How to work out profit on a flip

What profit on a flip actually is

For a single flip, profit is what the sale left you with after everything it cost. A simple illustration: you buy a dresser at an estate sale for $40, spend $15 on paint and new pulls, and sell it for $180 plus sales tax. The tax isn’t yours. Before any selling fees or delivery costs, that flip made $125.

That’s the whole idea. The difficulty is in the details:

• What you paid. Easy for a single dresser. Harder when it came in a $60 box lot with eleven other things.
• What went into it. Paint, hardware and cleaning supplies, often bought in bulk and shared across many pieces.
• What it cost to sell. Marketplace fees, booth commission, shipping you paid.
• What the customer paid that isn’t yours. Sales tax collected is owed onward, never profit.
• What came back. A refund changes the outcome of the sale.

Get any of those wrong and the profit figure is wrong, often in the flattering direction.

Why weekly totals aren’t profit

It’s tempting to take a week’s sales, subtract the week’s spending, and call the difference profit. It almost never is.

Resale is lumpy. You might spend heavily at three estate sales in October and sell those pieces through December. A week of big sourcing looks like a loss; a week of selling old stock looks like a windfall. Neither is true. Profit belongs to the goods, not to the calendar week.

That’s why Sellers Almanac shows Spent and Sales for Today and This week, side by side, and stops there. It never presents one minus the other as profit. A confident wrong number is worse than no number.

What you can do today, step by step

Until inventory items arrive, here’s a practical way to keep the records profit needs:

1. Give each sourced piece a short name or number. A strip of masking tape on the back of the dresser reading “D-14” is enough.
2. Record the purchase with that name in the note. “D-14 oak dresser, Maple Ave sale.” For a box lot, note the numbers it covers.
3. Record materials as Expenses classified as materials, with a note naming the piece when it’s specific: “pulls for D-14”.
4. When it sells, record the sale with the same name in the note. Record what the customer paid and the sales tax as the customer was charged it.
5. Keep a simple flip log alongside. One row per piece: name, what you paid, materials, what it sold for (excluding tax), selling costs. A spreadsheet is fine for this; the recorded notes let you fill it in accurately rather than from memory.
6. Work out profit on the log, not on weekly totals. For box lots, divide the lot’s cost across its pieces in whatever way you can justify, and do it the same way every time.

It’s manual. But every number in the log comes from a record you made at the time, which is the difference between a profit figure you can trust and one you hope is right.

What’s planned

Inventory items (individual pieces with photos and their cost, from the day you buy them to the sale) are in development. Profit figures depend on them, and when they arrive they’ll be worked out from your recorded amounts, not estimated. Until then, the roadmap shows where they sit.

Keeping it honest

Whatever system you use, two rules keep profit numbers trustworthy: never count sales tax as earnings, and never treat a missing amount as zero. Sellers Almanac keeps sales tax out of Sales and never counts a missing tax amount as zero. See where the money went and totals that admit what’s missing. For the inventory side, see reseller inventory management.

Sellers Almanac is in founder testing on iPhone and isn’t available to download yet. It is not accounting or tax software.