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Agree on a lot of your points. We use a TON of templates for clothing (20+) to have item specifics and other items prefilled, along with measurements needed in the Description (left blank). We have two shipping stations and a huge box/air bag, bubble wrap area (so shipping is efficient).
I will make the note that using locations in the SKU is huge to why we can ship so fast. All clothes are prepackaged in clear poly, and with the SKU and the Location in the Custom label field, we can find the item in 1 minute. Shoes are a smidge longer as we don’t prewrap, and we have to build the box, but they are done in 2 minutes. Avoid time searching for the item!
Simplico: I can hold the box closed with one hand and pull off tape with the other.
Amen on the heavy tape dispenser. I use the heck out of it. Need to find another cheap one for Veronica. I rarely use the tape gun anymore…
Yep, time is the biggest factor in the low dollar items. I’m pretty fast at the listing side of clothing (5 minutes), and if I have to do the photos / photo editing, another 5. Sourcing is 5 minutes, and shipping is usually about 1 minute (since the packing was done during photo editing, all we have to do is find and put in a bag/box).
So if I’m out in the wild, looking for big returns, but see items that are low returns, I still pick them up if I know the listing is quick.
Yeah, I ain’t gonna touch making that change with a 39.5 foot pole right now…
Too little benefit that may come back to hurt you. If you make the change, you get your Inventory value flushed into your expenses in one year, so you get a big benefit. Then you have to stay on that method to basically break even from thereon.
It is like how you can “manipulate” cash flow for large businesses. If you have a vendor that has a different reporting year than calendar year (yes, this still happens), then you can ask to pay your December bills “late” in January, making your cash flow look better that year. But if you don’t do it the next year, you get the hit later on.
Also like paying your mortgage. We always pay our January Mortgage in December. We did this once, and got 13 mortgage payments in one year. If we ever forget, then we only have 11 mortgage payments that year.
Besides…already set to keep the accrual method. Plus, it shows me the value of inventory I have on hand to make sure my Business Insurance covers that…
No worries. I didn’t know how to measure when I started, now it is second nature.
If you get into pants, you want:
Waist
Inseam
Rise
Overall Length
Thigh
CuffAnd if dress pants, how much inside material is at the cuff to let out. This was asked a lot of me at the beginning, so now I do it every time to avoid the question. Same goes for Suits and Sport Coats at the sleeve, measuring how much is available to let out the sleeve.
for us, the chest is pit seam to pit seam (and we show both the pit-to-pit and the full (double) numbers to avoid confusion
Length is from the collar seam to the bottom (not the top of the collar)
Sleeve on shirts is always from midline of the back (at the same collar seam as for the length) to the cuff.
Love this conversation, so sorry I’m late to the party.
First, the data from our store. Sales in the last 30 days:
Total Sold – 389, Total $ – 11,118
< $25 – 231 (59%), $4,203 (38%)
$25-$50 – 125 (32%), 4,533 (41%)
$50-$100 – 30 (8%), $2,021 (18%)
>$100 – 3 (1%), $360 (3%)Obviously $50 and below is our cash cow, and lots of profit in the $25 and up ranks. I would love to eliminate the sub $25 level, but when full time, hard to pass up this money. We look for the big hitters, and pick up the singles along the way.
Time is definitely a factor. When we do a listing all in, we are 15-20 minutes tops. So a $10 net profit on a 20 minute listing is $30/hour. That is a solid base to work from. Going forward, THIS is where we want to improve. Not just listing more, but netting more per hour (so higher dollar items or faster process).
Very impressive. Getting a 30% ROI after shipping and Fees is very solid, and all the listing work was done up front when you are just sending in more of something you already listed.
Love it!
Week of 11/18-11/24
Total Items in Store: 2,714 (Up 60% YOY)
Number of Items Listed: 60
Number of Items Sold: 83 (Up 30% YOY)
(Includes 4 Etsy, 0 Bonanza, 0 TrueGether, 2 Poshmark)
Weekly STR: 13% (Down 3% YOY)Total Product Sales: $2,265 (Up 31% YOY)
Cost of Items Sold: $591
Cost of Labor: $98
Highest Item Sold: $125 – Chippewa General Utility Copper Caprice Bridgeman Boots
Competition: Highest Priced Sale: Veronica wins the week and Veronica leads for the year 28-19Clothing
# Listed: 1,673
# Sold: 54
STR: 14%
ASP: $22.56Shoes
# Listed: 429
# Sold: 17
STR: 17%
ASP: $40.29Hard Goods
# Listed: 612
# Sold: 8
STR: 6%
ASP: $30.13Etsy
# Listed: 171
# Sold: 4
STR: 10%
ASP: $36.13Poshmark
# Listed: 98
# Sold: 2
STR: 10%
ASP: $57.50Loved this podcast! You are getting into my wheelhouse with this new business venture. If you ever want to bounce numbers, forecasts, or ideas about where you are going, hit me up!
Love your conversation on clothes filling the gap (and the dovetail on growing from 0). Start small, get the process down, cash flow your way up. This is also why we still do clothing, though we are looking to move out of the lower end during 2019, but until we have a solid source of cash generating inventory that can replace it, we stay there. Low dollar, but easy to list and yep, it fills the gaps.
Interesting. So, after 60 days, do you pay them for the item? How much do you pay them after 60 days?
Ok, so capital isn’t an issue. I know that many people when they go full time (ourselves included), we knew that we were going to have to increase our weekly purchasing, so we needed the capital to do that. I was wondering how you had that covered off, but sounds like you do.
And your STR was the other side of that equation from a cash flow perspective: how soon will your increase in purchasing start showing increases in sales? (and a recoup of your initial cost). For us, we are a 5X seller (we get 5X our purchase price in sales price) and we are in the 12%-16% STR. So for us, if we make a large investment in inventory, we can only expect to see 16% of that increase in sales in the first month. At 5X return, we should expect to get our initial investment back within the second month (sold 32% of the items at a 5X return which equates to 160% of the initial investment).
This is one area that I always want folks to think through before they go full time (and sounds like you have this covered). What is your cash requirements when you increase your purchasing, and how soon will you get that cash back (and start showing increases in profit).
If you are a 4% monthly STR, it takes much longer to see the increase in sales from any increase in purchasing. But if you are a 10X ROI, you get more cash on each sale.
I ran some quick numbers, and if two different sellers make an initial purchase of $1,000:
4% STR, 10X ROI – Recovers initial purchase cost in 3rd Month (12% sold, $1,200 profit)
12% STR, 5X ROI – Recovers initial purchase cost in 2nd Month (24% sold, $1,200 profit)Pretty close, with a nod to the faster STR. What we want to avoid are low STR and low ROI:
4% STR, 5X ROI – Recovers initial purchase cost in 5th Month (20% sold, $1,000 profit)
Doable, and a lot of businesses can do it, but it requires more capital up front, and solid processes to avoid leakage costs…
What kind of ROI are you getting on your RA items? We never seemed to do very good with them. ROI was too low and fees killed us…
Thanks! That is the 100% plan, for her to rest. I’m going to handle the business (and will be working at the contract gig) while she rests. I think my Mother-in-Law will be flying in to stay with us for that first week, so that will help as well.
She ain’t doin’ nuthin’ but restin’!!!
🙂
