Chances are, you probably sell on Amazon because you recognize the huge potential ROI there.
But have you ever stopped to think about your next step after your FBA business? Many FBA owners have never considered selling their business—or even know the option is on the table!
We wanted to share why selling your FBA business could help you build an even better business and be the best thing for your entrepreneurial journey. Let’s explore the reasons FBA owners sell their businesses.
The Truth about Selling Your FBA Business
Selling an FBA business boils down mainly to personal or business-related reasons.
In terms of personal reasons, we’ve seen sellers exit because of an event or goal that meant they no longer had time to manage the business. Some of these reasons include a death in the family or wanting to spend more time with their kids.
Business-related reasons tend to revolve around raising capital for another project or losing motivation to stay with the business.
Whatever their reason for selling, some FBA sellers have received two to four years of net profit in cash in one payment. That’s the biggest windfall many entrepreneurs have ever received in one go.
But don’t start counting your chickens before they hatch: first, let’s dive into understanding how FBA businesses are valued.
FBA Business Valuation
Online business brokers and individuals working in mergers and acquisitions (M&A) usually value businesses by a multiple of earnings before interest, tax, depreciation, and amortization (EBITDA). EBITDA represents a business’s annual profit, and it is multiplied in the range of two and four times.
The valuation formula we use is:
Valuation = 12-Month Average Monthly Net Profit x Multiple
There’s not much difference between the two formulas. We stick to the average monthly net profit because it gives a more granular view of an FBA business’s performance than an annual profit figure.
While average monthly net profit is easy to calculate, determining the multiple is a bit more complicated as it takes into account the business’s age, traffic sources, branding, product line, and pricing window.
Age of FBA Business
A profitable older brand tends to be valued more highly than a younger one because it has survivability.
Unexpected market demands and changes place stress on FBA businesses, which can seriously affect cash flow and average order values.
A business’s ability to scale and grow through these challenges shows buyers that it’s resilient. While you can’t directly influence your business’s age, the takeaway here is that age works in a seller’s FBA business’s valuation, which is why a long-term Amazon selling strategy pays off more than a short-term plan.
Diversity of Traffic Sources
One of the greatest advantages of selling on Amazon is being able to leverage their brand, which customers love and trust.
However, selling on a single marketplace can lower a business’s multiple because if that source of traffic is shut down, there’s a higher risk that the business will be negatively impacted.
Amazon is well known for delisting products and shutting down stores for minor infractions. While you can prepare to ensure you fulfill Amazon’s requirements, increasing the number of traffic sources through multichannel selling is a good way to minimize your business’s risk and increase its multiple.
Branding has a smaller influence on the multiple than the other factors listed here since it’s hard to quantify how strong a brand is .
That said, the number of customer ratings and reviews, as well as how high the ratings are, play a part in determining the multiple. If people mention the FBA brand on social media, the context is also taken into consideration. Are customers raving about a store’s products and recommending them to their friends? Or are their experiences mixed, with varied reactions toward the customer service or the product’s functionality?
A strong brand is an attractive asset to a buyer, but it has less weight than the other factors that affect a multiple.
There isn’t a perfect number of products that will help you gain the highest possible valuation. A couple of key things to keep in mind are the amount of work it takes to manage your product range and the diversity of the revenue generated by the products.
Let’s compare two FBA businesses in the home niche, both selling kitchen products. Business A has only one product, while business B has 50, and both generate $100,000 in revenue from sales each month.
Business A’s single product has the same risk as a single traffic source: if the product is delisted, the business’s cash flow is completely cut off.
While it might look like business B won’t suffer from this issue, there are a couple of issues with its product range. For instance, if a single product generates over 50% of the business’s revenue, this is also cause for concern from a revenue-by-product basis. Managing all those listings could also consume most of your productive hours, time that could be spent growing the business in other ways.
We’ve seen the ideal range of products to diversify sales and be manageable without being overwhelming is between three and eight products.
Of course, there are exceptions to the rule. Some buyers with large capital reserves won’t mind paying for a single-product FBA business because the potential ROI of a future flip may outweigh the risk. These types of buyers will probably make strategic acquisitions and have a team of optimization ninjas to increase the value of their assets.
Buyers who can afford to buy only a few FBA businesses will be much more cautious about a business with a product range that’s too large or small. They are likely to be solopreneurs who manage operations on their own, so the stakes would be much higher if the business didn’t work out as hoped.
Another thing to keep in mind is for how long you’ll calculate the average monthly net profit.
12 months is the golden standard because it provides a good view of the business’s traffic and revenue earnings and takes fluctuations in buyer demand, aka seasonality, into account.
If you started your FBA business less than 12 months ago, we’d recommend waiting before considering a sale. While you could shorten the pricing window to three or six months to reflect the profits, buyers will look at the business holistically and see that only a short window of data is available to help them decide whether to buy your business.
Again, there are exceptions to this rule. Some buyers with more capital means or a higher risk tolerance might make an offer for newer FBA brands.
Shorter pricing windows narrow the buyer pool, making it harder to find the right buyer who’ll offer you a reasonable deal. You might receive only a single offer and find yourself settling for a much lower offer than you wanted to ensure you close the deal.
Who Would Buy Your Site?
Now that you have a basic understanding of FBA businesses are valued, you might be wondering who would be interested in buying one.
There’s a wide range of buyers with different levels of available capital and time, but all buyers recognize the power of selling on Amazon, and they want a piece of the ecommerce pie.
FBA businesses offer a lower barrier to entry for ecommerce entrepreneurship than full-blown ecommerce, which requires owners to manage many different moving parts. Instead of building a business from scratch, a buyer can acquire an existing FBA brand that’s generating steady profit.
To increase your chances of receiving a great offer and landing a successful deal, let’s discuss how to widen the buyer pool.
5 Ways to Optimize Your FBA Business
Buyers are much more likely to put down an offer after doing their due diligence if they think a business is a deal they just can’t pass up. So how can you make your business an asset that buyers will compete for?
