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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

Amazon masterminds: Why You need one (episode 204)

Amazon masterminds

Why Amazon Masterminds?

Want to double your revenue? Find the latest tactics and stay ahead of the curve?

These sound like a pitch for the latest high-tech software, right?

Well you’d be wrong. I’m talking about good old-fashioned face-to-face, interactive Amazon masterminds here.

Through Amazon masterminds, I’ve personally found an amazing Amazon business partner, learnt many tactics that have made me $1000s extra, and been offered deals worth $100K+ a month of revenue.

But let me you how I got here…

My background with Amazon masterminds

First, I should give some background and confess. I’ve been a member of a private Amazon mastermind of my peers (Amazon sellers) for about 18 months now.

I also set up and ran (free) peer-group Amazon mastermind meetings myself about 2 ½  years ago, which ran for a while. That sputtered out because the people weren’t really committed. And I was wanting to focus on selling on Amazon, not running a mastermind for uncommitted people.

I took the learnings from both Amazon masterminds and created something better.

 So I’ve been running a successful (modestly) paid Amazon mastermind meetings for about a year via Amazing FBA (I recently set up a new  Amazon mastermind for new sellers, i.e., those who haven’t launched yet)

The reality of Amazon masterminds

First thing: yes, of course I’m going to mention my own masterminds, at least in passing . I run two Amazon masterminds each month. I’m writing an article about how important masterminds/masterminds are. It’s bound to come up! But I’m here to share my experiences of masterminds, not to pitch my own (if you do want to read the pitch for my masterminds/masterminds, of course, click here!)

Second thing: there’s a reason why I run an Amazon  mastermind each month. Because I believe it’s one of the most powerful ways I can truly help Amazon entrepreneurs.

Third thing: from everything I can observe of truly successful Amazon entrepreneurs – it’s (still) true that every one of them is a member of some kind of Amazon mastermind or mastermind!

I guess as a person who needs interaction and inspiration, I’m biased. But…

Coincidence? I don’t think so. 

My own wins from Amazon masterminds

I personally have got so many results directly from being in masterminds. I’ve found an amazing Amazon  business partner; sold thousands from secret techniques shared within the closed walls of a mastermind; and been invited into strategic partnerships to do deals involving $100s of thousands in revenue.

These results are not chance. But they equally would never have come about simply from networking on the superficial level(valuable as that is) at Amazon conferences.

Amazon Masterminds meeting

“What do you mean by ‘Amazon masterminds’?”

First, let’s start of by defining our terms.

‘Amazon’ as a business opportunity can be exploited by a huge variety of business models.  There could be around 14 business models, according to some authorities. That sounds about right. Certainly common ones include Retail Arbitrage; Online Arbitrage; Drop-Shipping; Wholesaling.

When I say “Amazon”, my particular focus here (and that of the podcast/blog and coaching programmes) is selling Private Label products via Amazon FBA.

Secondly, what are we talking about with a ‘mastermind’?

When so-called “Amazon masterminds” are not really a masterminds

I think it’s almost easier to say what masterminds are not. They are NOT, as far as I’m concerned, a mass meeting of 100 people where someone from the front discusses or teaches a lesson.

Don’t get me wrong. Big meetings can be very valuable -and by the way, Andy Geldman of Webretailer runs an excellent London Amazon meet up most months, where they have really helpful speakers. I’ve spoken there recently and was very impressed with the setup. It’s a great place to learn new strategies and tactics, and to network. But to my mind, it’s not a mastermind (and nor does Andy claim it is, just to be clear!)

Andy charges about a fiver to enter his meetings and, while I think that is super-cheap (and he could arguably charge up to £50 or so), he’s not charging hundreds, which I think is appropriate.

I think there are various aspects of Amazon masterminds that make them unique.

Firstly, to be really powerful, they need to be very interactive. So all participants have to think hard and engage their brains in a very active way. It develops their business thinking on a deeper level.

Secondly, they need to be focussed. Generalised excitement has its place, but I would argue that place is at a larger conference-type meeting.

Thirdly, they need to move the participants on in their business. How many times have you been to a large group meeting which inspired you to feel excited about business… and when you got home you did…er…absolutely nothing except talk about how exciting it was (it’s embarrassing but we may as well  be honest with each other – I did that for decades).

