There is more than 1 way to make money with comics. In this article, I will

• Identify 4 main methods that are commonly used
• Describe the main competencies or skills needed for each method
• Highlight the risk of each method
• Explain why it is important to know which method suits you the most

Method #1: The Retail Model

The retail model of making money with comics requires volume. In this method, it doesn’t really matter if you are making $10 or $100 per book as long as it is positive.

Sometimes, you might even take some small losses to just churn the money into new books.

To make significant money with this model, you need to be buying and selling comics on a consistent basis. Hence, you need to be good in the following:

• Supplier database: where to source for comics in large volume
• Logistic management: how to store, record and manage your inventory
• Shipping processes: how to ship safely and more efficiently
• Finance: how to keep track of all the spending and revenue of high volume sales
• Customer service: since you are volume dependent, you need to develop good customer service to ensure that majority of your customers are happy or the refunds will be crazy. You will also want repeat customers if possible to keep the volume high.

The good thing about this model is that the profit ceiling can be high if you are hardworking and consistent. The faster you churn, the more profits you can generate.

The down side is the amount of leg work you need to do. If you do not enjoy any of the above activities that I have described above, you will feel the burnout pretty quickly.

Method #2: The Arbitrager Model

The Arbitrager model refers to buying something for under market for a confirmed profit. For example, buying release day comics for cover when they are already selling for well over that.

Another popular example is scouting back issue bins for comics that might be mispriced due to owners not following up on the latest news.

This model has some similarities as the retail with some notable differences:

• You do not buy unless it is a confirmed profit. In contrast, retail model will buy even when there is no mispricing
• You do not sell comics as consistently as the retailer as it is limited by whether there are any arbitrage opportunities for that month or week
• The volume of sales is lower

In this method, you need to be good at the following:

• Finding deals either online or offline
• Be the first to know the news to exploit any arbitrage opportunities
• Be quick in your Ebay listings

Among the 4 methods, this is the least risky way of making money since the profits are confirmed.

The downside is that these opportunities are not consistent. It also depends a lot of whether you have access to a good number of comic shops or yard sales to find deals.

Method #3: The Value Add Model

In this method, you are acting like a oil refinery, which takes in crude oil and refines them into more expensive products.

For our case, it will be taking raw comic books and, pressing and grading them. So, you are making money because you are adding value to the comic. How much profits you make will depend on how good your value adding process is.

Specifically:

• Are you good at grading raw books using images alone?
• Are you good at pressing or know somebody who does?
• Are you efficient at CGC submission?
• Are you knowledgeable on the price difference between raw and graded books?

If you are good at the above, this model can be very profitable as well since the profits between the raw and the graded comic are also confirmed.

The risk to this method boils down to how often do you get the grading wrong. This is important as a differences in grade can drastically reduce your profits and might make the whole method unprofitable.

However, as long as you have more hits than misses, this will be a good method.

Method #4: The Investor Model

The final method is the investor model, which is the model that is the most suited for me. For this method to work, you need 2 things:

• The ability to do proper research that can give you some estimates of the long term value of comics
• A large capital

The capital part is seldom discussed in the comic circuit but is important. Without a sufficient large base of capital, it is difficult to see significant money with this method.

For example, let’s say our research is able to pinpoint comics that can return 5X over a 3-5 year holding period. Imagine you only invested $1000 for a year. Even if the comics do hit the 5X, you will only be getting back $5000.

In contrast, if your capital base is $20,000, you will be getting back $100,000.

This large capital requirement is a downside of this method. Furthermore, you can’t really touch the money for a long period of time so the ability to hold on to the books is important.

This is in contrast to the above 3 methods, which can generate cash upfront and needs no holding period.

The plus point of this method is that you will be doing less legwork as your returns are compounded by time.

Why is it important to focus on 1-2 methods?

Most of us have dabble in most if not all of the methods. However, to be good in them, you will really to focus on 1 to 2 method that fits you.

This is because the skills and processes needed in these 4 methods are different, although there might be some overlaps. It is difficult for one person to master all of these skills and also to develop the necessary processes.

This difficulty is why you do not see a business that is

• A retailer
• A trading company (to arbitrage)
• A refinery company (to add value)
• A investment fund

If you think doing all 4 businesses is crazy, then it applies to the way you are making money with comics as well.

I am not saying you cannot dabble in all 4 methods if the opportunities arise. However, to be consistent in your money making, focusing on one and developing your processes to maximize it is key.