Last time on Amazing FBA, we talked about startup businesses. Today, in part two of my discussion with Penny Lowe, owner of Wellington Consulting, we’re focusing on accounting for companies that would qualify for the 10k collective. In a nutshell, today we’re going to be talking about scaling from an accounting perspective.
It’s long overdue that we’ve had an accountant on Amazing FBA. Today I’ll be sitting down for part one of my interview with Penny Lowe, owner of Wellington Consulting. If I had to name one single item as the most significant pain point for most entrepreneurs, it’s accounting. So many people in all walks of business struggle with tax accounting, bookkeeping, and payroll. It’s impossible to cover everything accounting in just an hour’s worth of interviews, but today in part one of this two part series on accounting, we’ll be covering the basics for new sellers on Amazon.
It is important for any business to measure its profit and loss as this helps in determining the direction of the business. It helps in understanding if the business is headed in the right direction or if there are changes that need to be implemented. Continue reading
The final 5th part of this miniseries of 5 episodes, this completes this overview of Profit Maximizing Strategies. Remember the basics: you can only increase profit 2 ways:
We looked last time at decreasing your overheads. Here we address the other profit killer: your Direct Costs.
Otherwise known as COGS=Cost of Goods Sold.
look at your Total Landed Cost (TLC): Here are some ideas for reducing these:
-Manufacturing cost – can you negotiate with your supplier for lower costs? If you order more units, can you get a lower per unit price?
-Freight cost – get multiple freight quotes. Order more in bulk so you can sea freight rather than air freight etc. Choose lighter products!
Also consider your Amazon costs when choosing a product:
-Weight handling costs: Consider product weight & calculate costs very carefully if considering a heavy product. Will it make a profit?
-Oversize product costs: same things to consider as heavy products.
-Amazon Warehousing/storage – generally these are low but again very bulky products may increase these – do your P&L calculations carefully as well.
Other supply chain cost reductions: