It’s time for a quick recap of April!
Damn, what a roller-coaster… The beginning of the month went great for our ecommerce project on Shopify, then around the 15th it started tanking and it negated almost all our efforts from the first half of April.
Having worked with paid traffic before, I knew what I was getting into with that store promoted through Facebook ads, but you always hope for the best… and then it doesn’t happen.
Read on to see exactly what happened.
Here’s what happened in April
Having a full-time employee working in the office made me realize that there’s a lot of holidays in the Philippines. And I really mean A LOT. It’s like there’s at least one day off every other week.
Since we’re working from a cowork space, I can’t decide which day is worked and which day is off. When it’s a national holiday, the office is closed, and there’s nothing I can do about it.
We’ve had to organize our schedule around this. It was a little bit challenging in the beginning but we’re getting there.
What I’ve been focusing on
As I was explaining last month, my employee is handling the whole “Order Management” section of our ecommerce business. She places orders with the companies we get the products from, and forwards the package tracking information to our customers.
Which means that I currently handle all the other aspects of the business: media buying, customer support, social media management, and product research.
I’m not so excited about jumping from one task to the other like that and I would prefer focusing on product research and media buying.
Everybody has a plan, and then…
Since we had good results at the beginning of the month and it looked like we were going to make a profit, I started doing research to hire a second person to handle the social media and customer support.
Then, things started to go South on the 15th, so I had to post-pone this plan until the end of the month to see if we actually broke even or not.
At the moment, I don’t plan to take any money out of this project. So as soon as we start making profits, I will use the money to add new people to the team. Hopefully, fairly soon.
Hiring a media buyer?
Hiring for the media buying part of the business will have to wait because I’m still experimenting a lot of different things.
First, I would like to get a system that can be replicated easily for every product we launch. Then, I can hire someone to just copy and paste the same formula over and over.
We’re not there yet. I have a lot of tests to run from launching a new product, to scaling campaigns, and killing dying products.
Taking a look at the numbers
The great news for this month is that our ecommerce store finally broke even!
We didn’t make any significant profit yet, but the trend is certainly encouraging.
The goal for April was to improve our ROI by decreasing our spending while somewhat maintaining our revenue… and then we actually ended up increasing our spending by almost $15,000.
As you can see that increase in spending was counter-balanced by an increase in revenue of almost $20,000. That brought in a profit of less than $85. Hah!
It might sound discouraging to some people that we sold almost $60,000 of product to make only $85, but I’m actually very excited about it… because it’s going in the right direction.
You need to keep in mind that we didn’t have any profitable month since we started this project in January, so breaking even is kind of a big deal: it means we’re improving.
It’s also important to consider that while we made very little money, the experience we gained by running a store for another month is invaluable.
We managed to ship 2300 orders, get a minimal number of complaints from our customers, and we didn’t lose any dispute with our payment processors.
Our focus is on giving our customers the best possible experience to avoid any negative reviews and feedback.
I think that’s a mistake a lot of people make when they start their store: they look at numbers and that’s all they see: numbers.
To me, it’s all about the people.
Every sale is a real person who made the effort of pulling out their credit card and make a purchase through our store.
Our customers give us a certain amount of trust, and it’s up to us to make sure we deliver on our promises.
I hear nightmare stories by shop owners who get shut down by PayPal or other payment processors, but when I look at how they handle their customers, I’m really not surprised.
If you treat your customers like crap, you’re missing the whole point and your business is bound to crash and burn.
What about the money?
Here is a breakdown of the money flow for my various projects.
To make this report easier to understand, I’m using a simple color code: green numbers are positive, red numbers are negative.
Please keep in mind that these figures may not be 100% accurate due to various factors such as refund requests and network adjustments. The terms for each payment may also vary. As a result these numbers may differ from the actual payments issued and received.
|Niche Sites||$1,830.93||▲ $393.84|
|Facebook Ads||-$38,253.33||▼ $7,795.26|
|Cost of Goods||-$15,345.47||▼ $3,350.35|
|PayPal Fees||-$2,183.87||▼ $752.75|
|Stripe Fees||-$871.23||▼ $231.59|
|Product 1: PTE||$17.00|
I’ve been talking mostly about my ecommerce project recently, but my niche store is making a nice comeback: profits increased by almost $400 this past month.
That’s pretty cool when you consider that I didn’t work a single minute on that project in April. This money is all coming from work I did in 2015 and 2016.
I’m back into the profit!
The beginning of 2017 has been quite stressful since we were losing money month, after month, after month.
It’s exciting to see that all the hard work we put in for the past 3 1/2 months is finally starting to pay off.
Our strategy is improving, step by step.
What’s happening next?
The plan for May is basically to do more of the same.
Our strategy is to split every aspect of the business into small easily-manageable processes that we can incrementally improve.
It might not sound like a lot when you make changes that improve your revenue by 1 or 2%, but it all adds up, and this is where you turn a failing business into a success.
Our goal is to make a profit with our Shopify store in May: we’ll be plenty satisfied if we manage to make between 5% and 10% profit.
See you next month for another update!