By making it as hands-off as possible.
This is not to say that a less optimized business will attract zero buyers, but an FBA business that requires minimal work from the owner to maintain will be more attractive.
1. Use a Third-Party Logistics (3PL) Service Provider
Many sellers ship their inventory directly to FBA fulfillment centers, so storage and fulfillment are managed in one place. While it might be easier to allow a manufacturer to ship their products to FBA warehouses, it could be costlier than using a 3PL service provider.
Spend some time shopping for reputable 3PL solutions to see if there’s a more cost-effective route.
Another thing to consider is if you should use a 3PL as an additional storage facility. If stock doesn’t sell within six months, Amazon will charge long-term storage fees.
Depending on your products’ average turnover time, it might be better to hold stock in a warehouse and send batches of inventory to FBA centers according to your inventory forecasting.
While additional expenses sound like they should bring down your business’s valuation, removing essential services will in turn add extra burden and responsibility for the owner to manage and make the business a less attractive option.
A common mistake we see FBA sellers make is to cancel their 3PL solutions services, which brings down overall costs but adds 10–20 hours of work each week. The initial valuation price may increase but at the expense of making your business more hands-on.
2. Nurture Great Supplier Relationships
If you have exclusivity with your suppliers, ensuring that agreement will be carried over to the next owner makes purchasing your FBA business a more attractive prospect.
Establishing a strong relationship with suppliers saves the buyer the time and energy required to find reliable manufacturers, giving them one less thing to worry about, so they can focus on expanding the business in other ways.
Diversifying the number of suppliers the business owner can call on also works in a seller’s favor. The ability to order from multiple suppliers helps avoid dreaded out-of-stock situations for your top-selling products, especially during peak seasons.
We’re not advocating for drop surfing, where you’re encouraging suppliers to compete for your business by undercutting each other to offer the lowest price. Developing good relationships with more than one supplier opens up other manufacturing channels in case your usual supplier has production issues.
3. Optimize Product Listings
Creating a great product is only half the battle. Getting it in front of the right eyes is the other half.
Increase the chances that your products will appear to your target audience by optimizing the listings for SEO.
Search engine optimization will involve keyword research and the placement of target keywords in your copy’s title and body. Just don’t stuff the keywords in; Amazon’s search algorithm will deprioritize your listings if it detects too many keywords.
As an FBA seller, you can leverage Amazon A+ Content (formerly known as Enhanced Brand Content) to enrich your ASIN descriptions. A+ Content doesn’t get indexed by Amazon’s search engine but can increase conversion rates, leading to more sales.
Hiring virtual assistants or outsourcing time-consuming tasks frees you up to focus on your growth strategy.
A great way to improve your own efficiency and automate more of your processes is by creating standard operating procedures (SOPs).
Well-documented SOPs will help a buyer keep the business running as it currently does, so it doesn’t drop performance after changing hands. SOPs are especially helpful to solopreneurs, streamlining the transition period by providing a resource they can refer to at any time.
If the new owner decides to outsource, they can use SOPs to train freelancers to operate the business as you did.
5. Build a Monetized Email List
Many FBA owners overlook using an email list as part of their marketing strategy, but to understand the power of email marketing, the real value lies in the audience it builds.
Gathering subscribers looks great, but the number remains a vanity metric if the list isn’t used properly. When you consistently deliver value to an audience through curated content, the email list becomes a valuable asset in itself because you don’t rely on search engine algorithms for your content to be found and you can address your audience any time.
However, if you are considering selling your FBA business and haven’t started an email list, I’d recommend that you use your time and resources to bolster your business’s strengths instead.
Email lists take a lot of time, energy, and patience to get right.
You’re nurturing an audience from scratch, so you’ll need to experiment with the type of content you send out and to get all the elements aligned for the highest conversion rate.
The Myth of Timing the Sale
Deciding when to sell can be hard. Some sellers think they can time the sale like a stock based on market conditions and whether the forecast is bullish or bearish.
In reality, it’s extremely difficult to succeed with this approach. We’d recommend selling your FBA business when it’s at its strongest and performing optimally on the capital means available.
A buyer may be willing to pay a premium price for an FBA business generating steady sales that has products with Amazon’s Choice or Best Seller status in their subcategories.
A business’s value is how much a buyer is willing to pay for it, which is why it matters where you list your business for sale if you want to succeed in landing a deal.
Best Places to Sell Your Business
There are really only two options: selling privately or using a broker.
A third option is to use a DIY marketplace, but we’d strongly recommend against using this type of service. DIY marketplaces charge a commission comparable to that of brokers, and you have to do a lot of the work to source deals and market your business yourself.
If you’re selling for the first time, a broker is the optimal route (even though we might sound biased for saying so).
If you go for a private deal, you risk running into two of the worst kinds of buyers: the savvy kind, who know how to negotiate a low price, and tire-kickers, the sort who make inquiries and non-serious offers, wasting your time. There’s also the need to attract many qualified buyers, which can be tough if you don’t have a wide network of suitable connections.
Then you have to worry about marketing your business and making it as attractive as possible without overselling.
There’s a mixed bag of brokers available. A reputable broker will have processes in place to attract buyers who can prove their buying intent with verified liquidity. When shopping for a broker, do your due diligence to see if they have such a system, as it helps both sellers and buyers.
You can register for free on a broker’s marketplace to talk about selling your FBA business and how they’ll help you handle the administrative side of things so you can focus on managing the different offers that come your way.
What’s Next? Preparing for Life After an Exit
We hope that by this point you’re aware of the amazing potential that selling your FBA business holds.
One of those possibilities is to buy another FBA business and keep your momentum going. After all, no one said you had to hang up your FBA hat and call it a day! The skills and experience you’ve developed could be used to scale a series of smaller businesses, so they reach their potential.
In time, you could flip them for a profit, creating a money-making engine that provides five figures of capital for each deal you make.
In time, you’ll have built up an ecommerce empire.
This is just one of the routes you could go down. Of course, you can reinvest the capital in any way you want.
