Sales or Profit

By Tony Lam

  • SumoMe

 running for sales or profit

eBay and Paypal provide whole bunch of reports including sales and expense reports to the sellers. However, there is no report showing the net profit. Most of the sellers may be misled by the sales figure without noticing that their profit margins are gradually eaten up by increasing shipping charge, packaging material cost, eBay FVF, etc.  To have a clear picture of the net profit, sellers may need to create their own account report combining sales with variable cost and fixed cost. Knowing the MTD accumulative profit, sellers can be able to adjust their selling strategies continuously (using Deming cycle PDCA) to meet the profit targets before it is too late. Here I am going to share my way to track the profit for each transaction and MTD accumulative profit. It helps me a lot to put my focus on actual money in the pocket and catch up net gain when it is behind the target. How about yours? If you have other ways or suggestions, I would like to learn from you.

  1. Variable cost

Define variable costs such as eBay insertion fee, Final Value Fee (FVF), Shipping, Insurance, packing materials for each item and put it in an Excel spreadsheet. Define a Range Name(itemlist) for the list.

eBay item list

Then, record down each transaction in a separate Excel spreadsheet with total amount received.  Select the item by drop down list from the Rang Name (itemlist). Most of the entries are filled out automatically by Excel Vlookup. In case of some situations (such as multiple qty or combined invoice) that the formula does not fit, you can overwrite them with your figures.   If you are not familiar with Excel functions such as “Vlookup”, it is easy to google tutorials with keyword “ Excel Vlookup”. Here is one of the tutorial for creating drop down list and defining a range name.

eBay profit tracking table

  1. Fixed cost

Define monthly fixed cost such as rental, utilities, monthly subscription fee from eBay store/Inkfrog/Auctiva/ Other app. etc.  The figure forms a break even line for your profit and loss. For example, if the monthly fixed cost is $500, your monthly profit from 1) is $2000. Then, your profit is $ 1500. On the other hand, if your monthly profit earned is less than $500, you will report a loss for that month.

Category: Online Business

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