Bookkeeping is not fun, or glamorous. But, you have to do it. They keyword here is organization. This encompasses your inventory tracking, and tracking your money.
We’ll start with the inventory. Every item you have in your inventory, needs to be accounted for. Down to the smallest piece. They system that I use utilizes a spreadsheet, with five main columns. 1) Item name. 2) Item number. 3) Cost of Item. 4) Transaction fees. You can leave this one off when you sell in person. 5) Total profit. Start this early, with the purchase of your first item. Trust me. I started an item number system after I complied more items than I could keep track of in my head. I sat down and put each item into my spreadsheet. I then numbered everything, but not in the same order that they were in the list. The first page of my spreadsheet is a jumbled mess. When you sit down to compile your inventory, do it each item at a time, in chronological order.
When I sit down to add to my inventory, which is a lot easer now, I take it one at a time. If I buy an old boot, sock, and a toothbrush I pick one to start. Old boot goes first. I start typing into the first row under column 1.
1, Old Left Boot. Be specific. If you have multiple items that are similar you need to be able to differentiate when you make a sale.
2, Give it an item number. Since we go in chronological order its pretty easy. The last item was numbered 7001 so my old boot is item number 7002. You can start with whatever number you want, I just choose 7000 to start with because it seemed as good a number as any.
3, I paid $3.00 for my old boot so $3.00 goes in next.
4, Transaction fees. Lets pretend that we’ve sold this boot for $9.00. So, we’ll add up our transaction fees. The fees may be different depending on what platform you sell on. Lets say the fee is 4% of the sale price, plus a 30¢ fee to post the sale listing. Now, lets do some math. We sold it for $9.00 so we need to multiply 9.00 X 0.04 (To get the percentage as a decimal just move the decimal point two places to the left. Taking us back to grade school.) which gives me 36¢. Now we need to add that to the 30¢ we paid for the listing which is .30+.36 which is 66¢. I hate math too. Plug in 66¢ for the transaction fees.
5, is my favorite one. How much did I make? We know that we need to minus the fees and cost of the item. We paid $3.00 for the boot and 66¢ for the fees. Just add that up, 3.00+66 is $3.66. Now, we sold the item for $9.00, so now we subtract the items cost and fees from our sale price. 9.00-3.66, so we made $5.34 on the old boot.
I don’t factor in the cost of shipping the item, with the platform we use the shipping cost is calculated for us, and that is paid by the buyer so that’s a break even situation on the shipping.
Whew. Okay, now the money part. I know this one isn’t very exciting but bear with me. We’re almost done.
Keeping track of the money is fairly easy, if you start early. Don’t repeat my past mistakes. If you have used a bank book for a checking account it works pretty much the same. You will have a starting investment, and according to “How to be Successful in the Antiques Business: A Complete Guide to Opening and Running Your Own Antique Shop” by Ronald S Barlow, for a 50 square foot booth you need a minimum investment of $2,000. That’s for merchandise, fixtures, and your first months rental fees.
It’s fairly standard, just keep track of your debits and credits, add profits and subtract expenses as they come. There are a number of book keeping programs out there. You may check with your bank and see if they have a program available for you to use. There are apps you can download for a small fee from your smartphone’s respective app store, and there’s also good old paper and pencil.
Thanks for sticking with me through all that. Next week we’ll do something more fun. But, you have to take care of the not so fun stuff as well as the fun stuff.