Whether you pursue a passion project or put the money from the sale in your kids’ college fund, the possibilities start with the knowledge that your FBA business is a highly lucrative asset to the right buyer.
This insightful guide was brought to you from Empire Flippers. Do YOU want to contribute to the Viral Launch blog with your expertise? Simply complete our brief guest blog post form and we’ll contact you if it it seems like a great fit!
Saqib Azhar talks through his Amazon-focused growth strategies in 2021 and gives insight into how he built an enormous, highly engaged Amazon group on Facebook.
For the latest installment of Follow the Data, Saqib Azhar graciously shares his Amazon knowledge with host Cam Yoder. From starting your own business to training a country for taking on entrepreneurship, Azhar possesses one of the more influential voices in the Amazon seller community.
Azhar is the CEO and Co-Founder of Enablers and the leader of the world’s largest Facebook group for Amazon sellers.
At Enablers, Azhar’s mission is to combat unemployment in Pakistan by empowering and educating the youth to sell on Amazon. While most Amazon sellers seek to establish themselves, Azhar aims to lift a nation along with him.
With over a decade of e-commerce experience and a perspective unlike any other, Saqib has plenty of unrivaled knowledge to share. In other words, this is a must-listen for serious Amazon sellers.
Be sure to check out the show for advanced Amazon seller strategy from one of the world’s most knowledgable resources!
Get familiar with Saqib Azhar and his unique experience as an Amazon seller and community leader. (0:00)
Enjoy the episode? Like and subscribe to our YouTube channel or wherever you listen to podcasts! Don’t miss out on the Amazon seller insights within our hundreds of episodes.
With years of experience in the Amazon space, how does Saqib plan on growing his business in 2021? (7:12)
As a long-time seller who manages one of the largest seller groups and teaches aspiring Amazon sellers, Saqib knows the ins and outs of Amazon in a way few others do. Don’t miss out on his valuable insights on how to take your Amazon business to the next level in 2021!
Saqib witnesses plenty of new sellers entering the marketplace. What common mistakes do beginner sellers make when starting out? (15:13)
Like many aspects of life, the beginning stages are an excellent opportunity for a learning experience. However, beginners on Amazon quite literally can’t afford to commit beginning blunders. Saqib shares common beginner mistakes, so you can accelerate the learning curve and avoid rookie mistakes.
As e-commerce continues to grow, the ability to build a community around a product or a brand allows for explosive results. Further, Saqib breaks down how what has powered the growth of his company.
Before we say goodbye, Saqib offers sage advice for Amazon sellers. (31:29)
The entrepreneurial spirit and desire to be self-sufficient leads many to Amazon. But that same mentality can be their downfall on such a wide-ranging platform. To wrap up the conversation, Saqib leaves us with sound advice.
Is it too late to start an Amazon business in 2021? Not at all! We spoke with Kae Peterson, an Amazon seller who launched her brand in the past year.
On Follow The Data, we aim to cover the hottest topics for Amazon sellers. In this episode, we tackle the most common question we receive from those interested in starting their own online business: Is it too late to get in the game?
The short answer: absolutely NOT.
In this episode, host Cam Yoder chats with Kae Peterson, who knows firsthand that starting an Amazon business remains an excellent opportunity for entrepreneurs.
Kae’s background and experience in the volatile entertainment industry pushed her to search for more consistent, reliable income sources.
With an entrepreneurial spirit and appetite for learning, Kae charted her own path into Amazon and eCommerce. After successfully launching her first product in the past year, she’s looking to expand her business and online presence in the new year.
Be sure to check out the video below to learn how Kae made her leap into the Amazon marketplace, her recommended best practices for starting from scratch, and some inspirational gems to get your mind right!
Get to know Kae! Although a newbie on Amazon, she’s no rookie in entrepreneurship. Dating back to 2013, she’s ran a brick-and-mortar store and experienced success with music and modeling. So what led her to selling on Amazon?
It’s one thing to consider the prospect of selling on Amazon, it’s another to go through the stages before selling your first product. Kae walks us through the evolutions of her learning experience. (5:26)
Even with Kae’s unique background, her learning experience is a fairly common one. Once you’ve decided to start your online business, it’s all about finding a process that works for you. Finding experts you can learn from and accurate, reliable tools to discover and validate clever product ideas makes all the difference.
Additionally, Kae includes one crucial mistake that taught her a vital lesson with the product-finding process.
The cost of starting up an Amazon business can be a major deterrent. But Kae didn’t let the start-up costs slow her down, funding her own business in a creative way. (9:56)
Faced with the issue of not having the funds to confidently start her Amazon business, Kae took matters into her own hands. While programs such as Amazon Lending exist, the prospect of taking out a loan can be scary. So Kae started her own business as a way to fund her bigger vision, becoming a perfect example of how you can grind your way to make your dreams reachable.
Possessing a big picture strategy and learning from past experience are crucial for growth. What’s in Kae’s roadmap for finding products in 2021? (14:15)
There’s no greater teacher than experience. With her first Amazon product experience down, Kae offers insight on the elements of a product idea that gained emphasis for future products.
You’ve started selling on Amazon, but what happens next? Kae outlines her goals for in regard expanding her brand after launching. (22:15)
Every seller jumps into Amazon with goals and a purpose that is driven from within. Those components can determine your path beyond your first product launch.
With so much emphasis on making sure your first product is a home run, it can be easy to feel lost once the product is launched. Listen as Kae breaks down her long-term goals and what’s in-store for her brand for the year ahead.
Certainly, 2020 presented a unique experience for Amazon sellers. What issues are on the radar for sellers in the new year? (27:34)
After the past year, we could all use a dose of optimism. 2020 showed that challenges, both foreseeable and unforeseeable, will continue to persist and the successful will take them as they come and persevere.
A special thanks to Kae Peterson for hopping on the show and sharing her experience starting an Amazon business to this point. Make sure to give her a follow in the links provided below to follow her on her Amazon journey!
