first house always had something better for us. After the first several stops the game became a little more challenging.

“Hi, I have this fun filled, 5ft stuffed frog that we are interested in trading…”

By the end of a few hours we would return to our apartment and compare our successes. One group came back with a couch, another with a lawn mower, and another with an old computer. We then voted on who had the greatest spoils and had some ice cream.

Was a paper clip really worth a lawn mower or a computer? No. With few exceptions, we never really picked up anything with a value of more than a quarter on the first stop. It was through trading, bargaining, and searching that we turned a bent piece of wire into something worth thousands of times its value.

Just like “Bigger and Better”, you too can turn a small investment into a great treasure. Now picture yourself driving that DeLorean with the satisfaction of knowing that you did it by trading a paper clip!!

Even though it’s possible to trade a paperclip up to a sports car, it takes much less time if you start with something that has value. I’ve broken down the process into a few simple steps.

Step 1 – Know Your Market

Last year I became interested in old arcade machines. Because I’m a do-it-yourself kind of guy I decided to build my own arcade machine, so I began researching everything I could about arcade machines. Well, it just so happens that there was an auction for about 100 arcade machines just a month away, and I decided to check it out. To make a long story short, I walked out with TWO arcade machines and several parts for around $300.

I had only intended on getting one machine, but I couldn’t turn down the bargains I found. After some light touching up and a small upgrade, I listed one of them for sale at $1,100.

After a week or so, I got a few e-mails. One came to look at it and he started to do the classic bartering: “This is such a terrible machine, it’s dirty, it is ugly, I WANT IT!” After he finished telling me how terrible it was, he proclaimed that wouldn’t pay me a cent more than $700.

I accepted.

He was happy that he was able to get me down so much, and I was happy to have sold one machine for over twice what I had paid for two. The other machine went up for sale shortly thereafter. 🙂

The moral of this story is to know your market. Knowing when you see a bargain and knowing when you can sell it for significantly more is the key to becoming a successful trader. Knowledge is power.

Step 2 – Learn to Sell

The best way to learn how to sell is to get out and do it. There are countless books, videos and websites that can also help, but doing it is really the fastest way to learn. When I was in college, I would often buy things on eBay that were poorly listed and resell them for a nice profit. Often the only difference in selling price was how I listed it.

NOTE: With that said, let me stress the importance of honesty. There is never a good excuse to be dishonest just to make a few bucks. Not only will you feel terrible about yourself, but people will slowly start to distrust you. If you are honest, then you have nothing to fear. Some people seem to justify being dishonest, especially in sales. In reality, the world’s richest and most successful people are always going out of their way to be honest. There are a few rich scammers out there, but they never last for long.

Step 3 – Compound Your Investment

Say you buy a cheap car, fix it up and make a $1000 profit. The next step if to re-invest the initial amount along with that $1,000 profit. Maybe the next car will make you a $1,200 profit, and so forth. As you move into bigger and better markets, your profits will also grow. Before long you will sell something that will allow you to buy that vehicle of your dreams.

Step 4 – Stick With It

At first things come fast with huge returns… then they start to slow down. When things start to slow, double your efforts! When things slow down it just might be time to learn a new market (repeat step 1), or maybe it’s time to change your advertising or selling methods. You may be tempted to cut your goal short and enjoy the profits now, but having the will power to stick with it until the end will give you a great feeling of accomplishment, and you will be able to enjoy your reward far more than anyone who just went out and bought it.

Conclusion

Why not make “Bigger and Better” your new favorite game, and work up to something great! Learn your market, learn to sell, and compound your gains. Before you know it, you’ll have that car of your dreams for the price of a paperclip!

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