I don’t believe that really serves anyone long-term. I think the success of a Amazon masterminds is measured in how much action their participants produce and therefore how much progress they make towards their goals.

Which brings me to another question I’ve been asked a few times recently:

“What extra value does this offer compared to online research? Why bother being in Amazon masterminds?”

I love this question because it so clearly illustrates a number of things. This is a really important question.   

My simple answers: Time; Certainty; Motivation; Action; Progress

Amazon masterminds save time

Amazon masterminds value your TIME

Of course, since the invention of Google (and in more recent years, Facebook groups), in theory you can piece together all the knowledge you need to do anything.
The problem is- reinventing the wheel takes a lot of time.


Let’s say you are researching Product Research methods. Let’s say you manage to gather all the information you would get in a 30-minute hot seat at one Amazon  mastermind meeting by taking a week of Google research.

Great. So you saved yourself £49 (or £97 or whatever the mastermind costs). Let’s say you multiply that over 4 different areas of business.
You just spent 4 weeks doing something that could have taken you 4 days (in fact, more like 20 hours – including travel time!).


If your future Amazon business is going to generate say $10,000 a month in profit in a few months, you’ve just incurred an opportunity cost of $10,000.
For the sake of saving £49 (or £97 etc.) 

“Penny wise, pound foolish” is I believe what they used to call that!

If you don’t value your time, you won’t make serious money. Period. 

Amazon masterminds give you certainty

Amazon masterminds give CERTAINTY

Here’s a simple one: how do you know, out of thousands of Facebook posts, which ones are from a solid source, and which aren’t? The answer is that it’s hard to know! And doing much research on that would take even more hours. 


In an Amazon mastermind, you know who you are dealing with; because of non-disclosure and non-compete clauses, you can find out super quickly who to really follow. 

Assuming you’re smart enough to make sure there are NDAs and NCA’s of course (I really, really  would check this. There’s obviously a lot to be gained for an unscrupulous member to exploit others’ product ideas. Make sure there’s quality control about who the members are, and make sure that someone is responsible for policing this stuff).

More importantly, you can judge over time who is being successful and actually implementing stuff, and who is just spouting theory they “read somewhere” or from some guru. There is some value in the latter; but the former is WAY more valuable. The ability to really be able to differentiate between the two is really one of the high values you get from small groups where you can really get to know each other properly.

Amazon group

Masterminds give MOTIVATION

Be honest – how long have you been  “researching” the Amazon private label opportunity? After a couple of months without even buying a small amount of inventory, I’m afraid that “research” is cover for “fear/being lost”. That’s okay, honesty is useful – but why stay lost?

If you’ve been selling but way below what you know you’ve targetted, again, that’s just called being human. But if you do nothing new about it, nothing changes.

Being with human beings is hardwired into us. We’re group animals.  It should therefore be no surprise that your peer group (who you hang out with most of the time and compare yourself to) has a massive impact on everything about you. Your attitude. Your health. And, of course, your wealth.

Getting yourself a peer group and stay actually excited instead of being isolated behind your laptop is simply following fundamental principles of human (indeed, primate) social psychology. We violate those principles at our risk. Why fight nature? It’s so much more powerful to go with our instincts than to delude ourselves that we can ignore them…and frankly, to stagnate.

Build Amazon businessBuild Amazon business

Amazon masterminds promote action

Masterminds create ACTION

This is the kicker. If you’ve been “researching” for over 3 months without buying something, that isn’t going to change unless you change something.

I’ve lost count of the conversations I’ve had with people who are painfully obviously using the word “research” as a fig-leaf for “Fear”. There. I’ve said the four-letter word.

Fear is FINE. It’s nature’s way of flagging up risk. Awareness of risk –  contrary to the happy-clappy, “everything is gold” school of Amazon thinking (which is just BS, apologies for being blunt) is actually GOOD for business. What’s not good is going in circles, or not assessing the risk objectively.

If you don’t have proven strategies (and the latest Amazon hack is NOT a strategy, it’s a tactic. And that’s fine. But knowing the difference is everything).

You need people to inspire you by showing you what’s possible, and hold you accountable. If you’ve not done it till now, why will that change?

Some people seem able to work in isolation and still succeed with Amazon. I can think of about two people who were really doing that on a big scale. Guess what? They are now collaborating with other Amazon sellers to get to the next level.

