August 2014 Financial Results from selling on Amazon and eBay

September 3rd, 2014

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.   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.

August 2014 Income Statement

August 2014 Income Statement

 

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 (grant.ryanj@gmail.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 Statement

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:

2014 Amazon Sales

2014 Amazon Sales

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:

2014 August eBay sales

2014 August 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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48 responses to “August 2014 Financial Results from selling on Amazon and eBay”

  1. dan says:

    As for paying out commissions, aren’t you afraid that you are smawning competition? I read about people that have gotten burned by their commissioned sales people.

    • Ryan Grant says:

      So far it’s only friends that I know quite well personally, so it’s not a huge concern at this time.

      Best Regards,
      Ryan

  2. Decha says:

    Ryan,

    Thank you for great post and create the Facebook group. This is awesome. Enjoy your time in Texas this weekend.

  3. Alex says:

    Another Awesome Post Ryan. I am really looking forward to the facebook group.

    • Ryan Grant says:

      Thanks Alex! Glad to hear it with the facebook group, I hope it becomes a community where we can all learn from new things that others are trying.

      Best Regards,
      Ryan

  4. Genie says:

    How do commission people work? How do you find them and what do they bring to the table? Cost & risk associated?

  5. Craig says:

    I want to thank you for sharing your information Ryan. I stumbled on your website a couple of months ago and I’ve been using it as a steady source of information as I ramp up my business. I’ve been selling on Amazon part time for about two months now and I continue to learn more and more each day. Once I get my bearings, I hope to give back to the seller community.

  6. F says:

    Hi there,

    You might have mentioned this already but are your profits exclusively from retail arbitrage? Seeing your results are very encouraging and thanks for being so transparent.

    I have purchased a 300 worth of profits and I’m getting ready to send in my first shipment this week but keep thinking at the back of my mind “is this really worth my time?”. Have you ever had those doubts and how did you overcome them?

    Thanks.
    F

    • Ryan Grant says:

      It’s a mix of retail arbitrage, online arbitrage, wholesale, and thrifting.

      I basically got through the doubts by seeing results. I would just try this out and see what happens, if it goes well you will find out if it is worth your time pretty quickly.

      Best Regards,
      Ryan

  7. Carolyn says:

    Approximately how much per month do you pay yourself from your online Amazon business?

    • Ryan Grant says:

      Hi Carolyn,

      Right now, I don’t really, but that’s all part of the plan. I will likely begin taking money out in approximately 6 months.

      Best Regards,
      Ryan

  8. Mark says:

    Impressive Ryan! What I would like to see is a screen shot of the CATEGORIES you’re selling in. Also, are you getting your inventory via retail arbitrage, online, or wholesale? (Awesome average selling price by the way!)

    • Ryan Grant says:

      Hi Mark,

      Thank you, and take a look above, there is a way to get emailed a 1 page pdf that shows my sales by category.

      Best Regards,
      Ryan

  9. Cheryl says:

    Ryan,

    Fantastic month! I just started FBA about 2 months ago and just love it. You are inspiring me to do a lot more for the holidays. Thanks for all you do!

    Cheryl

  10. Galyna says:

    Thanx for sharing about repricing app! I just read an article about various repricing solutions and was going to ask your intake on that. I will try out the one you recommend!

  11. Jason says:

    Great job Ryan, I’ve been silently following your blog for about two months now and it’s definitely great content . Hopefully I’ll take the leap and join the fb group though I tend to like to remain incognito online, the value of helping others and vice Versa is a great Oppurtunity. I’m literally all about the numbers so you posting the spreadsheetS with the level of detail reAlly gets to the nuts & bolts of online selling. Still unsure why I didn’t decide to tackle amazon years ago and stayed on eBay/craigslist sells only. At any rate thanks
    -jason

  12. bkninja says:

    As you mentioned in the post, you have a large amount of inventory sitting available for sale. Would you mine sharing your total in-stock buy cost and total in-stock sales value?

  13. Scott Zilke says:

    Hi. Is there a reason you use Inventory Lab and Appeagle instead of just using the complete Scanpower system? I am using IL and profit bandit, and am trying to decide whether to use one service, with the same money ($59.99 Scanpower, $49.99 IL and $9.99 PB) I would get the repricer from Scanpower for free. I like IL, but the inner cheapskate in me sees a deal.

    • Ryan Grant says:

      Hi Scott,

      InventoryLab adds in accounting features as well so that is quite valuable to me. Overall, I like the interface of Inventory Lab working with Appeagle better as I have tried Scanpowers listing service as well. InventoryLab is planning on adding a repricer in early 2015 as well, so I think IL is something that can help me for the long term.

      If you end up making the switch, definitely let me know what you think is better.

      Best Regards,
      Ryan

  14. Pedro says:

    Ryan,

    Have you quit your day job yet? I just sent my very first shipment out to Amazon for FBA and I should start seeing my first sales by the 15th of the month with profits equal to or exceeding my day job.

    I want to take the leap but it’s a scary proposition to take the first step.

  15. Eugene says:

    Hey Ryan,
    If it’s not a secret where you sell Home Depot goods?
    Thanks!

