FOcus Archives - Amazing FBA - Expert Info for British Amazon Sellers

Archive

Category Archives for "FOcus"

Start selling on amazon? – why NOT to start with private label! (Episode #206)

How to start selling on amazon?

Want to start selling on Amazon?  Where to start?

The standard answer for a few years has been – by plunging straight into private label.

As that’s how I started myself – and eventually succeeded, until recently I taught that myself.

I’m no longer convinced

But after 18 months of mentoring people trying to start selling on amazon, and a year of masterminds mostly focussed on those, I’ve seen the struggles up close. I’ve seen inside too many businesses and too many minds. It’s a hard way to start.

All business has challenges starting. That’s a given. You need a tough mindset. I just happen to think that in late 2017, the old model just isn’t cutting for those who are trying to start selling on Amazon now.

Are you still focussed on Private Label?

Yes I am. I believe private label on Amazon is still a big opportunity.  I have many friends making loads more money than me to back that up. It’s not theory.

So I believe that Private label – and even better, developing unique products -works on Amazon.

However, when it comes to how to start selling on Amazon, that’s a different kettle of fish.

I think the irony is that by prematurely plunging into private label, many sellers actually miss out on properly executed private label. How can that be true?

It’s simple really. They  blow their budget on the first budget. They  bust their confidence in the business model, and indeed in themselves. And then they quit too early – and miss out on $10s or even hundreds of thousands of dollars of revenue per month

I’m not talking about what the overall goal is – rather,  it’s about how we GET there!

Start selling on amazon upwards graph on 3 gold bars

Whatever Works is good

Also I’m increasingly happy with whatever WORKS rather than being puritanical about business models.

As I’ve talked over the past two years to many Amazon experts, it’s clear from the sharper people (especially the master himself, Will Tjernlund )  that there are several models that can work. And you don’t have to start with private label.

Focus is good and learning a particular set of skills-  but so is PROGRESSION:

from simple to advanced; from low-risk to higher risk; from quick wins to projects that take months to come to fruition.

There is  a natural progression in terms of risk in the various business models available to ecommerce sellers in general, and ways to start selling on Amazon in particular.

chimp scratching head- Start selling on amazon

Real learning versus the the Art of Aping…

It’s like my old job of piano teaching.

Sure, I can teach little Johnny to seem like an accomplished pianist by teaching him or her three specific pieces and about 10 scales. You get a certificate, you look good, the parents are happy. 


Trouble is, he doesn’t know his way round a piano, he can’t read the music, he can’t play by ear, he doesn’t understand what he’s playing or why…in short, he’s not becoming any kind of real musician. Or any kind of real pianist. 

He’s aping the real thing. But he’s basically little more than a trained monkey.
Put him in any situation that demands real understanding of music, or real control of a piano, and he is finished.

My experience with Amazon sellers who try to learn  how to start selling on Amazon with Private label is remarkably similar.

Indeed, it mirrors my own journey as an Amazon seller myself. And it also mirrors my journey as a piano student/musician to a frighteningly similar degree too.

Vested interests trump real learning

That’s not surprising. There are a lot of vested interests in trying to “pre-package” business building skills and mindset. Same as there were in pretending you can become a pianist, with 20 minutes’ practice a day and three pieces at a time, with some bullshit “grades” scale.

(By the way, I have 7 years’ higher education in classical music, I’m engaged to a pianist – so this is not the ranting of an amateur. On the contrary. It’s the ranting of an ex-professional).

Both things, I’m afraid, while much better than doing nothing in terms of progressing, are basically based on a totally false premise. The false premise being that you can learn the piano by aping much better pianists’ external results – or by aping the actions of advanced Amazon sellers.

Instead, what I’ve seen overwhelmingly is that all of us entrepreneurs need to develop the right mindset and skills. And those come from experience.

Start selling on amazon

Experience is the best teacher (no surprise there)

The truth is that there is no substitute for learning overall business strategies and tactics. Nor is a substitute for learning by experience.

You need to learn to understand what you see in the data; to READ the data. You need to learn the landscape of a marketplace. Everyone has to learn how the mechanics of production, freight and amazon work. You need to get familiar with Amazon’s internal processes.

All this takes time and practice. It doesn’t need however to be a painful, high-risk, uncertain gain experience, like that of the big private label approach.

Practice makes you better. Planning for months, selling nothing, then sending half your life savings across the world suddenly…well, that is NOT such a great way to practise becoming a better online seller. Nor to start selling on Amazon specifically.

15 reasons  to start selling on amazon with something other than private label

BIG RISKS -AT THE TIME OF LOWEST COMPETENCE! 

  1. when you start out, you know little and have little experience. That’s fine. That’s also not the time to take big risks!

    MOQs and freight costs from China –

  2. these nearly always make for a rather unpalatable large upfront order. It’s all relative of course. If you have £10-20K to invest, you might get away with a budget of £2-3K per order plus some giveaway money. Not for any serious product in the USA, though. And for most people, that’s about half their money for Amazon, in my experience.