Amazing FBA Amazon Masterminds

The “Amazing FBA” Amazon Masterminds

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 focus members; and needs to lead its members to action, which leads to their progress.

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

-if you know the value of being in one of the Amazon masterminds

-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 Amazon 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.

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

153 Selling on Amazon.com with David Aggiss Part 1 of 2

Today on the show, I have one of the first contacts I made when starting this show, David Aggiss. I had him on, all the way back in November of 2015. Since then, he has given up the day job and is his own full-time boss. He has a few business, one of which being an Amazon business. We’re going to dive in and find out David’s strategy for selling on Amazon.com.

Getting Started selling on Amazon.com

David started learning about Amazon in April/May of 2015 and began receiving some training. In about four months, he started selling his own product. He took off quite well in Q4. At the time, incentivised reviews were still allowed so he made that a large part of his strategy. His sales exceeded his expectations going from 10 units a day to 30 on average. He launched his second product in Q4 last year and focused on his listing since incentivised reviews were no longer available.

Finding a product

There are a lot of techniques for finding products. David decided to simply look through Amazon. This is a great technique for finding good products. Look for lower prices and low competition items when first starting out. If you find a good product and the listing isn’t optimised, then there is definitely an opportunity for you to sweep in and take over. You can use Google Trends, Merchant Words to help you find what popular and what people are looking for.

David didn’t use any tools to find products, like Jungle Scout etc. He didn’t know what his products would be so he wouldn’t know what to search. Once he picked the products, he verified through Jungle Scout that there was a demand. Now he has about 5 products he’s working through launching.

He search Amazon to find his products. He narrowed his search to products between $15 and $50 and looked for products that interested him. If you are interested in the product then it’s easier to relate and figure out what those buyers are looking for. Then you can tailor your listing to those shoppers.

Selling on Amazon.com Post-Incentivised Reviews

Getting reviews has become much more difficult since Amazon banned incentivised reviews. With this new world, you have to pay more attention to reviews since you can no longer give products away in exchange for a review. One thing to pay attention to when getting started with a new product is the number a reviews your competition has. If they have thousands of reviews, it’s going to be much harder to compete because it is more difficult to reach a competitive level.

Make sure you competitors only have a hundred or so reviews so you can better compete. Then you can use other services to help get legitimate reviews. You can also try to get traffic coming in from off Amazon.Ads on Facebook, Google, and Bing are great places to start.

There are also ways you can use Amazon to boost your listing. Spending heavy on PPC at the beginning is a good way to drive traffic when selling on Amazon.com. Once your listing gets going, then you can cut back to where it’s profitable. One thing David mentioned was participating in Lightning Deals. These deals on put on by Amazon that offers their shoppers very good discounts for a very limited amount of time. There is a link underneath your Advertising tab on the main screen of Seller Central. It’s not all the time, but Amazon will offer you a Lightning Deal when it’s relevant. This is a great way to drive a lot of sellers to you listing and gives a nice boost to new products.

Amazon sets the parameters. They will tell you the time slot, the minimum number of units, and the sale price which is based on your sales history. David, for example, recently got a time slot for 1am to 7am. Not the best time as many people aren’t looking at Amazon so early in the morning. Despite that, he had an additional 40 sales from the deal.

146 FBA Inventory Management with Jeremy Biron of Forecastly Part 3 of 3

Maintaining Ongoing FBA Inventory

There are many things that you have to take into consideration. You have to think of your lead time and everything that goes into it. Also consider receiving time at Amazon. It might take awhile for them to check it in. When planning a strategy for your FBA inventory, you should plan for the worst case scenario. There could be issues with it getting backed up at port or issues with your supplier.

Using Software to help FBA Inventory Management

A great thing about using software for forecasting, is that they can keep track of that, whether it’s Jeremy’s Forecastly or another piece of software. It tracks inbound inventory, current inventory, what you have in manufacturing, and true sales velocity.

You also need to consider spikes in sales. You may have consistent sales every day, but a couple times a month your sales spike. This is why you need to build in a safety stock. That gives you a cushion so that if you get a surge in sales, you have enough stock to cover it until your next shipment gets there.

