Inside a Million Dollar Amazon Arbitrage Account (2021 Year-End Numbers)
By Gaye Lisby – January 21, 2021
My name is Gaye Lizby and I co-lead Amazon Seller Tribe with Garry Ray. We usually have a lot of fun together inside the Amazon Seller Tribe while also helping to create the most 7-figure sellers in the industry.
Now, some of you may not be familiar with me. So, you might be saying, “Well, does she really know how to sell on Amazon?”
I can’t blame you. But, today, we won’t be talking much about me or if I know how to sell on Amazon. I’m going to show you what a 7-figure Amazon account looks like.
There’s a tool that many of us in the Amazon industry use called Inventory Lab. It’s a tool with a combination of bookkeeping and shipping into Amazon’s Warehouse tool. It syncs with our Amazon Seller account, so it’s able to pull data from the account and hold it in Inventory Lab.
The best thing about this is it really helps you track whether you’re a profitable or not. It also helps you to track what are the buys you’re making that are profitable and those that are not.
I’m going to let you look inside the back of our Inventory Lab. Note that there are some details we’re going to blur because we don’t want you to scalp our inventory and make money on it. Our goal is to teach you how to do this properly and build your 7-figure Amazon business.
In other words, I’ll be teaching you how to fish, not hand you the fish because in my opinion, makes you weaker. I can testify that what I’m about to teach you will make you stronger.
I know this because as a middle-aged woman, I had to start over from literally $0 after I found out my marriage wasn’t what I thought it was. My journey began literally from the spare bedroom of my sister’s home and I built my Amazon business with her. An Amazon business that really matters. So I’m going to show you the backside of what a real Amazon Seller account can look like.
And hopefully, this is going to help you in many ways.
So, if you’re ready, then let’s start.
Disclaimer: You won’t be seeing my supplier line. That’s the part where I’m not going to give you the fish. But rather, I’m going to teach you how to fish.
In this page, you will see the number of units sold, the losses, and some of the product doesn’t sell for the price that you wanted them to.
You might have some units here that sell for a profit and some units that don’t. You can also see the average ROI from each supplier. Now, this may look different for each Amazon Sellers. As you can see, our business is a combination of online arbitrage and retail arbitrage. We don’t do wholesale or private label.
If you join the Amazon Seller Tribe and we say we’re going to teach you how to be an arbitrage seller, you’re literally seeing that we have done this ourselves.
Our revenue for the year of 2021 was 1.2 million with over 26,064 units sold.
You will also see that there’s a Refunded unit. Don’t get too worried about that or scared about that. This only happens when the units are refunded back to your account. They products are still in absolutely new condition. The customer hasn’t damaged them or whatever, and they go right back into salable inventory.
Now, when you see the profit line like this from Inventory Lab, this doesn’t represent the amount of profit that I can put in my pocket and go buy a boat with or whatever else I want to do. This represents the profit that came from the sale of those particular items. I’m still going to need to subtract some costs there. Now, this is the part where a lot of sellers are popping up and saying, hey, I’ll teach you how to do this. But this is the part they don’t show you.
This where you end up off in the weeds or you end up in a lot of trouble because you haven’t learned everything you need to learn. Other gurus sort of do that on purpose. They really don’t want you to succeed. It might be because they don’t even know how to help you succeed.
Let’s just go over here. Here’s the accounting section so I could break it down to see my FBA sales all the way down to the Reimbursement and etc. We use the Garry Ray method. Garry Ray is the co-leader of Amazon seller tribe, and he’s also the head coach of our coaching program.
Just as he taught and teaches in the coaching program, we absolutely itemize all of our expenses. So, I’m going to click the other expenses tab and we’re going to blur out some of this data just because I think that’s right to do for my own personal account.
In this page, you will see the total expenses of my Amazon business. So we have the payroll and any removal fees that Amazon has charged us.
Removal fees occur when we had some units brought back to our warehouse. The ADT that you see here represents our security system out in our warehouse. We also have subscriptions in here for our Repricer and for Inventory Lab.
So, we break down those particular expenses to find out our profit for the year. These are 2022 expenses.
Now, how does this translate into Net Profit? Let’s take a quick look at our Profit and Loss Statement.
Profit and Loss Statement
You can see December got crazy and it was awesome. However, we started out slow in January of 2021. We made some changes and then started picking up the speed. This almost got us to the $100,000 a month mark and we tried to maintain that throughout. And then, in Q4 it went crazy as you can see the sales.
