Cazmanian_minx's new MF diary

cazmanian_minx

I messed up my cashflow and lost one of my best-selling items after the supplier put up prices to more than I was selling them for. It's taken me a year to source a replacement, but fingers crossed I have one now (waiting for new prices to come through for the plating) - all I need to do is rustle up a few thousand pounds to place the first order!

gallygirl

As long as you have a plan

GDB2222

cazmanian_minx wrote: »

If you add in the PayPal fees it works out about the same - my average item sells for £3 or £4 and PayPal takes 20p+2.9%. The toolkits sell FAR better on Amazon for some reason - about 20 a week at the moment, against about 5 a month on eBay!

Can I just explore this a second longer? I don't want to pry, so tell me to shut up if you wish, but I'm interested in how this works.

Say you sell an item for £4 that weighs say 200g.

You get £4 less 25% = £3.
You pay 60p+40p+20p = £1.20 for packing etc

That leaves you with £1.80 left over on a £4 item. Out of that you need to pay for storage and transport to Amazon - suppose that comes to 20p, so you are left with £1.60 to pay your cost price for the item + a profit element.

Does that actually work out as a profit, at all?

I can see that it works much better for more expensive items, as the package cost is proportionately less, and it probably helps if you can sell more than one items to the same customer. I am just left wondering whether the low cost items make you any money?

cazmanian_minx

The low margin low cost items don't get put on Amazon I have a spreadsheet which works it all out for me, there has to be a minimum net profit of 15% before I'll consider sending it there.

TallGirl

Sorry to hear business is tough for you right now but don't be so hard on yourself just thing how lucky you are in orther areas, husband, lovely dogs, lovely place to live etc etc.

BIZZYIZZY

Caz I just want to say keep your chin up and I think you are an inspiration to us with your determination to go out and achieve all that you want, I have read your old thread and this one and I am so impressed with you.
I am a lurker on here same as 'our 'local one the org, I do go on them both every day. Anyway just want to say good luck with your business

cazmanian_minx

Happy Friday everyone and I'm glad to say it's a happier one than last week's I've managed to pay myself for a start - not quite caught up with the month, but when the Amazon income clears into my bank on Monday I'll be able to pay myself the final £200 for the month. Another £50 has disappeared off the Tesco credit card and the more eagle-eyed amongst you will have spotted that I've stayed in my overdraft in order to put £365.41 into the offset account - this is 1/6th of the tax bill due on 31st July and I'm determined to have it put aside for once.

The shop is still going through a rough patch, but I threw myself on the mercy of a group of very wise friends who gave me a lot of fantastic feedback, some of it hard to hear, but I have about a gazillion ideas of things to improve and am drawing up my battle plans Royal Mail has thrown a significant spanner in the works with the publication of its new business prices though. The Large Letter increase is about the same as last year, but the Packet rate is an effective increase of about 59%% :eek::eek::eek::eek: They're combining the first four weight bands into one, so where you previously had 0-100g, 101-250g, 251-500g and 501-750g, from April 2nd there will be one price for 0-750g. Needless to say, for someone whose average packet weight is 200g, this does not work out well! I'm going from paying £1.66 (no VAT) for first class to £2.13+VAT, which is a huge leap and if they don't make the same weight-band change to over the counter stamps, EXTREMELY difficult to ask customers to accept. For a non-VAT-registered business, I should think that going back to stamps will be a no-brainer. Personally I'm waiting until they announce the over-the-counter prices before I sit down and work it all out. Unfortunately I don't have the volume to keep my discounted PacketPost account if I just send the Large Letters through it. At least everyone's in the same boat - it'll be interesting to see how this affects eCommerce in general.

GDB2222

But you'll be able to offer discounted shipping prices where people buy multiple items - apart from needing a larger jiffy bag it won't cost you any more to send out 5 items than 1. Put a note on your website explaining why you are doing this, and people will understand. Every cloud etc.

cazmanian_minx

GDB2222 wrote: »

But you'll be able to offer discounted shipping prices where people buy multiple items - apart from needing a larger jiffy bag it won't cost you any more to send out 5 items than 1. Put a note on your website explaining why you are doing this, and people will understand. Every cloud etc.

I already do - P&P is a flat rate of 90p for UK customers, whatever's in it (worked out on the average amount I pay for Large Letter and Packet combined) and free for anyone spending £10 or more. If I went for 2nd class post instead of 1st I could probably keep it at £1, as 2nd class packet rate is going up to what I currently pay for 1st, but at the moment, most of my UK customers get their order within 24-48 hours of placing it and about 80% of my eBay feedback has some variation of 'Fantastically fast delivery' on it - it's one area where I really do stand out from some of my competitors. If I were to keep first class I'd have to start differentiating between LL and P items - a LL item would actually be able to go down to 80p, but packets would have to go up to £2.30 which is one heck of a leap. Averaging it again would leave me somewhere around the £1.60 mark.

Sepa74

That's a real dilemma. I hope you're customers get used to it and you don't see a big drop in business.