Did you know that you can start with no experience when you go into wholesale sourcing for Amazon? Learn more from today’s episode with Dan Meadors.
Eg: give up day job quickly; build a scalable business; build a sellable business.
The Amazon wholesale model can create a reliable, consistent business.
It’s a very cashflow based business.
They have tried to make something as simple as possible.
With any physical product business, you do need to have the capital to invest.
Private Label is probably more capital intensive.
For wholesale sourcing for Amazon, you should be able to start with $2000.
Ideal brand partners have a MOQ (minimum order quantity) between $250-750.
With those, $2000 gives you enough bandwidth to access discount tiers and have a few SKUs.
Dan has had a 17-year old start – now 19, selling millions.
Also, a couple in their 60s and 70s have also successfully adopted.
The model does scale easily because of pace to market.
From seeing something on the screen to selling it is often 7 days!
If you’re running at 30% ROI – that’s 30% month over month growth.
How to work without capital
If you don’t have the budget for capital, but you have the skills, you. You can be a consultant.
Dan came across a product with 40 sellers on it. Competing with others
That company wanted to turn the business into a sellable asset.
They wanted to have a clean Amazon presence – large reach.
Wanted to run advertising- margins were not enough.
The manufacturer asked if Dan would help set up an account and manage the account for them and just take a commission.
Yesterday signed a deal – working directly with manufacturers
Yes – they have a lot of students who do this.
They struggle with the confidence in making the pitch.
Of course, if you have the experience, you’ll do even better.
You have to be clear what you’re selling when you talk to the brand.
If you don’t have a lot of experience, you can’t sell that!
Base on logic rather than experience.
If it’s poor results, they can just stop!
Most decisions are based on understanding.
Dan doesn’t try to sell – he focuses on EDUCATION.
Eg adding 5 quality pictures – it sounds legit because it IS!
You can show competitor listing or something optimises.
They are buying into the RESULT not the EXPERIENCE
Dan says things like: “ I don’t promise I’m the solution. I’m more of a consultant.”
Eg: Dan has worked with 19 brands to create EBC – Enhanced Brand Content.
How does that work? Talk about things that work and invest them in the process.
We’re happy to make a connection with a contractor – they work to create it – and then it goes on Amazon.
Be good at figuring out what the problem is.
There is an outsourceable solution for anything.
The community of the wholesale formula provides this stuff.
Dan and Eric have one major virtue – charging into stuff!
Eg property – they decided 6-8 months ago to invest in properties.
First one was a storage unit – traditional analysis eg cap rates looked amazing.
It was way more tedious to do that
Bought 4-5 houses that were wildly profitable -but only based on the learning from experience.
Work on the basis of deficiency
If there is a listing with garbage images and title etc. but it is still selling, that is a great opportunity,.
For Dan and Eric, it started with them.
Develop processes before you get a person on board.
The first hire meant that they were stuck trying to get value out of an employee.
It’s better to start with processes first and then hire a person to run them.
Dan encourages manufacturers to think about RESULTS.
Similar to employees – just want smart and hungry people.
When you plug a smart person into a process they will make the process better.
Now, whenever Dan trusts an employee that almost gives them ownership.
Dan will guide it but not do it.
Scouting, sourcing, selling
Operate with typically 3 criteria – to see if it could be a lead. .
Anybody who has never sold on Amazon can start tonight.
Looking for a product with these criteria:
If hits criteria, look on Google “can see Eye Drops”
Look at their website.
Find contact details.
The goal is to educate them in the processes.
Over time, you’ll end up working with the right partners.
Where you’ll grow seamlessly.
Bad business relationships result from goals that aren’t aligned.
One account represents a profit for Dan and Eric for $250K
You don’t need a ton of accounts to get a great business.
Dan would ideally work with 3-4 brands.
At the moment they work with 45 brands now.
This includes optimisation and re-engineering.
That can be flexible.
They are an “authorised retailer” but effectively a channel partner.
Often just purchase a product from them and sell it at a profit.
Sometimes one of 2-3 people authorised to do that.
Do offer a pure Agency type deal sometimes.
Normally the. Company is looking for a very specific result.
Eg looking for immediate and massive growth in order to prepare for a sale
Set up special page for Amazing FBA audience.
Dan wants people to understand the model and see if it might be for them.
If it IS for you, it is one of the most scalable models download their guide.
Jump in! There has never been a bigger opportunity with more viability.
Amazon’s FBA system has empowered normal people to build massive businesses.
Look at what models exist and start experimenting.
You’re already doing this business model mostly.
Just find products in your searches that could enable you to sell within 7 days.
Avoid the trap of thinking of your products as your brand!
The brand is the value of the service.
Someone who came into their business 2 months ago.
He started out as a student of the course.
He had never sold on amazon
Started with course in 2016.
Built wholesale line $160K/year
Used strategy in course
Learned over time
He didn’t own the IP but he owned the relationships
In 14 months up to $1.1M revenue
Sold relationship to the brand – set of processes 2.5X of profit (seller discretionary earnings)
Ie around $460K
Listing to closing was a few weeks!
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