One of the most challenging aspects of starting a business is getting your product in front of the right audience. As Amazon owns about 49 percent of the U.S. e-commerce share, it makes sense to start an Amazon FBA business to sell your e-commerce products as your target market already prefers shopping there.
Additionally, Amazon makes it easy for sellers to list, sell, and ship their products through their Fulfillment By Amazon (FBA) program. Here’s everything you need to know about an Amazon FBA business and whether you should start an Amazon FBA business or purchase an existing one.
What is FBA?
Some 73 percent of Amazon sellers in the U.S. use the FBA program, making it one of the most popular e-commerce sales options. Amazon FBA sellers receive immediate access to Amazon Prime customers, which can significantly impact the bottom line of the business. On average, Amazon Prime customers spend $1,400 per year on Amazon, whereas standard Amazon customers only spend $600 per year.
The other reason why FBA businesses are popular is that it’s convenient.
With an Amazon FBA business, you don’t have to ship, package, or store any goods yourself. Instead, you pay a small fee, and Amazon employees handle all of this for you.
Shipping fees are up to $5.26 for large items (items up to 21 pounds), and they also have oversized pricing options for much larger items.
Storage fees are also reasonable at $0.69 per cubic foot for standard items January through September (October through December fees may be higher to accommodate increased demand during holidays).
You’ll also have to decide whether you want to be a professional seller or an individual seller. You aren’t required to have a professional seller account to have an Amazon FBA business, though it may be cheaper depending on how many items you plan to sell. A professional seller account pays a flat rate of $39.99 per month, whereas an individual account pays $0.99 per item.
Therefore, if you plan to sell more than 40 items per month, it’s likely more economical to purchase a professional seller account.
So if you’re looking to own an Amazon FBA business, is it better to purchase an existing business or start one from scratch?
While there is no right or wrong answer, here are a few questions you should ask yourself to determine which is the best solution for your situation and goals:
Do You Have The Capital?
The first question you should ask yourself is if you have the means to purchase an existing business.
An Amazon FBA business usually sells for about two to three times its yearly net profit. In other words:
Annual Net Profit x Multiple (usually 2 or 3) = Valuation
Therefore, if you want to purchase a business that makes about $10,000 in annual net profit, you can expect to pay $20,000 – 30,000.
Unfortunately, if you don’t have any capital upfront, your only choice is to build one from scratch, which can still be quite profitable!
Is This a Long Term or Short Term Investment?
Another question you should ask yourself before getting started with an Amazon FBA business is how long you’re willing to invest in the project.
If you’re willing to invest in this business for a few years, starting from scratch may offer you a more significant ROI. Getting started can be challenging as you’ll have to find your own suppliers and build reviews and a brand. Therefore, during those first several months, you may not make a dime, so you can’t expect to flip the store in a few months.
On the other hand, if you are looking to purchase a store, sell for a few months, and then flip it quickly, an established store is a better option.
Building momentum in a brand new company takes time. Not all sellers are profitable in the first year of a new Amazon FBA business, making it difficult to flip for a reasonable price as your net profit may be zero or negative.
However, once you pass a certain threshold of reviews and brand equity, exponential growth becomes possible.
What Skill Sets Do You Have?
Some people entering the Amazon FBA world have a background in business or marketing. If this is the case, one of the best ways to decide whether you’ll purchase or start an FBA business is to play to your strengths.
For example, if you previously worked for an e-commerce store and understand how to grow it, you may perform better if you purchase an existing store and grow it.
However, suppose you worked at a startup company and understand how to be resourceful, play the long game, and hang in there during the first challenging year of zero profit. In that case, you might be more successful starting a business from scratch.
Building a business from scratch and taking a business from five figures to six or seven figures requires two very different skill sets, so play to your strengths.
What Kind of Risk Would You Rather Take?
Starting any business involves some risk. However, the type of risk you take differs based on whether you purchase an existing business or build one from scratch.
Building one from scratch requires zero capital risk upfront though your chances of becoming profitable are much lower.
If you purchase a business that is currently profitable, your chances of remaining profitable are much greater. However, if you suddenly run into problems with suppliers, knock-off items or pricing wars and your business falls apart, you’ll lose a larger investment.
Therefore, while the risks differ, both have risks. So would you rather gamble time or money? Here are your choices:
Buy a Business = Higher Probability of Profitability + Increase Capital Risk
Start a Business = Lower Probability of Profitability + Lower Capital Risk
What Is Your End Goal?
Ultimately, the right decision depends largely on your goals. Do you plan to grow businesses from scratch and then sell them? If that’s your end goal, starting a business from scratch is the best way to learn.
Above all, running an Amazon FBA business is similar to running any business. Regardless of whether you purchase one or start one from scratch, it requires a lot of time, dedication, and commitment, and you can’t give up on it after a few months. You’ll have to put out fires and appease angry customers, though the rewards of growing a thriving business are more than financial. Get started now, and commit yourself to keep going!
According to multiple reports, Amazon is planning a special “Summer Sale” slated to begin toward the end of the month. Along with this news, it appears that their signature Prime Day sale will be postponed.
The spontaneous sales event signals that a return to normal is imminent, and presents an excellent opportunity for sellers to make up for lost sales at the onset of the pandemic.
There has been no formal announcement, so more details are sure to emerge in the coming days. Until then, here‘s what we know about the upcoming sales event:
What is it?
Unlike Prime Day, which features site-wide deals, this special sales event appears to be exclusive to fashion brands. Amazon has requested that sellers submit deals for items with a discount of at least 30% to jumpstart interest and sales.
“The Big Style Sale takes place later this month and will include seasonally-relevant deals from both established and smaller fashion brands,” confirmed an Amazon spokesperson to CNBC. “We are delighted to help brands connect with our vast global customer base for this event.”
Currently, it’s unclear if this sale will be exclusive to Amazon Prime users. But with over 150 million Prime subscribers, massive traffic is inevitable.
When is the Summer Sale?
According to the same CNBC report, the seasonal sale begins Monday, June 22, and lasts 7–10 days.