    Cashflow

  3. It usually takes months to get a decent private label product off the ground. The fastest I’ve personally done it was four months, with a business partner – so we had a combined 4 years of Amazon experience at the time and access to some very experienced people. It’s still challenging enough.
  4. That means no money coming in at all for months.
  5. AND a large lump sum out a few months in.

    TIME TILL YOU START SELLING

  6. It takes months to get a PL product off the ground.
  7. Meanwhile you’re not learning from the marketplace directly – you’re an outsider attempting to learn from the rather minimal data Amazon releases. Data which the rest of the planet is also trying to learn from. This is a huge downside.
  8. You’re not learning to ship in products or deal with Amazon systems. That’s a large learning curve. The sooner you can start the better
  9. You’re not getting access to Amazon business reports with more insider information like conversion percentages
  10. You’re not getting access to the Search Term Reports which I believe are the real value you’ll get from Amazon ads. That’s where you find out keyword-level conversion percentages which is VERY powerful info.
  11. you’re also not earning! See the cashflow issue above.

    The percentage of successes is so low!

  12. This is the real kicker, I’m afraid. I do know several people who started with private labelling and are still at it today and making great money. Maybe 10-15 people. Maybe 20 max.
  13. However, I must have known hundreds people (vaguely known of at any rate) who started around the same time as me, or have drifted into (and out of) the Amazing FBA Facebook group . Most have apparently drifted away without achieving anything. Or worse, they are fantasising about making money for 2 or 3 years – and wasting those years (that was me for years, by the way – which is why I try my best to stop anybody else wasting their life in the same way)
  14. True, most people who start anything don’t follow through. And that is perhaps even more true for online businesses.
  15. Still, it would be nice to see a little more consistency if it really  is going to be advertised as a potential replacement for the day job (by the way, I’m super cautious about what I say to any potential mentoring client or member of a my London masterminds about replacing day jobs. In most cases, I say give it a minimum of a year – and that’s short)

 

Start selling on amazon

Conclusions on Private label as a way to start selling on Amazon

Am I saying private label is dead then? Is it true that nobody should start a private label business on Amazon? Is private label only for the rich or the super-experienced online maverick?

No, no and no.

That is NOT what I’m saying. I want to be super clear. I think the opportunities to make a ton of cash and have the satisfaction of becoming a real entrepreneur (and mastering a tricky but addictive craft) are very real with private label. And even better with original tweaks to a product.

But both models take serious investment of money, time and energy into each product line. 

That is fine, even very important at the right point in your development as an Amazon seller, or as an entrepreneur.

Start selling on amazon - the himalayas

Don’t start with Mount Everest

But you don’t have to START learning to mountain climb by training in a gym for 3 months, studying maps and theory incredibly hard, then attempting the Himalayas as your first set of mountains.

Sure it’s been done – I read about exactly that in the news a while ago.

There’s a clue here. It’s news – because it’s the exception to the rule!

You don’t have to START selling on Amazon by scaling a private label mountain either.

Again, yes there are exceptions. Again, we read about them and the buzz goes around. Because it is NEWS. Because -I’m sad to say, after trying this way for so long with newcomers –  it’s unusual to succeed that way.

There are alternatives

So is this a reason to be depressed and quit?

Maybe – if you are the sort of person who quits easily. In which case, please don’t attempt to become an entrepreneur.

Most people shouldn’t scale the Himalayas and most people probably shouldn’t be entrepreneurs either. And that is absolutely fine. 

Most people don’t have the mindset, stamina or sheer hunger of an entrepreneur, and there is nothing wrong with that. I’m not a rugby player – despite being forced to play it (very badly) at school. Yes, I admire good players – but I don’t feel a failure because it doesn’t suit me (my sports teachers at school had a go of course…)

Most people who are a right for a profession build skill, fitness and experience one hill, one mountain at a time. If they get on well,  they move to the next natural level.

start selling on Amazon - business post-its

Amazon is still business as usual

Business is no different – and Amazon is no different to business. Just because Amazon has built the world’s most amazing traffic and conversion machine shouldn’t blind us to the fact that normal business rules still apply.

The economics and business principles are the usual:

Supply and demand. Risk-reward ratios. Opportunity cost.

The mindset and skills needed are the usual ones too:
The skills of assessing the supply and demand balance in a market; assessing risk vs reward; weighing up opportunity cost (if you go for one opportunity, you tie up the money and time that could go into another);

The mindset of a blend of vision and opportunism; pragmatism with some theory and imagination; discipline with flair and improvisation……and so on…

Go for it – but lower risk and increase learning!

I personally think anyone wants to have a serious crack at building a business and becoming an entrepreneur has never had such opportunity at their feet. And if you want to go for it, I think you should go for it.

There is no reason for anyone to exclude themselves from becoming an entrepreneur.

But wait – isn’t that against everything I’ve been saying in this post?

No again.

I want you to have the maximum chance of success, not to exclude you from the club.

What I am saying is that starting an Amazon business with private label does not maximise your chances of succeeding.

Instead, what you should do is read my next post and consider a much lower-risk way to learn your craft as an Amazon seller!

(Now there’s a cliff-hanger…!)

Thanks for reading.

