How to Find the Profit Margin for your Antique Booth or Vintage Reseller Business & Why it Matters!
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- Опубліковано 18 січ 2024
- I'm a big believer in knowing your numbers as a business owner. It's the only way you can really evaluate the actual health of your business! Finding your average profit margin is a key metric you need to know; this video shows you how to do that as well as offers tips for what it should be for a healthy, sustainable booth or reseller business.
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In this video, Melanie Alexander from Lost and Found shows how antique booth owners and vintage sellers can make more money by understanding and improving their profit margins. Let's dive into the key points:
Markup vs. Margin: Melanie explains the difference between markup and margin. Both are about making money from sales, but they calculate it differently.
Example of Markup: She gives an easy example - if you sell something for double what you paid, that's a 100% markup.
Profit Margin Defined: Melanie introduces profit margin, which is the profit percentage from the sale price. For instance, selling a $5 item for $10 gives you a 50% profit margin.
Why Profit Margin Matters: She emphasizes why understanding profit margin is crucial. It's not just about making money; it's about covering all your business expenses like rent and supplies.
Setting a Standard Markup: Melanie suggests having a standard markup to easily figure out your average profit margin. This helps you know how much money you're really making.
Impact of Low Profit Margins: She warns that even if you're making good sales, low profit margins might mean you're not pocketing enough money.
Pricing Strategy: Melanie recommends pricing items at least three times what you paid for them. It's not about being greedy but making sure your business is sustainable.
Handling Criticisms: Addressing concerns about high prices, Melanie explains that it's about sustaining your business and not being greedy.
Consumable vs. Non-consumable Goods: She compares items people use up (consumable) to items that don't get used up (non-consumable) and how it affects sales and profit margins.
Smart Shopping and Pricing: Melanie encourages smart shopping, finding good deals, and being willing to charge more for items that deserve it. It's about making your business work.
This video is a handy guide for antique booth owners and vintage sellers who want to boost their profits. Melanie shares practical tips to help you understand, calculate, and improve your profit margins for a successful business. Don't miss out if you're looking to make more money in the vintage selling game! 🚀💰 #VintageSelling #ProfitMargins #SmallBusinessTips
Hope it's helpful!
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Hi Melanie. Its so true that people feel awful for marking up their inventory. I tell my booth vendors to NOT feel that way. They had to source it, transport it, clean it, price it, and transport it again to the store. Also, antique and vintage items simply aren't being made anymore. There's a limited supply of it all. Great video.
Yes, there is SO much work involved, and you should be paid for your time, like in any other job :) Sounds like you are a great mall owner Jimmy and those vendors are lucky to have you!
Love this video. We price stuff for what it’s WORTH, you don’t see anyone selling an authentic Louis Vuitton bag for 20 bucks, because it’s WORTH way more than that. Everyone does this, Amazon, Target, Walmart, etc. It’s just business and definitely not for everyone.
When I consider buying something I always ask myself if I can sell it for 4 times the price they are asking. Even then you have customers asking for a discount, things get broken or stolen, things aren't selling so you have to offer a percentage off for a month, etc. I don't see how anyone can see it as a business and not at least triple their prices. And in my opinion those who are pricing too low are not only hurting themselves, but all the other vendors also. Thanks Melanie for breaking things down financially with some common sense and taking the "guilt" out of asking for market value for something that you got a killer deal on.
Yes . . . they are hurting themselves and everyone else as well!
Super helpful. I listen closely to every thing you teach. Thanks for sharing your knowledge.
Glad to help!
Thank you for the great info! I regularly watch other UA-camrs who show what they paid for their items they are selling in their shops & I love to see their profit! Its so inspiring 🙌 . I want to make a living from this not just have a hobby 👍
You can do it!
I feel like I just sat through Intro to Business 101...thank you, great info, especially at the start of the year.
Glad it was helpful!
Great video! This isn't exactly the fun part of our business, but so very important. Thanks for passing along your knowledge.
good video. I never understand the I got it as a good deal therefore, I'm going to pass it along to my customer.
Another informative show from the expert. Listen to her....
Thanks Curt :)
It's crazy that we have to explain our paychecks in this business! This doesn't happen in 'regular' retail stores. You did a great job explaining this Melanie. You are an amazing businesswoman!!
