Ok, content of the video aside, what in the world is the guy in the thumbnail wearing? Any guess? Yes, this is AI generated but the image was too funny not to use as a thumbnail....
Hi, Jon, I really like your approach to tracking the buy cost of items. I track similarly to you, and it really helps me to know what my profit/loss is on pretty much every sale. Thanks for all you do!
I agree that knowing what you have into inventory is very important. I track mine differently as I buy differently than you. I mainly look to be the end buyer on businesses that are closing. That means buying everything whether you want it all or not. I track based on overall buy cost. For example, I bought out a new car dealership's entire parts inventory when the owners retired. The 'manifest' they gave me had over 80k individual items, a lot of it being things I won't bother selling or may wholesale out. There is no real time efficient way to assign a cost to each individual item. Instead I track toward recovering my buy cost. Once recouped I know everything else is pure profit from that point forward. That lets me know where I stand on a macro level and allows me maximum flexibility in my pricing (for my business). There is no right or wrong way to track, just what works best for your business, but you should be tracking your costs in some way.
Exactly how I look at it. If I spent $100 dollars on a bunch of stuff at a yard sell I just put that as my COGs. I just need that $100 back and every thing else is the profit no matter what it goes for. If something isn't selling online then I find a face to face cash way to sell it. Whatever I get for it is profit or I can donate it as a tax write off.
Good video, Jon. I liked seeing how you approach your accounting, especially how you use MSRP to weight the cost you assign to each item in a mixed pallet. I have such a volume model that I cannot be as granular with each item, plus I have no MSRP as a guide. I often have buys where I can recoup my money on the first sale, making the rest of those items essentially free. But like I say, the market sets the price, so I’ll sell at a loss and move on if I’ve made a bad buy. About 10% of my store is in that category at the moment, as I’ve posted some questionable items while I was learning my niche. Now those dog items are moving out for very little profit, and I’ll be glad when they’re finally gone. Nonetheless, every $1 that I spend on my store these days comes back as a $3 deposit, so I’m usually winning the game.
Here's a thought to get rid of the toilet seats. As you're driving around your town, Look for areas where rehab specialist have moved in and regen neighborhoods. Many of these businesses probably keep the old toilets and just replace the seats. I'm sure you could strike a deal with them.
I would default the unknown items to 0.00 msrp. Since you are most likely going to get something damaged it feels more realistic. I’m hoping we’ll be able to input by cost after the sale since I track beast on an entire buy so if I buy 10 things for $50 and sell the first for $20 it’s a pie cost of $18 after fees and zero profit but if I sell the next thing for $100 that’s a buy cost of $2. Since these buy costs can change minute by minute until I get to $0 buy cost, it’s important to be able to adjust it after the sale
A buyer wants me to use a FedEx overnight label he emailed to me. The item had free shipping for a buyer. The full price for this overnight label would be $285. The item was sold for $150. Does this make any sense, even with a FedEx account?
I wouldn't do it. Sounds fishy as hell. eBay wouldn't have a tracking number you provided from a label you purchased and they could claim they never received the item and eBay would find in their favor. Especially fishy if it is a non-urgent item like a book or collectible as opposed to a car part or a medical device or something like that.
Revenge you can obtain your label from anywhere provided it’s a real label. If the buyer is willing to pay for it (maybe they have a corporate account they are using to buy their personal label) then all you really need is the tracking number to upload to eBay along with a screenshot of the label. I’d the label is invalid or already in use eBay should reject it. Up to you but it may be shady what they are doing it’s not fishy.
I am curious as i have been ingerest but did not yet buy...the liquidation lots you buy...do you include shipping in the COG or would it be a business write off?
I wrote down how much I paid for each item on the 3 occasions i've thrifted so far since starting in january. QUESTION: For taxes: of I spent for example $10 on $10 items ($1 each) at a thrift store, but then donated 2 of those items. Do I just say I spent $8 on $8 items. Pretend I never bought those bad buys? I'm going through stale inventory.
Ok, content of the video aside, what in the world is the guy in the thumbnail wearing? Any guess? Yes, this is AI generated but the image was too funny not to use as a thumbnail....
Thank you Jon!!!
Very excited about putting buy cost in. That’s great news.
Hi, Jon, I really like your approach to tracking the buy cost of items. I track similarly to you, and it really helps me to know what my profit/loss is on pretty much every sale. Thanks for all you do!
