{"id":120,"date":"2014-03-02T18:45:36","date_gmt":"2014-03-02T23:45:36","guid":{"rendered":"http:\/\/openproduce.org\/blog\/?p=120"},"modified":"2014-03-02T18:45:36","modified_gmt":"2014-03-02T23:45:36","slug":"another-look-at-the-numbers","status":"publish","type":"post","link":"https:\/\/openproduce.org\/index.php\/2014\/03\/02\/another-look-at-the-numbers\/","title":{"rendered":"Another look at the numbers"},"content":{"rendered":"<p>A little over a year ago, I <a href=\"http:\/\/openproduce.org\/blog\/?p=99\">posted a simplified profit and loss<\/a> showing our sales, inventory costs, other expenses, and profit (or loss) for each year.  Here that table is again:<\/p>\n<style type=\"text\/css\"> td {text-align: left; padding: 2px; padding-left: 5px; padding-right: 5px;} td.red {color: red;} th {text-align: left}<\/style>\n<table>\n<tr>\n<th><\/th>\n<th>2008<\/th>\n<th>2009<\/th>\n<th>2010<\/th>\n<th>2011<\/th>\n<th>2012 (projected)<\/th>\n<\/tr>\n<tr>\n<th>Sales<\/th>\n<td>$49,000<\/td>\n<td>$298,000<\/td>\n<td>$465,000<\/td>\n<td>$613,000<\/td>\n<td>$778,000<\/td>\n<\/tr>\n<tr>\n<th>Inventory<\/th>\n<td>$49,000<\/td>\n<td>$249,000<\/td>\n<td>$368,000<\/td>\n<td>$480,000<\/td>\n<td>$518,000<\/td>\n<\/tr>\n<tr>\n<th>Expenses<\/th>\n<td>$51,000<\/td>\n<td>$75,000<\/td>\n<td>$140,000<\/td>\n<td>$166,000<\/td>\n<td>$156,000<\/td>\n<\/tr>\n<tr>\n<th>Profit<\/th>\n<td class=\"red\">-$51,000<\/td>\n<td class=\"red\">-$26,000<\/td>\n<td class=\"red\">-$43,000<\/td>\n<td class=\"red\">-$33,000<\/td>\n<td>$104,000<\/td>\n<\/tr>\n<\/table>\n<p><\/p>\n<p>Since I posted that, we&#8217;ve finished off 2012 and had a great 2013.  Here is a revised table, with real numbers from those two years:<\/p>\n<style type=\"text\/css\"> td {text-align: left; padding: 2px; padding-left: 5px; padding-right: 5px;} td.red {color: red;} th {text-align: left}<\/style>\n<table>\n<tr>\n<th><\/th>\n<th>2008<\/th>\n<th>2009<\/th>\n<th>2010<\/th>\n<th>2011<\/th>\n<th>2012<\/th>\n<th>2013<\/th>\n<\/tr>\n<tr>\n<th>Sales<\/th>\n<td>$49,000<\/td>\n<td>$298,000<\/td>\n<td>$465,000<\/td>\n<td>$613,000<\/td>\n<td>$836,000<\/td>\n<td>$906,000<\/td>\n<\/tr>\n<tr>\n<th>Inventory<\/th>\n<td>$49,000<\/td>\n<td>$249,000<\/td>\n<td>$368,000<\/td>\n<td>$480,000<\/td>\n<td>$652,000<\/td>\n<td>$686,000<\/td>\n<\/tr>\n<tr>\n<th>Expenses<\/th>\n<td>$51,000<\/td>\n<td>$75,000<\/td>\n<td>$140,000<\/td>\n<td>$166,000<\/td>\n<td>$201,000<\/td>\n<td>$189,000<\/td>\n<\/tr>\n<tr>\n<th>Profit<\/th>\n<td class=\"red\">-$51,000<\/td>\n<td class=\"red\">-$26,000<\/td>\n<td class=\"red\">-$43,000<\/td>\n<td class=\"red\">-$33,000<\/td>\n<td class=\"red\">-$17,000<\/td>\n<td>$31,000<\/td>\n<\/tr>\n<\/table>\n<p><\/p>\n<p>As you can see, 2012 did not go as well as we were expecting &#8212; and we&#8217;ll take a look at why that is.  In 2013, however, we actually made money for the first time since we opened.  Hooray!<\/p>\n<h3>So what happened in 2012?<\/h3>\n<p><b>Sales were higher than expected.<\/b> About $58,000 higher.  This is good!  But not high enough to offset the other factors.<\/p>\n<p><b>Expenses went up.<\/b> I&#8217;m not sure what I was thinking, but I projected expenses going down by $10,000 from 2011 to 2012.  Instead they went up by $35,000.  