Another month is in the books and that means it is time for another financial results post. If you missed last month’s or any previous results posts, you can find them HERE.
We’ll get started with some background information on how my time was spent during May 2014 before getting into the numbers. May was a unique month in that a significant portion of my time was spent related to activities for my textbooks business. Some of this was by design, and a few things came up during the month that required my time that were not planned for. I spent about 100 hours over the course of 3 weeks directly related to my textbooks business, which was time that I did not have available for the online selling activities that I am blogging about here. In addition to this, there was one day that I took completely off to attend the college graduation of one of my brothers. So in total, for the month of May, about half of my working hours were spent on activities not related to selling online. This is a very significant amount of time, and it did have an impact on my May results.
Before we get to the numbers, 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 May. There are not any new additions this month to the level of detail that I will be sharing. 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: 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. Also for clarity, this does not include any income from www.textbooks4you.com, it is simply my income from amazon and eBay.
May 2014 Financial Results
Notes: Items in parentheses indicates a negative number. Mileage expense was calculated using the IRS mileage rate of $0.56 per mile.
Profits for this month took a significant dip, but this was due mainly to the way that I spent my time this month. Overall, I am quite happy with this level of profits as it was reached with about half of my working time being spent on other activities. I am planning to devote the vast majority of my working hours this month to selling online, and it should result in seeing an increase in profits for June’s financial results post.
A note on the inbound shipping, there were a good number of heavy and oversize items that I sent into FBA during the month of May. This is the reason for the inbound shipping amount not decreasing more substantially compared to April despite the less overall time spent related to amazon and eBay.
Next, we will take a look at this month’s cash flow:
Total cash inflows decreased a bit compared to last month, but remained significantly positive. Inventory purchases decreased for the first month in awhile, and this was due to the way my time was spent. It’s good to see cash flow be positive for the month, but in reality as long as it’s around zero as I grow my business I will be happy. Down the road I will definitely looking for a nice positive cash flow month after month, but growing quickly often necessitates having a low cash flow.
Now, here are some screenshots from my amazon account to provide some support for the profit numbers I am sharing. Sales for May 2014:
Overall, sales were down about 33% which is significant. This was due largely to the way my time was spent. Another factor playing a large part, was the decrease in average selling price from $48.07 to $33.91. This was due to selling many items during April that were over $100, that are unlikely to be as profitable as they were during April. I am going to continue to look for ways to increase my average selling price, and keep it as high as possible.
Now, here’s my sales by category for the month:
There are a few noteworthy items here. Toys remained my number one category in terms of sales dollars, but in terms of items sold the beauty category was my top category for the month. In addition to this no single category was over 20% of my sales, which is a change from the past months. I plan to continue to stay diversified across categories to help minimize the overall risk in any one category. I am happy with this mix of categories for May, but it is somewhat unlikely that I will see no single category representing even 20% of my total sales volume again soon.
I won’t be showing an eBay screenshot as the total amount was less than $100.
Overall, total sales for the month were $19,090.40 versus $29,707 for April. As previously discussed, this was mainly due to how my time was spent for the month. My goal for next month is to exceed $7,500 in profits and get back in line with what I saw in April. I believe there will be some lingering effects in June from the lack of work in May, but my goal is to work hard to get the inventory levels back up, and get the profits increasing as well.
Last month I did a contest in which Jenn, Meredith, and Hendra all received a 20 minute phone/video call with me. It was great getting to talk to each of them, and I want to try another contest this month.
The prize: Three (3) individuals will win a 20 minute phone call / video call with me via the method of their choosing from the following options: phone call, skype call, or video call via google plus. In the call you can ask me any questions that you would like about selling on amazon, selling on eBay, tips to grow your business, board games, sports, products you sell that I should be using, or any topic you would like to discuss. Each winner can ask whatever they want.
How to enter: You can enter this contest by either of the following methods:
- Subscribing to the blog using the button below if you are not currently a subscriber.
- Leaving a comment below answering either of these questions:
- What are your goals for June 2014 with selling online?
- What has been the most beneficial tip or piece of advice that you have received related to selling online?
