@bgriffin wrote:
So let's say that after doing this 5 years I've come to find that my end of year profit seems to be really close to......80% of my total fees. So if my total fees for the year are $100,000 my profit tends to be close to $80,000. (all numbers are for demonstration purposes only and are not indicative of my actual amounts lol). So let's say I have a profit goal of (gee let's make the math easy) $80,000 then I know I need to do about $100,000 in fees this year.
@myst4au wrote:
I use the IRS mileage rate
@bgriffin wrote:
I've harped on this in a couple of threads lately. I could certainly be wrong but to me it seems like a lot of mystery shoppers don't have a natural propensity for running a business. As I've said before, there's absolutely nothing wrong with that. A huge majority of Americans don't. So, in the spirit of that, what are some of the things you think many shoppers don't fully "get"? I'm not talking about the actual shopping part. I'm talking about the actual running of a business. The things that would translate to any business you might run. Full disclosure I'm hoping to learn a lot in this thread too.
I'll start. I think a large number of shoppers fail to accurately account for vehicle replacement costs. And it runs the gamut from way high to way low. I know some shoppers think oh I get 35 miles to the gallon and gas is $3.50 a gallon so that's $.10 a mile and that shop is only 5 miles each way so it only costs me $1 to do this shop. On the other hand you have people who think because the IRS mileage is $.575 (or whatever it is currently) then that must be what I need to account for. Then there are the people who figure gas plus maintenance costs and insurance. In all actuality none of those are very accurate. The IRS mileage is very likely quite high and even figuring gas and maintenance is too low. Because many people fail to account for replacing the vehicle. Every mile you drive is a mile less you will get out of your vehicle. I'll give an example.
Let's say you buy a brand spanking new $25,000 car (not recommended for mystery shopping I'm just trying to make the math easy) and you expect to drive that car for 250,000 miles at which point you expect it to be worthless. If that was accurate (foresight is never absolutely accurate for such things) then the replacement cost for that vehicle is $.10 per mile. You absolutely have to include that in your profit calculations. Otherwise you end up using up your vehicle and overstating your profit because you didn't figure for buying a new car when you wore out the old one.
For my vehicle I use the following calculations:
Vehicle Replacement Costs: $17,000 / 170,000 miles = $.10 per mile
Gas: $3 per gallon / 35 mpg = $.085 per mile
Scheduled Maintenance: $200 per / 10,000 miles = $.02 per mile
Expendables (brakes, tires,etc) $1000 / 50,000 miles = $.02 per mile
That's a total of $.225 per mile. I round that up to $.25 mainly to make the math easier in my head and to account for break downs. Over 170,000 miles that would be an extra $4250 for break downs and repairs. Over the life of a 250,000 mile vehicle that would probably not be high.
Some people include a portion of insurance in their calculations as well. I do not for the simple fact that I would have the exact same insurance as I do now, the only difference is the higher mileage and while that did make a small change to my insurance premium it was a statistically irrelevant amount.
@bgriffin wrote:
I've harped on this in a couple of threads lately. I could certainly be wrong but to me it seems like a lot of mystery shoppers don't have a natural propensity for running a business. As I've said before, there's absolutely nothing wrong with that. A huge majority of Americans don't. So, in the spirit of that, what are some of the things you think many shoppers don't fully "get"? I'm not talking about the actual shopping part. I'm talking about the actual running of a business. The things that would translate to any business you might run. Full disclosure I'm hoping to learn a lot in this thread too.
I'll start. I think a large number of shoppers fail to accurately account for vehicle replacement costs. And it runs the gamut from way high to way low. I know some shoppers think oh I get 35 miles to the gallon and gas is $3.50 a gallon so that's $.10 a mile and that shop is only 5 miles each way so it only costs me $1 to do this shop. On the other hand you have people who think because the IRS mileage is $.575 (or whatever it is currently) then that must be what I need to account for. Then there are the people who figure gas plus maintenance costs and insurance. In all actuality none of those are very accurate. The IRS mileage is very likely quite high and even figuring gas and maintenance is too low. Because many people fail to account for replacing the vehicle. Every mile you drive is a mile less you will get out of your vehicle. I'll give an example.
Let's say you buy a brand spanking new $25,000 car (not recommended for mystery shopping I'm just trying to make the math easy) and you expect to drive that car for 250,000 miles at which point you expect it to be worthless. If that was accurate (foresight is never absolutely accurate for such things) then the replacement cost for that vehicle is $.10 per mile. You absolutely have to include that in your profit calculations. Otherwise you end up using up your vehicle and overstating your profit because you didn't figure for buying a new car when you wore out the old one.
For my vehicle I use the following calculations:
Vehicle Replacement Costs: $17,000 / 170,000 miles = $.10 per mile
Gas: $3 per gallon / 35 mpg = $.085 per mile
Scheduled Maintenance: $200 per / 10,000 miles = $.02 per mile
Expendables (brakes, tires,etc) $1000 / 50,000 miles = $.02 per mile
That's a total of $.225 per mile. I round that up to $.25 mainly to make the math easier in my head and to account for break downs. Over 170,000 miles that would be an extra $4250 for break downs and repairs. Over the life of a 250,000 mile vehicle that would probably not be high.
Some people include a portion of insurance in their calculations as well. I do not for the simple fact that I would have the exact same insurance as I do now, the only difference is the higher mileage and while that did make a small change to my insurance premium it was a statistically irrelevant amount.
@CoffeeQueen wrote:
It's been demonstrated many times on this forum, that location determines much of a shoppers success. I think even the most determined and businesslike shopper can't overcome the limitations of their location.
@Aquiest wrote:
Don't forget to account for your car's warranty expiration. Warranties always state a specific time period and also a mileage expiration, WHICHEVER comes first. I have NEVER had a warranty last as long as it was supposed to. As a matter of fact, my 3 year warranty on a car I bought 5 months ago expired last week due to mileage.
@bgriffin wrote:
@CoffeeQueen wrote:
It's been demonstrated many times on this forum, that location determines much of a shoppers success. I think even the most determined and businesslike shopper can't overcome the limitations of their location.
I live in a small town that's population is a few dozen over 24,000.
@Aquiest wrote:
Also consider the dangers of being on the road, aside from the financial aspect of it. Late last year my vehicle was totaled at the fault of an uninsured driver while on my way to a revealed inspection. Luckily I was not severely injured, but it brings to attention that we are at risk the more we are out there. And also more opportunity to fork over hard earned money & be susceptible to insurance hikes via traffic violations.
@cjbstar wrote:
I think one of the biggest things newer shoppers do not figure as a cost is their time. Time and again when a thread discusses the shop pay few mention the actual time involved from start to finish. The time you leave your house to the time you return home plus the time to enter the report are all part of your cost.
@Aquiest wrote:
If you buy a new car, a warranty is going to be included whether you believe in them or not. If you buy used and finance, some banks require it.
@OHGuy wrote:
I would like to add to this discussion, that if one truly looks at this as a business, then one should consider setting up an LLC (Limited Liability Corporation). I was advised to do this when my wife and I sat down with a financial advisor a few years ago. The most compelling argument for doing this is the protection it offers from lawsuits. So what type of lawsuit would a mystery shopper risk being involved in you ask?