Forecastly

Forecastly has many business that use its service. The software can then use this anonymous data to make predictions about Amazon as a whole. It takes ASIN level data over the past 30, 60, and 90 days to makes prediction about future sales numbers.

Their main focus is demand forecasting. It considers your recent sales including stock out periods. If you were out of stock, it can determine what you would have sold had the product been available. It also tracks the variability of demand which is something you can’t do in a spreadsheet.

The main thing you have to be conscious of when managing your FBA inventory is, what do you need to replenish, when do you need to replenish it, and how many units do you need to replenish. Forecastly tracks all that while monitoring your inventory and will recommend your orders.

Many sellers want to use a 60 day trend to determine their sales velocity which is a bad idea. If you selling in an upward trend, meaning your sales are growing, then your sales were much lower 60 days ago. This will make your average too low. Forecastly uses a 30 day trend to get the most up to date projections.

False Rule of Thumb

We, here at Amazing FBA, love a rule of thumb. Unfortunately, when it comes to FBA inventory, many sellers follow a rule of thumb that won’t help them, and could hurt them. It’s the idea that you need to have X amount of days worth of inventory. Whenever they place their order, they bring it back to this magic number.

For example, if you wanted to maintain 90 days of inventory and you order monthly with a 30 lead time. When it’s time to make an order, you have 60 days of inventory. Based on this, you would order 30 days of inventory.

You don’t need that much inventory. You wouldn’t need to order for another month because you have a 30 day lead time and you’re tying up cash in stock you don’t need. The rationale behind this method is security. The attempt to avoid stock outs by keeping a large amount of stock on hand.

Future of Amazon according to Jeremy Biron

Amazon will continue growing their own private label brands. So Amazon is now your competitor. International markets are growing. The European markets are booming. If you’re having success in the US, you’ll want to take those products to the UK and the rest of Europe. That isn’t as easy as it sounds. You have to come up with a separate replenishment strategy as well as deal with the tax regulations. There is an opportunity, though. Especially in Germany where 40% of the sellers are non-German, and very few are American. That means they are willing to buy from foreigners, but not many Americans are there yet.

As Amazon grows, the more warehouse space they will need. They are investing in new space, but they don’t want to overdo it. You will likely see seller-fulfilled-prime see some growth as a solution to this problem though will come with its own issues.

The inbound process is likely to change. It used to be that you would just slap on a UPS label. Then you had to also do the Amazon label. Now you have to do box contents. It’s going to get more and more complicated as Amazon continues handling more inventory.

If you want to receive a free tool for launching new products, head on over to Forecastly.

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125 How KLT Can Win You Customers Again and Again…

Today I am bringing you another episode on marketing fundamentals: KLT. Know, Like, Trust. Once again, this isn’t a mindset for you, but that of your consumer which is really important to understand. Stepping back, the most important thing to understand is what marketing means. Marketing isn’t about creating a widget and figuring out how to sell a lot of it. It may look like that, but marketing is really understanding markets. Simply put, supply and demand.

Understanding Markets

If you start by understanding the markets, and find what people are looking for, then create a product that fulfills that need, that it truly smart marketing. To take a pre-existing product, and then try to sell it is much more primitive and difficult to do.

Last episode, we talked about message to market match. If you are the only person selling red dog bowls, even though a lot of people are selling dog bowls, you win. The caveat to that is credibility. I gave the example of trying to sell the world’s best dog food to cat owners and how you won’t find success with that.

Now, imagine you have that same dog food in a room full of dog owners, except that you are trying to give this amazing dog food away for free. That puts the questions in people’s minds. Why in the world would someone be willing to give away this great product for free? How can this dog food do everything it claims?

KLT: Know, Like, Trust

There is a simple marketing principle of KLT. Know. Like. Trust. These are the elements we need to have in place before people will buy from you. Amazon puts a spin on this that you should be aware of.

Know

If people have never heard of you then it’s going to be harder to get people to buy from you. This is difficult to do when you only have a listing to do this with. If you are the only person selling a red dog bowl, it’s less important. However, you won’t likely remain the only one. If there is any sort of competition, you will need to work on your brand marketing off Amazon. You will need to have a website. You need a social media presence and you will want to get YouTube videos up.

Like

The next step is getting people to like your product. It is possible to accomplish this entirely on Amazon. You must have great looking pictures and amazing packaging. No longer can you get away with putting dreadful products on Amazon and sell it. You really must make sure that you have a good quality product.

