How to Split Profit...

[zaraspooky]

Hi folks.

I sold an item and am splitting the profit with a friend and am planning on doing more. I understand it's not an ideal situation, but that's what it is. Trying to figure out what the actual profit is, is what's killing me.

Since the net proceeds figure includes shipping and taxes minus fees, I can't use that.

What would be the best way to figure the actual profit (it doesn't have to be exact). Should I just take the sale price, subtract any out-of-pocket shipping fees, and the ebay fees? Am I missing anything else?

I know this isn't even addressing the federal taxes that are coming. That's a whole other conversation.

Thanks.

[krazzykats]

Go here and find the sale.  Click on the > to see all the expense details.

Seller Hub | Your financial summary | eBay

[dryophelia]

@zaraspooky 

I would wait the 180 days before paying your friend, just in case the buyer does a chargeback. 

PayPal, credit card companies and some banks allow six months for their customer, your buyer, to open a case. 

[mtgraves7984]

What would be the best way to figure the actual profit (it doesn't have to be exact). Should I just take the sale price, subtract any out-of-pocket shipping fees, and the ebay fees? Am I missing anything else?

@zaraspooky 

Your method will work but won't figure profit ... only a net amount you're being paid.

Yes, you'll pay FVFs on the item + s&h + sales tax (when applicable). From that figure, deduct your FVFs (and the $.30 Transaction fee) and the actual shipping cost... you'll have your net.

Beyond that... it's whatever arrangement you had with your friend as to who gets how much of the pie. Bon Appetit.

[buyselljack2016 · Accepted solution]

My item that sold.

What eBay shows me when I click on the "order number".

I do labels through eBay, so costs are shown/deducted

 

[zaraspooky]

That's exactly what I was looking for.

Thanks.

[reallynicestamps]

The fees are on the entire payment.

But parts of that payment did not go to you but to the buyer's state tax authority and to the shipper you used.
In addition, you paid for packing materials.

[mtgraves7984]

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@zaraspooky wrote:

That's exactly what I was looking for.

Thanks.

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@zaraspooky 

Keep in mind that the info shows the Order Earnings. You asked about 'profit'.

The Payment Info doesn't take your friend's cost into account. That's why I mentioned your 'arrangement'. Good luck.

[lakefor94]

"I know this isn't even addressing the federal taxes that are coming. That's a whole other conversation."

Sounds like you have figured out the expenses and can reach a net profit for the person you consign for.

I do a lot of consignment, though for businesses only. I take 20% of their net for income taxes.

[zaraspooky]

Understood.

Fortunately, I don't pay for most of the items I sell. I save them from being recycled. I also don't pay for packaging as my work throws away mass amounts of bubble wrap and boxes.

This means most of the earnings are profit.

Thanks.

[reallynicestamps]

I save them from being recycled. I also don't pay for packaging as my work throws away mass amounts of bubble wrap and boxes.

What are your labour costs for sourcing, sorting, cleaning and storing the reused goods?

Here in BC the minimum wage is 27c a minute.