Thanks so much Cindy, and yes! It is crazy ;)
All items need to be sold for what the market can bare. Even if you mark up an item 20 times what you paid for it. Some things you can do that with and some things only 3 times what you paid. Depends on the item and what the market can bare. All vendors in this business need to buy as low as possible and then price average of what the same item is being sold for in other places, online, other shops and other booths. Nothing is more frustrating for a vendor business owner to see others in the same shop selling the same items in their booth for crazy low prices because they got it really cheap or did not do their research on the item. This is a business not a charity. If our intention is not to make money there is no reason to do it. It is too hard of a business to just give our stuff away for next to nothing. We have to remember our time, gas, wear and tear on our vehicles and body are all worth being paid for, not to mention we are tying our money up in inventory for who knows how long. Thank you Melanie for this info. Every booth vender needs to think about all the things that go into this business. I know vendors who don't even keep track of what they pay for an item. So how do they know if they are making any profit.
🙌🏻 🙌🏻
GOOD CONTENT MELANIE ~ APPRECIATED ❤
Great video! I work in an antique mall and am constantly amazed at vendors who don't consider the actual numbers. Getting a cheque at the end of the month does not mean you made money. What did those items cost you? How much money did you spend picking? Do you even dust and fluff your booth or does it look like a flea market dumping zone? Then there are so many vendors that don't even get a cheque and consider the antique mall a hobby. Please take your hobby out of my mall because I'm trying to earn a worthwhile profit while you're undercutting everyone to make 10 cents on an item.
Agreed :)
Totally new at this, and I struggle with my bigger items and art. I keep hearing "they won't pay those prices" in the city I live. I don't live in a small town. I have good quality stuff and I don't want to give it away, no matter what the amount I might have in it. So I have been depending on what it would cost a customer to go purchase at any big box store new, but cheaply made. Like a simple lamp & shade, chair, dresser, etc. I have many vintage & antique items. I also consider what I would be willing to pay at any other store, booth etc, on my personal budget and taste.
Thanks for the video, I now need to look at my smaller items, I think I am selling a bit short to make up for the criticism of my prices on larger items.
You do for sure have to consider your customer base and what they will pay. So you could look at trying to source a little smarter . . . maybe only buy those bigger pieces when you find them at a steal? And toss in the occasional piece with a smaller profit margin for that "wow" factor? Also, could be a location issue. All malls are not created the same and what would be "too expensive" at one could be seen as a deal at another :)
Get information! Thanks so much for reminding us to take the emotions out of our calculations.
What a fantastic video!! We work hard as booth owners and if the customers don’t find value in our products they won’t buy them. We are finding unique one of a kind items typically. There is huge value in that! Also, when we have an eye for buying items at a great cost, it can also be used to bless others by what they have found! Most people aren’t afraid to make offers either, so it’s good to have some cushion built in. Thank you again for this video. So well done!
So true!
I love your videos! I learn so much from you and I’m so glad you share your knowledge and expertise with us. I’ve been a reseller for 7 months and I think a big part of deciding how to price your items comes down to: 1) what the item is, 2) how much you pay for it, 3) and what are the average market prices for it. If you buy something is not that much on demand then no matter how little you paid for it or how much you price it up, it’s gonna sit for a long time and not sale. You have to really do your research to find out what buyers want in your area and create a smart inventory based on that. More times than not people will pay up if it’s something they really want. Of course that getting this “formula” right takes some time and sometimes you make a lot of mistakes in the process.
Excellent thoughts! Sounds like you're doing well!
Very helpful - thank you for giving examples too.
Thanks for all your inspiration. Opening our first flea Market booth in February. I have been binge watching everything I can find about the whole process. Thanks for sharing your knowledge.
You can do it!
Thank you Melanie. The way you presented the material in your video gave me an ah-ha moment. Looking at your calculations, I can figure what my monthly sales need to be just to break even. If I keep a minimum or consistent profit margin percentage by shopping smart (profit is made in the buying) then I can have a minimum monthly sales goal. Total monthly sales above that I have earned a profit, below that I have a loss. As a newbie that was a 💡and a tangible goal I can focus on for my booth plus a big incentive to be picky in my shopping selection. Hope that makes sense. Thanks again!
Woohoo!
Thank you so much for the info!