That’s it, either subscribe or leave a comment answering one of the 2 questions and you will be entered to win. There will be a maximum of one (1) entry per person. The deadline to enter is June 10th 2014 at 11:59 PM ET. At this time 3 individuals will be chosen by using www.random.org. Winners will be contacted via email to arrange scheduling.
Thanks for reading, and if you have any other questions or comments, please leave them below or send me an email at email@example.com.
52 thoughts on “May 2014 Financial Results from selling on amazon and eBay”
Hey Ryan, I just spent the past few days reading your entire blog. Good stuff! I have a question I hope you can answer. If you only had 3k to spend on inventory every month, what would be a reasonable sales # and profit per month?
Glad to hear you have enjoyed the blog! If you were to be able to spend the entire $3K and get all of the inventory shipped into amazon, I would think it would be possible to get to $2-3K in profit on $8-9K in sales within a couple of months.
Ryan, another question: when you send an item in how quickly do you want it to sell? Are you pricing for fast nickle or slow dime? Obviously ideally we’d want everything in our inventory to sell out, but reality is that won’t happen. So, what is a good rule of thumb for sell-through rate for you?
Thanks for answering all my questions!
I try to apply a balanced approach to my inventory, meaning that my goal is to have a variety of fast and slow selling items. Normally I am looking for items that will sell in 1-6 months. I haven’t calculated my exact sell through rate recently as I have been working on growing quickly, but I would say it is around 25-30% on a monthly basis.
My goal for June is to start selling grocery and sell over 40 units since I had to move to the pro account. I just got authorized for grocery, so I can check that one off, now just need to sell.
Sounds like a great goal, and good to hear you were able to get the grocery approval.
Great blog! Found you via /r/flipping. I’m just getting starting in this business. I found my first two items at a thrift store but have started to realize the greatest gains can be from FBA. Sourcing seems to be the area in which I need the most guidance so I’m hoping to win your contest and learn from someone with experience where to begin.
My goal for June 2014 is earn at least $100 in net profits. I’m hoping this can come from my first ebay or Amazon sale.
Thank you again,
Glad you found the blog, and that sounds like a great goal for June!
Just getting started so goal for this month is to make enough to cover fees for pro account and shipping. Also to continue to learn about wholesale sourcing options.
Sounds like a great goal, good luck making it happen!
Hi Ryan, I’ve been doing FBA since April and am completely obsessed with it – no kidding, I dream of it all the time. My goals for June are to continue to increase each payout (currently bi-weekly) by 15%, to learn how to source online, and to master sourcing locally for replens. My fingers are crossed that I’ll win a call with you. Congrats on all your success!
FBA can be very addicting as it sounds like you are finding out. That’s an awesome goal, and 15% increases every 2 weeks will really add up quick.
I am looking to do $3,500 in gross sales with a profit of 1,000+. Last month I did sales of $3000 with $770 of it being profit.
Great goal, best of luck on making it happen!
Hey Ryan, great work this month, despite redirecting 100 hours of your time you still came out profiting! I think my goal for the month will be to get my Amazon business started as my eBay one has hit a limit. I’d also like to learn about these limits and try to raise it.
Thanks Jay! That sounds like a great goal for the month as well.
You say this is the profits of just the inventory that sold during the month,
Do you have a program that you enter
In what you payed for a given item so that you just have to run a report to get these charts you have or what. Just seems rather tedious to figure up your exact profits every month. I know I can go through the items I sell and get this info but I only sell about 10% of what you do at this point.
Yes, I am using a program called InventoryLab in which I enter the costs when buying to calculate the profits when items sell. I agree that without this program it would be a very tedious process to figure out the per item profits. I have been getting more questions about this lately, so I will be doing a full review of InventoryLab and all of the features that I use in the near future.
One more question Ryan, when you make purchases at retail locations do you ask to be sales tax exempt? I know this is possible for resellers like us provided we have the right documentation, but having never done it can you give me advice on asking to be exempt from sales tax for a purchase at the front counter?
Do you think there is negative side effects to doing so, like the employees will know what you are doing and watch you more closely or they will refuse to sell to you?
