One of the main purposes of this blog is document some of my personal finance journey. I believe there are 3 parts to the personal finance equation: 1) Making money, 2) Saving Money, and 3) What to do with said money. I plan on covering a bit of all 3 on the blog, but today I want to share what I am doing to increase the 1st part of the equation.I have some ideas for a few side projects, but selling items through Amazon FBA is the one I have been able to really make progress on. BigHabitat has a primer on selling on Amazon and creating FBA shipments so I am going to skip those details for now and jump straight into where I am at.
I would say I have been roughly selling for a month even though I started paying Pro seller fees on May 2nd. My first item actually sold on June 17th and the month of June is when I really started doing my shopping of things to buy and sell. It was an amazing feeling receiving an email that told me an item has sold. I only sent in 3 or 4 items in my first shipment so selling one was pretty good for me. I took the positive momentum and went out shopping for more things to sell with slightly more success.
My plan for the blog is to update you monthly on my progress for selling things through Amazon FBA. I am going to include all revenues and expenses and plan to track the number of hours I spend on the business. I want this to be a legit income supplement for my family and want to show you how easy/difficult it might be for you to do it for yourself. I have no inside knowledge and have only learned what I know from a few free resources such as Pat Flynn’s podcast where he interviews Jessica Larrew, Jessica Larrew’s website, and the Online Selling Experiment. I have invested in some tools that I learned about through these websites, but other than that the investment has been minimal except for buying product.
I do plan to invest in the business in the future once I have some profit to speak of and determine that is viable for me to continue. My future investments are going to be a bluetooth scanner, proper scale (using a kitchen one currently), and maybe a course or 2 from one of the websites mentioned above. I am not afraid to put some money back into the business if it shows me some success.
What I started with:
- Dymo 450 Series Printer (free or $80)- I purchased this from Staples using my ink recycling rewards, but also can be found on Amazon. If you don’t know what that is, check out this post from Big Habitat.
- USB Barcode Scanner ($26) – I purchased this off of Amazon and it is helpful when listing inventory. It is so much easier than typing in the numbers. The next step is to get a bluetooth scanner for price checking items while out and about instead of draining the battery on my iPhone.
- Self Seal Poly Bags (~$51) – Used for sealing food and other products. Definitely not necessary to start so not sure what my logic was for purchasing them. You need these bags to put certain products and the bags need to have a label that have a suffocation warning on them.
- Boxes from Home Depot ($1.30/box) – I bought 4 large boxes and 4 small ones since they didn’t have any medium ones. I will be returning the large boxes since they are huge!
- Packing Tape (free or $5-$6) – I also used Staples rewards for this item and already had some laying around the house.
- Profit Band Phone App ($15) – Used for scanning items in stores and determining if they are worth buying.
This is all I used to get started and it was all under $200 if I were to buy it all out right. You probably can do it cheaper if you want to get rid of the poly bags and the barcode scanner. You technically don’t need profit bandit, but for $15 it is a must have I think. Now, I think they have a monthly subscription model so you can try out it for free for a month or 2.
To date, I have made $30 in profit net of all fees including the cost of purchasing the goods and the $40 pro merchant fees. Not bad! I have a decent amount of inventory now so I expect the profit to go up. My ultimate goal is to make $1,000 in profit monthly by the end of the year. Do you think it is possible? Anyone else have experience with FBA? Leave me a comment.
[Full Disclosure: The first 3 item links are affiliate links and I will make a small commission if you purchase an item using them. Normally, I would advocate for using a cashback site to lower your price but that isn’t possible with Amazon so I comfortable linking them.]
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ProfitBandit is now $12 a month 🙁
I know and it is a major buzzkill! I am trying to recruit my brother in college to help mye source, but I am not sure how profit bandit will work or if I can let him use mine if I am paying the $12 a month. It is definitely worth having though as I think the $/hr would go wayyy down to where it wouldn’t be worth the effort anymore.
Hello,
Thanks for blogging about this, as it is something that I’m also interested in exploring (especially after looking at the information Big Habitat has posted with deals). Do you do any searching for discounted gc or use cc rewards? If so, how do those factor into your profit calculations?
I do a mixture of both. I use my fidelity amex to purchase the items or gift cards for the item. I haven’t let the extra margin come into my profit calculation yet and I am not sure if that is good or bad. The math I have heard is that people make 1/3 of what they sell an item for if the #’s are right so that is kind of my barometer. I think that works out to having at least 100% mark up on most items depending on size and weight. Send me an email if you have any questions about getting started.
Very cool. Are you selling solely to generate income, or are you also looking to bank points? For a while I looked into specifically office supply store deals, in an effort to resell at break-even or even a very slight loss and pocket the 5X per dollar (using an Ink card). I haven’t been too persistent since items are rarely discounted enough at stores like Staples to make a flip with commissions a reasonable endeavor. If it doesn’t kill your income stream, can you share anything about where you tend to shop and maybe some general categories of items? If it’s a deal killer, that’s fine – (forums?)
I haven’t been banking points at the moment though I think that could be an option. For easy record keeping, I have used my Fidelity Amex to purchase everything so just increasing my margins. It is also easier to account for.
As far as locations to shop, I will scan items anywhere. I just look for the clearance section and go. I have been to Wal-Mart, Target, Macy’s, Kroger, TJ Maxx, Marshalls, and Staples as well. The advice I have read is to scan a bunch because you don’t know what will sell so I just go crazy in whatever store I happen to be in. I figure I will niche down once I get more experience and figure out what works for me/my area. Hope this doesn’t kill my $30 a month haha. Shoot me an email or pm if you want to talk more or even setup a specific topic in the forum. I think a partnership can help save time and make more money!
I’ve been reselling since March, but it’s mostly been to increase my balance of points and miles (0%-15% profit margins). This month though, I really started ramping up due to inspiring blogs such as, Online Selling Experiment and Big Habitat. We must be on the same wave-length or something.
Anyway, I wish you luck with with your goal and look forward to reading about it!
Sounds like we are. I am going to try and keep a monthly update going and maybe more frequently if I start coming across interesting things or growing at an alarming right. Shoot me an email if you want to compare notes!
WN – could you go more in depth on Profit Band? I’ve never heard of it and would love to learn more, thanks!
I will once I get better with it. Right now, I am not even sure I am using it correctly.
I could’ve written your post! I simply decided to decrease home clutter and lo and behold, many of those items were selling on amazon. After sending those in, I’ve begun to source, although, since I’m not selling 40+ items per month, I don’t feel I can justify the $40 per month pro fee. Soon, I hope. But, our goals are the same…$1000 a month by years end. Still learning and trying to fine tune my intuition. Ultimately, 5k would be nice. When I read some do 15-25k, well, ouch, that hurts my head. I want to make sure to keep it fun.
Awesome! I just applied to get approved in the health and beauty category so I am still waiting for approval on that. I also decided to go great guns with this thing to see what I can really do. I am going to LLC, business banking account, and the whole 9 to see what I can really do. I am going to reassess after the end of the year and decide if it is worth my time and effort. Let’s compare notes in a month or 2 and see how we are doing.