Make Money on eBay Selling Discontinued Items

There is a fortune to be made selling discontinued items on eBay. Many can be found in local retail stores and will sell for a high profit because consumers are creatures of habit — they don't like change. People will often pay an exorbitant amount of money to keep using their favorite hair color, keep drinking their favorite coffee, or keep using the same baby products on their infants. Learn how to cash in on discontinued products by understanding how to recognize them and how and when to sell them on eBay.

Profit Is All About Timing

To make money on eBay with discontinued and limited edition items, timing is important. The optimal time may be as soon as you find the item, within a few weeks before the item expires, or months later when other sellers have run out. Being greedy does not pay on eBay, and sometimes you end up with nothing. Other sellers will always be willing to charge less. Pay attention to the competition and expiration dates and adjust your pricing as necessary to stay competitive and still make sales.

When you discover that the selling price is falling and your profit margin reaches its lowest acceptable level and the expiration date is approaching, sell the items in a lot or batch for your cost and move on. Get out while you can still recover your investment. Another profitable discontinued item will come along. If there is no expiration date, you can price high and wait. Items like food and health and beauty products often have expiration dates. eBay does not allow the sale of expired products on the site.

How to Sell Discontinued Items on eBay

The best way to sell discontinued items is to buy a few (if you can find them), see how they perform, and then buy more if the profit is acceptable. It is not a good idea to buy hundreds of dollars worth of merchandise at one time because you may get stuck with too much of a product after it was no longer profitable. This can be a costly lesson, so don't get greedy. Find a source, sell some of the product, and then decide if you want to sell more. It is better to miss out on a buying opportunity than to hoard a product (especially if it expires soon) and get stuck with a bunch of products you can't sell. 

What Kinds of Discontinued Items Are Best?

The best types of discontinued items to sell on eBay are consumable retail goods such as cosmetics, health and beauty products, medicines, baby products, first aid items, and non-perishable food products. These items will constantly be discontinued, and this is by design. Large manufacturers like Johnson and Johnson, Kimberly Clark, Nabisco, and Kraft know that the consumer market will respond to a new product.

When sales of a once profitable product fall below a certain threshold or fall into the decline stage of the product lifecycle, manufacturers know it is time to stop making it. Shelf space can be allocated to a new product that will get its own advertising campaign and a lot of marketing attention. Shelf space for the declining product will be allocated to the new product. It is a cycle that occurs constantly and what drives many of the manufacturers to continually develop new products.

Why Discontinued Products Sell for Such High Prices

Everything in America seems to be “new and improved,” yet plenty of consumers still love “established and trusted.” There is a market of consumers who pay for tried and true products that they can no longer buy through conventional means. Many products in the decline stage still have a loyal following of customers.

One example is hair color. When women find an at-home hair color that works for them, they are reluctant to change. Hair color is always being discontinued. The next time you are in a Walgreens or a grocery store, look at the clearance or reduced section. Hair color is usually one product that is always marked down. It is not unusual for hair color to be marked down to $3 a box, and to sell on eBay for $45 or more per box. And don't forget the men's hair color. Shades of Just for Men Touch of Gray is also discontinued regularly and can sell for up to $20 a box on eBay.

Non-perishable food is another category to pay attention to. Remember the Hostess Twinkie frenzy back in November of 2012? According to the Chicago Tribune, "The company said Friday it has asked a bankruptcy judge for permission to go out of business and lay off 18,500 workers, blaming a labor strike by members of the Bakery, Confectionery, Tobacco Workers, and Grain Millers International Union."

Smart eBay sellers rushed out to grocery stores, Target, Walmart, and anywhere Twinkies were sold. They listed the iconic snack cakes on eBay and many sold for over $30 a box. Sometimes, a major event like the Twinkie situation is a great way to make some fast cash on a disappearing product.

Other brands and types of products that are frequently discontinued:

• Aveeno skin and hair care products
• Pantene hair products
• Redken hair products
• Air freshener refills
• Breakfast cereal
• Cake mix and frosting flavors
• Coffee (especially K-cups)
• Deodorant
• Laundry fabric fresheners (dryer bars, beads)
• Stop-Smoking products (gum, patches)
• Sunscreen
• Vitamins and supplements

How to Find out If an Item Is Discontinued

Learning about a discontinued item is mostly paying attention. A few ways to learn if an item has been discontinued:

• Go on eBay to the health and beauty and grocery categories and search for the keyword "discontinued."
• Google it. Lots of bloggers vent online when one of their favorite items has been discontinued. The manufacturer may also have the notice of discontinuation on their website.
• Look on Amazon reviews. Customers will often use the Amazon Reviews option to complain that products the like are not available because they were discontinued.
• Call the 1-800 number on the back of the product and ask them. Nothing like getting the information directly from the horse's mouth. If you call the company, ask if the product is undergoing a packaging change or if it has permanently been discontinued. If just a packaging change, the item will return to the shelves and you will know you only have a short window to sell the item for a profit before the supply is reinstated.
• Watch the news. There are often reports of discontinued items showing up on eBay for crazy prices. For example, when the Today Sponge was taken off the market, NBC News reported it. Today Sponges were selling on eBay for 5 times the shelf price because eBay sellers had purchased them for resale, and there were not any available in stores. Eventually, the sponge was re-released and supply caught up with demand.

Pay attention to what customers in stores are saying. Have you ever been shopping and another customer is looking for something and comments that they can't find something. Or they turn to the person they are shopping with and say something like:

"I can never find __________. I wonder if they don't make it anymore."

That's your cue to ask them what they are looking for and do the research later. Just paying attention to what is going on around you can have huge rewards.

Use Caution When Buying Discontinued Products for Resale 

Remember to do your homework and check completed listings to determine a fair and competitive price. Don’t assume other sellers have done the math. They may not be getting the item for the same price that you are paying.

Look for the items discontinued items to resell at grocery stores, drug stores, WalMart, Target, dollar stores, Big Lots, Ollies, Five Below, local independent closeout stores, or grocery liquidators. You may also find items at garage sales, and estate sales. Some grocery stores have a special section for clearance items. Some of those items are being discontinued in that particular store only because they aren't a good fit for the local market. Others have been discontinued by the manufacturer. You will have to do the research to determine which it is. If discontinued by the manufacturer, the price can only go up because the item won't be made anymore, and simple economics tells us that the less there is of something, the more people will pay for it. If the item has only been discontinued by a particular store, it will still be readily available elsewhere and won't be a good seller on eBay.

Where to Find Discontinued Consumable Products

Look for hair products at salons, Ulta, Sephora, and other stores specializing in makeup, skin, and hair care. Sometimes items will be in the clearance section, sometimes they will be on the shelf at regular price. You can often still make a nice profit paying regular retail for the item — so look at the regular sales floor in addition to the clearance section. Always do the research and math before buying.

Probably one of the best places to find discontinued items is at and flea markets. Vendors often have a large quantity to sell and don’t care about selling online because they lack the skills or the patience required to sell on eBay. Most flea market sellers have no interest in listing, shipping, or waiting for the sale — they have a fast-turn business model and want to sell quickly without having to deal with eBay's rules or the possibility of returns.

You never know when or where discontinued items will pop up so always be on the lookout.