  16. Bill says:

    Ryan,

    Do you know of an alternative to TaxJar for those of us that do not have a Pro account yet?
    Awesome on your August numbers!!!

    Thanks,

    Bill

  17. Mindi says:

    Hey Ryan
    Great numbers for this month! After reading this post I feel incredibly lazy, yet energized to do some more sourcing. Can I ask how many SKUs do you have in your inventory? Thanks!

  18. Cailie says:

    Hey Ryan,

    Quick question. Do you wait until you have a large amount of stock to send to FBA, or ship as you get the items? Are larger shipments worth waiting to have for more efficent shipping/FBA-ing?

    • Ryan Grant says:

      Hi Cailie,

      I generally ship once I have about 100 items to ship to FBA. If it’s likely you will get more items within less than a week, then I may wait to send them items out, but if it’s going to take longer than that to accumulate more items, then I would recommend just shipping to keep the process moving, and get the sales rolling.

      Best Regards,
      Ryan

  19. Mark Regan says:

    Hi Ryan,

    Thanks for the great information! I just restarted my biz after losing a bunch of book sources and I was wondering what your starting budget was. I started with $1500 but I’m not doing great with sales. I keep adding inventory and I’m sure I’ll get the hang of it though! Retail arbitrage and wholesaling are a whole new world but I’m loving it!

    • Ryan Grant says:

      Hi Mark,

      I started with about $5,000 initially. Glad to hear you are loving wholesale and retail arbitrage!

      Best Regards,
      Ryan

  20. Paul says:

    Ryan,

    Your results are very inspiring. What criteria do you use to buy products? Are they within a certain price range, 1:3 profit ratio? Within a certain Sales rank? Thanks again.

    • Ryan Grant says:

      Hi Paul,

      I am not sharing my exact strategies for sourcing at this time. I plan on releasing some of this information in the future though.

      Best Regards,
      Ryan

  21. Mark says:

    Hey Ryan,
    Thanks for the tip on Appeagle. I was getting a bit disappointed by my sales but decided to give them a try. All I can say is I am very happy with the results. It took some tweaking to get to exactly what I wanted as far as pricing goes but I have noticed that my items are selling and for good prices too.

    Now I can stop refreshing my Sales dashboard and work on sourcing product.

    Thanks again!
    Mark

  22. Coach Macon says:

    Hey are you doing any coaching at this time? 30 mins would be GR8!

    • Ryan Grant says:

      Hello,

      Currently I have suspended my coaching for the next few months to focus on selling on amazon. You can find more information about how to get on the waiting list through this link on my blog: ose.wpengine.com/coaching

      Best Regards,
      Ryan

  23. Pedro says:

    After 2 weeks of selling I have returned about 30% of my initial $1500 investment. Sales are slow and I’ve made a few small mistakes. I find it quite frustrating since my items are not selling as fast as I anticipated.

    I feel as if I’m just scratching the surface but at the same time spinning my wheels in certain aspects. The potential of FBA is truly limitless as proven by your results. Yet I feel like I’m not making the significant sales needed to make the business viable at this moment.

    How long did it take for you to become proficient enough with FBA to be self sufficient?

    • Ryan Grant says:

      Hi Pedro,

      It takes some time to build up a sustainable business, but it sounds like you are off to a decent start. It will take everyone a different amount of time to become self sufficient, but you can see my results by looking at my past monthly results posts.

      Best Regards,
      Ryan

  24. Dan says:

    Hi Ryan, is your $36,835.48 in FBA revenue a hypothetical figure you have calculated based on the purchases you’ve made this month and what you anticipate them selling for? And your cash-flow figures your actual real figures?

    • Ryan Grant says:

      Hi Dan,

      Both are 100% real figures and actually happened, as with all results I post here.

      Best Regards,
      Ryan

      • Dan says:

        Thanks for your response! I think I understand how you’re presenting it. I read a little more carefully. Cash flow is king, as they say. I can’t believe you’re sourcing this much from in-store retail! Amazing! Congratulations on your progress and new office space. Would you be divulging your lease terms in the future? You’re doing a decent amount of business, Fidelity has an unlimited 2% cash back AMEX, it’s hands-down the best I’ve found. Might be worth a look, if you don’t have something comparable.

        I started looking for people taking the jump to full time FBA because my wife and I are about to do it too! You’re the only blog so far that kind of mirrors our year as well. Our next disbursement this Friday will be about $25k, all our inventory is paid for and we have around 113k in accounts receivable or unsold inventory. It’s been a long year of being patient, but I’ve run out of stuff to buy and we’re all stocked up for the time being. Our bills are about $6k a month, but want $10k positive cash flow so we can max our IRAs each year going forward.

        Congrats on all your hard work and balls! I’ll be reading your blog!

        • Ryan Grant says:

          Thanks Dan! I will be sharing my lease terms in my financial results post which should be coming out on Monday. I do have a few credit card strategies, and average at least 2% back on the vast majority of my purchases. Also, not all of my sourcing is done in retail stores, it is also a mix of online sourcing, and just a little wholesale sourcing.

          Best of luck to you and your wife in reaching your goal!

          -Ryan

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