Let’s explore how to calculate the Amazon Seller's profits using the AccrueMe Calculator.
On the AccrueMe Calculator, you can experiment with different numbers to see just how much a partnership with AccrueMe could increase your Amazon business's profits and your lifestyle.
While results will vary (for example, any Amazon Seller knows that no two months are exactly the same), this should give you a general sense of how the numbers work and how different factors impact the difference AccrueMe will make when it comes to increasing your Amazon Profits.
A few terms to go over first:
ROI: Return on Investment. This is essentially your profit percentage. If you spend $100 on inventory and sell that for $110, your ROI is 10%. To calculate your ROI, take your profit divided by your expenses, then multiply by 100 to make it a percentage.
Turnover time: This is how long it takes you to turn over your inventory. To measure that, think of it this way: If you stopped buying new inventory today, how long would it take you to sell out? As you will see when you use the AccrueMe Calculator, the Turnover time has a huge impact on your Amazon profits.
Lifestyle Withdrawal: This is how much you are taking out of the business and using to pay your bills, feed your family, spend on hobbies and luxuries, and anything else you use your personal funds for. The more money you leave in the business, the faster AccrueMe can help you grow your business through compounding gains. However, we expect our Sellers to make reasonable lifestyle withdrawals every month, as any business owner does, so we have included a feature in the AccrueMe Calculator for you to experiment with. On the AccrueMe Calculator, you can select the percent option (a percentage of profits you will withdraw), or the fixed option (a dollar amount you will withdraw).
Amazon Seller Capital: This is the amount you yourself have invested in your business.
AccrueMe Capital: This is the capital AccrueMe will provide. AccrueMe Capital may not exceed the seller capital.
Before we get into a mathematical example of how AccrueMe can benefit you as a Seller, let’s take a moment to remember what AccrueMe is about:
AccrueMe is leveraging growth capital and compounding returns to take money that otherwise wouldn’t have been part of the pie & convert it into game-changing profits for Sellers and for AccrueMe itself.
So, here’s an example of how this works:
Assume (for example) 20% ROI with 30-day inventory turnover time on $100,000 capital, matched by AccrueMe to bring total capital to $200,000.
20% ROI means $120,000 revenue ($20K profit) on $100K, so assume $240K revenue ($40K profit) on $200K after AccrueMe investment. $20K profit increase, which becomes an extra monthly $10K in the Seller’s pocket after accounting for AccrueMe’s 25% share. Without compound interest, this would make the Seller $240K richer after 2 years.
The benefit to the Seller is much higher than the above numbers because the Seller can keep that full $240K in the business instead of making a monthly payment to AccrueMe.
This means the 2nd month would see $48,000 profit on $240K capital, and month 3 would bring $57,600 profit on $288K capital.
Even accounting for the profit share owed to AccrueMe, by month 6 the Seller has leveraged compounding returns and increased scale to bring their personal monthly profits from $20K to well over $50K.
Furthermore, as the Seller’s revenue grows, the $ provided by AccrueMe represents a smaller and smaller % of the total capital, meaning the Seller’s profit share percentage owed to AccrueMe decreases over time. And once the Seller pays AccrueMe off, Seller is permanently entitled to keep 100% of monthly profits going forward--- profits which may be nearing $2M/mo by the end of month 24.
24 months of a $20K profit increase at 25% profit share would mean $240K extra after 2 years. But due to compound interest and diminishing profit share, Seller’s business has actually earned an extra $7 Million by the end of month 24 than they would have without AccrueMe.
This math assumes the Seller is keeping all capital in the business.
However, if the Seller chooses to make monthly lifestyle withdrawals of 15%, they still have an additional $5.7 Million in their business by the end of month 24, and an additional $1.6M in their own pocket.
The AccrueMe Calculator on the AccrueMe website allows one to change any of these numbers (Seller capital, AccrueMe capital, ROI, Lifestyle withdrawals, Turnover time) as they wish.
AccrueMe is the only company leveraging compounding gains to offer true growth capital with no monthly payments, interest, or permanent loss of equity attached.
To learn more about growing your Amazon Business using AccrueMe, the partnership model AccrueMe offers for Third-Party Amazon Sellers, and how to apply for Amazon funding, sign up here.
If you are ready to take things to the next level, apply now and get pre-approved for Amazon funding from AccrueMe and double your Amazon Seller capital.
Commenti