The extended duration of the sale in comparison to traditional Amazon promotions certainly should be monitored as more information is revealed.
Why is this event happening?
While Amazon positioned itself favorably to handle the pandemic compared to brick-and-mortar retail, they were not without COVID-related complications.
The Summer Sale drives up excitement and sales for a situation where sellers, consumers, and the company all win. This promotion gives sellers an increased opportunity to boost sales and unload seasonal inventory squandered by the pandemic-related postponements.
Which retailers are participating?
This event appears to be invitation-only, with Amazon having sent invites to select sellers. If you’re a seller who didn’t receive an invite, that doesn’t mean you’re entirely left out!
If Prime Day is any indicator, it’s highly likely that the sale will bring an influx of shoppers looking for a deal, so there’s plenty of opportunities for sellers to crash the party by running promotions.
Be sure to stay posted on the details of the event, as more information is sure to come!
Did you receive an invitation to the Summer Sales event? How do you plan on preparing for the sale? Let us know in the comments!
It’s the most wonderful time of the year! Almost 50% of online holiday shoppers bought from Amazon in 2017, and we’re expecting to see that number increase in 2018. So, to help sellers ensure they have a lucrative Q4 this year, we’re going to walk through how to best prepare for Amazon Q4 traffic, what dates you need to remember, and how to get in front of as many buyers as possible to drive your sales through the roof.
Are you ready?
Let’s dive in.
Crucial Q4 Dates
One of the most common mistakes sellers make during Q4 is missing or forgetting important dates. Amazon events tend to happen on similar dates, so you can safely assume that the timeframe for these events will be nearly the same in 2018 as in 2017. Also, be aware that Amazon just enacted a new shipping policy in late August that will cause shipments with irregularities in quantity or delivery address to be delayed. Keep that in mind as we go over important dates during Q4.
Reduced Fulfillment Fee – Runs October through December
Last year, reduced fulfillment fees started on October 1 and continued through November and December. If FBA sellers reduce their storage space during these months, they could drastically reduce their total amount of FBA fees.
Increased Inventory Storage Fee – Runs October through December
During this timeframe, Amazon increases storage fees by 200-300% for standard and oversized items. This can really affect your profit margin, even with holiday sales, so make sure that you have room in your budget for higher fees.
Cutoff for New FBA Seller Accounts and Shipments – After Mid-October (Possibly)
Last year, new sellers weren’t allowed to sign up for FBA or send FBA shipments in after mid-October. This has been account based rather than ASIN based, so in the past sellers have sold retail arbitrage using FBA to get around the cutoff. But as long as you create a shipping order before the cutoff, you should be okay.
Cutoff for Black Friday / Cyber Monday Inventory – November 5
Last year Amazon also instituted a deadline for sending inventory for Black Friday and Cyber Monday. Black Friday (November 23) marks the official start of the holiday shopping season, and Cyber Monday (November 26) is a huge day for online retailers, especially Amazon sellers. Make sure you have enough inventory in your Amazon warehouse to cover your Black Friday and Cyber Monday orders by November 5, or mid- to late October, just to be safe.
Cutoff for Inventory to be Delivered by Christmas – December 1 (Probably)
The craziness doesn’t stop after Cyber Monday! All of your inventory that you plan to deliver by December 25 must be in the warehouse by early December.
Don’t forget these dates. FBA sellers have to be on top of their game from now until Christmas in order to capitalize off of massive Q4 revenue opportunities.
Planning A Launch
Your next challenge is to determine the best timeline for getting your inventory into the warehouse and for starting a launch so you can get onto Page 1 at just the right time.
First, look at market data from previous years to determine when sales have historically started to increase (not sure where to find data for your product? Our Market Research Chrome extension can help with that). You can expect that sales will follow the same pattern for 2018. Make sure your inventory is in stock before the sales spike.
Then plan to start a product launch at least a week before the sales spike. A launch typically takes 7-10 days and will help increase sales and drive ranking so you can ride the wave of Q4 sales all the way through the holidays.
Timing is crucial. If you launch too early, you’ll have to maintain your ranking all throughout the holiday season. Launch too late, you’ll have to give away too much inventory and run out before the sales wave ends – or even worse, you’ll miss the wave completely. If you are unsure about when exactly you need to start your launch, our coaches can help you research past trends to determine the best launch strategy for your product market.
Preparing Your Listing
Before you launch your product, you need to make sure that your listing copy and photography are both fully optimized and follow Amazon style guidelines. A well-written listing and high-quality photo set work together with product launches to increase organic sales and drive ranking for a successful final quarter.
Make sure that you’re using high volume and high opportunity keywords in your product listing. You have to plug in the best Amazon keywords in the best order in a way that reads well and follows Amazon style guidelines. Piece of cake, right?
Ranking is largely determined by your title, followed by your bullet points and backend search term keywords. Our Keyword Research and Listing Builder tools allow you to discover which keywords have the highest search volume in your market, which high opportunity keywords you might be missing out on, and how many potential searches your current listing could rank for.
Your listing also needs to be written well enough that buyers are convinced your product is worth buying, but without using restricted phrases or claims that could get you flagged by Amazon. If you don’t have the time or skillset to create an optimized listing, our team of copywriting professionals can do it for you.
Product photography is crucial for converting clicks into purchases. Because they can’t see the product for themselves before buying, online shoppers heavily rely on photos for information. To convince shoppers to add your product to their cart, your photos need to look professional, display important details of your product, follow Amazon guidelines (or risk being flagged), and establish an emotional connection with buyers.
If you’re a new seller or have little to no photography experience, hiring a professional photographer might be the best choice for you. Your photo set has to convince buyers that your product is better than your competitor’s product, but it’s only one of the many moving parts of a successful Q4 strategy.
Crafting Your Amazon Q4 Strategy
A successful Amazon Q4 strategy depends on planning, preparedness, and deliberate action. Now is the time to do your research and start prepping your listing and inventory for the busy holiday season. For more tips and tricks, be sure to check out our recent video on Q4 sales strategy.