(By the way – well done for reading to the end. Now there’s a hint that you have some stamina. You’ve passed the first test, oh Jedi. If you’re British, Click here – I think you may have what it takes to join the real business builders.)

(Sorry, I couldn’t resist putting a little teaser at the end too! I’ve got to have fun too, you know…)

Happy hunting.

 

An Amazon mastermind: Why You need one- part 2 (episode 205)

“So are you suggesting I just set my own Amazon mastermind group up?”

Absolutely, you can. I’ve set up my own Amazon mastermind myself, as I mentioned earlier.
Here’s the thing – it’s really hard work. If I were just selling on Amazon, rather than also running a podcast and coaching, I simply wouldn’t do it all again. I’d just plug into an existing group.

But, if you want to create something from scratch, I can give you a ton of reality checks form from personal experience:

Finding new Amazon seller peers for your Amazon mastermind

Firstly, and most importantly, you’ve got to gather together a set of people who are worth being peers with in an Amazon group in the first place.

When I first started out on Amazon, and formed my own peer group of Amazon sellers, I looked through the Facebook group of a course that I was in, and searched for people who lived in or near me (in London). I then tried to check out what they had been posting, to see how active they were, whether they were moving forward with the process, etc.

That took a lot of time and effort. Trouble is, that was just a beginning!

Think about it.

Amazon mastermind hurdle 1- Facebook Monkeys

Facebook Groups aka “The tyre kickers’ Club”

There are a lot of people out on the Facebook groups, even within paid courses, who don’t have enough money, don’t have enough time, and don’t have the right attitude.

They hope they can make some money on Amazon. They’ve often been pitched into the idea that they can easily replace the day job within 3 months (if that’s you.

Sure, it happens- but it’s pretty rare. Sorry to burst your balloon. It’s not a business-like attitude. It’s based on hope. Which, as we all know, is not a strategy…).

What I’ve just described sounds, in fact, like a typical Facebook group of Amazon wannapreneurs.

Which is why my first effort to create a little Amazon mastermind faltered. I had found a bunch of would-be Amazon sellers who lived in London and posted a bit online. Not surprisingly, most of them proved to be very much non-action-takers, and the meetings ended up being people fantasising about starting a business, instead of doing it!

Filtering out the tyre-kickers

What you need is a filtering system. And, guess what, that takes time and effort to build. What I do these days for the masterminds for Amazon sellers that I run (through Amazing FBA) is have an application process for each Amazon mastermind.

I ask every single applicant to fill in a form with questions that I’ve honed over a year of working this process. Then in some cases (all cases, for applicants to my $10K Collective Amazon mastermind ), I have a 20-30 minute interview in which I ask detailed questions.

Why bother? Well, see above. What happens to you if you create (with some effort) a peer group of  under-capitalized, time-poor un-focussed people? Oh yeah…

Finding people to put through your filter

Of course, if you are going to filter people out, you need a way of finding possible people in the first place. If you’re going to manually do that, you need to be going to a lot of physical meet ups and other big groups.

That’s great, but there aren’t a whole lot of good ones in the UK. There’s a fantastic Amazon meetup in London once a month, run by the excellent Andy Geldman of Webretailer. Then there are various other meet up groups, some of which might be good, but many of which, I suspect, are run by wannabes not business owners.

Amazon mastermind meeting venue

Finding an Amazon mastermind meeting venue

Once you’ve gathered your troops, you’ve got to find a suitable venue for your Amazon meet up.

Firstly, it needs to be reasonably accessible for your members. So the geography and transport links matter. Then it needs to be affordable (money is whole other issue we’ll discuss). This all takes quite a bit of time and effort. Even in London, I found it took hours, and we have a ton of business meeting venues in this place.

You need a space that enables you all to think clearly. You could use your own house, of course, if you have the space- and the headspace. But do you really want  the kids -or your husband/wife-interrupting a crucial business point? How conducive to clear thinking is that? It’s cheap but brings its own issues.

You could use a local pub but I’ve found (having been in an Amazon mastermind in the past who met in one) that the noise seriously disrupts your ability to hear crucial bits of information. So I can’t recommend that.

A quiet cafe is better – but although I find that works great for one-to-one meetings, it’s not really the right way for a group of people to work, as they have to basically take over the room to do it. And there’s always a screaming infant somewhere (and why should there not be? it’s a cafe!)

 Venue resources

You need decent wifi of course (although I think it’s less important than most people make it. But you shouldn’t spend your whole time online. You need to think clearly. Online is not the place for that).

I think a whiteboard or an easel with a flipchart is very, very helpful for brainstorming strategies, or capturing key resources (eg websites or online tools) for the group.

Coffee on tap is great -free, good coffee even better! Easily available toilets are a mundane but crucial part of a good venue. And finally, you ideally want somewhere easy for new members to find, not a cramped room hidden upstairs behind a noisy pub!

Why choose an existing Amazon mastermind

Conclusions – a reality-check on creating your own Amazon mastermind

I hope that the above experiences save you wasting months of hard work. Frankly, now I know from experience what I know, if I were just selling on Amazon, rather than also running a podcast and coaching, I simply wouldn’t do it all again. I’d just plug into an existing group. As indeed I did myself about 18 months ago!

