who takes the most of sales, etsy shopify

oh how much a profit did I make in my,first three calendar years of launching,my first Etsy brand that's what we're,going to be covering in this video I got,this video requested quite a few times,after I posted how much I made after my,first calendar year where I disclosed,how much gross revenue I made like I,said the reason I didn't share it in,that video was because there was so much,other value like really intense value,and strategy that I was explaining that,I thought that was the True Value I,share my numbers to inspire people I'm,not sharing them to like brag or,anything but just showing people what's,possible and the real value for your own,business is the free strategy and the,thousands of hours that exist on my,channel of how to build an actual,business from how to hire employees do,inventory management marketing,photography ad strategy all of that that,type of content exists in my business,which is more valuable than knowing,somebody else's numbers but the the only,other value that I would say that is,valuable from knowing what my actual net,profit is like true value for actually,helping your business is understanding,the makeup of all the expenses that,exist in the piece of the pie of your,business and the psychology of why it's,important to know this pie of your,business if your business is an engine,looks like this circle right here within,that Circle you have a bunch of,different pie slices and those pie,slices essentially make up all the,pieces of your business the really,dangerous thing about not knowing the,makeup of your business really put,emphasis on why this is so important and,why it's important to understand what,your landed finished product cost is,including shipping costs of the raw,materials too including labor including,the actual raw material including your,packaging everything it's really,important to know what at the end of the,month what you spent on product at the,end of the month so not how much,inventory you have or how much inventory,you bought but they costs associated,with the items that you've sold for that,month that is called your cost of goods,sold and if you don't know that at the,end of the month that means that you,have really no idea what exact items you,sold and what that cost was associated,with those items that you sold so that's,what your cost of goods sold is now if,you don't know the concrete expenses in,your business which is your cost of,goods sold your seller fees which I put,here nine and a half percent it's really,the six and a half percent plus the,three percent transaction fee I just,summed it into one possibly your,shipping cost if you're giving free,shipping right if you don't know these,major direct expenses associated with,the sale of an item then what happens is,is you are basically blindly running a,business without knowing how much budget,is left over to allocate to your,marketing costs and your marketing cost,percentage which you're not going to,know when you first launch could make or,break your profit right so if you don't,know how much budget or how much piece,of the pie is left to even leave for,your marketing cost you basically have,no kpi to go off of telling you you know,that your business makes sense or not,and you're actually turning a profit and,you'll be very surprised I've done a lot,of consoles this year and or the console,even happens I usually tell people to,give me a breakdown of this pie chart of,their business most sellers can't give,this back to me I'm going to be going,over what that pie chart is for my,business and Then followed by obviously,what is my actual net profit what has my,net profit been for the first three,calendar years since I launched my first,Etsy brand,foreign,like I mentioned before like the real,value out of this video isn't how much,did Hannah make a real value for you is,relating this to your own business and I,also want to disclose that I don't share,intellectual property for free of my,Brands I still run brands at the same,time so I don't share things like store,names or product titles and stuff like,that for my own brand because as you,know if you own an Etsy store and you're,an Etsy YouTuber you're basically asking,for store suicide once you should,publicly share not only your success but,then also your products I mean I've had,people go straight to my listing and,steal my images buy my products I've had,Chinese manufacturers which I don't have,any raw material manufacturers from,China but I've had Chinese manufacturers,buy my products reproduce my products,and then I see them on Amazon with my,own photography so I I don't disclose,that valuable information for my own,business so if that devalues my channel,and all the hundreds of hours of content,and information in this Channel please,just don't follow me I'm sure you can,find another person to help you or I,would just say just put in the work and,figure it out on your own if you're that,skeptical because I don't want to share,intellectual property that I've spent,you know thousands of hours to build,let's hop into my computer screen I'm,going to screen record and inside my,Etsy account so we can do some number,breakdown teen I have all my monthly,statements here if I scroll down here,you see I didn't start the brand until,July where we made a whopping 44,obviously that's not even profit but,we'll go more into that later,and you can see I started gaining,momentum August September October,November December of 2019 we were doing,almost a thousand dollars a day in sales,and for me that was just like crazy I,was just launching as many products as,possible I was bundling items I was just,going into town this was about seven,months before covet happened basically,for 2019 let me just write in the date,here we finished out the year doing only,67,000 but we really only started making,sales in that August so not too bad for,the first couple of months and then as,you can see when we get in to 2020 so,January was even bigger than December of,2019 and we just have continual growth,so I actually thought that coven was,gonna hurt my store because it wasn't,like a necessity item you'll see may we,have had a really good month June I mean,all the months were pretty good,September was a little bit slower and,then once we get to December we had our,biggest month on Etsy now if we move,over into my Shopify account I'll just,show you some numbers on this as well I,didn't run any ads for my Shopify,account in 2019,and then when we go into 2020 I actually,started scaling some ads on Shopify in,2020 and 2020 I only ran ads really the,last month of 2020 so it was pretty good,that we still ended out the year on,Shopify with about 174,000 which really good for only basically,running ads like seriously running ads,on Facebook and Instagram for one month,so that brings out that year,2 if we do a custom time here,20 custom time frame to 945,000 remember guys I'm gonna break down,the profit for a year in the next part,of this let's move on into,2021 and let's switch this over to 20,21 2021 is where things got really,interesting because as you know if,you've watched my other videos we