In the transcript, the speaker discusses a method for calculating the net profit per product when selling items on Amazon using Amazon Seller Central. Here’s a step-by-step breakdown of the process:
1. Accessing Amazon Seller Central: The speaker starts by logging into Amazon Seller Central, which is a platform that allows individuals and businesses to sell products on Amazon.
2. Locating the Specific Product: Within the Seller Central dashboard, the speaker navigates to the “Inventory” section and selects “Manage All Inventory.” This view displays a list of all the products the seller is currently offering on Amazon.
3. Choosing the Product of Interest: From the list, the speaker selects the specific product for which they want to calculate the net profit. In this case, it’s a golf towel.
4. SKU Economics Dashboard: Clicking on the product’s SKU (Stock Keeping Unit) opens up a new dashboard called “SKU Economics,” which provides detailed information about the product’s financial performance.
5. Analyzing Sales and Costs: The SKU Economics dashboard displays a line graph showing sales revenue (in green) and expenses (in red) over a specific period, typically the past 30 days. It allows sellers to track the product’s financial performance over time.
6. Key Metrics: The right-hand column of the SKU Economics dashboard displays essential financial metrics for the chosen product.
7. Adding Cost of Goods Sold: The speaker emphasizes that one significant cost not included in the initial calculation is the “Cost of Goods Sold.” This represents how much it costs to produce each unit of the product, including manufacturing and shipping costs. The seller needs to manually input this cost based on their calculations.
8. Calculating Net Profit: After entering the “Cost of Goods Sold” per unit, the SKU Economics dashboard automatically calculates the net profit (or net proceeds) for the product. This net profit represents the true profit earned by the seller after considering all expenses, including the cost of goods sold.
In summary, the transcript explains how to access and use Amazon Seller Central’s SKU Economics dashboard to track the financial performance of individual products, with a focus on calculating net profit per product by including the cost of goods sold. This information is crucial for Amazon sellers to assess the profitability of their products and make informed decisions about their business.
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