WHAT TO BUY AND WHAT TO PAY IS ALWAYS THE BIGGIE AROUND HERE....
obviously dh is the math person in our business.....but i have to do the math all the time....
HERES A LITTLE NUMBER THAT IS A GOOD REALITY CHECK SOMETIMES...
ITS A NUMBER that really helps me judge things, whether to buy something, what to price something, etc ....ITS is a number he gives me once in awhile..... im supposed to make it lower....the number is the percent of sales our expenses are......
we are usually between 25 and 30%....
HERES HOW I DO THE MATH WITH THAT NUMBER IN MIND....
we pay 10$ for something....operating the store adds 3$, if our expenses are at 30%, so if i double the price to 20$ we are only making 7$...... and that is if we dont discount.....the lower the expenses the more we make....
confusing to me is ....if we buy something for 500$ and sell it fast , like the same day or week, , for 600$....did we make money or not? ....
i also use this number when trying to judge how to use the paid hours in the best way...
i use a lot of general ideas.and consider the numbers all the time and in lots of ways....but
couldnt do our books....and wouldnt want to...
heres a math HERES A MATH PROBLEM FOR YOU....
**YOU ARE IN A MALL
**YOUR BOOTH RENT IS 150$ PLUS 5%
**YOUR MARK UP IS ABOUT DOUBLE.OR WHATEVER....DONT FORGET TO TAKE OUT YOUR EXPENSES
***YOU SELL 500$
THIS IS HOW I WOULD JUDGE A SHOW OR A MALL SITUATION.....AND IT DOESNT REALLY COUNT THE EXTRA TIME IT TOOK, ABOVE NORMAL EXPENSES, TO GET THE STUFF THERE and it doesnt really take in all the other merchandise thats tied up ....it cant really count the good stuff that might happen too...like a big sale at the store later etc etc....from seeing us at a show or mall....there is always a lot of grey areas....thats where the your owners judgement comes in...or for us our consensus on the situation...
2 comments:
I really really like how you think...and this applies to your "Jiggling" post too! I totally get it and it makes absolute business sense to me.
Since my "Vintage Finds" business is a hobby, I look at it in a little different financial way - and have set this standard: If I pay in rent out of pocket (so I sold less than my rent) for two consecutive months -- time to rethink what I am doing. That is my rule of thumb. Now, what I must say is that since I began in 2001 I have always made more than my rent. Some months way more, some months fine. So, I am not looking at total expenses: my time, my gas, etc...just buying to cover my hobby & have my hobby allow me to do something I love to do!
What I look at is the perks I get from this business:
*writing off my mileage
*getting to still go out and buy --- but having a purpose --- I love to hunt & gather!!!
*having a place to unload my stuff - see I get bored easily and may bring something home & decide to sell it later
*having a place to just "play" to display, display, display!
So, my math is much the same as yours -- only different in the sense that you are a business and I am a hobby. You do this on such a grander scale and others do depend upon your math.
I also will "do the math" every now and again in someone else's booth where I don't see much or any turn around of product. My question will be...how do they make more than their rent for two consecutive months? But then I figure we each have our own math to do -- and not for me to figure out how or why it works for them.
Keep on thinking the big thoughts!!
Kari
i hear you kari.and thanks...
there are probably way more at the hobby level than not........
......the hobby level is great... for the fun , the thrill and the beauty of it...and the curiosity and love of learning....and if they make some money great...so if you do your math and arent draining the family bank....then it sounds like a real good thing..........
...antiques draws lots of educated people with lots of money and good taste...hate that!! which really hurts me at auction...a lot of my good friends also hurt me at auction!!!lol..
another big plus is you can do it into really old age if you are inclined....ive had several very active customers in their 80s.... still out there enjoying what they like and being competitive in the market place........
its a pretty wonderful business really......
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