All your content has been a treasure trove, thanks!
Great to hear you are enjoying the content! I do generally purchase tax exempt at retail stores. The only thing you really need to do at most stores is say that your purchase will be tax exempt and provide a copy of your resale certificate. It varies a bit from store to store, but if you ask how to get tax exempt, then they will let you know.
I have considered the negative effects, but so far I have not noticed any employees begin, or had any stores refuse to sell to me. There are a few stores that I don’t use my resale certificate, but at the vast majority I do and haven’t noticed any issues.
Thanks for this awesome blog. It is a great source of inspiration and information.
1) My goal is to generate $2000 in cash flow per month by year end. I’m at about $400 after expenses now so that is a stretch.
2) Best tip was found by looking at your inventory purchases. It really shows the need for continual sourcing.
Thank you LC! That’s a great goal, and that’s awesome that seeing the inventory purchases is your tip! 🙂
Hey Ryan, Congrats on another great month!
My goal for this month is to get my first shipment sent to FBA.
I have a question for you… how are you handling your taxes, from what I’ve read, doing FBA causes tax liabilities in several states, because the warehouses are all over the place. Can you shed some light in how you’re dealing with this?
Also, another question (if I may), when you scan an item in the amazon seller app, it asks for outboud shipping cost. What is a good rule of thumb to calculate shipping cost on the fly?
Thank you! Currently, I am not sharing my sales tax strategies on the blog. I am working on getting everything fully setup and will plan on sharing as soon as I have it finalized.
As for outbound shipping, I usually assume it’s $1 an item for estimation purposes. In reality, it’s usually between $0.50-$0.60 per pound. Best of luck to you on getting the first shipment sent to FBA!
I love the way you are asking about June 2014 goals – motivates to get the job done right away, and not stretch it out for a year.
Last month has been really good to me regarding Amazon sales. Not as much as in money figures but in terms of growth, comparing to previous month.
Regarding your question about goals for June – I recently saw this quote online “Proceed as if success in inevitable” which resonates with me because I am that type of person that does not like to risk much. So I decided to “adopt” this quote and try to live by it for the next few months.
As for the most beneficial tip related to selling online – it was to use FBA by Amazon 🙂
Sounds like a great goal, and that is definitely a good quote to live by. Using FBA is a great tip as well 🙂
My goal for this month is to import my first private label product to sell on Amazon.
My tip is to take action now if you haven’t already and don’t be discouraged when faced with a setback.
Congrats on your success and all that you share!
That’s an awesome goal, and great advice. You’ll have to let me know how the private labeling ends up going for you as that is something I am going to look into down the road.
1) My goals for 2014 is to earn enough to quit my 9-5. My girlfriend and I are working toward that both!
2) Bonus Answer : My best piece of advise from a blog or on-line was showing me that you can make a living doing this type of work, but …….I still need to learn more. Hoping to win the contest!!!! -Joe
That’s a great goal! and doing this full time is absolutely possible.
I have question about your income statement.
How do you determine which items you are selling are Amazon Merchant Fulfilled versus Amazon FBA?
I use a program called InventoryLab to track my finances, and within the software I able to download separate reports for items sold via FBA and merchant fulfilled.
Sorry my question wasn’t worded correctly.
I was curious on why you might choose to sell certain items using the Merchant fulfilled channel versus the Amazon FBA channel. Does it just depend on the item due shipping cost or size or something like that?
No worries Theo. This post explains how I decide where to list my items: https://onlinesellingexperiment.com/should-i-list-my-item-for-sale-on-amazon-or-ebay/
If you have further questions after reading that, just let me know.
What are your goals for June 2014 with selling online? I am looking to bring my wife into my Ebay/Amazon sales. Hopefully she can be a big help!!
What has been the most beneficial tip or piece of advice that you have received related to selling online? Diverify markets. I am selling products now that i would have never looked at before. New customers with better margins. A win for all:)
That’s an awesome goal Aaron, best of luck in making that happen!
Ryan…I have been working in corporate America for the last 17 years in sales and I’m hoping I don’t enter my 18th year because MY GOAL is to quit and sell on Amazon and eBay only!!