Trust

The last element is trust. If you’re going to sell dog food, and make some big claim that it’s going to make your dog live five years longer, then you need to back that up. Be careful on how to try to backup these claims. Amazon supplement sellers were leveraging the trust people had in Dr. Oz after he claimed vitamin c serum was the next big miracle drug. Soon these sellers started getting cease and desist letters from his lawyers. If you’re going to reference an expert, be sure you have their permission to do so. A long-term strategy might involve referencing celebrities and big names in your industry and paying them for permission to use them.

Using this Principle on Amazon

Let’s bring it back to the simplest stick: how to I make my listing more likely to convert? KLT. The know part is a long-term strategy. If you are around for a long time, keep showing up in Amazon results, dominate a niche, then you gradually become known to people and they start searching for your brand name. That is when you know that you’re starting to build a brand. When you’re sticking in people’s minds to the point they search you out specifically.

To get people to like you, you have to have a remarkable product. Since you, likely, aren’t well-known, your images and packaging have to look simply stunning.

Trust is much harder to build, but you are leveraging Amazon’s trust. Which isn’t the same as your consumers trusting you or your brand. If it’s on Amazon, and it has good reviews, you are leveraging the trust generated by other consumers in their reviews, and the general trust people have in the Amazon platform.

This principle of marketing is harder to implement on Amazon, but it is vital to understand it you are wanting to build a business and if you are planning to sell that business. The more of a brand value it has, the more differentiation it has from any rivals, the greater multiples you can get when you go to sell. That could be the difference between selling your business for 2x your profits versus 3x. This is when you get the payoff for all the hard work you put in now.

Long-Term Strategy

I want to emphasize that this is not an instant win situation. You will get quick wins with higher conversion, the real payout shows itself long-term with a strong independent business. There are plenty of tricks you can use to circumvent the system, but Amazon is quick to fix that and then you are left with nothing. What I am teaching you today is a tried and true marketing principle that has stood the test of time.

If you are serious about moving your business forward, there are still spaces left for the December meeting of the Amazing FBA mastermind in London. In January I will be expanding to include a high-level mastermind for those that are serious about creating a strong business.

122 Big Business Vision- St Paul’s Cathedral, London

Have you got a vision for you business?

I have to confess. I have spent way too long, jumping from product to product, trying to make a buck, which is fine. However, after a couple of years, I stop and think, “What’s it all about?” This is a very important question you must ask yourself, and it’s something that will change over time.

When I first started, my vision was to make a lot of money quickly and put it back into my life, into other projects that were important to me. While that is still a part of my vision, it has grown. Now my big picture is to build a business that I can sell for a decent amount of money, and be proud to own because it is producing really beautiful products; rather than before when I would grab any product that looked like it might sell.

If you take the St. Paul’s Cathedral, the full vision of the architect was never realized. As beautiful and amazing as it is, there plans were much bigger.

The first thing is, you have to start with a plan

You may not be working with stone and mortar, but it is still very similar. The financial aspects are similar. You have to work within a budget. Maybe you have more than you expected, maybe less.

In your business, you have to worry about competition

There are many other people that are selling the same or similar products to the same customers. You need to plan ahead to combat that.

  • Your plan needs to be fluid

You need to make your plan with the understanding that it will change. Amazon is always changing things, moving the goalposts. You need to have a plan that can adjust to change with it.

  • Be Realistic

You can’t go in with £5000 and expect to turn in into £500,000 by the end of the year. Big visions are great, but you need to make realistic goals. You can’t invest peanuts and expect to turn it into a mint overnight.

While this has always been the location of the St. Paul’s Cathedral, the original burned down, along with a lot of the city, in The Great Fire in 1666. You need to be able to handle setbacks and recover. Sometimes we make a bad product, sometimes we get close to bankruptcy, sometimes we have business partnerships that go bad.

Out of that makes room for something bigger. A lesson to learn from the cathedral is the chance for renewal. When thing go wrong, that can open the door to create something much bigger, much better, and a much stronger vision. You can take lessons from before. Figure out what worked, and recreate those things, and figure out your mistakes and avoid them.