At Viral Launch, we want to provide you with all the information you need to become successful on Amazon. For more Amazon selling strategies during every quarter, we encourage you to subscribe to our blog, check out our Youtube channel, and listen to our Follow the Data podcast.
Is your Amazon product stuck in a rut? Selling consistently can be a challenge, and with sales lower than you want them to be, you’re probably left wondering what you’re doing wrong. Your low sales volume could be due to any number of things. Maybe your listing isn’t optimized well for main keywords. Maybe people are choosing to buy a similar product with more reviews. If your stock isn’t moving as fast as you would like, we’ve got some tips to help you learn how to increase sales on Amazon.
Before we begin, it’s worth noting that there’s no one quick fix to increase your product’s sales. Unfortunately, there is no such thing as a silver bullet. Amazon uses a variety of factors to determine which products appear on page one for any specific search. And just because your product is on page one, doesn’t necessarily mean it will convert well. These tips give you a range of ideas that will all work together to help boost your sales.
1. Optimize Your Listing
In order to make sales on Amazon, you have to get your product in front of shoppers. No one is going to buy a product they’ve never seen. In order to rank in Amazon’s search results across all major search terms and get your product seen, your listing needs to be optimized for relevant keywords related to your product.
This can be achieved by using a keyword research tool to help you identify high volume keywords. Be sure you are utilizing a tool that utilizes only Amazon data. When you search the main keyword that describes your product, the tool should give you the monthly search volume for that exact word as well as other suggested keywords to use and their monthly search volume.
Once you have a list of relevant keywords to your product, you can start writing your listing. Unlike Google, Amazon’s search engine focuses on unique keywords, meaning if a keyword is in the listing once, no extra weight is give if it is used again.
While using a keyword multiple times doesn’t give your listing an extra boost, the placement of keywords does matter in ranking. A keyword placed in the title will carry more weight than a keyword placed in the bullet points or backend. With that in mind, it’s usually best to place the highest volume keywords in the title to capture as many searches as possible.
To keep track of all the keywords while writing, we recommend using a listing builder tool. Many of these tools will remove a word from your “master keyword list” once you have used it in the listing.
If you don’t feel particularly confident in your writing abilities, another option is to hire a professional copywriter to create your listing for you. An experienced writer will be able to work with you to write engaging and informative copy that captures all main keywords and adheres to your brand voice. If you’ve got the money in your budget, this option could take one thing off your plate.
It’s important to remember that an optimized listing can only get you so far. Yes, it will ensure that you are indexed for all relevant terms and provide useful information, but it takes a combination of things to convert sales. Make sure your entire listing is strong from top to bottom. This includes investing in professional photography, ensuring your product is priced competitively, and getting to the top of search results.
2. Focus on Increasing Your Review Count
Over 85% of online shoppers say they trust product reviews as much as they trust a personal recommendation. This means that having a high number of reviews plus a high review rating can translate to big sales for your product. However, about 90% of Amazon shoppers never leave feedback, meaning the vast majority of shoppers are never giving their opinion.
Obviously there’s no way to ensure every person that buys your product will leave a review. But there are a few tactics you can use to help encourage past buyers to login and write their thoughts on your product.
Many Amazon sellers find that a small insert in your product packaging can nudge buyers to visit your review page and leave their thoughts. This simple reminder can also contain information on who to contact if for some reason there are any issues with the product at the time of delivery. This allows you the chance to make things right before the buyer torches you in a bad review.
That being said, there is a risk in adding these inserts to your product packaging, since Amazon’s terms are written so loosely. While some sellers see success with marketing inserts, add them at your own risk and know that Amazon could take action.
Email Follow Up
Email follow ups are a great way to communicate with buyers. It’s usually best to send a series of emails that builds up to asking for a review. You can create an email template for each of the follow up steps and use an automated email system to send these out:
Delivery Confirmation – Sent 1 to 5 days after delivery, this email will confirm the delivery of your product. This is also a great time to provide a contact number and let the customer know they can reach out with any issues they might have. You always want customers to contact you first with any problems in order to deter them from leaving bad reviews.
Review Request – The third email, sent 5 to 15 days after delivery, should contain a request for a review. Explain to the customer how reviews help your business and that you would really appreciate it if they took the time to leave their opinion. You can even include a link that will take the customer directly to your review page.
It’s best to end your email sequence at 2 emails. Any more than that, and it may appear spammy to customers. While nothing will ensure every single customer leaves a review, an email follow up sequence will help to nudge customers in the right direction
Important Note: When asking customers to leave reviews of your product, be sure to not offer any incentive for a review. This is against Amazon’s terms of service. It’s crucial to not break any of these rules when it comes to asking for reviews, as Amazon has recently been cracking down and suspending accounts for review manipulation. Make sure you read the terms of service thoroughly and that you aren’t in violation of any of them when asking customers to leave feedback. For more info. concerning email follow-ups, check out our video below!
3. Run a Promotional Launch or Giveaway
At first thought, this may seem counterproductive in your search for how to increase sales on Amazon. How could giving away your product at a discount help make it a success? But there is a science behind this process that could help boost your ranking and improve your sales in the long run.
What is a Launch?
A product launch is a targeted giveaway meant to project your listing to page one of search results for a major keyword. The overall goal of this process is to increase organic sales, but you’ll have to giveaway your product at a deep discount in order to boost keyword ranking. To rank among your top competitors, you must match or slightly exceed their daily sales for a short period of time. Usually this discount is 90% or more so that you’re able to sell the required number of units per day.
Who Can Help Me with a Launch?
The Amazon Seller Coaches at Viral Launch are here to help you in every step of this process. First we’ll help you identify a keyword to target for your launch. Then using Amazon data for your specific market, we’ll determine the number of units you’ll need to give away in order to achieve page one status.
Typically, launches run for 7 to 10 days. This range is the sweet spot. It allows enough time for Amazon to recognize the sales, while also being short enough that it limits the number of units you’ll have to give away. This will allow you to boost ranking while also saving money.
