When I sat down and crunched the numbers I will get paid $61.75 an hour for selling on Amazon FBA. This is for about 30 hours of work over a 2 week period. Granted, Amazon doesn’t just give me money for sending in inventory – someone needs to buy it first! How’d I do it? Read below to find out…
I FINALLY had a chance to sit down and finish processing some of my thrift store and book sale finds and ship ’em out to Amazon. I have no problem finding time to go out Scouting for inventory – it’s the processing that is a pain in the rear. Oh, and also, I was happily distracted working on this website and writing a book with Debra. It is thrilling to sit down and see just how much each item could be sold for. So here is the break-down of what I’m sending out today:
$3,200 worth of inventory is sitting on my front porch waiting for my fabulous UPS guy to pick it up – woo hoo!
Here’s a pic of the 8 boxes.
They range in weight from 7 – 25 lbs.
They are going to two different warehouses and two different sides of one of the warehouse – so 3 different shipments. Two for CAE1 = Columbia, SC (2 boxes) and IND4 = Indianapolis, IN (6 boxes)
What is in these boxes?
- Thrift store purchases from 8 different thrifts I hit in the last 2 weeks. Spent $197.60 (some of these items were from this thrifting trip)
- About 3/4 of the books I purchased at a book sale last Friday – spent about $18.
- Some items that I purchased from a Craigs List ad (spent $25) – games, software
- A couple of items that are replenishment’s for items that are sold out on Amazon (a little experiment of mine) – spent $10.98.
- A few items I bought on clearance from my local grocery store – spent $29.73 (in hindsight I probably shouldn’t have purchased these items – could have gotten more bang for my buck at the thrift stores – hopefully they sell quickly).
Total spent on inventory: $281.31
Total selling price for this inventory: $3,200 (this is a close approximate number – I might need to adjust prices a bit)
How much should I make after all the fees and costs of inventory are taken out?
When you are buying & selling “big box store merchandise for retail arbitrage, you can expect that $3,200 to be divided into 3rds – meaning 1/3 for cost of goods, 1/3 for Amazon Fees and 1/3 for net profit.
If you look at my inventory total selling price of $3,200 – that would mean inventory costs of $1,066 following the 3x rule.
Because I am “thrifting” most of my inventory I only spent $281.31 on inventory! So let’s break it down…
Selling Price = $3,200
Cost of goods = – $281.31
Amazon Fees = – $1,066
That gives me a gross profit of $1,852.69 (58%)
In the last two weeks I’ve worked on FBA for a total of 30 hours max. That means I made $61.75 an hour!
30 hours includes driving time, shopping time, listing/label/packing time. All of my time is included in that 30 hours.
Crunching The Numbers
For fun I did a little more number crunching. Say I choose to dive into this FBA business full-time and devote at least 40 hours to it every week. And I’m able to consistently find inventory with low cost and high returns. Then, that could work out to be:
$61.75/hour * 40 hours/week * 52 weeks/year = $128,440 per year!
Wouldn’t that be nice 🙂
My little disclaimer: What you make on Amazon will be effected by many factors – your “cost of goods” (how much did that inventory cost you?), Amazon fees, the product you are able to source, how quickly/slowly the product sells….etc. AND – out of that $61.75/hour I have to also pay Uncle Sam (just like I would if I had a regular J-O-B).
p.s. Does this “Thrifting For Profit” part time business sound interesting to you? Have any questions? Ask away below – we love questions. Even if you just have a comment – we love those as well. 😉