It’s good to make sure you have the right mindset but, I believe, success follows hard work. So e sure to go back, if you haven’t listened already, to episodes 115 to 120, for an overview of how to increase your profits by increasing sales, and reducing costs.

Think big. Act Big. If you are in London or come down to London, consider being a part of the AmazingFBA Mastermind group. My goal is to have two levels, one for those getting started and another for those that are much further along. All that is coming up so stay on the lookout.

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119 Are these Hidden Amazon Costs Killing your Profit?

This is the 4th of 5 episodes in the mini series with One aim: Increase Your Profit!

Today we address the less sexy side of increasing profits: decreasing costs! All of us are to some degree aware of costs when ordering inventory because a sudden spend of several $1000 in one go generally gets your attention!

But there is a hidden profit killer that I’ve fallen victim to too many times: OVERHEADS!

Your overheads creep up over time, it seems, like weeds! Add the latest software product once a month, use a VA for research, add a bank account… and it can add up over the months to several hundred pounds a month. If you are running a huge business, that’s fine – but is it in proportion?

Here’s what works for me: every 3-6 months latest (don’t leave it for over a year like I used to!), I download a CSV of a bank statement. I go through all my expenses and ruthlessly cull half or even 2/3 – anything the business doesn’t really need yet and isn’t necessary for expanding in the next 3-4 months.

For research, having played with many tools, I now use just two paid ones for the majority of work: Jungle Scout* Chrome Extension and Keyword Inspector. (*affiliate link)

Two free tools to track sales and price history: Keepa and Camelcamelcamel.

Other overheads:

Check the best deal for a business address, phone numbers.

Do you really need complex accounting software? I’ve used Xero and A2Xaccounting for 2 years. I still can’t make my bank accounts reconcile with the system – the result is that the Xero accounts are wildly out with reality.

I’m giving up and saving myself £50 a month.

For sales and profits tracking, I find cashcowpro really really helpful at just $29 a month or so.

Bootstrap to start with, get the cash coming in and THEN spend a proportionate amount of money on overheads. You should in any case do things manually to start with so you understand your business numbers and processes.

Face it, we mostly check our sales stats more than once a day! It’s so easy to overlook overheads but the danger is that all your hard-won gross profits get swallowed in your overhead. I’m embarrassed to admit how long I let that happen. Don’t copy my mistake!

 

118 the 3rd way to increase your eCommerce/ Amazon Sales

There are only two ways to increase your Profits in any Business:

  1. Increase your income
  2. Decrease your Costs!

in this 3rd of five parts in this mini-series, we talk about the 3rd way to increase your income. It’s called increase AOF – and it’s the most ignored!

AOF=Average Order Frequency. Simply put, we are trying to get our customers to come back and buy from us more often!

This is not just a marketing idea – it affects all your business decisions. For example, if you go into a category like supplements, or say sell shampoo, it’s obvious that it’s a product that gets used up (renewable), and thus that at least potentially, your customers might come back.  If you go into something that you put in your body or on your body, you need to source from USA, UK or Europe.

So your initial choices make a real difference. If you really want people coming back, you need to build a strong brand and also offer some clear difference or value. Otherwise, in reality, customers buy from Amazon rather than your business and thus probably really shop on price.

The more you want to do this, you need to start building your own lists (especially email lists). Remember the old internet marketing saying: “The money is in the list”. Email is still worth more than any other asset eg compared to Twitter, Facebook, Youtube followers (although these do have value- this Podcast is an example!)

In order to build your email lists, you need to be very careful around Amazon’s TOS. There are other methods (like, for example, Facebook marketing to launch your product – and build your email lists at the same time).

 

 

#91 Why Amazon means I’m not going “Back to School” this Year

This is the traditional time of year for “Back to School”  – not just for pupils, or parents of pupils, but also for those of us who have to work in them…until now!

Amazon and the online world have enabled me to quit all of my “day job” work that I wanted to leave. It works! However, I want to say that it has taken me about 2 1/2  years to get to that point – so the pitch of getting free of the day job within 3-6 months is unlikely. Possible – but unlikely. You’ll have to work, take calculated risks and have a decent amount of capital. With those behind you, you’ll need good training and a community of fellow sellers.  Combined, these give you a real chance of succeeding in your goal.

This episode is one of the **Summer Series** of bite-sized chunks of Amazon Strategic Goodness!

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