Another month is in the books, and that means that it’s time for me to share another financial results post. If you missed any of my past financial results posts, you can find them HERE.
We’ll get started with some background information on how my time was spent this month. I took about 3 days completely off this month, but with the exception of that I was working around 40 hours per week related to selling online this month.
Before we get to the numbers, there is one more topic to discuss. My goal with sharing my financial results is to show what can be done, and is not meant to be seen as bragging or anything of the sort. I want to show that working hard and sticking with your plan can pay off. If the results turn out to be poor at any time I will share that too.
With that said, let’s get into the numbers for August.
August 2014 Financial Results
I have continued with the same format that I used last month to continue to show additional detail of revenues and expenses. I want to provide as much clarity as possible into what I am doing on a month to month basis (if you have suggestions for additions to these posts, please let me know!). The numbers below are basically the profits that I am making for the month. The profits are calculated only on items that have been sold and shipped during the month. They were calculated by taking selling prices, minus all fees, minus all shipping and packaging costs, and subtracting the cost of the items. Certain important numbers such as: COGS, inbound shipping to amazon, customer returns, supplies, storage fees, and services have been broken out separately. The FBA profits number factors in reimbursements from amazon for items lost or damaged at the warehouse. This will NOT be the exact number that goes on my tax returns as there will be additional deductions for cell phone, home office, etc. However, some of these are costs I would generally be incurring anyway, so for simplicity I will be leaving them out of the calculations. It’s also possible that I missed a receipt or 2 and the spending numbers may be updated slightly, but all numbers from amazon/eBay are 100% accurate. Also for clarity, this does not include any income from any other sources, it is simply my income from amazon and eBay. To get a better look, click on this image (or any others in the post) to enlarge.
Notes: These are pretax income numbers and mileage has been calculated at the IRS rate of $0.56/mile. MF stands for merchant fulfilled and FBA is fulfilled by amazon.
This was my best month yet in terms of sales and profits, and I am very happy with these results. Revenues were up across the board on all of the sales channels that I use compared to last month which is good to see. The amazon commissions and fees were up quite a bit compared to last month due to the increase in sales volume, but that was to be expected. The amount of commissions that I paid out to individuals sourcing for me during August was up quite significantly as well. You can find a brief explanation of the commissions I am paying in last month’s results post. This was due to a several reasons, but the main one being that there was a larger percentage of my inventory that was sourced by others that I am paying commissions on this month.
Profits were up significantly due to several factors, but the largest one was increased product sourcing both by me personally, as well as those individuals helping me source. There was also a seasonal strategy that I was utilizing that has helped to increase this month’s profits as well.
The services that I am paying for that comprise the above monthly total are the following:
Inventory Lab – I use their service for listing all of my products for sale on amazon, as well as the majority of my accounting. Current cost is $49.99/month, you can sign up for a 30 day free trial with no credit card required.
Scanpower– This is the primary scanning app that I use in retail stores. Current cost is $39.95/month, you can obtain a 1 month free trial by entering my email (email@example.com) when signing up.
Shoeboxed– This is a service that I use to manage my receipts. I send my receipts off to them in an envelope, they scan them into an online filling system, and mail them back to me. Current cost for the plan I am using is $29.99/month, you can sign up for a one month free trial.
UPS Smart Pickup – This is a service to have UPS pickup boxes from my house, rather than having to personally drop them off at a UPS location. Current Cost is $41.20/month.
Appeagle– This is new this month, and is a repricing service that I am using. So far I really like the results from using this as it will end up saving me a lot of time manually repricing. In addition, it reprices items up as well as down, so I have sold many items already for more than I have listed them for. They have a 14 day free trial, and if you enter coupon code which you can gain access to from my resources page, and you will receive 50% off your first month’s subscription if you elect to become a paying user. The current cost for this service for me is $25/mo.
Note that of these services, the current total costs do not add up to the numbers shown above, as I paid for some of these on an annual basis to obtain a discount.
Next up, we’ll take a look at my cash flow for the month:
Cash flow for the month was fairly significantly negative. This is due to continuing to buy significant amounts of products, as well as the timing of my amazon deposits this month. I currently have significantly more waiting to be deposited into my bank account from amazon on my next disbursement than the approximately $7K that my cash flow was negative this month. So on the surface this might look like a poor result, but part of it is just due to the timing of disbursements. Also, as I have stated in previous months I am looking to keep cash flow around zero for the time being as I continue to work to grow this business, so cash flow in this range is according to plan.
The other piece of the puzzle that is not currently shown in these results posts is the current value of my inventory. As this is increasing every month as I continue to reinvest virtually all proceeds from amazon. There have been some large negatives in 2 of the last 3 months, but overall I am at about zero in net cash flow for the year. I am planning on continuing this trend for the foreseeable future as well.
Now I will share some screenshots to provide some support for the above numbers I am sharing. Please note that the amazon sales number will not be exactly the same as what is shown above, as the screenshot below shows all orders that have been placed (but not necessarily shipped), while the above numbers are only for items that actually shipped during the month. In this case, I had a significant amount of sales toward the end of the month that had not shipped, and thus they did not show up in the above revenue numbers, but they will show up in the screenshot below. Due to this the variance is to be expected:
Overall, about $43K in products were ordered from me during amazon, and I am very happy to see this increase. It was by far my best month yet in terms of sales, and I hope to see the trend continue.
If you want to see the breakdown of the product categories that comprised the $43K in sales, you can get a free one page PDF via email showing the breakdown by clicking the link directly below. Simply click this link and you can enter your email without leaving this page to receive the report.
Now, here’s a screenshot of my eBay sales:
My eBay sales were again relatively low, and again this result is due to focusing almost exclusively on FBA. The backlog of items for eBay remains, and I have some plans in place to get these items selling in the coming months. Doing this will help with the cash flow as well, as all of these items are paid for, but just have not sold (unfortunately, many are not even listed).
Overall, I am very happy with the results from this month. I reached my goal of exceeding $10,000 in profits that I set last month. I am hoping to again exceed $10,000 in profits for September as well.
New as of today, I have created an Online Selling Experiment Facebook group. My goal for this group is for a place to primarily share “experiments” and new things that we are trying related to selling on amazon. I have some specific ideas and examples that I will be sharing within the group. In addition to this I will be sharing the amount of time I spend working September 8th through September 14th by posting a recap of what I worked on and for how long each night to provide some insight into how I spend my time working for anyone who wants to see. You can join by clicking HERE.
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