£0.55p profit would you bother..?

Etycoon · #1 10-14-2014

I just sourced a new product fairly low competition and really high demand in the UK , and Germany.

Upon doing some calculations I can match the lowest price and make £0.55p profit per a sale using FBA

What do you guys think is it worth it..? I could probably sell 500+ units a month.

And is there any tips you can give when using FBA etc

Thanks

BiN4RY · #2 10-14-2014

If I were you, I'd ask myself two questions:

1) If I lose one item (fraud, lost mail, broken, etc), how many more do I have to sell to recover the loss?
2) How much time will I need to spend to process all of my orders, and how much am I getting paid per hour doing this (profit/hours spent)?

Use your answer to consider if you should bother or not.

Etycoon · #3 10-14-2014

Quote:

Originally Posted by BiN4RY

If I were you, I'd ask myself two questions:

1) If I lose one item (fraud, lost mail, broken, etc), how many more do I have to sell to recover the loss?
2) How much time will I need to spend to process all of my orders, and how much am I getting paid per hour doing this (profit/hours spent)?

Use your answer to consider if you should bother or not.

Hmm.. you make some fair points.

I would need to sell about 4 units to recover such losses as lost or stolen. The item is cheap and due to the market I am confident that the risk of fraud is very low.

I plan on using Amazon FBA therefore I wouldn't need to pack and ship the item, also the product is self explanatory so I wouldn't be getting many customer queries to answer.

All I would need to do is maintain the stock, which should be once a month.

jeffweico · #4 10-14-2014

There really isn't that much fraud on such low priced items. Yes, it happens, but rarely. Since Amazon will be handling everything for you what it comes down to is this:

Is it worth £275 ($438.74) in profit to buy 500 items per month and send them to Amazon?

I think so. 10 items like that and you suddenly have a nice little income stream there with very little work.

But that is just my opinion. And, as with everything else, you need to try it to see how it works in reality. If it DOES work, I would see if I could get a better price by buying a couple thousand units at a time. Also, if it would save money to send them to Amazon that way. But I would just do a month's worth for 3 months or so to make sure all goes as planned.

Gamefreak · #5 10-15-2014

profit is profit as long as your items do not cause problems, are not prone to returns or easily broken as amazon customers like to return their broken junk and keep your new item.

eBay King · #6 10-15-2014

Sure, go for it. Sounds like very low profit, but if you get many more products like that, you can build up the profit levels and the account will strengthen.

Good luck.

Univerzal · #7 10-15-2014

Maybe it isnt the highest profit but its worth it if you can grow the account.

Every dollar is a dollar.

rsot · #8 10-15-2014

Profit x volume is your key here OP - do you also have the time to do this? If your time is ok, then go for it. All the best

#9 10-15-2014

You have to figure out if the juice is worth the squeeze. (always wanted to use that saying since I watched the girl next door)

Only you can really say if the profit is worth the time spent.

JamesNorth101 · #10 10-15-2014

All about risk and reward.

So long as each item does not cost £50 to buy and only sell for £0.55 profit (which is not the case here) then it sounds like you have a very nice little earner for yourself.

Good find

Callidus · #11 10-15-2014

Base it on how many you can sell at that amount - this makes it sound better....

If you can sell 10,000 at 0.55p profit thats good but how much time does it take you to pack them, hassle from customers etc...

A profit is a profit...good luck

GreenBean · #12 10-15-2014

Quote:

Originally Posted by Callidus

Base it on how many you can sell at that amount - this makes it sound better....

If you can sell 10,000 at 0.55p profit thats good but how much time does it take you to pack them, hassle from customers etc...

A profit is a profit...good luck

I thought with FBA no packing as such?

Callidus · #13 10-15-2014

Quote:

Originally Posted by GreenBean

I thought with FBA no packing as such?

Didn't see that part, even better then!

GreenBean · #14 10-15-2014

Thread is in AMAZON....

it's a good plan indeed for the OP

MICKY H · #15 10-15-2014

Tell you what Etycoon, if you cannot be bothered, send me a PM with all the details and I will do it, will me buy a few bottles of wine....lol

Kiroshi · #16 10-15-2014

For me I think the strongest thing to consider is how much you are actually paying for each unit at wholesale. Many of my items I make around £1 profit on, but I only buy at 50p per unit, so its all good. They sell high amounts so I have to buy in around 500 every other month. Now if those items cost £10 per unit or more I would have to strongly consider if it is worth the risk of buying that amount in for the profit.

rsot · #17 10-15-2014

Quote:

Originally Posted by Kiroshi

For me I think the strongest thing to consider is how much you are actually paying for each unit at wholesale. Many of my items I make around £1 profit on, but I only buy at 50p per unit, so its all good. They sell high amounts so I have to buy in around 500 every other month. Now if those items cost £10 per unit or more I would have to strongly consider if it is worth the risk of buying that amount in for the profit.

100% profit - nothing to sneeze at

hulkman · #18 10-15-2014

It seems that you are basing that profit if you sold it at the cheapest price now. What happens if that seller decides to lower his price? Are you going to be stuck with the product, are you going to take a loss on it? Is it something that can easily be sold if needed to.

MICKY H · #19 10-15-2014

Maybe he has not realised, he does not have to the cheapest if selling FBA, just the cheapest FBA seller and he will get the buy box. Therefore the profit will be higher.

GreenBean · #20 10-15-2014

Quote:

Originally Posted by Kiroshi

For me I think the strongest thing to consider is how much you are actually paying for each unit at wholesale. Many of my items I make around £1 profit on, but I only buy at 50p per unit, so its all good. They sell high amounts so I have to buy in around 500 every other month. Now if those items cost £10 per unit or more I would have to strongly consider if it is worth the risk of buying that amount in for the profit.

By doing your homework, you are on the right track to good business.

Nice one.

Etycoon · #21 10-15-2014

Quote:

Originally Posted by hulkman

It seems that you are basing that profit if you sold it at the cheapest price now. What happens if that seller decides to lower his price? Are you going to be stuck with the product, are you going to take a loss on it? Is it something that can easily be sold if needed to.

The manufacturer regulates price my pricing is based upon the rock bottom price you are allowed to sell at.

Etycoon · #22 10-15-2014

Quote:

Originally Posted by Kiroshi

For me I think the strongest thing to consider is how much you are actually paying for each unit at wholesale. Many of my items I make around £1 profit on, but I only buy at 50p per unit, so its all good. They sell high amounts so I have to buy in around 500 every other month. Now if those items cost £10 per unit or more I would have to strongly consider if it is worth the risk of buying that amount in for the profit.

its £1.88 a unit at a fairly low order quantity. Obviously if I order more I can get a cheaper price. I have observed the few sellers who are actually selling this product and can confidently say they are selling a few hundred a day, so I think ill go for it.