Return On Investment Today

Repricing (selling our books) is part of our daily work flow. When we reprice our books, it keeps our books competitive and ensures more sales, if you do it right!

If you’ve been reading this blog for a while, thank you for that, I really appreciate your time, you will have heard me mention the term ROI i.e. Return On Investment. Everyone has at least heard of ROI.

How is it then that I have been speaking about ROI and hearing about it since Day One on our Book Arb journey and only now am I really starting to apply it properly?

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It’s funny how we can think we know something and still not apply it or think we are applying it.

“There is nothing so useless as doing efficiently that which should not be done at all.” ~ Peter F Drucker

Let me explain how that plays out in Book Arb. Of course I have been familiar with the concept of buying and selling books and making a profit, I run an online bookstore after all.

However, I was applying the concept in a micro management way thinking that I was being “penny wise” i.e. looking after the profits on each book and that would take care of the overall profits.

Repricing (selling our books) is part of our daily work flow. When we reprice our books, it keeps our books competitive and ensures more sales, if you do it right!

“There seems to be some perverse human characteristic that likes to make easy things difficult.” ~ Warren Buffett

Now obviously making a profit on each book is important but because we were focused on getting as much profit out of each book individually we squandered time, momentum and compound interest.

Over the past year and half I have spent countless hours repricing our books daily. It’s part of the business and also shows Amazon, Big Daddy, that you are actively selling your stock as opposed to using Amazon as a warehouse for products that may or may not sell. This brings other benefits other than profits alone such as more exposure to more buyers thereby increasing your market share.

However, we were way too focused on holding onto our books to get a better price as opposed to selling as much stock daily for an overall ROI. We forgot to think about ROI on our overall investment monthly.

“Compound interest is the eighth wonder of the world. He who understands it, earns it…he who doesn’t, pays it.” ~ Albert Einstein

The chart below demonstrates how the same $10 compounding with only 20%, 25% & 30% profit over the course of a year way out performs holding out for a 100% profit every 8 weeks.

COMPOUNDING at 20% 25% and 30%

When I think about how much time I spent ‘nursing’ books i.e. repricing every day but not effectively I scratch my head. When I think about how much compound money I left on the table by not selling and turning over profits I am astonished.

For the record we have found that the longer our books are on the market, unless it’s a textbook season, the more inclined the price of the books are to decrease over time unless they are year round books. Hold that thought in your back pocket when repricing as it will serve you well. If you can sell for a profit today, sell.

Our strategy was ineffective on both a profitability and time wise front. Man, I didn’t really get it until recently. This business is about turning over as much inventory every month to compound the money for a staggeringly high year round ROI.

Can you see how ineffective our strategy was? We thought we were doing it right but man were we off?

Remember, it’s not about being busy, it’s about being effective. We have still made a lot of sales over the year but this one strategy slowed our progress big time.

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I would add that it’s not to say that it’s not possible to make 100% profit on most books, it’s just don’t delay holding out for it. A bird in the hand philosophy in this business will serve you much better.

It’s just all about buying the right books at the right price at the right time. When and where to look for these books and knowing how to read the Keepa charts makes this easy.

Do not be the bottle neck in your business by being ineffective. Buy and sell books every day. Compound your money by selling as much as you can as quickly as you can and you will be astonished at your progress.

Now that we have corrected our approach to repricing our profits are already increasing exponentially and we have more time back to ourselves. Repricing used to take me hours every day. Now, it takes a lot less time. Less time and more money, who knew?

Next, I will discuss the power of streamlining daily tasks & how we are doing it in our business.

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Mindset is Everything

Our minds are our dream makers or breakers. Having our minds tuned to expect success and happiness is the key element to a fulfilling life in every way.

As alluded to in the other blog, mindset is what separates the wheat from the chaff when it comes to success.

As easy as this system is and it is easy, if your mind isn’t tuned for success it is easy to find a way to mess it up or at the very least slow it down.

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We have been on this journey with book arb since October. We have had so much support through the training and community and yet it took a while for it to really sink in that this business is less about selling books and more about flipping money. Success is achieved through the speed of turnover of sales and ploughing the profits back into the business. This is what achieves breath taking compound auto profits. We bought good books or so we thought starting off. Now, we look at them and giggle. What were we thinking and yet mistakes are part of the road to success.

For most of the world mistakes can be viewed as something that went wrong, an inadequacy of some kind or that success is not meant to be. Believe me, I used to think the same thing as I created business failure after business failure. Now, though I have come to see that building in mistakes as part of the journey makes for success.

The biggest mistakes we made with this business were not reading the sales charts (keepa charts, more on these at a later time) thoroughly enough. Also, we kept holding out for more profits on every sale i.e. we did not reprice competitively enough in the beginning. However, once we realised that profits of 30% turned over quickly on every dollar many times a year amounts to way more than of 100% ROI annually. Very satisfactorily, we are beginning to see the results in our profits with that change of approach.

Compound interest is the eight wonder of the world. He who understands it, earns it ….. he who doesn’t ……. pays it.               ~Albert Einstein~

We may have been spoiled during the one and a half bumper season we have experienced so far (there are typically 2-3 textbook seasons throughout the year, Jan-March, May to Jun & August to October when college kids do bulk buying) when we were commanding sales from 100-250% ROI (return on Investment) and expecting that to continue. Not that that is not achievable over and over again but not every day!

The other invisible impediment could well have been that I was so used to not achieving success that when it came wrapped in a big red bow, like this one did, that it took me a while to really understand that making money is easy. Of course, there is work involved but now we’re creating money that will make a life-changing difference to our families and it’s just a rinse and repeat system now that we are getting it down.

The other exciting element for us is that others in the community who are a year ahead of us time wise, using this system, are already working one hour a day and creating tens of thousands of dollars in income.

The velocity and speed with which success is possible with this has been amazing for us. It’s why we put the last of our savings into this. It’s why I walked everywhere and took buses for six months having put the money to purchase our car into the business. Now, I’m not talking a Ferrari, at least not yet, I had put aside €1,000 to put towards purchasing a second-hand car but having that money work for us to get us to where we are now has been worth it. Next year I will be in the happy position to buy any brand-new car I desire.

There will be many more posts about mindset as that is my area of passion. Our minds are our dream makers or breakers. Having our minds tuned to expect success and happiness is the key element to a fulfilling life in every way. We are finding financial success with this system transformational. Having this part of our lives squared away is clearing the way for success to show up in every other area of our lives too.

In the next blog I will describe some of the key habits I perform daily that makes success with book arb a certainty. After all, success is a habit too.

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