 What's going on guys welcome back to another video so this one we're going to be breaking down how to make 25k per year profit. The reason why I picked 25k per year as kind of like a starting point is because here in the UK then the average wage is in and around that number. Give or take a couple of grand either way depending on where you live. I know the reason why you should watch this video is because we're going to be covering things like expectations and going over just how realistic it is to actually achieve that figure especially in your first year. I know the good thing to know if you wanted to start dropshipping is when you see these big screenshots of half a million, one million to know realistically how much profit they're actually making from that. So one of the biggest mistakes I made personally when I first got started was trying to get to those big numbers as quickly as possible. So first I wanted 10k a month then 20k a month then 50k a month then 100k a month and it wasn't until about after 12 months and I had to submit my first books that I realized I was making a significantly less money than I actually thought I was. So whilst those big screenshots those big numbers are cool what's even cooler is big profit margins. So in my opinion this is what should always be your focus and this is actually one of the reasons why I like to scale my stores quite slowly. So if I show you this store now that I started in October for Q4 we can see that the very first couple of weeks so the first week there was no sales at all so if we go into the 7th to the 13th we can say we were averaging sort of like in and around $150 a day maybe and then found some traction on the 13th. This first kind of selection of five or six days is purely the testing phase. This is testing different audiences different creatives and seeing where the traction comes from. If we then skip forward to the next week so the 14th to the 20th we can see we've found some traction we kind of know what works. We're starting to apply some low-risk scaling methods and now we're able to consistently achieve in and around sort of $400 per day. If we then take a look at the next week so the 21st to the 27th we can see we hit some inconsistencies which is perfectly normal by the way if you're spending small budgets such as like this. So on October 21st we actually had a billing issue in the account so some of the ads didn't even run but apart from that we hit some pretty decent days around $900 and then we can see the 25th and the 26th were both sort of $300 less and the reason being for this is because I like to make adjustments to my ads to make sure that they're performing as profitable as possible. So whilst $900 per day looks a lot better than say $600 if I'm making more profit from the $600 that's all I care about. I'd much rather scale up maintain and say a 30% profit margin then try and get to $1k a day as soon as possible only operating at say 10% and so with that being said then guys thanks for tuning in to the video I hope you enjoyed this one make sure you stay tuned all the way through. If you want me to do a case study on that store that I just showed you where we can jump into the ads manager and I can show you where I make those changes and kind of like my thought process make sure you let me know in the comment section down below and then when I finally scale up to plus 1k per day then I can get that video recorded for you guys. Thanks again for tuning in don't forget to like the video if you want to see more and of course if you do enjoy my content please consider dropping us up as well. With that being said let's jump straight into it. So here we are on the diagram that I put together we can see at the top 25k profit per year is going to be our target and then we've got three different ways of getting there basically. These different percentages so 10% 20% 30% these are the profit margins that your business may be working on me personally depending on kind of what product I'm selling and what country I'm selling to as well that can influence things quite a lot or depend on where kind of my business sits between these numbers but as a ref all of them you can expect to sit somewhere between sort of 10 and 30 percent profit once you find some traction with a product and you're making consistent sales. So let's start with the worst-case scenario which is a 10% profit margin. If you turn over revenue making sales whatever you want to call it to get to that 25k profit per year you need to be making £250,000 in sales or $250,000 whatever revenue it is you're selling it. Now that may seem quite unachievable might seem quite scary especially to do in your first year but one of the beauties with dropshipping is when you find something that works you really can scale up quite quickly as we just saw with that store that I showed you. But one thing I like to do which is a handy exercise to do to make things more realistic and achievable is to then break it down into smaller goals. So instead of saying I want to try and achieve 250 grand this year break it down to the monthly goal which is a little bit over £20,000. Well if we break this down even further we can see we only need to make £685 per day and you just saw in that store I showed you I can show you again if we hop back in that I had my first let's see if we go first to the 14th I think it was a bit further on actually and so let's go 15th to the 21st and we can see it was the 21st so I didn't run any ads for that first week so within the first two weeks I was able to achieve the sorts of numbers in which you need to achieve to get to that figure of 25k profit per year. So when you have the right strategy and you find something that works you can scale up pretty quickly. If you're selling the product that perhaps is a bit more expensive and there's more profit in it or perhaps you're just getting some really nice results from your advertising then you might be achieving 20% in which case things become a whole lot easier. So obviously the revenue the sales the turnover becomes half of that of 10% so we only need 125k per year in sales per month this is £10,000 £410,417 per month with £342 per day and then of course we have the best one overall which is 30% this is what everybody should be striving towards. If you have a business that's operating with these high profit margins then when things like a new Apple update system so like the iOS 14 rollout or like COVID the more profitable your business is the more healthy it'll be and the more kind of capable it will be. I've kind of seen you through those rough times or those rough patches so at a 30% profit margin you only need 84k revenue a year which is 7k per month and 230 pounds per day. Another extremely positive thing about smaller revenues and higher profit margins is that here in the UK when you hit I can't remember I think it's 85k and don't quote me that on that but I think once you hit 85,000 pounds in revenue in a rolling 12 month period you then have to become that registered so it always pays off to be as profitable as possible. So 685 pounds per day at 10% 342 at 20% 230 at 30% what do these actually mean realistically how do we achieve those and can we achieve those in our first few months. To break this down further we need a selling price for our product so using the same example as the story just showed you say we're selling a product which is 40 pounds this is the ideal kind of price range in my opinion especially this time of year because 40 pounds sort of suffits that gift price bracket and also fits that impulse purchase price bracket as well so try and find a product you can sell for 40 pounds and it costs you yourself less than 10% less than 10 pounds from your supplier so to achieve 685 pounds per day at a 10% profit margin selling a 40 pound product 10% obviously of 40 pound for every sale you're going to make approximately 4 pound profit to achieve these numbers you need to make a total of 17 orders per day this will get you the 685 per day which will in turn get you the 25k profit by the end of the year moving on to the 20 again everything halves because the profit margin is double so selling a 40 pound product you will make approximately 8 pound profit per sale so you only need to make 9 orders per day to achieve 25 grand profit per year moving on to last but not least and we have 30 percent this is where things become really exciting because it's super achievable 12 pound profit per sale and only six orders per day that is all you need to make a pretty decent profit per year of 25 grand especially all things considered to run a business of this size of this stature of 85 grand in revenue you will only need to commit somewhere between sort of three and five hours per week to achieve these sorts of numbers and when you kind of pro router your time invested versus the money out it works out to be a pretty healthy wage one final note then to wrap this video up everybody watching this video is capable of achieving six orders per day if you have the right strategy if you're looking for something to take all the headaches and guessing and trying an error out of starting a business on Shopify then I highly recommend checking out my e-com academy clubhouse we now have over 200 members that have been through the trial and tested systems and strategies inside that produce the results that I've just showed you in this video so if you'd like more information on that make sure you check out the links in the description below thanks again for watching the video I hope you enjoyed it don't forget to drop a like if you haven't already please consider subscribing to my channel if you want to see more and I'll see you guys in the next one