The only reason I go to all the trouble it takes to create and run a Amazon mastermind (which I detailed just some of above), is that it’s part of my mission at Amazing FBA.

That mission is to help Amazon sellers and those in the process of establishing their own Amazon businesses to achieve REAL goals. Not just fantasies. And not to take 12 months on something that you could achieve in 3 months (or even 2) with some guidance from experience.

Even then, I couldn’t justify the time it takes away from my Amazon business if I didn’t charge a certain amount for all the efforts. The cost is pretty modest, by the way, if you compare it to the literally £thousands I’ve seen some Amazon trainers charge.

Often they turn out to be not true small group masterminds, but actually groups of 30-60 people. There’s nothing wrong with paying £10s of thousands if you get value in the £100s of thousands, but I’m pretty suspicious of the value most of those so-called “Amazon masterminds” can really deliver.

The “Amazing FBA” Amazon Mastermind

So, I guess that brings me fairly unavoidably to mention the Amazon masterminds that I run for Amazing FBA. Again, I don’t want to be self-serving, but it would be a bit strange for me not to mention them in the context of Amazon masterminds and  masterminds as a whole.

I try to practise what I preach, basically. I said at the start of this article that I believe that a mastermind needs to be interactive; needs to be focussed; and needs to lead its members to action, which leads to their progress.

The secret sauce to a successful Amazon mastermind

From the (sometimes painful) experience of trying many approaches in Amazon masterminds (both as a member and group leader), I’ve found the formula to combine all those good things. Like a lot of good formulas, it’s pretty simple. In fact, that’s partly why it’s so effective.

The secret sauce that I’ve found to combine all those outcomes, is the “Hot Seat”.

I’ve found that to be so effective that we’ve made it the overwhelming focus of each Amazon mastermind meeting.

Amazon mastermind hot seat

The Hot Seat Secret

Here’s how it works:

Each participant gets minimum 30 minutes to focus on their own business. Specifically, to focus on ONE thing. Even more exactly, the ONE roadblock that when they break through it, it will really move the needle. Will really move their business on -substantially. 

So it’s very focussed. That’s one secret. It’s also interactive. Because once the member in the hot seat has outlined their issue, all other members are there to bring their experience and thoughts to the issue.

Of course, it’s very helpful if the other members who don’t have anything valuable to bring can keep schtum. That way,  others who do bring value can help.

But it is excellent business training to encounter business problems and brainstorm solutions. That is the real training we all need as business builders. Not an obsession with the latest trick or grey hat technique (useful as they are, of course). But business thinking and mindset.

There is a huge bonus of having a genuine peer group in an Amazon mastermind. A lot of the people in the group share the same set of problems. So by listening to solutions to another person’s problem, you’re hearing the solutions to many problems of your own.

Win-win. 

Implementation is the ultimate test of any Amazon mastermind

SO, the group members can almost not fail to move their business forward. Provided the participants go away and implement this stuff (another crucial word), they Job done! Isn’t it?

Well, almost. The implementation piece has proved to be a real challenge for many Amazon mastermind members. Which is why I’ve recently added in a simple extra process to make sure people are held to account. In other words, to use peer pressure in a very positive way. To get you to do what you said you were going to do!

KLT

Ensuring members do what they say they will!

We’ve simply added in a quick video call check in once a month. The aim? Simple. To make sure people are implementing what they’ve said they would.

It’s early days, but the results already look promising.

It’s fairly obvious where I’m going with this, so I’ll just come out and say it:

-if you’re convinced of the value of being in an Amazon mastermind

-if you’re not wanting to go through the pain, time & effort of creating your own Amazon mastermind,

-AND if you live near London (or can get there)

then obviously I think you should consider the Amazing FBA masterminds!

I’m not going to make a huge pitch for them here; if you want to check them out, there are now two levels:

The Zero to Hero Mastermind, which is geared to those who have not yet launched, and to those doing just a few thousand $ a month (or equivalent) on Amazon (we may form a separate mastermind for the latter as it grows)

The $10K Collective, which is for those doing at least $10K a month on Amazon.

Conclusions about any Amazon mastermind – done properly

The thing is this. Now, you have a process that means you focus on the biggest win in your business right now. You can get the collective mind to break through blocks and find the actions to get that win. You  have a means to hold you to do that action. 

Now you have a really powerful driver to move you forward.

Like I said,  that may be why nearly all the successful Amazon entrepreneurs I know are part of one.

Wherever you live in the world, I’d encourage you to look for a face-to-face mastermind you can regularly commit to.

The word commit is a key one here too. If you put little in, you get little out.Your peer group will massively impact your wealth and well-being. So Choose wisely who you associate with.  

But once you’ve chosen well, commit to your Amazon mastermind. The more you sweat to rearrange your schedule to get to meetings; spend money on trains or planes to get there; in short, the more you put in- the more you get out.


I can give you a promise from my experiences as an Amazon seller and from running groups. The rewards of a really quality Amazon mastermind are truly many times greater than the effort. And the ROI (for the right group) many times greater than the cost. 

