# Inventory



## PrettyPaisley (May 18, 2007)

In another life I wouldn't think twice about a business that requires inventory but I have to admit I'm very nervous at the thought. *BUT* I know that I can probably be successful with it (as I have in the past) - it's just the idea of inventory is freaking me out. 

How would you look at this? You take some start up money, say no more than $400. As soon as you get your $400 back under the mattress you take some of your profits and put it back into more inventory, with the idea of taking only a percentage of your profits to buy more. On average you're making about 30% on your money and plan to cap the amount of inventory you have on hand at no more than $600-$800. 

When you are looking at this $800 in product do you look at it as $560 in your money that you can't touch or do you look at that $560 as a requirement for a stream of revenue you would otherwise not have? 

I have got to bring in some money and it MUST be around my family's schedule. I have 6 other's schedule to work around (as I refuse to put my girls in daycare/after school care) and sit behind a desk for $9/hr 40 hours a week. I have found the product and I know the way to sell it (again-I've done this before children) I just can't seem to wrap my brain around the inventory issue.


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## Halfway (Nov 22, 2010)

Once "start-up" capital is paid back (under your mattress), the rest are operational funds unless the inventory seriously depreciates over time. If that is the case, it becomes a appreciable asset and must be viewed at the lowest price you can sell it at.


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## PrettyPaisley (May 18, 2007)

The item does definitely not depreciate!!!


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## Halfway (Nov 22, 2010)

PrettyPaisley said:


> The item does definitely not depreciate!!!


It remains an asset then. Include it on your balance sheet if you intend on pursuing an institutional loan.

Remember the cost of the items become an item for your tax preparer if they roll over tax years.


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## PrettyPaisley (May 18, 2007)

No loans. Just cash - I won't need more than then initial $400 or so. Thanks.


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## Halfway (Nov 22, 2010)

Best of success!


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