Cost of Goods Sold...and Bought

August numbers add a twist to this year’s grim saga.

August

Total income: -12.2%
Total COGS: +2.0%
Payroll: -7.8%

Marketing: +110.7%
Net Income (Profit): -197.8% (-$796)

Year to Date: 

Total income: -19.6%
Total COGS: -23.2%
Payroll: -18.6%

Marketing: -11.5%
Net Income (Profit): -26.4% (-$355)

Basically, I narrowed the persistent monthly sales deficit a little bit at a huge cost to profitability. The only two black numbers are the ones I want to be red. 

Dropshipping changed some outbound freight costs from an operating expense into Cost Of Goods Sold. I don’t like statistical flukes, but there’s nothing real behind the apparent jump in COGS. That number should settle down now that kite season is mostly over.

I wrote off $100 worth of dead stock, and $65 in late payment fees on my Mastercard didn’t help the bottom line, either – all because I forgot to click Citizens Bank’s superfluous “OK” button in the online bill pay interface. That wasn't the first time, either. 

Advertising was the big killer, though. That outlay more than doubled and sales obviously did not. Google’s the only winner here.

Per my usual effort to end on a positive note...September's targets look easy. I think that's the first time I've said so this year.


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Meanwhile, I’m mentally spending all the money that I’m not earning. Assuming that Christmas sales magically materialize as usual, I’ll need to buy:

Chair: Duct tape is slowly replacing the leather on my venerable executive chair. Samsonite apparently doesn’t make office chairs anymore and I can’t buy a chair online if I cannot find the same one that I’m already using. I’m going to have to (shudder) visit physical stores to do some test sitting. Old-school shopping is a lot of work just to park my butt comfortably for another 10+ years. But it’s got to be done. The nice thing about being old is that this next chair might outlive me if I choose wisely.
Expected price: $100-250. Critical

New laptop: After five years of nearly continuous use my Dell Vostro is getting slow and crash-prone, and Windows XP is due to pass into history soon. I’ve always bought Dells because of my extensive experience with those dependable workhorses. I usually buy machines with a little more oomph than I really need, both for future-proofing (that’s why this machine lasted five years) and for limited personal use (gaming while I’m on vacation). If Christmas sales track the rest of this year I might have to go with a basic business machine this time around, although a sexy little Lenovo tempted me when I compared them to Dells a few weeks ago.
Expected price: $650-1100. Critical

Software: If I can find a Windows 7 machine I won’t need much new software. If I’m forced to jump two generations to Windows 8, a lot of my old programs will be incompatible. I’m going to need Quickbooks; my 2009 version is already unsupported. The boxed version of QB Pro 2013 goes for $160 on Amazon. (one should always buy Quickbooks on CD, not the digital download, as Intuit only allows you to install it once.) I think and hope that MS Office 2007 will still run under Win8, because I sure can’t afford to replace that.
Expected price: $160-300. Probably unavoidable

Telephone: My god, has it really been almost two years since I replaced my old flip phone? Yes, it has, and my current phone’s battery is mostly dead (plus my iPod is dying and I need an MP3 player for my morning walks.) Rather than replace the battery, I should replace the phone when it becomes eligible in January. I’m currently paying $15/month for plain old cell service. A data plan is $30. I’ll get a smart phone if I can pay Verizon $30 instead of $15, rather than on top of $15, although I fear that it won’t work that way. Like it or not, I should at least try to stay on top of modern technology. 
Expected price: $200-400 plus monthly charges. Expendable

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Bottled Up Jewelry got a partial reprieve after I took a closer look at it. I’ve sold 37 pieces at $30+, which isn’t too shabby. Pink Depression Glass is the most popular material; square and rectangle earrings are the most popular styles. I got rid of all the fused glass and mixed nuggets, eliminating one subcategory and 19 product pages. I’ll slay the whole line if I don’t sell any between now and January. One or two pieces a month would be nice, but since I can’t afford to advertise it due to the staggering amount of competing glass jewelry for sale out there I'll settle for any action at all.

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I’ve got to solve the Panther Vision problem. This old warhorse recently showed a slight pulse, but still nothing like its old vigor.

I expected to find some formidable new competitor with better presentation out-pricing me. I didn’t. One discounter with a marginal website is underselling me by $2 but adding a ridiculous shipping charge ($9.50 vs. my $3.50). A lot of people are siphoning off sales with cheap 2-LED caps, but that’s always been true. On one hand, I'm glad that I'm not being obviously out-competed; OTOH, a straightforward explanation would've been nice.

Panther says that their sales are meeting expectations…so it’s not them, it’s me.

A new line of knit winter hats is due out at the end of next month. Maybe that will rekindle the fire.