To find out more about the regular monthly masterminds for Amazon sellers led by Michael, click here

154 Time Management for eCommerce with David Aggiss Part 2 of 2

The great thing about running an Amazon business is the freedom it allows in your personal life. You can go on holiday as you want and you can take a day off as needed. You set your own schedule and make your own deadlines. That also creates one of the more difficult aspects of your job as an Amazon seller, time management. Today on the show we have David Aggiss and we’ll be discussing time management techniques when you’re running an online business.

Time Management for eCommerce

If you are first starting out, the challenge is finding enough time to work on your business. You have your full-time job, maybe a spouse and children, then your Amazon business on top of that. It’s going to lead to some late nights and long days. That’s the struggle of it. It’s important to set aside time-blocks for specific tasks. If you start working without this, you’ll end up working on a number of things and accomplishing nothing.

Customer service is a daily task. You’re probably going to be in Seller Central a lot anyway, which is a good thing so you can respond to customer questions and other issues as they arise. Once a week, you want to look at your listings. See if there is any way to improve them. You should take a look at your PPC and keywords to make sure they are performing how you want.

Time Management when Expanding Your Business

Expanding your business is an evening job. If you are looking to research new product lines or find new suppliers, make sure you have a few weeks available where you can put in some serious evening hours. You’re going to have to work everyday with emails back and forth with your suppliers, especially if they’re in China. Unless you can get on a Skype call, this process could take a week or more because of the time difference.

Skype is recommended to help speed up this exchange. However, keep in mind that if you’re looking into several suppliers, that Skype could get overwhelming. It is easier to maintain all the information if you limit it to email since that has understood, built-in limitations. Also, you will have a record of everything discussed.

Outsourcing

If you find that you don’t have the time to handle everything that you need, consider outsourcing. Be aware of what your strengths and weaknesses are. Focus on your strengths, outsource your weaknesses.

If you are making enough money from your Amazon business that you can afford to outsource, then you are probably pretty proficient at the day-to-day Amazon tasks. Then you’ll want to continue to handle those. If your background is in web design, then build your website yourself.

If, however, you don’t know the first thing about building a website and you have no idea how to work on social media, outsource those. Chances are you can find someone that will do it better and faster. If a task is going to take you a week, but someone who is an expert can do it in a day, pay them to do it. The task will get done several days soon and you now have that week to work on something you’re an expert in.

Focus Management

While time management is important, focus management is as well. Like I said before, you have the freedom to make your own schedule, but you don’t have a boss to keep you on track. It’s easy to lose focus and let your business suffer because of it. You have to keep in mind why you want to run your own business. Whether it’s to have a luxury house, nice cars, or to simply spend more time with your family. Whatever it is, whether it changes over time, always remember that and let it be your motivation to stay focused.

131 Are your Amazon Ads Killing Your Profit?

Today we are continuing with our giving-up list. What are you going to give up in 2017? Before you start doing something, you need to stop doing something else. You must free up your time, money, and mental focus. Today we will be discussing sponsored ads, or Amazon ads. Amazon calls them sponsored ads. Broadly speaking, they are one of a few ways you can that drive traffic that is moderately guaranteed to work.

Amazon Ads

If you have a product with terrible conversion rates and a decent amount of reviews and that’s not shifting over time, and you’re driving traffic with pay-per-click, then you have a problem with your product or listing. But if you have decent sales and the conversion rate isn’t terrible, not below 10%, then what is going to determine your profit will be the balance between the sales price and the cost of goods sold. A big percentage of that is your Amazon ads.

If you increase your price you could negatively affect your sales, however, if you reduce your cost, by reducing money spent on Amazon ads, then you will increase your profit while maintaining your sales. Which is obviously a big win for you. 

It is very important to use negative keywords if you’re using auto-campaign. I always suggest using auto-campaign to start with because you can gather a lot of data and tune the algorithm to your listing.  But after a while (say 1-2 weeks usually) you shouldn’t be spending a large bid-per-click on that.

Using Negative Keywords

Go through your search term report, and anything you’re spending a lot of money on, that doesn’t bring you sales, is something you want to put in negative keywords fairly soon.

How soon? Well, if you are really serious about your products, you have signs of good success on your hands, and deep pockets, you might want to run a loss on that campaign for a rather long time in order to gather data.

If you have 50 clicks on a keyword and no sales, that pretty certain that it’s not working. You’ll want to make sure that’s a negative match keyword. However, to get 50 clicks, you likely spent a lot of money and you might want to have a cutoff at 5, 10, or 20 clicks.

The next thing you want to look at is the keywords that are making sales. These are probably going to be a small percentage of all the keywords you’re using. Over time, you’ll start gathering your long-tail keywords, but starting out, it’ll likely be around 10-15. That all depends on how much you’re willing to spend before you make sales.

Unless you want to be really harsh, after two to three weeks you’ll have your 10-15 keywords that are making you sales. You’ll want to look at those and reduce the bids on those which are costing you too high of advertising cost of sales.

