Reflecting on Two Years of E-commerce: A Journey from Zero Sales to Over €145,800 in Gross Revenue and the Decision to Continue or Quit
Starting an online business is often described as a journey filled with challenges, learning curves, and moments of both triumph and frustration. Today, I want to share a personal story that encapsulates these experiences, hoping it may resonate with fellow entrepreneurs navigating similar paths.
The Beginning: Seeking Advice and Gaining Momentum
More than two years ago, I reached out on a community forum to seek guidance for my Print-On-Demand (POD) Etsy shop. This initial post received invaluable feedback, which helped me secure my first sale—and many more thereafter. The support and insights from the community were instrumental in shaping my early efforts. Original Reddit thread with 84 comments
Scaling Up: Developing Products and Expanding Channels
Following that initial boost, I dedicated time to creating new designs and expanding my product lineup. By June 2020, my Etsy shop had achieved over €4,400 in sales. Feeling optimistic about my progress, I launched my own website on Shopify to gain greater control over sales and marketing efforts. My goal was to leverage paid advertising across platforms like Google, Facebook, and Instagram.
Financial Snapshot: The Rollercoaster of Growth and Losses
Here’s a simplified overview of my sales and profit trajectory over the first year:
- November 2020: €11,283 in sales (€1,807 profit)
- December 2020: €21,863 in sales (€1,617 profit)
- January 2021: €7,057 in sales (€321 profit)
- February 2021: €25,018 in sales (€2,602 profit)
- March 2021: €31,914 in sales (loss of €3,872)
- April 2021: €13,076 in sales (loss of €41)
Hitting €30,000 in sales was an exciting milestone for a small, solo business operated from home. It felt like tangible progress. Yet, the path was far from smooth.
Challenges: Advertising Costs and Market Dynamics
In mid-2021, I encountered significant hurdles. Changes in iOS tracking policies led to rising ad costs and diminishing returns on Facebook Ads. Despite investing heavily in paid campaigns, profitability became elusive. By May 2021, I ceased advertising altogether. Since then, my monthly sales on Shopify have hovered below €2,000, and on Etsy, below €1,000.
Adding to the complexity, geopolitical and regulatory shifts impacted my business:
- Brexit: Since January 2021, Etsy sales declined, and order fulfillment became more complicated.
- VAT Regulations: From June onwards, additional VAT charges for European orders increased administrative burdens. I now hold VAT registrations in both Germany and the UK, requiring multiple tax filings.
- Health Insurance: As a German resident, I am obliged to pay for health insurance, which I cannot deduct as a business expense.
These factors have increasingly strained the financial viability of my venture. The business barely reached a break-even point for the year, and ongoing taxes and insurance costs weigh heavily on my morale.
Reflections and the Dilemma
Despite accumulating over €145,800 in gross sales, I find myself at a crossroads. The journey has been invaluable in terms of experience, but the consistent low margins and mounting expenses have taken an emotional toll. I am a stay-at-home dad, eager to contribute financially to my family, but the current business model seems unsustainable.
Should I:
- Continue pushing forward, perhaps pivoting my approach?
- Scale back and focus on stabilizing?
- Or consider quitting altogether?
Your insights and stories would be greatly appreciated. Have you faced similar challenges? How did you decide your next step?
Thank you for taking the time to read my story.
Warm regards,
Alex
