When running a business on ETSY (or any online venue, personal website, or home parties) it’s very important to keep track of money in and money out. It’s nearly impossible to gauge how well your business is doing without keeping track of the necessary profits and expenditures. Once you are tracking the in and out of money it can be easier to find budget limits, and determine where to cut costs from and where to put more money in. If you aren’t already I would get an accounting software (Quickbooks is one of the best) and put it all your information; inventory, receipts, bills, advertising costs, and sales. It’s also a great program to use to keep track of inventory pricing such as cost, wholesale price, and retail price of items you have for sale.
Here are some quick tips on how to save money once you gauge where your business stands with money in and money out:
* Have a Set ETSY Bill. Every month determine the exact amount you want to spend on ETSY for listing new items and renewing. Remember if you want to only spend 60.00 a month don’t set your budget at 60.00 because you still have to account for items being sold and your commission costs to ETSY for those items being sold. If you sold $350.00 in merchandise on ETSY that’s $12.25 that will also be on your bill Try to stay as close to your budget as possible.
* Research Supply Prices. Always remember this: You are not married to your supplier. It’s okay to look for better pricing on items. You may get lucky and your current supplier may price match the other supplier, but they won’t if you don’t ask.
* Dedicate to FREE Promotion. There is no cheaper advertising than free advertising, and there are many ways you can do that. I am currently working on a Facebook fan page, and it’s free.
* Cut Unreasonable Practices that Bleeding Money. I was offering free shipping for a long time but with the cost of shipping going up and the cost of my mailers going up it was no longer practical for me. I still have very good shipping costs ($1.99 US, $2.99 international) but it was unreasonable on my already lower priced items to offer free shipping.
Hope this helps you out a little with your pursuit of making more profit in 2011.