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ARCH Report for 2015

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First, let me apologize because I actually went an entire year without giving a report on the brand and the online store. Now that taxes have been done and the dust has settled, kind of, I can do a report that will either inspire you, or make you say, WTF? I’m never happy with the progress of the business as I know what mistakes I made and I know what I can improve upon. Right now I know that I have to improve on having enough capital to keep the wholesale deals I had last year for myself. I definitely have to move ARCH branded products at a faster rate so that I can make my manufacturer happy and keep the relationship strong. I only made one order last year and they were not happy about that at all.

Anyway, here we go with what you came here for. (Gross totals only because that makes me look like a baller ūüôā Seriously, I’m only showing gross totals because I’m embarrassed at my net. There is a reason for my net, but that’s a little too much transparency for this report.

ARCH Brand Sales from Square: $404.06

ARCH Brand Sales from Amazon: $1974.64 The breakdown of sales from Amazon are as follows

  • ARCH TR-114 Runner (Limited Edition Suede Pack)$1774.72
  • ARCH Incognito Waterproof Tech Jacket (Reflective Strip)$119.946
  • ARCH CG097III Lightweight Running Trainer (Kickstarter Pack) $39.991
  • ARCH CG097III Lightweight Running (Kickstart Green/Black-White) Size 8 $39.991

The ARCH Brand Sales were difficult last year. In this article I explained how the factory cut the last wrong and the sizing was incorrect. I had to adjust the sizing of the shoe by the box label and utilize UK sizing for US sizing as an explanation. I backed off from using Facebook Ads as conversion is ridiculously low with those ads. I instead placed my time and effort into building up the website through articles and content as well as placing an emphasis on the ARCH Online Shop’s inventory to get more eyes on the brand. While sales were slow overall and I still have 60 shoes in inventory, what I’m most excited by is the fact that the brand is officially able to make sales without reducing costs. The shoes are now selling at the 75.00 price point. I am giving discounts on my Square store, but it’s evident that the majority of ARCH sales occur through Amazon to people who I don’t know and have never met. In my mind you don’t have a real business until the customer who doesn’t know who you are takes a chance on your product and that is happening now. The only ads I’m using to promote the brand are through Amazon Ads and this picture will show you the breakdown of how the ads are working.

Amazon Ads for promotion
Amazon Ads for promotion (click to expand)

Account Deposit Totals: $400,080.87  Р This consist of sales that did not occur on the ARCH Online Shop on Amazon. The deposits are based on my Square platform (3291.90) and wholesale totals (the rest).

ARCH Online Shop on Amazon official total from 1099K: $317,994.11

It was a solid year by the gross numbers ($718,074.98), but the net is a completely different beast. In 2014 I took a huge gamble in February and March on the Air Foamposite Spiderman and Silver Camo. I bought 300 pair at 160.00 a pair. It was a $48,000 purchase. The shoes tanked. Instead of the shoes selling at my estimated 280.00 per pair shipped, they sat and ended up selling at around 175.00 a pair three months later. The price never adjusted on the shoes and never reached retail at $250.00. This gamble was terrible because I still had to purchase inventory and continue selling. For the first time in 2014 the biz took on debt. That debt has killed my net from late 2014 through 2015. What’s the moral of the story? It’s okay to take a gamble, but be measured in your risk and use everything at your disposal to make a purchase that risks almost 50,000 dollars.