At UnusualInvestments.com, we’ve explored many different ways to make money. While it is not an easy task, flipping Forever Stamps is certainly possible and people are doing it today. Let’s talk about this and explain how it is done.
Overview of Forever Stamps
Forever Stamps (as of this writing in 2021) are priced at $0.55 each. As we have written before, they are somewhat of an inflation hedge and a store of value. As the price of postage increases, you can still use your Forever Stamp in the future to mail one envelope via US Mail, regardless of what the price per stamp increases to. So they “hold their value” so to speak.
The most popular denomination of Forever Stamps are sheets of 20. Most of these sheets are available on the USPS website or a local US Post Office for $11.00. The American flag ones are the most common, but there are a variety of other designs celebrating anything from a particular state, a famous person, pop culture, a type of animal, and all kinds of other things.
Sheets of Forever Stamps are also very lightweight and easy-to-ship, which is actually a key factor when it comes to potentially flipping them for a profit, as shipping is a key transaction cost.
How to Buy Forever Stamps
You can drive directly to a US Post Office or even your local grocery store and buy stamps. However, chances are they carry a very limited inventory of designs.
You can actually go to the USPS website and order stamp books to be delivered directly to your door. The shipping cost is extremely low. For instance, if you order 100 sheets of 20 Forever Stamps (2000 stamps), the cost of the stamps is $1100. The shipping cost is just $1.85.
When Should You Buy Forever Stamps?
The best time to buy Forever Stamps is right before a price increase kicks in. You have advance warning and can buy just before that date. However, waiting for a price increase to be announced could take months or years. You can make money at any time re-selling Forever Stamps. This is because some buyers on Amazon are willing to pay slightly more than the current postal rate for each stamp.
Best Designs to Buy
You want to buy unique Forever stamps that will maintain their appeal and hopefully not be available for purchase on the USPS website much longer. Ideally, it would be the type of stamps someone might even want to collect and maybe not even use because they are passionate about a person or cause, and the design looks cool.
For instance, Elvis is a beloved figure and an Elvis stamp that will only be available for a limited time should maintain its appeal. Some people are history or military buffs, and a stamp highlighting a particular historical battle or well decorated unit might be one to consider.
Why is it Even Possible to Flip Forever Stamps?
First, people aren’t aware that they can buy Forever Stamps online from the USPS. They think you have to go to the US Post Office which is a miserable experience in many people’s minds. Amazon and its Prime free shipping program, on the other hand, have a very high consumer appeal and people love shopping from Amazon.
Second, the USPS rotates through different Forever Stamps over time, with new designs coming out frequently. Even if they design a stamp in the same genre, for instance, Elvis, the State of New York, or Christmas trees, they will generally retire the old design and come up with a new one. So stamps you bought from USPS even a couple weeks ago might have already been removed from their website and no longer available for purchase.
Third, as mentioned above, while this is not a large factor, the cost of postage does go up over time, so you might capture a few cents of value per stamp if you bought before the increase.
Finally, some people just throw the stamps in their Amazon cart without any idea what the current cost of postage is. For all they know, they are getting the exact same USPS price.
How Do You Sell on Amazon
The short answer is you use the Fulfillment by Amazon (FBA) program. There have been countless online articles written about FBA, but let me summarize it. As a seller, you pay a few different fees to Amazon to store, sell, and ship your products to customers. Amazon then pays you the sale price minus those fees.
Basically, you ship your products in bulk to an Amazon warehouse, and they take it from there. You do write up a description for your products and send photos, but they handle everything else — selling and shipping the product to the customer, as well as customer service issues and returns.
Most sellers pay the $39.99 a month fee for unlimited product listings and then monthly fees per unit based on how much space your products take up in their warehouse.
How Much Money Can You Make?
Amazon actually has a tool at sellercentral.amazon.com that allows you to calculate how much money you make per unit sold. I plugged in the Garden Beauty 2021 USPS Forever Stamps Postage 1 Booklet 20 Stamps, and it gave me the package dimensions of 0.63 X 2.72 X 5.87 inches and a unit weight of 0.0198 pounds.
The item price the seller was charging was $16.68. Assuming Amazon would handle fulfillment, there is a $2.50 selling on Amazon fee, a $2.70 Fulfillment by Amazon fee, but no storage fee (even when I experimented with different values and put as many as 100 stamp books on average being stored).
As for shipping costs, I assumed around 20 stamp books would be mailed from me the seller to Amazon at the same time. Accounting for the shipping from the USPS on a large bulk order to me, then me mailing 20 at a time in an envelope to Amazon, you get roughly $0.10 in cost per unit to ship to Amazon.
The net profit in the calculator is a measly $0.38 or 2.28% profit margin. Note that this does not include the $39.99 a month fee to be part of FBA. Presumably anyone doing this would spread that cost out over 1000’s of units; but again, that might subtract a few more cents off your margin.
The Bottom Line
In most cases, this opportunity is extremely low margin and you should proceed with caution. Try to avoid competition by NOT selling the exact same stamp that is already available at the Amazon marketplace; after all, you are selling a commodity and your margins might get compressed to zero (or negative).
That being said, even for the extremely low margins that are available, this might make sense for some people that think they can turn their inventory over many, many times per year without the work involved of running a traditional retail operation.
It might appeal to other people that don’t mind having some of their money parked in an inventory of stamps as an inflation hedge.
Additionally, some FBA sellers are simply looking to rack up a lot of transactions and ratings so that they have a strong seller profile for their other higher margin items.