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[–] 6 points 3 months ago* (last edited 3 months ago) (2 children)

It's less about "how many books?" and more about "how much per day?"

There's a minimum amount "to keep the lights on" and then how much to turn a profit.

Generally speaking new books carry a profit margin of 30-40%.

So $600 a month for rent. Utilities (electricity, internet, insurance, security system) probably another $150.

Figure a 30 day month that means doing $25 a day just to keep the lights on.

I have to replace the stock sold with more stock. So 60-70% goes back into maintaining the supply.

So $25@30% means sales of x@100%, solve for X. 25*100 = 2500 / 30 = $83.33 a day just to keep the lights on. $25@40% = $62.50 a day.

If an average transaction is $20, that's 4 or 5 sales a day just to keep the lights on, with a little bit extra, figure 1 to 2 books per transaction?

Now, that being said... To recoup the total costs, $600 for fixtures, $350 for a Point of Sale, a certain percentage of each transaction to handle credit card processing (generally 2.5% + a transaction fee that can be as high as $0.10). That's $950 + $0.60 per transaction I have to make back before there's any money left over.

Let's say I do 5 transactions a day, $100 a day.

$100@30%
83.33 - Keep the lights on.
$16.67
$0.60*5 - $3 a day transaction fees.
$13.67

I have startup costs of $950, not counting domain registration, creating the LLC, etc. I'm ball parking this to keep it simple. 😉

$950 / $13.67 = 69.5 days before I make back the money on the fixtures and machinery needed to run the business.

$100@40%
62.50 - Keep the lights on.
$37.50
$3 a day transaction fees.
$34.50

27.5 days to make up the money on the fixtures and machinery.

Now, I haven't paid ME yet, and I have a mortgage, health insurance, and I need to eat too...

So let's say to personally survive I need $5,000 a month.

$166.66 a day. @30% that means an extra $555.55 a day. 27 transactions a day pays ME. So figure on $671.55 a day pays me, the transaction fees, and keeps the lights on. 34 transactions a day.

$166.66 @40% that means $415 a day. 21 transactions a day pays ME. $527.60 a day pays me, the transaction fees, and keeps the lights on. 27 transactions a day.

Doesn't count advertising, taxes, the domain and email costs, the business license and such, one time costs that I'll likely just eat. But you get the idea.

If I hit 35 transactions a day at $20 per, I'm golden.

Space can be open 8 AM to 8 PM, 3 sales an hour? Every day? Seems feasible. Would be working myself to death, but that's life in startup!

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  • [–] 6 points 3 months ago (1 child)

    Maybe throw in a coffee shop and some evening events. Not much reason to go to any retail establishment these days.

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