Looks like Marty made money on '42 M

In one of my previous Marty threads, someone said that Marty was making money. I wasn't so sure so I entered all his auctions on an Oliver 1900 into a spreadsheet. The Oliver was powered with a 4-53 Detroit Diesel which he disassembled. I reported here, and on the Oliver Board, that he probably took a loss. He would have done better selling that tractor with one auction.

I wanted to see what would happen with an IH product. The Oliver crowd doesn't seem to be that needy for parts. Marty lucked out with three bidding frenzys on the SMTA grill @ $430, PTO shaft @ $218.49, and M&W (?) live pump @ $300. They total $948.49.


34 no bids
18 one bids for $197.82 total
4 two bids for $53.08
6 three bids for $166.62
7 four bids for $155.49
3 five bids for $207.27
3 six bids for $94.64
2 seven bids for $52.50
3 eight bids for $107.82
13 nine or greater bids for $1708.20

Total bids are $2643.44
Total shipping is $844.00
Residue (scrap) estimate is $350.
Cost of tractor was a confirmed $950.00

The grill, PTO, and pump saved his butt. I don't think he was banking on those items to deliver the bids.

I am still of the opinion that his business is marginal at best. He is cranking out six tractors this week. Hard to know if this is a desperation move or simply a planned sales expansion to coincide with a vacation week.

Parting out tractors can be profitable. I just wonder if his business model actually works. No, I am not doing this brief analysis as a guide to establishing my own dismantling operation. Where am I going to find the inventory in New England?

One of the benefits of Marty's efforts is he has depressed the value of parts for the rest of us who are buyers. It is why I would buy from him if I wasn't blocked. An occasional bad part is worth it when the other low-cost parts are averaged in.

The following add is posted on the Northern Mi. Craiglist with photos. Really nice looking H. Probably the same sort of deal.


this tractor is being parted out and only selling by the part was in a shed for over 20 yrs runs great no smoke the nices sheet metal we ever seen and can UPS parts to save gas money best to call 1 989 313 1841 as email dose not work all the time 1 989 313 1841

Thanks for running the data Wardner. It is cool to see what the final totals look like. I did a little math beyond yours to see what he would have made without the three big parts.
Total minus the big three $1694.95
Scrap $350 (don't forget he is making more than you because he sells a lot and it is $240/ton machine cast not $180 heavy shread)
Shipping $844
Purchase Price $950
TOTAL (w/o big three) $250.95 (Plus you can figure another $150? for a regular grill, pump and PTO) That would make it $400


At first I thought that would chicken turds, but if he kills one tractor a week he makes $20,800 per year. That guy said he bought at least three tractors at the one sale. Do the math there...

It would really be "profitable" to you and I because we would keep all the parts we "had" to have and use the rest to supplement our habit. I think this is the direction a couple board members are headed in.

The problem is you have to find them for less than $1000 or there is no room for error. The other math we didn't do is tire disposal. Those rears will add up in a hurry. I went to the tractor killer guy in northern WI to pickup my WD-9 engine and there had to be 300 rear tires scattered in the woods around his shop.

Does the shipping come out of the total you gave or is that paid for separately? The other factor that comes to my mind is that (at least for me) ebay charges 9% of price+shipping on each sale and paypal takes another 2.9% +30 cents per transaction, plus ebay is charging him 25 cents for each listing since his all start at 9.99. I have parted out 8 tractors over the past two years, and I have found it to be fairly profitable on my scale. I only part out tractors that are clearly going to cost more to repair than they are worth. All but one have had seized engines and that one had a lot of other issues. I have paid anywhere from $330 to $900 including delivery. I list parts for sale until they sell instead of scrapping them if they don't go the first time, although I do scrap parts that are damaged. I have always found that rear tires are one of the first things to sell so I am surprised that they are a disposal problem. If they are totally junk I will take them to the dump, but that is rare.
Zach

sflem,

The shipping at $844 means nothing. Can't be used in his gross profit calculation. He either wins or loses some unknowable amount. The shipping he "calculates" and charges the winning bidder is offset by UPS fees, packaging materials, and a considerable amount of labor. It's my opinion that he loses on those charges when taken as a whole. And he does discount well on combined shipping of two or more items.

When using your figure of $400 or any number, there has been no accounting for all the other labor, eBay fees, rent value, trucking and equipment expense, utilities, workman's comp and other insurance, FICA, and on and on. He is certainly not a one-man operation. I assume he has three to six people on the payroll or hires them as sub-contractors. If they are sub-contractors, he better not get caught. Michigan will squash him like a grape on the floor of the produce section. The state compliance officers know slime when they see it.

As for tires, he sold the rear pair with rims for $78. One front for $26.64 and the other for $38.55.

As for scrap, he probably is getting a good price as he is located near Lake Huron. I can do better being located 20 miles from the Atlantic Ocean. I can't quote you because I haven't scrapped anything since I got a high of $380 per long ton on "heavy melting" several years ago.

Very true, shipping should be a wash. Generally shipping covers shipping and eBay fees from what I have seen by buying and selling back in the day.

That is quite a bit of money for scrap. Those prices were current as of two weeks ago here in WI.

I realize there are costs to doing business, but it still gives you an idea of what he has to work with. I certainly can't justify doing it for that kind of money. Like I said, it wouldn't be the worst thing if you did it to supplement your habit.

I'm really glad he's selling stuff!

Rick

Interesting discussion. I'm surprised the pto shaft brought that much.

Shoot, a year and a half ago I bought two nearly complete M's for $250 each and before that one with no rims for $200. The one with no rims has a dented MTA grill on it and a good rear end. They're still decorating my yard. Makes you think, though.

ive been to alot of sales that he has bought tractors at. ive seen him loose money and ive seen him make thousands. but i think its all about volume he does not just buy one he buys loads sometimes more then on trip.

If Marty wasn't making enough money to satisfy himself, he wouldn't continue to use this business model. Even with his very basic listings, it's a LOT of work when you're talking about 100's of auctions.

Marty sees no need to improve his business. He's obviously making good money at it, or he would quit. If he alienates a few people, so be it. He's got millions more to choose from.

If you're not mature enough to realize from his vague descriptions, iffy pictures, and too-good-to-be-true prices, that you're buying as-is, where-is and taking a chance on the part, anything that happens is on you.

That said, IMHO it's worth it when the parts are a mere fraction of what you'd pay in a junkyard.