$20k Challenge Result Take 2 - Profit Revised Down Significantly

Last Friday I posted the breakdown of my $20k challenge results.  I claimed that I earned a profit of 2.9% on the sales and 10.3% when you consider all of the portal payouts and loyalty points, etc.

Then on Tuesday I showed one of my main purchases, which was buying iPads from Sam's Club.


Trouble then ensued:





Noah from Money Metagame who is also one of the participants commented:

For the 20k Spending Challenge, you can't count the $40 you saved via different card's Amex Offers of $20 off $20 towards your profit. If all spending is on the Amex Plat, you'd only be able to save $20 once for the entire challenge at Sam's Club.
This would be like me saying I used a different Amex card to get a free $20 Sam's Club GC and sold it for $18 profit. No spending went on the card, but somehow my profit in the $20k challenge became $18 better. It just doesn't work that way.
I think some recalculating is in order.

Vinh of Miles per Day agreed with Noah.  Vinh happens to have also started the challenge:

Good call Noah. When I read that, I thought it was a bit odd that he counted it. You can either count the $20 as if you really did use the AMEX Plat there or you can only count the AGC profit route.

Point of Contention

If you look at the post from Tuesday, you will see that I saved $40 off the price of the iPad by using 2 AmEx Offers for You on top of the discount gift cards I bought via my AmEx Business Platinum.

Noah and Vinh contend that I cannot use an AmEx Offers for You from another AmEx card as part of my profit calculation.  All spending must be done through the AmEx Business Platinum.

My Logic 

When I decided to use the AmEx Offers for You I looked at it like a $40 coupon off the product.  $20,000 was entirely spent on the AmEx Business Platinum (the offer was $20 off a $20 purchase).  Not one penny was laid out on another card.

If I had an unlimited supply of $40 coupons, everyone would agree that I would be able to use those in my profit calculation.  Is this really different?  I think there is an argument for both ways, but I may be justifying what I already did.

Either way, I'm happy to go along with Noah and Vinh especially since the stakes of the challenge are nothing.  

My New Math

I used this idea to buy 15 iPads so $40 of Profit x 15 iPads is now down the tubes.  That's $600 of profit lost for the challenge.  

My new profit numbers now assume the $600 was put right on AmEx Business Platinum.  The $600 goes into the cost of the merchandise, but does not affect portal payouts or loyalty points so I won't show that here.  

• Spending Complete: $20,511 

• Inventory Total: $405 -  One laptop was returned, it will be shipped back to me soon, this will hurt my profit margin until it is resold.

• Selling Price of Merchandise after Amazon Fees: $20,482.53
• Net After Fees -    -$28.47

• Profit Margin from Sale -     -0.14%

• All forms of Portal and Loyalty $ - $1,478.20

• Net after Portal and Loyalty Points - $1,449.73

• Profit margin after Portal and Loyalty Points - 7.07%

That's obviously much worse than previously, but still not too bad.

Merchandise vs. Gift Cards

While this may not have worked out for the challenge, the math of my original sales stay the same for your own reselling.  The profit is still profit, just not earned from the correct credit card.


The Sam's Club iPad deal involved 5 different forms of savings, a quintuple dip ala Frequent Miler.

- AmEx Offers for You
- AmEx Gift Cards
- Discount Gift Cards
- Shopping Portal
- Sam's Club Cash

I think this actually illustrates something that merchandise reselling has as a benefit over gift card reselling.  Don't get me wrong, I enjoy a gift card resale as much as the next guy, I do it all the time.  That being said, it can be difficult to stack many avenues of savings when buying gift cards. Merchandise reselling can involve a lot of creativity and quadruple or quintuple dipping can turn a bad deal into a great deal.