WooHoo! I’m free….well not quite yet.
I have the luxury of working from home but I do have to travel some as well and I’m all traveled out…unless for vacation!!
My ultimate goal is to grow this business so that my boyfriend can also quit his “Corporate” J.O.B. and can we both work this together and BE OUR OWN BOSS!!!!
Thanks and hope to talk with you soon…Susan
That’s a great goal, good luck making it happen!
Thanks, Ryan, for all the great information. I look forward to your emails and appreciate all the value and content you provide. Best advice or tip so far is from Chris Green: Hussle, don’t be a lazy seller. Scan everything. Look high up to the top shelf and low to the bottom. Check behind the products facing you. Leave the shelf neat. Befriend the store workers. Be nice and most importantly, provide value to others.
You are very welcome!
That’s an excellent tip, all of those will go a long way, and hearing it from Chris Green further validates the advice.
Congrats on another great month. You had achieved incredible results by working half of the time. Thanks for sharing and helping others.
The one tip that has had a huge impact on how I sell online (my 3rd month selling on Amazon) is the Fast Turns concept introduced by Duane Malek. Now I look for items that have a fast turn potential instead of sticking to the 3x principle. The important lesson for me is the time value in the equation. The faster you can turn your inventory, the faster you’ll get your return and reinvest.
Thanks Lei, and you are welcome!
Finding items that sell quickly definitely helps, especially when just starting out. Thanks for sharing that tip!
I do this part time. My goal for June is $2500 profit. I would love to get to $5000 monthly and be able to transition out of my other business. A phone call with you would be a great help (sending positive vibes to random.org!)
Just subscribed to your blog.
Congrats on another great month.
Thank you for subscribing! Best of luck on reaching your goal, and potentially I will be chatting with you soon.
Love your posts. The ideas for building success and inspirational numbers are fantastic for my newbie self 🙂
I have three goals for June:
1.) $500 in payouts from Amazon
2.) send more inventory (2 boxes a week vs. 1)
3.) go to a new sourcing location each weekend
I am big on measurable goals and I think I can achieve all of these.
The best piece of advice I’ve gotten is to make sure you look at who your competitors are (new or established) and how many items they have before buying/sending in too much stock.
Everyday I’m learning new things. So much to learn but by taking action I’m learning lessons by doing – not just reading/listening to podcasts and dreaming.
Thank you for the kind words!
Those sound like great goals, and that is an excellent tip as well. Good luck to you on reaching your June goals!
What are my goals for June 2014 for selling online?
Good question Ryan and my cheeky answer is to win a Skype call with Ryan Grant to find out more about how he is killing it online!
In all seriousness my goal for June 2014 is to take a look at my sales statistics from January – May (Jan was when I started this business). I want to get a more detailed analysis of profits, return on investment, margins etc so that I can strategically plan for the next few months. Like you I am running at zero cash flow. If I make sales then as soon as possible I am reinvesting in order to try to grow quickly. It is going pretty well so far but I am well behind you so a few tips would be awesome.
Haha Rob, nice answer! and if you are a winner you can definitely ask anything you want.
That’s an excellent goal about knowing your numbers. Understanding the financial aspects are key to succeeding.
Thanks for entering me into the contest.
The best eice of advice I’ve gotten and am trying to adhere to is this: You can’t make it on volume alone. It has to be about your margins. A lesson hard learned but one i’ve benefited from.
Thanks for all you’re doing,
No problem! That’s great advice, maintaining margins are essential for this business (and really any business). They are always important to know, as you could be selling $500,000 in sales per year, but if your margins aren’t there then you could still fail.
When you calculate the Amazon Merchant Fulfilled, Amazon FBA and eBay profits under “Profits by Source”, are you just taking sales from a sales report for that month or are you figuring out what you make after fees? Also, what do you qualify for less one time purchases, equipment like a heat shrink machine or a thermal label printer? Thanks
I am using a program called InventoryLab to list my products, and I am able to download profit reports from that. As far as one time purchases, yes I am thinking of equipment such as a printer, a bluetooth scanner, etc.