That was mostly payroll (always payroll!) and a few big projects.<\/p>\n<p><b>Inventory ratio didn&#8217;t go down.<\/b>  The inventory ratio (or COGS ratio) is the percentage of your sales that goes back into buying inventory.  For instance, in 2011, we spent $480,000 on inventory and sold $613,000.  Inventory was 78% of sales.  This is best expressed as a ratio or percentage because inventory costs tend to vary with sales:  if sales double, so do inventory costs (and vice versa).  I had hoped to get this down to 65% or so in 2012, but this was not realistic.  Instead, it was&#8230;78%.<\/p>\n<p>In short, some rosy predictions didn&#8217;t come true.<\/p>\n<h3>And what went right in 2013?<\/h3>\n<p><b>Sales went up.<\/b>  But maybe not as much as they could have&#8230;there will be a future post on this topic soon.<\/p>\n<p><b>Inventory ratio went down <i>slightly<\/i>.<\/b> It fell from 78% to 76%.  This means we raised prices a smidgen, found better deals from distributors, threw away less spoiled produce and bread, or suffered less shoplifting.  Probably all of the above.<\/p>\n<p><b>Expenses went down!<\/b> By about $12,000.  This means they were essentially flat from 2012, minus a few one-time expenses that didn&#8217;t happen again.  Payroll was essentially the same at $140,000 for both 2012 and 2013 (and up from $32,000 in 2009!).<\/p>\n<p>All in all, this lead to a profit of about $30,000 last year, which will make a small dent in the $150,000 we&#8217;ve rung up in liabilities of one sort or another.  A few more years of that &#8212; or, hopefully, higher profits &#8212; and we&#8217;ll actually start taking home some money.  Assuming Whole Foods doesn&#8217;t open in 2016 and wipe us off the map.  No one said running a small business was a quick way to get rich.<\/p>\n<p>A new post coming soon on sales growth and future strategies!<\/p>\n","protected":false},"excerpt":{"rendered":"<p>A little over a year ago, I <a href=\"http:\/\/openproduce.org\/blog\/?p=99\">posted a simplified profit and loss<\/a> showing our sales, inventory costs, other expenses, and profit (or loss) for each year.  Here that table is again:<\/p>\n<p> td &#8230;<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[],"tags":[],"class_list":["post-120","post","type-post","status-publish","format-standard","hentry"],"acf":[],"_links":{"self":[{"href":"https:\/\/openproduce.org\/index.php\/wp-json\/wp\/v2\/posts\/120","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/openproduce.org\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/openproduce.org\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/openproduce.org\/index.php\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/openproduce.org\/index.php\/wp-json\/wp\/v2\/comments?post=120"}],"version-history":[{"count":0,"href":"https:\/\/openproduce.org\/index.php\/wp-json\/wp\/v2\/posts\/120\/revisions"}],"wp:attachment":[{"href":"https:\/\/openproduce.org\/index.php\/wp-json\/wp\/v2\/media?parent=120"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/openproduce.org\/index.php\/wp-json\/wp\/v2\/categories?post=120"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/openproduce.org\/index.php\/wp-json\/wp\/v2\/tags?post=120"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}