A total mind-switch that I personally made in my antique booth business this past year is knowing when to just let an item go! With your merchandise inventory, you know not just what it costs, but WHEN you purchased it. Has the item been in your inventory for over a year? Or more?? That item also has hidden costs; maintaining it, cleaning it, storing it, transporting it back and forth to your booth, etc. It can be overwhelming to keep it, especially if home shelf space is limited like mine. If you have done everything you can to move that old item out of your booth (fresh tag, different season, better vignette, lowered the price) and it is still not gone, it's time to cut your losses and donate it!!
Yes! That's a great tip as well, thanks for sharing :)
Love this video!! I watch them all! Actually, watched this one twice. lol!
So helpful ... thank you!
Fantastic info! Thank you Melanie.
Glad it was helpful!
Thanks So Much! This has been very helpful...VERY!!!! Appreciate you!
You are so welcome!
Thank you. I use an excel spreadsheet to keep track of all my inventory with SKU, what it is, where and for what I bought it. And also a total so I can keep an eye on the value of my inventory. It’s quite simple. When I sell an item I cut the “row” to another spreadsheet (I keep one for each year) and add price sold and date. I have formulas calculating profit (and conversion because I sell on Etsy in $ and live in Denmark with Kroner). I work on upping my margin and the spreadsheets have helped. This works for me and just wanted to share that it doesn’t have to be complicated.
thanks for sharing!
Melanie, thank you so much for sharing your knowledge. This video was great and helped me better understand how to start calculating my profit margins. This year my goal for my business is to better understand the numbers side. This is a great start . Thank you!
I'm so glad! You got this!
Thank you for breaking down the numbers like that!
You bet!
Awesome!
Great video. Thank you for sharing
Thanks for watching!
Thank you
Hi Melanie, love your videos. Based on this video and the pricing strategy, how do you price things that you get for free or donated to you?
Great video, fantastic information, but don't forget you need to keep some of the profit for future purchases
Absolutely! I do discuss that a bit when showing the example of Business A and Business B. But yes, that's another thing your profit needs to cover--restocking!
This video was so helpful-thank you! What software program would you recommend to keep track of all your numbers? I just started so I have been writing everything down for now, but I know I will need a better system to keep track as time goes on!
You're welcome! I wish I had a great tip for you . . . but I do paper as well. In my online store platform, I can load cost of each item and it will calculate profit margin for me. But for my booth items, I just have a blank spreadsheet. I try to have a general idea what my average profit margin is, it's hard to be exact. But if you get a good average, then you can look at your check at the end of the month and determine about what is your true take home profit :)
Great information. I do the same looking for barn finds for my own home. I try to leave a tag on the items what I paid for it what today's market value of it was. So if one day I or my kids need to get rid of it they have an idea of what is donatable and what is a treasure they should try to sale.
Don't get me wrong....if I LOVE an item I will pay full price if I can't find during my junkin.
I love that idea!
Smalls keep me afloat! I sell more on small than that 30 to 40 $ Fenton glass item. But it will sell. It takes a while.
That's the case for many booths :) And remember that volume has a direct relationship to profit margin . . . items that you sell a higher volume of, you can get away with a lower profit margin :)
What is a reasonable price for booth space per sq foot?
Hello how can you figure price if you buy a storage unit with literally thousands of items not all items are saleable counting all items is time consuming was is the best way to keep track and figure out cost / profit margin per item? It is very hard to keep track of bulk purchases
It is tougher when you are buying in bulk, but I would still encourage you to find a way to track what you have. Perhaps after you go through that inventory and toss out what you aren't going to sell, divide up the total cost you paid for the unit between what items you have left? It won't be perfect, but it's a place to start. Or you could sort the leftovers into buckets of cost--small, medium, and large. If your unit cost $500, take a number and divide that up as a cost for all the smalls, then another for the mediums, and another for the larger? At some point, you will need to at least get a ballpark idea of your costs or there really isn't any way to determine your real business numbers
I often buy bulk. I take the cost of the items, my driving expenses, supplies needed to clean or repair, etc. I subtract the items from that total as they are sold and don't consider the purchase profitable until all those expenses have been covered. If I bought $3000 from an estate and only sold a $100 item, I have not made $100, I am still in the hole $2900+. Sometimes it has taken over a year to cover my costs, other times it can be as little as a week.
Right now any sales go toward rent and nothing else. 😅 venue is too slow
I'm sorry to hear that :(
❤
$0 😂