dealt,with two suspensions in 2021 they had a,fight Etsy to prove to them that we were,innocent and we actually ended up,getting all of my accounts back because,they didn't just ban this account they,banned all the accounts that were,associated with it as you can see we,still had pretty decent momentum after,that December and doing 74 and then 70,000 and then 82 in March and then mid,April we got banned for the first time,for nine days got the account back,mid-may and then we lost it again at the,end of May but by the time that we got,the accounts back obviously it destroyed,our sales at the end of the September we,still were able to pull in at least like,around nine thousand dollars and then we,started building the momentum back up,again but those months really hurt our,store and if you haven't watched my,other video that whole process of how I,got my account suspended and and then,how I got it back make sure you check,out that video but as you know if you've,watched that video it forced me to,really double down on Shopify so let's,go into we go into 2021 what losing the,Etsy accounts forced me to do was really,double down on our processes being able,to let me change that again 2021 losing,my Etsy account really forced me to,double down on my Shopify so it forced,me to really hone in on my Shopify,account and really scale my ads build a,better website build better products,learn more copywriting do email,marketing SMS marketing Tick Tock,influencer Outreach it was kind of a,blessing in disguise because it taught,me so much valuable things with Shopify,our sales up to 486 thousand dollars now,let's talk about some profits you need,to know what all of your expenses are so,you are understand how much money you,have left over to allocate for marketing,costs and also obviously what your,actual profit is and in the beginning,just to give you some perspective,obviously this brand is not a good,example because we're profitable right,away but my other brand was not,profitable right away it took us a full,year to even be in the green before we,actually started making profit and again,that's all contingent on what you're,selling what demand there is for those,products how much competition there is,but your personal expenses are so how,much your cost of goods sold actually,eats into that profit it's different for,every single niche in every single,business depending on what you're,selling remember we did about sixty,seven thousand dollars in that few,months there in 2019 67 691 and then we,did like another like thousand I think,in Shopify let's just break down some of,our expenses here so we have averaged,overall 32 percent cost of goods sold so,that's the cost to create a product that,that includes raw materials coming to,the office that includes the finished,packaging cost to the customer that's,included in that total cost of goods,sold cost of the item so 32 percent then,I had an eight ran around 8.7 percent,just taken off the bat because I give,free shipping so 8.7 goes to shipping,that year the seller fee the Etsy,selling fee was only five percent it,wasn't six and a half percent so you can,take five percent off the bat and then,there was a three percent transaction,fee it's three percent plus point two,five cents per transaction but I'm just,gonna put three percent and then add,another percent because basically you,have 25 cents per transaction on the,transaction fee but then you also have,that 20 cent renew fee so we'll just add,another percent for that also spent 12,of the gross sales on paid traffic so at,Etsy ad spend that brings us to our,expenses at 61.7 If I subtract 100,that's a 38.3 profit margin which is,pretty dang good I don't think I ever,sell that amount of profit moving,forward now if I multiply 38.3 times 68,000,that profit for those first few months,there was twenty six thousand and forty,four dollars let's move into year two on,Shopify and Etsy when we did a little,bit over 1.1 million again we have that,32 percent product cost we have an 8.7,shipping cost average we have that year,I think it increased to six and a half,percent plus three percent plus that one,percent that we're throwing in there,that year my marketing costs increased,because we started running Money Paid,traffic on Shopify which is way more,expensive it was way more expensive than,Etsy so it made my marketing cost,percentage go up to 16 and then I also,hired my first employee that worked very,very part-time a few hours a day because,she could be in and out real fast that,brings our total direct expense is to,70.2 percent,29.8 profit margin let's move into,2021. this is where it gets a little bit,more complicated because our marketing,cost percentage on Shopify is way more,expensive it was on Etsy 32 cost on our,cost of the product 8.7 on shipping we,have been six and a half percent selling,fee the three percent transaction fee,plus the one extra percent and on PPC it,increased to about 22 percent increase,my payroll as well so my payroll went to,about eight percent we went from having,you know over almost 30 percent profit,margin previous year and then it dropped,to about,18.8 the following year which is still,not it's not horrible but my expenses,did increase because I hiring more,employees and I hired the new employees,at the worst time right when everything,was like crashing because I was planning,for more growth and more expansion but,then obviously we had a back pedal and,hone in on Shopify we still ended out,the year with about 170 000 profit,margin which definitely not mad about at,all but you know once you hit a number,it kind of hurts a little bit to see you,regress but that's all business that's,how business is sometimes it's not just,like upward Hill of like rainbows in,sunshine all the time I hope you got,some value out of this video I hope that,you understand the importance of knowing,your profit that's the real value out of,this video not how much money I made,it's learning how to be able to analyze,your business as a piece of a pie and,being able to look at your p l at the,end of the month and make database,decisions based off of what's selling,what's not selling also by doing a,layout of what your margins are you can,highlight what you need to fix maybe you,need to get your operations cost down,maybe you need to get your costs down,when you have everything laid out for,you it makes you it helps you make those,higher level decisions on where your,money is best spent I actually have a,profit calculator that you can have for,free it's what I used when I first,started out it's a Google sheet that you,can grab below you can go ahead and make,a copy of it and start paying out the,cost for your own products basically,what you're going to end up with is an,average cost percentage an average net,profit percentage based off of all the,skus and all the listings that you sell,if you haven't already done that with,all of your products I highly recommend,that you do that with that sheet it's a,free sheet go ahead and grab it for,yourself I've got some value out of this,video and I'll see you in the next video,bye guys,foreign

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