Advertising Cost of Sales Metric

One caveat, don’t allow advertising costs of sales to be your main guiding point. When you launching products, you’ll be raising your prices over time. For example, if you’re spending $10 on advertising on a product you’re selling for $10. That’s 100% ACoS (Advertising Cost of Sales). Over time, you might raise the price to $15 which change that ACoS dramatically. So I wouldn’t recommend using that as a metric. It can be misleading until you land at a stable price.

What I would recommend looking at is the overall spend on advertising divided by the overall sales. A very simple, robust metric that you should monitor weekly at least. 

This isn’t something Amazon will give you because they want you to spend money on advertising.

It’s very simple to calculate. Get the same time period for both; you can get your advertising costs from the seller central “Advertising” tab, and you add up how much you spent. Then you go back to your business reports, and add up the sales you made in the same exact period period. Then just take your advertising costs and divide them by your sales.

The main thing is that it’s not about the advertising cost of sales, it about profit. If my profit margin on an item, before advertising, is $3, then I can spend $3 on advertising before it becomes a loss.

Another thing to consider, is that, if you have a decent selling product, you may be willing to run at 100% ACoS. That is, you’re running a loss on those sales from ads. You will still rank organically because of the ads, and you can make your money from organic sales.

I wouldn’t recommend it if you’re not being aggressive and really looking to grow your sales volume. I prefer to keep my ACoS where it is break-even. Let’s say I am selling a widget for $10, and my total cost before Amazon ads, including Amazon fees and fulfillment costs etc, is $7. That means, before ads, my profit margin is $3. I would not want to spend more than $3 per sale averaged over all my ads. That means that all sales gained via Amazon Ads are at breakeven or better, and that all organic sales represent profit. 

Additional Help

I know this is complicated and it’s not really meant to be an instruction guide for pay-per-click ads. If it’s the sort of thing you need help with and you want to get in touch with me, I do offer a one-off call with you through Clarity FM. It’s  $2/minute so it’s an expensive way of working with me. You’d be better off joining my mentorship program if you want ongoing help. Although I’m pretty strict about who I work with,  I do have room for one or two more people. If you’re interested, still apply, and don’t assume I won’t work with you. Just read the guidelines and FAQs first though.

 Another, inexpensive, way to work with me, as well of several others, is to become a part of the mastermind group. The London mastermind is in full swing and we’ve had meetups with about 6-10 people, which is perfect. We have dates set from January to June if you’re interested in working with me and up to 10 other people.

PPC Entourage

One last word on pay-per-click, I am trying out some software called PPC Entourage which they claim will help you manage your pay-per-click very quickly and easily. I haven’t had a chance to really dive into it but I will give it a test run and report back to you. If you want to try it, you can get a copy at http://ppcentourage.com/.

The London Mastermind

Need more personalised input on issues like this? Live in the UK in or near the South-East? You might want to consider joining us for monthly meetings where we can thrash out all the issues like this one for YOUR business. Check it out here.

130 When to Abandon an Amazon Marketplace

Welcome to part 2 of what I’m not going to do in 2017, my stop-doing list or my giving-up list, if you will.

The next thing on my list after giving up products that aren’t profitable or don’t sell, is to think about the marketplaces that you might stop selling in as well. Certain marketplaces will be better suited for certain products. For example, if you wanted to sell barbecue equipment in the UK right now, while it’s in the middle of January and it’s freezing cold, you won’t do well. You might get a few hardened people (like me!) that walk around in shirts while it is 5° C, but not many. Certain products aren’t going to work out in certain marketplaces at certain times.

Tune Your Listing to the Amazon Marketplace

It may be that you sell a product in one marketplace and it does really well, then you try to sell it in another and it does poorly. You have to make sure to do the right things. You have to dial in your pay-per-click and your keyword research needs to be specific to each marketplace. Don’t be lazy and transfer over what you already have because it can work quite differently. Especially if you’re a UK seller trying to sell in the US marketplace or vice-versa. Don’t assume the keywords are the same, they often aren’t.

Let’s say, even once you’ve done that, and done your pay-per-click properly, and did a proper launch, your product isn’t taking off. I wouldn’t say to kill it, but maybe pause that listing and let your inventory sell off. This isn’t a product you’d want to re-order.

Know When to Walk Away

Classic example, I had a generic product in the US marketplace, we’ll call it a blue  widget, sold great, but only at a certain price point which wasn’t profitable. If I raised the price, it would drop to page five and sales would disappear. Now a niched-down version of that product, call it a stainless steel blue widget , did much better. I sold 1200 units in six weeks at a 25-30% margin.

With those same products in the UK, it was a different story. The generic blue  widget version did a few sales a day at a profit. However, the niched-down version, the one that sold 1200 units in a few weeks in the USA, was very disappointing. It, maybe, sold one or two units a day, even though it was still on page one, albeit at the bottom. For me, that’s not worth the time and effort to keep doing that. I was then able to reallocate my money and focus into something else.

This isn’t so much giving up an Amazon marketplace as such, but rather, giving up a certain product in a certain marketplace. I encourage you to look at your numbers. Make decisions based on the data rather than what you wish was the situation. Just because you invested a lot of time, money, and effort into something, doesn’t mean you have to stick to it. You have to be willing to walk away if the data shows that it’s not working. It’s called a sunk cost and it’s an incredibly important discipline for all business people. 