While a large portion of our data points to 7 to 10 day launches being the most effect for sales history and velocity, Amazon’s algorithms are constantly changing. This means it’s important to keep an eye out for the latest best practices. Some Amazon sellers have recently found success giving away a larger amount of inventory within one day for a larger, sharper sales peak to boost ranking.
What Happens After a Product Launch?
Once your product is ranking, the goal is to get enough organic sales that you can maintain your page one ranking. This places a lot of importance on your listing, photos and price. Be sure your copy is optimized for your main keywords. Upload professional product photos and make sure your product is competitively priced. All these factors will help you convert and maintain your ranking.
4. Utilize PPC Ads
PPC (Pay Per Click) ads allow your listing to get more exposure for a targeted keyword. When you set up a PPC campaign, you set a daily budget and bid on a click price. Amazon will then post your listing as an ad for targeted keywords. You do not pay unless the ad is clicked. However, keep in mind that just because someone clicks, does not mean they will buy, so be sure your listing and photos are optimized to convert sales. There are two types of Sponsored ads in Amazon Seller Central:
Manual – This allows you to pick the specific keywords you want to target. If you know which keywords your listing converts best for and you want to target them specifically, this is a great option.
Automatic – This option allows you to set a budget and then Amazon’s algorithms will select which keywords to present your product for. These ads can be a bit unfocused or random, but can give great insight into which terms your product converts well for and can still help to get your product seen.
Use the Data
One thing people often overlook about PPC campaigns is that it gives you tons of useful data about your listing, impressions and conversions. This can help you improve your listing and increase sales. For example:
High Clicks, Low Sales – If you’re getting a lot of clicks for a keyword, but low sales, you may be able to tweak your copy and optimize the listing in order to take advantage of the customer interest in the specific keyword.
High Conversions – If you’re getting a high number of conversions for a specific keyword, you may want to put even more focus on and budget into that keyword, as it’s clearly paying off for you.
High Impressions, Low Sales – If it seems that you’re getting a lot of impressions, but no one is buying your product, this may mean that your chosen keyword isn’t relevant to your product. This then causes people to click the ad, but leave the page as soon as they realize it isn’t what they want.
Bonus Tip: External Traffic
While it’s against Amazon’s guidelines to include any links or marketing language in your listing that takes shoppers away from their site, you are allowed to push visitors from other sites to your product on Amazon. You can utilize your company website, blog, etc. to bring people to your Amazon listing.
If you have a website or blog with decent traffic, start including links to your product listing. You’d be surprised of the difference this can make. The goal is to get as many eyes on your product as possible, so the more paths to your listing, the better.
Keep in mind though that for some sellers, driving external traffic isn’t always the best use of effort or money. First focus on using the tips previously mentioned in this post and take advantage of the immense traffic that Amazon already provides.
Get to Work!
Remember there’s no magic bullet for increasing your sales on Amazon. A variety of factors go into ranking, converting and staying competitive in any market. Don’t simply pick one of the tips out of this list and assume it will mysteriously solve all of your problems. Take your time, gather data, do research and create a strong overall listing with optimized text, professional photos and a competitive price. With all these factors working together, you’re sure to find the methods that make your revenue grow!
Ready to ditch the corporate life and sell Amazon FBA (Fulfillment by Amazon)? Not sure how to get started?
Or maybe you’re already selling Amazon FBM (Fulfillment by Merchant) and looking to make the switch …
If you’re interested in FBA vs. FBM each program has its pros and cons. But ultimately, FBA provides an unmatched, hands-off selling experience with the ability to scale. For these reasons, many sellers prefer FBA to FBM.
FBA is a method of fulfilling products by having Amazon store, pick, pack and ship your inventory. Through FBA, Amazon even handles returns. Although there are additional fees, setup, and tax obligations, FBA makes it easy to quickly start and scale your business. lot of the content in this blog can also be found from our How To Sell series! Check out the video if you’d like to get started on your Seller Journey:
Why Would I Want to Sell Through Amazon’s FBA Program?
You don’t have to store boxes of inventory at your house. One major benefit to selling FBA is that Amazon handles a good portion of the selling process, namely the most time-consuming portions. Although you still have to set up an Amazon Seller account (we’ll talk more about how to do this later), choose a product to sell, list the product, and have the inventory sent to an Amazon Fulfillment Center, Amazon takes care of the rest of the process with FBA. So when a customer orders your product, Amazon handles the fulfillment logistics of picking, packing, and shipping. In their words, “You sell it, we ship it.”
Once your products are ready to sell and in stock at Amazon’s warehouses, they are automatically eligible for Prime 2-day shipping. Although it is possible to be a Prime seller through FBM, you must meet extensive criteria to be eligible. And with an estimated 112 million Amazon Prime members, or about 62% of U.S. households subscribed to Prime in 2019, you can’t afford NOT to have Prime shipping. Numbers like that are hard to ignore when it comes to the sales potential that Prime provides.
What are the Different Methods of Selling on Amazon FBA?
Now that we’ve established which program you should sell through (FBA), let’s talk about methods of selling, or where to get inventory. There are many options, all of which appeal to different kinds of people. Some are more hands-on, while others allow for higher earning potential. Three of the most common methods include Retail Arbitrage, Wholesale, and Private Label.
Retail Arbitrage – This is a process of finding discounted products in retail stores (such as Walmart, Target or Kohls) and reselling them on Amazon. To make it profitable, the items need to be bought at a significant discount and sold at a higher price on Amazon. You can sell other branded products using this method and it is often a lower risk option, since you can check before purchasing the items if you will be able to make a profit or not. You can also search liquidation stores or online sites for pallets of returned items that can be resold.
Wholesale – To sell wholesale, a more unique method, you must find a manufacturer (local or abroad) and convince them to allow you to sell on their behalf. The smartest way to do this is to create an official business or LLC, acquire a wholesale license, then reach out to manufacturers/wholesalers to discuss a contract for selling their items. Getting the business to agree to providing you exclusive selling rights can lower your competition as well.
