A few days ago, Selena @ Apron Thrift Girl wrote an excellent post about closing the books on your 2010 online sales. Although it’s not something I’ve ever done, this post certainly gave me something to think about. So, I did some number crunching and the results were very interesting.
Here’s the good, the bad and the ugly of my year-end review:
- I sold a total of 700 items with gross sales of $6,426.
- The average was $9.18 per item; the median was $10.25; and the mode was $10.00
- The largest percentage of items (18% or 126) sold for $10.00. The next largest percentage was 9% (62) sold at $0.99.
- 56% (395) of my items sold for less than $10.00
- 37% (256) sold between $10 and $20
- 4% (31) sold between $20 and $30
- 1% (10) sold between $30 and $50
- 1% (8) sold for more than $50
- My gross receipts (including shipping) were $9,577, and my expenses (i.e., fees, inventory, postage and shipping supplies) were $5,653 (does not include printer ink, paper, and labels).
- In 2009, my gross receipts were $15,261 (average/item $11.24) and expenses were $9,182, for a net income of $6,079 (or $507 /month).
- 423 items (56.5%) were from my home, mostly fabric from my stash; old books and magazines; sewing patterns; knickknacks; etc. … my own virtual garage sale! This also includes a couple quilt tops I sold on Etsy. Total sales = $3,200!
- My cost of goods sold is averaging about 20%.
- Bottom Line: my net annual income for 2010 was $3,924 … or an average of $327 per month.
So, what’s the real story and what does this all mean?
- First, I didn’t list as many items in 2010 as I did in 2009. There were a few months in 2009 that I listed between 25-50 items/week.
- In 2010 eBay increased their fees, which were 24% of my sales, compared to 19% for 2009. However, percentage of total expenses was actually less in 2010 (58% v 60%).
- In 2010 there were more items that sold for $0.99 at auction; and I also started selling fabric pieces for $2.99 each. This was something new for 2010, and items that sold under $10 represented 60% of my sales. Not so good as this affected my bottom line.
- I supplement my income selling items between $10 and $20. The magic number seems to be $9.99.
Many folks do make a decent living re-selling online – whether on eBay, Etsy, Bonanza, Amazon, etc. – but let’s be honest, it is labor intensive and time consuming. So if I want to be successful in 2011, I have to make some changes. Here are my eBay business New Year’s Resolutions:
- Goal #1: List, list and list more! List at least 20-25 items per week. Selling on eBay is a numbers game: the more you list, the more you sell.
- Goal #2: Increase the number of items in my store. I currently have 540 items in store; and I need to increase it to 1,000 to justify the monthly fee of my eBay store.
- Goal #3: Eliminate $0.99 auction listings. If an item is worth only $0.99, then donate it to charity and get the tax write-off. Unlike the old days, $0.99 auctions do not create bidding wars. Too many items sold at the $0.99 starting price – not worth the time and effort.
- Goal #4: Increase average price per item to $15. Eliminate – or at least decrease – the number of listings under $10. In 2010 I sold almost 300 items for $10-plus: average price = $14.84. If all my items had sold at this average price, I would have sold over $11,000 in 2010 … wow!
- Goal #5: Decrease average cost of goods sold to 15%. This is a little tricky because, if I make a goof in a purchase, I will list it and hope I break even. Nothing gained, but nothing lost. So I need to be more selective about items I purchase for resale. New rule of thumb: if an item costs under $10, it has to sell for at least $10 more. If it’s priced over $10, then I need to double it.
- Goal #6: Go saling every week! This seems like a no-brainer; but honestly, there are just some weeks I don’t feel like getting up at the crack of dawn on a Saturday, especially if I’m going by myself. No more excuses for missing garage sales!
I will also follow-up on Selena’s recommendations about closing shop for 2010; and start fresh for 2011 by taking stock of my inventory and clearing out slow selling merchandise.
And while this information may not be of much interest to many of you, it certainly has helped me to write it down and focus on my business goals for 2011. Let’s hope this works … otherwise, I’ll be seeing you at the employment office looking for a part-time job!
I wish all the best for you and your online resale business. Let’s make this the best year ever both on- and off-line. Here’s to a very successful 2011!