Need more personalised input on issues like this? Live in the UK in or near the South-East? You might want to consider joining us for monthly meetings where we can thrash out all the issues like this one for YOUR business. Check it out here.

129 My New Year’s Resolutions No. 1

Happy New Year!

I am back after a much needed break. It was nice to get away and spend time with my family and reflect rather than constantly being in action.

I’m going to be doing a mini-series focused on the idea of New Year’s resolutions. I will be changing things up this year and I’m going to resolve to not do things rather than the usual resolutions to do something; I’m going to take away instead of adding.

The Wrong Way to do New Year’s Resolutions

Resolutions tend to revolve around exercising more, going running, learning to cook, starting a business. Just stop. Where are these resources coming from? Where are you going to get the time? The money? The mental focus? Where is this going to come from to accomplish these new things?

My philosophy is: you have to stop some habits first. There is still 24 hours in a day. Your bank account still holds the same amount of money. Your anxieties, your stress, your reservation don’t magically reset with the new year. Whilst it is important to have a plan, I think it’s more important to make the space for these new plans. You have to make time, money, and above all, mental focus. While, for many people, mental focus seems less important than time or money, it’s not. Trust me. I’ve been at this game for a couple years now and your mental focus is your most important asset. All the money in the world won’t make you successful if you don’t have the mental focus.

My To-Not-Do List

The first thing I want to stop doing, is trying to pursue too many business models at once. At the moment, I am solely focusing on private label, and I’m basically going to stay with that. I’m trying to do various different things in my life and it’s time to give them up. The most important thing I have given up, is the last of my piano students. I wasn’t enjoying it and it was adding quite a bit of stress. While it’s important to have off-Amazon income, it was taking too much of my focus.

What can you give up from your daily/weekly schedule that will clear up time and mental focus? It might only be a few hours a week, but those few hours can be spent on better pursuits. For me, it means more time helping you out with the podcast, helping my mentees, or focusing on the mastermind group.

Learn to Give-Up Products that Don’t Work

I am giving up products that are a disaster. While that may seems obvious, it’s easy to fall into the sunk cost fallacy

. Launching a new product takes a lot out of you. It’s takes time, energy, and money. Once you put so much into it, you become attached to it and it seems like everything is wasted if you walk away from it. So you keep sinking more and more into trying to force it to work rather than cutting your losses and walking away. You have to take into account what the market will bear. The market being your consumers and competitors and the law of supply and demand.

I tried to make one product work and it nearly put my entire business at risk. It was getting many negative feedbacks (NOT reviews!) which could have led to my account being suspended. That would have put other products at risk that were actually performing well.

I have probably spent several thousand dollars on that product over that course of a year and a half. I put time and effort into it, spent some money and time with a designer,  hired a photographer. None of that matters because the market has spoken!

Another product I eliminated sold quite well around Christmas 2015. However, when I ran the numbers it just about broken even. I realized that if it’s not going to make a profit at Christmas, then it’s not worth the effort I’m putting into it.

Consequently, this year I had a niched-down version of that product and it sold even better. I sold around 1095 units during the Christmas season, and I only have a few left. I turned my cash over in a about three months. From the time I put the first deposit down until now. It was about 25% margin which, while not exciting, is definitely worth renewing. None of that would have been possible if I tied all my money up in that other product that sold, but didn’t turn a profit.

Harden Your Heart towards Your Products

By giving something up now, you can re-purpose those resources into something more valuable. My suggestion is to be hard-hearted about your products. If they don’t sell, cause problems for your account, or don’t turn a profit when you run the numbers, cut them loose. If you haven’t ran the numbers to find out whether you have been profitable, January is a great time to do it.

The London Mastermind

Need more personalised input on issues like this? Live in the UK in or near the South-East? You might want to consider joining us for monthly meetings where we can thrash out all the issues like this one for YOUR business. Check it out here.

127 Why Email is Killing Your Amazon Business

Today, I want to talk to you about focus and your use of your time. Everyone in this business seems to go through this same things: overwhelm. I did a whole series on this that you can find here:

  1. #73 Overcoming Amazon Overwhelm – Part 1
  2. #74 Overcoming Amazon Overwhelm – Part 2 – Energy
  3. #75 Prioritising Tasks – Overcoming Amazon Overwhelm Part – 3

However, today I want to talk about the biggest time-suck in your life, which is email. Email is one of those things that seems like a productive use of your time, and if you worked in a corporate environment, or still do, you can relate to this. Email is one of the most common things in everybody’s life. For many people it’s the first thing you do in the morning.  You go through your email with your coffee when you wake up. If this is you, STOP.

Take Control of Your Agenda

If the first thing that you do in the morning is work on emails, whose agenda are you following for your time? Not yours. I’d say it’s being set by the people that have emailed you which could be anyone.

If you think that your boss or your clients won’t be understanding, then maybe, you can prioritise them and only them by filtering your inbox. Though, I’m not entirely convinced that you have to respond to them by 9 am. However, if you do, them schedule a time for that rather than react to the email coming in.