Thanks Brenda. As I said it's not for everyone but knowing this information can't hurt!
I agree that knowing what you have into inventory is very important. I track mine differently as I buy differently than you. I mainly look to be the end buyer on businesses that are closing. That means buying everything whether you want it all or not. I track based on overall buy cost. For example, I bought out a new car dealership's entire parts inventory when the owners retired. The 'manifest' they gave me had over 80k individual items, a lot of it being things I won't bother selling or may wholesale out. There is no real time efficient way to assign a cost to each individual item. Instead I track toward recovering my buy cost. Once recouped I know everything else is pure profit from that point forward. That lets me know where I stand on a macro level and allows me maximum flexibility in my pricing (for my business).
There is no right or wrong way to track, just what works best for your business, but you should be tracking your costs in some way.
Exactly how I look at it. If I spent $100 dollars on a bunch of stuff at a yard sell I just put that as my COGs. I just need that $100 back and every thing else is the profit no matter what it goes for. If something isn't selling online then I find a face to face cash way to sell it. Whatever I get for it is profit or I can donate it as a tax write off.
This is how I do it too
Good video, Jon. I liked seeing how you approach your accounting, especially how you use MSRP to weight the cost you assign to each item in a mixed pallet.
I have such a volume model that I cannot be as granular with each item, plus I have no MSRP as a guide. I often have buys where I can recoup my money on the first sale, making the rest of those items essentially free.
But like I say, the market sets the price, so I’ll sell at a loss and move on if I’ve made a bad buy. About 10% of my store is in that category at the moment, as I’ve posted some questionable items while I was learning my niche. Now those dog items are moving out for very little profit, and I’ll be glad when they’re finally gone.
Nonetheless, every $1 that I spend on my store these days comes back as a $3 deposit, so I’m usually winning the game.
Here's a thought to get rid of the toilet seats. As you're driving around your town, Look for areas where rehab specialist have moved in and regen neighborhoods. Many of these businesses probably keep the old toilets and just replace the seats. I'm sure you could strike a deal with them.
That’s is exactly the right way to do it. Now put but date in the item and sell date and sold price. Calculate ROR annualized and smile.
You can change that formula so you won’t have to recalculate the percent you are applying to allocate cost
I would default the unknown items to 0.00 msrp. Since you are most likely going to get something damaged it feels more realistic.
I’m hoping we’ll be able to input by cost after the sale since I track beast on an entire buy so if I buy 10 things for $50 and sell the first for $20 it’s a pie cost of $18 after fees and zero profit but if I sell the next thing for $100 that’s a buy cost of $2. Since these buy costs can change minute by minute until I get to $0 buy cost, it’s important to be able to adjust it after the sale
Also for commission sales, when I’m paying 40% of the sales price for cost of goods, I would have to abject the buy price after sales as well
No space! Can't buy pallets.....I wish
A buyer wants me to use a FedEx overnight label he emailed to me. The item had free shipping for a buyer.
The full price for this overnight label would be $285.
The item was sold for $150.
Does this make any sense, even with a FedEx account?
I wouldn't do it. Sounds fishy as hell. eBay wouldn't have a tracking number you provided from a label you purchased and they could claim they never received the item and eBay would find in their favor. Especially fishy if it is a non-urgent item like a book or collectible as opposed to a car part or a medical device or something like that.
Revenge you can obtain your label from anywhere provided it’s a real label. If the buyer is willing to pay for it (maybe they have a corporate account they are using to buy their personal label) then all you really need is the tracking number to upload to eBay along with a screenshot of the label. I’d the label is invalid or already in use eBay should reject it. Up to you but it may be shady what they are doing it’s not fishy.
Thanks for your insight.
The buyer is a 15 year ebayer. Good feedback history.
Looks good on paper, but.....
I am curious as i have been ingerest but did not yet buy...the liquidation lots you buy...do you include shipping in the COG or would it be a business write off?
I wrote down how much I paid for each item on the 3 occasions i've thrifted so far since starting in january.
QUESTION: For taxes: of I spent for example $10 on $10 items ($1 each) at a thrift store, but then donated 2 of those items. Do I just say I spent $8 on $8 items. Pretend I never bought those bad buys? I'm going through stale inventory.
My memory sucks but somehow I know the item cost 99% of the time.