In my last post, I stated that my 2016 goal is to pay myself $750 a week. To do that, I calculated that I need $6429 in weekly sales to meet that goal.
I’ve had a few people message me saying that my numbers are off or that it’s a poor return or not realistic. So, for this post, I’m taking my real numbers from my most current payout (Dec 9 to Dec 23rd) to see what my paycheck calculates to.
Before I share my numbers, let me share a little info about me and my business:
- Joined the Amazon FBA program on April 30, 2014 with no online selling experience and while working six days a week at a regular job.
- In August 2015, went part-time at my job. Since then, I divide my time between Amazon FBA, my blog, caring for my mom and working one or two days a week at my job.
- I run my Amazon FBA business 100% on my own. My husband doesn’t help and I don’t have a VA or employees.
- For 4th Quarter, my average time sourcing was 10 hours a week and another 10 hours a week to list, prep, ship and do bookkeeping.
- My primary focus was toys in October and November. On November 28 and in December, I bought shoes in addition to toys.
- All sourcing was either through retail or online arbitrage. However, the majority was retail arbitrage.
- I pay for all inventory with a credit card and pay off the balance each month.
- I started doing Profit First in August and since then, I transfer a % of every Amazon Disbursement into my business savings account for future expenses (profit check, emergency fund, my paycheck and taxes).
I shared the above information with you because I don’t believe that just giving you my sales number or paycheck amount will do a whole lot of good.
Actual Numbers from Dec 9 to Dec 23
Below is a screenshot from my Seller Central account:
Deducting Out the COGS to Calculate My “New Money”
Every two weeks, I deduct my COGS from my disbursement amount. I get the COGS from InventoryLab by exporting my FBA Sales numbers into Excel and then eliminating the rows that aren’t included in the Amazon Disbursement period. The next step is to have Excel give me a total for the “Buy Cost” column.
For this period, my COGS is $1519.04 and I’m left with $1039.94 in new money:
As you can see, my numbers don’t exactly fall into the 3x Rule. Amazon Fees are less and COGS are more than 1/3 of my selling price.
Different Options for the New Money
At this point, what happens with any new money you receive is up to you:
- Put the full amount back into your business for new inventory and expenses. *This is what I used to do
- Put random amounts into your business and household accounts.
- Allocate the money based on percentages into different accounts. *This is what I do now
My Plan for the $1039.94
Again, it’s your decision as to what you do with your money. Some of you may not take a paycheck and some of you may take a large one. But this is what I’m going to do:
- Amazon is depositing $2558.98 into my checking account.
- My COGS is $1519.04. From this, I need to pay off my credit card balance of $1327.80. This leaves me with $191.24 to keep in my business checking account for new inventory purchases and expenses.
Then, allocate the $1039.94 into different accounts:
Though I’m not paying myself today, I allocated $363.98 towards my future paycheck. This is roughly 10% of my sales figure.
As the $363.98 is for a 2-week period, it calculates to $181.99 in weekly pay ($363.98/2 = $181.99).
I am short of my $750 weekly goal. To get there, I need to improve my ROI %, get sales up and/or allocate a smaller amount to my other funds.
I hope this makes sense to you and clears up how I came up with the $6429 sales figure in my last post.
As always, I welcome any questions or comments either here, in email (firstname.lastname@example.org) or on my Facebook Page.