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I thought it would be interesting so see if anyone wanted to discuss the year as a whole. Here are my end numbers as well as my 2019 numbers.
2020 Weekly Averages 2019 Weekly Averages
Items sold: 34 Items sold: 22
Sales: $1143.15 Sales: $784.31
COGS: $117.15 COGS: $99.31
Profit: $1026.00 Profit: $685.00
Average profit per item: $30.84 Average profit per item: $30.85
New listings: 34 New listings: 29
Beginning inventory: 1562 Beginning inventory: 1094
So as you can see, I experienced 46% growth year over year in sales. I also saw a similar gain in store size. Having more items for sale definitely increases sales volume. My average profit per item was identical year over year. My growth was purely in store size. Last year during Christmas break I listed 167 items in one week. This year I did not do the same. I was too busy playing with the kiddos to get much done. That’s cool though – I deserved a nice break. The tax man is finally gonna get a nice chunk from me this year!
So what did I learn? Simple: more items for sale = more sales. I just need to keep my nose to the grind stone and get stuff listed.
Plans for 2021?
Well the big thing I need to do is find a balance of listing death pile items and sourcing.
Let’s be real – stopping new sourcing just isn’t gonna happen. I don’t even think it is a great idea as every time I consider stopping, I’ll find a $200 item that sells within a few days. If I had stopped, I never make that sale! So I have to be smarter about it.
Bottom line – I do not have any metrics placed on my sourcing. That must now be tracked and documented. This week I’m brainstorming how to put hard caps on my sourcing that will still allow me to look for the white whales, still buy some bread n butter stuff to satisfy the scavenging itch, but allow me to work on getting my backlog listed.
My initial thought is a formula that takes into account the previous weeks items sold and listed.
Scavenging allotment = [(Items sold + Items listed – last weeks scavenging)/4] + 2
The first part of the equation would be my “bread n’ butter” items. It will always round to nearest whole number.
The “+2” part is for my white whales. These are the items that I just have to get because they are big profit or super quick sales.
A special condition is that the (solds + listed – scavenged) must be higher than 30. If that number is less than 30 then my “bread n butter” goes to 0 for the week no matter what. I’ll still have the 2 white whale items I can look for.
So applying that formula to last weeks sales, I get:
Scavenging total = [(25+22-53)/4] =2
Scavenging total = 2
I will apply this number to my sourcing this week. I can ONLY shop for 2 total items because last week I scavenged 53 items. That blew up my bread n butter total.
Since I can only get a max of 2 things this week, next week I’ll be able to buy a bit more even if I don’t list anything due to sales alone, but always a fraction of my sales.
So if I want to shop more, I gotta list ALOT more. Listing alot more will drive my sales up, thus also increasing my buying power. BUT if I earn a big week of buying power and actually buy everything allowed then it will throttle me the following week.
So there you have it folks, my 2021 business plan: Buy less stuff by doing more math and number crunching. Lol!
I’ll add my sourcing limits and buying totals to my weekly metrics for accountability.
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“So what did I learn? Simple: more items for sale = more sales. I just need to keep my nose to the grind stone and get stuff listed.”
–Yep, this is the way. (as long as you have decent taste in stuff or know how to research, which you do)
“Well the big thing I need to do is find a balance of listing death pile items and sourcing.
Let’s be real – stopping new sourcing just isn’t gonna happen. I don’t even think it is a great idea as every time I consider stopping, I’ll find a $200 item that sells within a few days. If I had stopped, I never make that sale! So I have to be smarter about it.”–Sourcing more and more stuff is a personal decision. As long as we have a handle on listing, we scavenge more. If we feel our death piles are becoming a problem, we slow down. Mental health is important for sustainability. Sounds like you walk that line well.
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Really great post! I love all of the breakdowns of percentages and Year Over Year things in particular. This was also my first year where I really started tracking what I spent on merchandise and as I sell mostly video games and electronics, the costs tend to add up really fast. I came up with a formula much like yours, but rather than items sold I stuck to a certain percentage of gross earnings that I earmark for buying new products. If I’m able to find smaller or cheaper items (bread and butter) I’ll do that, but it will come out of the funds set aside for white whale items. Really looking forward to selling in the new year and tracking my numbers even more specifically this year. Best of luck to all of you! ^_^
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We are under lockdown and I’ve not been sourcing at all but over the last few years, it has become much, much easier to walk out of a store empty handed, more quickly, and to pass over under $30 items. Also I remember to some degree the very longest tail items I have stocked. So, a few years of sales experience is so helpful in being able to avoid picking up lower dollar, longer tail items. I don’t feel the same urgency to buy anything that I know I can sell for a profit and I’ve become quite picky. Thank goodness as I am not a power lister it seems.
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Oh yeah, I’ve become MUCH more picky over the years, but I also have become much more knowledgeable! Having that much knowledge about about a wide variety of things can be dangerous when trying to limit inventory intake.
Jay talked about scavenging frequency on the podcast and I can relate. When I first started I would go scavenging ALL THE TIME. I scavenged alot then, but my knowledge depth and scope was limited. I didn’t shop entire sections of stores. I was mainly vintage toys and electronics. Then shoes… then clothes….then….EVERYTHING! Now I can go into a thrift store and scan the entire store in 30 minutes and get ALL the low hanging fruit in every section. My eyes just naturally gravitate to the high dollar and the more unique items in each section from years of experience. There is ALOT of low hanging fruit out there folks.
Now, I’ll go to 1-2 places on Saturday and one other place on Sunday. Nothing at all during the week. During the summer I’ll do yard sales instead of the two thrift stores on Saturday.
The thrift trip on Sunday is mainly so I can claim the mileage for driving 30 miles down the road so we can do lunch at Qdoba. I routinely walk out of there with nothing.
I just ran my mileage report for 2020 taxes and I have 2600 less business miles this year than 2019 and 4200 less than 2018 so I’m definitely not going places as much.
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It has been a really long time since I checked in. 2020 was a roller coaster. My eBay business went down by 30%. Sourcing was hard for all of the obvious reasons. It was a rough year that way.
BUT we had one big shiny thing happen. We bought an investment beach house in the Carolinas. For 2020 we let the management company that was already running the place manage it, but last week we put it on Airbnb. We have a cohost helping with it, so sort of like training wheels for us. We’ve already secured five bookings for 2021 in one week since it went live. We are hopeful that we will get many more bookings than we did with the management company. Eventually this home will be our retirement home, but we will never live in it during peak season. We are looking for a Maine home next which we will live in during the summer and rent out during ski/snowmobile season. The end goal is to have renters pay for both properties. Exciting stuff.
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Glad things are going well for you guys. I know you have traditionally been a clothes seller so I can imagine its been difficult to source enough.
Rentals are great as long as:
–you have the up front money to buy the rental (or rentals)
–you either can afford the necessary renovations or afford a house that’s turn key
–you can handle the monthly nut in case rental income doesn’t cover your bills 🙂
Other than that, its a slam dunk 🙂
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@retrotreasures sure….
https://www.airbnb.com/rooms/46580953?source_impression_id=p3_1609978238_to2%2BrLOuyblMsoWj
@jay yes I agree on all points. All true. 🙂 -
Retro,
If you give your kids the jobs of taking pictures and listing, then you could buy as much as you wanted and make a lot more money. Or if that doesn’t work, hire someone.
However, I think you would then need to get more storage because I think that is an issue for you.
Personally, I have changed my habits to try and go to estate sales where they have high value items. I spend time vetting the sales to get the right ones. This takes more time up front, but I have been sucessfull at getting $100+ items that have been selling quite frequently lately.
Mark
Mark
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@retro-treasures-wv Thank you for starting this thread! I love hearing people analyze their processes and plans for the future. Congratulations on your growth this year! I have a question about your sourcing formula; what does the “/4” stand for (weeks in a month)?
@atomicstar Congratulations on trying out AirBnb with your rental! We are also interested in learning how to do that remotely, so if you have any tips later in the year I’m all ears.For me this year was a big learning year. I only started dabbling in Ebay and The RealReal about 18 months ago, so my starting listings for 2020 was about 30, and ending listings about 180 (with about another 20 on The RealReal). I grossed and netted about the same as the year I experimented with Amazon FBA (which I have since quit) which was a bit surprising to me (I was expecting Ebay to be less). By the way, those numbers are very small; grossing about 6k, netting about 2.5k.
I have no business finance background but taught myself some basics of double-entry accounting this year. I am continuing to refine my book keeping process as a lot of my scavenging involves a mix of real and theoretical money (kind of like buying things with credit card or airline awards) so it has been difficult to accurately assess the actual money cost/profit of things, but I think 2021 will have a more accurate financial picture.
2021 will have me continuing to reevaluate my sourcing standards as my two main suppliers have increased costs and I’m looking at pivoting more strongly into a third option. I would like to get to the level of expertise where I can pick up more profitable items and not waste my time on the low dollar, but I also feel like I’m in that money-crunch stage where I have to list/sell low dollar or risk not making a sale at all (because my inventory is so small).
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It’s just a control factor to keep the final result reasonable. Let’s say I have a monster week of selling 50 things and I list 160 things. I don’t want my purchase limit to be 160. In that case it will just be 40.
I’ll adjust the forumla as needed. I may do away with the “+2” and just allow myself to buy $100+ items as they pop up with no limit. They’re rare enough to be statistically irrelevant.
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