Chances are though, you could get away with answering emails twice a day. 11 am is usually early enough for most emails; then again at 4 pm. If this makes you uncomfortable and you’re worried you may miss something important, put it in your signature. Let them know that you don’t read emails often and offer an alternative way of contacting you if it can’t wait. Let them know that they can contact you on your mobile. Now, don’t put your mobile number in the email. The people that will need to contact you via mobile with have it. You don’t want to get a bunch of random calls throughout your day. That would defeat the purpose.

The purpose is to take control of your time. By limiting your time spent on email and limiting who has access to your attention, you are able to plan your day as you see fit rather than being bombarded by random conversations that make it impossible to focus.

Limit Social Media

Another thing that people do is check Facebook obsessively. Personally, despite have a lot of Facebook friends because of the podcast, I don’t get on Facebook much. Giving credit to Tim Ferriss of the 4-Hour-Workweek, we don’t increase productivity by adding things but rather by removing them.

What this Means for Your Amazon Business

The number one productivity killer is email. If you are letting it take over your life, stop right there. If you are looking for a specific email, say from a supplier, that will help move your business forward, then order your inbox by the “From” field rather than “Date”. That way you can look for a specific person rather than being saturated with all the emails you have received recently.

Another time-trap with email is when you are trying to compose a message to go out. Obviously, you have to go into an email system to do this and then get sucked into your inbox. What I have begun to do is draft the email outside of the system. I will go into notes or notepad and compose it there.

If you are going to be sending similar emails to different people then make sure you are using templates. This does two things. It creates a standardized process so your are simply doing copy, paste, send, rather than typing it up every time. It also keeps you off the email system. So you pull up the template, then dump it into the email system rather than spending too much time in your email.

Don’t Use You Inbox as a To-Do List

Some people use their inbox as a to-do. Their messages are a list of task to be done. If that’s you, don’t feel bad, we’ve all been there. Instead, make a separate list. During your scheduled email time, make a list of what needs to be done. Use the previous day’s emails to create your to-do list for today.

Take Control

Schedule time to check your email and never make it the first thing you do. Have your own set of priorities that you need to work on that will move your business forward.

I have one space left if you are looking for a mentor and are serious about building a business. Go to http://amazingfba.com/mentoring if you’re interested.

117 The 2nd way to increase Amazon Sales

This 2nd way of increasing sales is so neglected, you can get ahead simply by implementing anything in this area!

The simple idea is to increase the AOV=Average Order Value.

It can be more difficult to implement on Amazon than just getting new customers but is potentially much more profitable.

If someone usually buys a $10 widget at 50% margin, you get $5 profit per sale. If you usually sell say 10 orders of 1 $10 widget a day, your profit per month=$5X10X30=$1500

If you can increase the AOV by say just $1, you would end up with $11X50%X10X30 profit=$1650. $150 extra ie 10% extra.

Multiply such effects across several products and it can add to your bottom line quickly.

The simplest way to increase your AOV is simply to increase price! But you have to weigh up against conversion rate changes etc. to see whether that increases or decreases your price.

Another way is to bundle together products physically eg a 3-pack, 4-pack, 6-pack etc etc. Easy and very very easy to sell on Amazon.

Another way that is even easier is to offer a discount via a promotion code. Eg BOGOF (Buy One, Get One Free) or buy 3, get 10% etc etc.

If you set things up wrongly, you’ll make less profit, not more, so know your numbers going into this! Done right, this is a simple way to edge up your profit margin.

A harder way but possible on Amazon, is to do cross-sells eg “this is also bought with X” (spatula with slotted spoon for example). It’s possible to influence this again using promo codes – you can offer a 25% discount off a slotted spoon, for example, when you buy a silicone spatula etc.

Another way that is hard to do on Amazon but possible, is to upsell eg from a $5 spatula to a $25 frying pan. Same kinds of methods.

Increasingly, we are looking at strategies that will work best when you have control – in other words, you start to build your own email lists (and other assets like social media subscribers/followers etc.).

There is one more basic way to increase sales that is used least of all by Amazon sellers but could be the most powerful of all…read on…to the next episode…

To find out more about the Amazing FBA London Mastermind mentioned in the episode, click here

113 Know Where You’re Going with your Amazon Business

There is a triple metaphor here. Simple stuff but still true:

  1. Know where your business is heading. And where it is right now. If you don’t have goals, you won’t know where it’s heading. And if you don’t measure your position accurately (eg cash, cashflow, P & L etc), you won’t even know where you are now.

2. Know where you are going. How does your business fit into your life? How does it serve your goals?

3. When you are literally having  goods transported from one side of the globe to another, check  all the details twice. Where is it going from? Where to? Exactly? Have you got the commercial invoice, purchase order etc. all sorted?

Freight is one area where just doing it needs to be tempered with double checking all the details!

112 JFDI – the Everyday Secret to Being Productive

JFDI -it’s nothing fancy; it’s a London saying. But it works…

If in doubt – stop making excuses. If you know you need to do something, Just Do It! It’s like Nike said (but with less swearing).

Sounds simplistic but it’s the  mindset that gets stuff done: come what may, whatever it takes, whether you’re in the mood or not, inspired or feeling flat…do it anyway.