At the end column beside December, you can see the refunds, reimbursements. A lot of that came back in and then just went right back out in sales. Then there are some columns that have a restocking fee, promotional rebates. Amazon gave us a rebate discount or gave the customer rebate or discount depending on what it was.
There are some shipping credits and that sort of thing. Some of the other categories are the cost of goods sold. We actually had to spend $650,000 in inventory buys to get to this $1.378 million figure here in sales.
You can also see on this page FBA transaction fees. These are the kind of fees that Amazon charges. It’s their platform, their playground, and we get the chance to play on the most powerful playground in the United States. We have access to it 24/7 and so do our customers too. As profitable business owners, we don’t mind that as the FBA transaction fees are the cost of doing business here.
In the other expenses column, you’ll see some of our payroll expenses and some of the expenses that we talked about with subscriptions and the charge for our Internet, security system, shipping labels, boxes and much more. At this point, you can see that our net profit now is $107,324. This doesn’t include another bit of profit, which is probably around $12,000.
|Total Net Profit||$107,324.63|
About Gaye Lisby
I mainly spend the day helping other sellers make money on Amazon while my sister takes care of the bank account credit cards. We buy our stuff on credit cards so we can get the points and we pay off that bill every month.
We never carry a balance over into the next month and never carry that interest fee over into the next month.
Sometimes, if a spare hand is needed in the warehouse, I’ll do that. This includes hauling boxes or picking up boxes almost anywhere. if we accidentally run out of boxes, I might also do the purchasing for that.
Everybody else does the rest and I like it that way because the whole process is almost an automatic stream of income. It’s an additional way for us to make money here in the later part of our careers since my sister and I are not young people anymore
When I found out my marriage wasn’t what I thought it was, I was already around 50 something years old. I basically just walked out the door of our home with some books, a canoe, my guitar, a gun and a computer.
After my failed marriage, I kept looking at that computer, thinking maybe I could figure out how to earn online. I went through a couple of MLM things and dabbled around with that while not knowing anything.
I’d been in the classroom as a teacher, so I really didn’t know anything about how to make money online using my computer. And certainly, I didn’t know anything about e-commerce.
In 2014, my online mentor learned how to sell on Amazon and he said, “Gaye, you got to do this. This is awesome.”
I was doing a little caregiving for a retired surgeon to earn money. I loved him and I loved his family. He was in his 80s and was ready to cross over the Jordan River. So, I really wanted to complete my assignment with him.
I started selling on Amazon at Zach’s urging. I would drive an hour to work, an hour home, and I would go to the basement to work on my Amazon business with my sister. Our little unfinished basement is where we pack and ship boxes of inventory into Amazon.
In our first year of selling, we made $17,000 in revenue. At that point, we thought, “Hey, wait, this thing really works.”
In 2015, we poured on the steam. Every day, I would go to work and come back home. My sister and I would go straight to the basement. We did everything, from getting orders, packaging them, and then sending them for shipment. We did everything to build our business. we ended that year with $508,000 in revenue.
Our profit was high enough. So, we went down to the bank, and that was the day we watched the banker right across the face of our mortgage paid in full.
Our Amazon business hung around just under and just over 1 million until 2020. During the Covid year, our business fell off the mark. I was devastated on that because I lost my own gold lanyard, the million-dollar seller status.
Our mother had nearly passed away. We ended up being at the bedside for almost two months with her.
My son had nearly died tragically of blood clots. It was hugely traumatic for us because my baby sister had died a year earlier of blood clots going to the lungs.
Then, in August, my baby granddaughter was born prematurely and I couldn’t even see her for a month. It took a month before I could even hold her because of Covid. 2020 was a very tough year.
At the end of 2020, we ended up just in the silver lanyard status of $750,000. It was a blow to my ego.
But here in 2021, we recovered a gold lanyard and did pretty good. We put some money in the bank, and in some investments. This allows us to give to the missions projects we support in the Philippines and a sober dad project that’s near and dear to our hearts.
These are some of the things that we can do because of the success of our Amazon business and these things make our lives meaningful. Although, for us, the most fun thing we do is to help create the most seven-figure sellers in the industry.
Hopefully, from what you’ve seen today, you can say, “Okay, these people are real deal sellers. They really are selling, profiting, really are making money on Amazon.”
And if you want to learn how to reach this type of success, I urge you to join the Amazon Seller Tribe so we can help you get to where you want to be