January is in the books, and that means that it is time for another financial results post. January was my 4th month selling online full time, and I was very interested to see how sales in January would be after having a very large sales jump in December. If you missed December’s results post, you can find it HERE.
First, we’ll get started with a little background on how my time was spent this month before we get into the numbers. I took 2 days off in January, and would say I averaged 30-35 hours per week directly related to online selling activities. I spent some time meeting with accountants to get a plan in place for taxes this year, and in the future. I also met with a lawyer regarding business structure, and a few other questions I had for the future as I begin to scale my business. These items cut into my revenue generating time, but having these meetings should help to ensure I have things properly set up for the future. I will post about some of these items, including the business structure I will be using, in a future post. For January I worked the majority of the month on online selling, but there were some lasting effects on sales from not working much the last half of December as was discussed in the December results post. The lack of inventory at the end of December definitely contributed to lower sales in January.
Before we get to the numbers, one more topic to discuss. My goal with sharing my financial results is to prove that this can be done, and is not meant to be seen as bragging or anything of that sort. I just want to show that working hard and smart, and sticking with your plan can pay off. If the results turn out to be poor in future months, I will share that too.
With that said, let’s get into the numbers. I will be sharing a fair amount more detail in this months post compared to previous months. I want to provide as much clarity as possible into what I am doing on a month to month basis, and will continue to add some more details as the months go on. 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. This month, I have broken out the cost of inbound shipping to amazon, customer returns, supplies, storage fees, and services. 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 mileage, cell phone, home office, etc. I will be adding some of these additional expenses to the results posts in the coming months. However, 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.
Hopefully, these numbers give a clearer picture of where my profits are coming from. You will see that I also had $400.11 in one time purchases. These were investments in my business, one is a bluetooth scanner, and the other is a label printer. Both are tools that have already begun to increase my efficiency, and should pay significant dividends in the form of time savings for the foreseeable future. I will be doing a post about these tools later in the month to show how they will be helping to save me time. I added a separate line item for these costs, as they are one time costs, and will not need to replaced for several years.
These numbers are quite a bit lower than I saw in December, but I believe that this is due partly to not continuing to send in inventory to amazon at the end of December. I anticipate a fairly significant increase in profits for February, especially as a result of the inventory that I have been buying throughout January.
Also new this month, I have added in a simple cash flow statement. This will show all of the cash inflows that I have during the month, as well as outflows. Take a look here:
One item to note here is that inbound shipping costs and refunds to customers are directly taken out of my amazon account, and are factored into payments from amazon in the cash inflows section, and as a result do not need to be added into the cash outflows section. I have added this as a means of gaining some clarity into how much spending goes into making the profits that I do. Basically what this means is that my bank account balance is $1,248.45 greater than it was at the beginning of the month. This number is significantly less than the profits I realized during the month, and this is due almost entirely due to inventory purchases, as I purchased over $7K of new inventory in January. My current plan is to reinvest virtually all profits into the business buying as much inventory as possible, and thus net cash flow will be significantly lower than profits for the foreseeable future as I grow my business.
Now, here are some screenshots from my amazon and ebay accounts to provide some documentation for the profit numbers. Here’s a screenshot of my amazon sales for January (click to enlarge, same goes for all screenshots in this post):
As you can see I had a little over $9K in sales for the month on amazon, but you can also see that the bulk of my better sales days came towards the end of the month. Next up is a screenshot of my amazon sales by category:
Grocery and toys continued to be my top 2 categories for the month for both number of orders, and sales volume. These will continue to be 2 of my top categories, but I plan on working to add some more sales to the Beauty, Health & Personal Care, and Pet Supplies categories in the coming months. I want to focus more on these categories to build consistent sales year round, as toys in particular will see a large spike in December and then may trail off the rest of the year. I don’t plan to avoid the toys category by any means, I just want to have a diversified product offering.
The last screenshot for today is January’s ebay sales:
I have yet to find a better report to show eBay sales by month, but will see if I can find one for next month. The items I sold on eBay this past month were quite valuable, with an average sales price of almost $189 per item. Lately with eBay I have been focusing on higher dollar items as there is more time involved with listing and shipping the items. This average sales price is quite a bit higher than it will likely stay, as I sold 9 of a single item for $295 each.
Overall, for January total sales between amazon and eBay were $13,588.54. I am happy with these results for January, but definitely am looking to increase in the coming months as I set a big goal for the year. If you missed that post, you can find it HERE.
Also new this month are 2 experiments that I will be trying as a result of the flexibility of schedule allowed by selling online full time. If you are interested, checkout my experiments page HERE.
That’s all I have for now, if you have any questions or comments PLEASE leave one below or send me an email at firstname.lastname@example.org. Anything is fair game!
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