This episode of the My First Million podcast features hosts Sam Parr and Shaan Puri discussing the unique business model of a company that specializes in purchasing and reselling unclaimed airline luggage. They explore how this company has secured exclusive deals with major airlines to acquire lost items, ranging from high-end jewelry and luxury watches to bizarre personal belongings, and then resells them at a significant discount.
Topics: Business Models, Unclaimed Luggage, Entrepreneurship, Retail, Secondary Markets
Introduction [00:21]
Shaan Puri: Hey Zach, welcome back. How you doing?
Sam Parr: Pretty good.
Shaan Puri: So, this week you have a profile of a company that has created a monopoly around selling people’s lost luggage. How did you hear about this and tell us a little bit about it?
The Unclaimed Baggage Business Model [00:37]
Sam Parr: Our founder, Sam, actually came across this company. He likes to research weird business models and kind of boring companies that are doing interesting things in the middle of nowhere. This tiny company out in Scottsboro, Alabama, called Unclaimed Baggage, they kind of have a monopoly on this market where they have strict, they’ve struck an exclusive deals with almost every major airline in America. And they essentially buy baggage that the airlines aren’t able to find the owner of, and they sell this baggage in a massive 40,000 square foot warehouse. And yeah, you find some pretty weird stuff there.
The Variety of Lost Items [01:21]
Shaan Puri: You find some pretty weird stuff. You’ve got like pages and pages. Now they have like an online presence, so people can actually go online and buy all kinds of things that people have lost. Unbeknownst to them, their luggage is being sold out from under them, and they probably don’t even know that it is it’s out there still, which is probably uh, it ticks off a lot of people, but.
Sam Parr: To be fair though, the, so the airlines do try really hard to reconnect the luggage with their owners. They have all these crazy matching software systems they use, and in the end, only a tiny fraction of baggage isn’t actually able to be reconnected with its owner. I think it’s something like 0.3% of all luggage in America. But you know, understandably, it is kind of a contentious thing too, because they’re selling really personal items from people’s suitcases. And they have a process when a suitcase comes into the store, they have a team that kind of goes through it and filters out anything that might be inappropriate or that they can’t resell. So they actually only end up selling about a third of the stuff that is in these suitcases. The other two-thirds either get thrown out or donated.
Teasing the Inventory [02:35]
Shaan Puri: So don’t, don’t tell us everything, but give us a little teaser of some of the crazy things that that this company has found and sold.
Sam Parr: You wouldn’t believe it. I mean, you know, a suit of armor, a $64,000 Rolex watch that was like incredibly rare, tons of really expensive jewelry, like $20,000 pieces of jewelry that people just never claimed. Vacuum-packed frogs in a suitcase, the original prop of the character Hoggle from the movie Labyrinth, which is like this weird goblin character or whatever it is. Probably just slammed in the comments for getting that wrong. Live rattlesnakes in a duffel bag, all kinds of very weird stuff that we’ll get into in the article.
Expanding the Inventory [03:04]
Shaan Puri: Very cool. Now, there’s also weapons and all kinds of stuff like NASA products and.
Sam Parr: Yeah, so yeah, they not only sell suitcases, but they sell, they buy unclaimed cargo, which can be anything, like freight cargo, can be government property, and you know, stuff, also stuff that’s left in the overhead bins, musical instruments, skis, surfboards, really anything, anything that people fly with is fair game for them to sell.
Pricing and Value [03:57]
Shaan Puri: And is the stuff reasonably priced? And have you looked online just to get a sense of what what they’re selling and what they sell it at?
Sam Parr: Yeah, I think, you know, some customers have claimed that things are anywhere from like 20 to 80% below what you would pay somewhere else. And it seems, you know, from glancing at their online inventory, it seems their prices are pretty fair. I think the real value add is you just you find one-off things that are probably pretty hard to find sometimes. Like I know that that $64,000 watch I mentioned, you know, I think some some gentleman actually came in the store and ended up getting it for 35 grand. So he he got a pretty sweet deal on that watch. It was probably, you know, it’s a rare Rolex that he probably couldn’t find anywhere else. So it’s kind of like eBay in the sense that you you get these really strange, unique, one-off items that you can’t really sell anywhere else. It’s kind of like kind of like the world’s best, you know, pawn shop or something without the pawning.
Closing [05:00]
Shaan Puri: That’s great. Well, it’s another little subculture that you dive into that I can’t wait to share with the readers. So make sure you guys open it up on Sunday. Thanks for joining us, Zach.
Sam Parr: Yep, see you guys on Sunday.