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A friend wants me to create and run an online store. She would create and box the products, I would take online orders, run the site, and ship products out. I would get 15% of the profits. Seems low to me, as I would be marketing and all that. What do you all think?
#15% #good
  • Profile picture of the author KamesCG
    Sounds like a bum deal to me...

    You need to have way more defined before signing up for 15%...

    How much marketing do you have to do each week?

    Can you do content marketing for 4 months and stop working, while getting paid, because products are selling?

    My best advice is to define the project a little bit more

    Design & Developer

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  • Profile picture of the author JosephI
    It depends. 15% of what profits?
    Gross, net, after taxes, before meals.....
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  • Profile picture of the author dave_hermansen
    We focus more on $ cleared per processed order, not %. 15% of $20 sucks but 15% of $500 is pretty good! Also keep in mind it's per average order, not item.
    StoreCoach.com - FREE TRAINING - Learn How to Build Your Own eCommerce Website
    My PROVEN ecommerce process, as seen on: Fox Business News, the NY Times & Flippa
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  • Profile picture of the author onlinecommerce
    It sounds like she is acting as the "manufacture" of the product of sorts.

    Another question to consider is who is paying for everything? the product, the website, advertising etc.

    Regardless 15% of the profit is garbage in any situation in my opinion. You are doing the core of the work to market and sell the products. The products alone are basically nothing and will just collect dust. Products are a dime a dozen there are tons out there and her specific ones are not special.

    If you do want to market her products online you should be buying them from her at a low cost. Say her total cost including her time is $5 for the product maybe you buy each one from her at $8-$10 and then mark it up say 4-8x. If you want to do a profit sharing she should probably get 15% of profits, you should get the 85% as that is where the bulk of the work is.
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    • Profile picture of the author NeshSab
      15% sounds too low IMO.

      You are practically running the whole business, doing all the hard work.
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  • Profile picture of the author Silas Hart
    15% is manageable if the volume is there and you feel like you can make a decent amount of income from that 15% - Most large retailers survive pretty well on 15%.
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  • Profile picture of the author Acornia
    Amazon works on 30% gross profit margin, 0-5% net, companies like Saks 60-70% so it's all relative without the other information. At the other end of the scale affiliates get 7-10% so there's a sweet spot somewhere in there.
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