Tracking sales and profitability

When you are reselling products online for a profit, tracking sales and profitability is essential to the success of your business. By tracking these metrics, you can identify areas where you are succeeding and where you need to improve. In this chapter, we will discuss some tips and strategies for tracking sales and profitability when reselling products online.

1. Set up a sales tracking system: The first step in tracking sales and profitability is to set up a sales tracking system. This could involve using a spreadsheet, a dedicated software program, or an online platform such as Amazon or eBay. The key is to choose a system that is easy to use and that allows you to track sales and profitability over time.
2. Record all sales and expenses: To track profitability accurately, it is important to record all sales and expenses related to your business. This includes the cost of the products you are reselling, any fees or commissions paid to online marketplaces, shipping costs, and any other expenses related to your business.
3. Calculate gross profit: Gross profit is the difference between the selling price of a product and the cost of goods sold (COGS). To calculate gross profit, subtract the COGS from the selling price of each product. This will give you a rough estimate of the profit you are making on each sale.
4. Calculate net profit: Net profit is the amount of money you have left over after subtracting all expenses from your gross profit. To calculate net profit, subtract all expenses (including COGS, fees, shipping costs, and other expenses) from your total revenue. This will give you a more accurate picture of your profitability.
5. Monitor sales trends: Monitoring sales trends can help you identify which products are selling well and which are not. This information can help you make better purchasing decisions and adjust your pricing strategy accordingly.
6. Analyze expenses: Analyzing expenses can help you identify areas where you can cut costs and improve profitability. For example, you may be able to negotiate lower shipping rates or find a more cost-effective supplier for your products.
7. Set goals: Setting goals can help you stay focused and motivated as you work to grow your business. Consider setting goals for monthly revenue, gross profit margins, or the number of products sold. This will give you something to strive for and help you stay on track.
8. Keep track of your inventory: Keeping track of your inventory levels is essential to ensuring that you have enough products to sell and that you are not overstocked. Use your sales tracking system to monitor inventory levels and make purchasing decisions accordingly.
9. Conduct regular financial reviews: Conducting regular financial reviews can help you stay on top of your finances and identify any areas where you need to make changes. Consider conducting a monthly or quarterly financial review to track your progress and identify areas where you can improve.
10. Use online analytics tools: Many online marketplaces offer analytics tools that can help you track sales and profitability. Use these tools to monitor your progress and identify areas where you can improve.

In conclusion, tracking sales and profitability is essential to the success of your reselling business. By setting up a sales tracking system, recording all sales and expenses, calculating gross and net profit, monitoring sales trends, analyzing expenses, setting goals, keeping track of your inventory, conducting regular financial reviews, and using online analytics tools, you can stay on top of your finances and make informed decisions about your business. With the right strategies and tools in place, you can build a successful and profitable reselling business.