Private Label – Private Label selling involves working with a manufacturer to produce items and add your own brand name and logo to the products. As long as there is no patent on the product model, you can legally sell under this method and even work with manufacturers to create product modifications or additions to make your brand’s product stand out. Many private label sellers use Alibaba.com to connect with manufacturers, get samples, purchase inventory and more.
How Do I Get Started with FBA?
There are two account options when selling on Amazon: Individual and Professional. With Individual Selling Plans, you pay $0.99 per item every time a product is purchased. For those sellers making fewer than 40 sales per month, this may be more cost effective than paying the $39.99 Professional Plan subscription fee. These fees are on top of other FBA fees, which we’ll get into more later.
If you haven’t already created a Seller account, you will need to set one up. If you already have an account as an FBM seller, you can easily switch over to FBA inside your Seller Central account.
For retail arbitrage sellers selling FBA, you will need to add the product to your inventory in Seller Central and follow the steps to create labels for your items, which can be printed at home. Once you have printed labels, you can package different items in one large box to be shipped to an Amazon fulfillment center and print a shipping label for that box as well.
Keep in mind that you will need to pay for these shipping costs out of pocket, plus any materials needed for shipping (labels, boxes, tape, scale, etc.). Additionally, Amazon may require you to send inventory to multiple fulfillment centers depending on their inventory levels, which could increase your shipping costs.
Amazon does not require sellers to sticker products at the SKU level as long as you have a manufacturer barcode for the product. But other sellers with the same product (that are also “stickerless”) could get mixed in with your inventory in an Amazon warehouse and could be picked up and shipped to a customer instead of your stock. If their product is used, lower quality or even counterfeit, you could receive poor reviews, a higher return rate or even be suspended by Amazon for counterfeit sales (even if the product is not actually your inventory).
If you choose to sell Private Label or Wholesale, you’ll want to find a good product to source as well as a trustworthy manufacturer. Check out our podcast about finding a good manufacturer to make sure you make a smart partnership as well as our podcast about sourcing the right product to make a sourcing decision that meets your goals.
You can choose to label items yourself (following the method mentioned for Retail Arbitrage) as long as each unit has a scannable barcode or you can pay to have Amazon prep and label each item for an additional per-item fee. Fees can be as low as $.70 per item to as much as $2.20 per item.
When your shipment is ready to be sent to Amazon, make sure you have an organized shipping plan that includes easy tracking so you can ensure your inventory makes it to the desired fulfillment center. To learn more about carriers who partner with Amazon to deliver shipment to their warehouses, visit their page featuring Partner Carrier options.
Once Amazon has your inventory and your listing(s) is live, Amazon will handle the delivery of purchased items to customers as well as customer service throughout the process. Sellers just need to ensure their item is always in stock and ready for customers to buy. Check out our blog on inventory best practices to make sure you never get behind or run out of stock.
What are the Fees for Selling through Amazon FBA?
Because your inventory is stored, packed and shipped by Amazon when you sell FBA, there are additional fees associated versus FBM. Earlier in 2018, Amazon restructured their FBA fees into two fee structures:
Fulfillment Fees are per unit, based on the size and weight of each item and include the complete picking, packing, shipping and handling, customer service and return process for each item.
Monthly Inventory Fees are assessed per cubic foot based on the total size of your items. Inventory fees increase for Q4, so it’s important to calculate your costs for each quarter. Below is a breakdown of Amazon’s FBA fees. Make sure to double check your math with an FBA Calculator for help determining your costs before you source.
Other potential fees sellers could incur include long-term storage fees (if items in your inventory have sat in a fulfillment center for 6 months or more) and additional storage fees if you choose to participate in Amazon’s Multi-Channel Fulfillment Program (more on this later).
Things to Keep in Mind as You Start Your Amazon FBA Business
Although there was once a time when online sellers could get away with not paying sales tax, those days have come and gone. In June of 2018, the United States Supreme Court ruled in favor of South Dakota in South Dakota vs. Wayfair, Inc. Now, one-by-one, states are starting to enact economic nexus legislation.
Because the decision is new at the time of writing this post, it will take some time for the effects to play out. We encourage sellers to keep an eye on internet sales tax by state, and stay informed on the latest news in Amazon sales tax. Sellers should connect with a tax consultant versed in online sales tax regulations to avoid slip ups or potential mishaps in their FBA businesses.
Did you know that you can fulfill orders from sales channels outside of Amazon.com through the Amazon FBA Multi-Channel Fulfillment Program? Rather than having multiple different inventory locations and shipping methods for your different online sales sites, store all of your inventory in Amazon’s warehouses and let them pick, pack, ship and handle your items to customers, whether the sale is through Amazon.com or elsewhere. There are additional fees associated with the fulfillment process for multi-channel orders, but you can skip the headache of storing, packing and shipping your items and let Amazon do the heavy lifting.
If you are selling retail arbitrage or wholesale, the Buy Box is going to be very important to you. The Buy Box is the box on the right hand side of a listing page with the price, seller and shipping information as well as the “add to cart” button. If there are multiple sellers on a listing, they will be listed below the seller who has “won” the Buy Box. Since the majority of buyers purchase from the seller who has “won” the Buy Box, winning is critical to increasing sales. Although there are several factors considered to “win” the Buy Box, fulfillment method is a crucial component. And FBA sellers are significantly more likely to secure the Buy Box over other sellers.
If Amazon is handling the customer service for your product under FBA, you shouldn’t have to worry about reviews right? Wrong! Reviews are a huge driver of sales, so whether you’re selling wholesale, retail arbitrage or private label, bad reviews and a low star rating can tank your sales rate. And, with the ability to filter by star rating, too many bad reviews could effectively leave you out of a user’s search results.
For private label sellers, positive product reviews are key to buyer trust in your product quality. If your product is similar to several others in the market, a better star rating could guarantee your product is chosen over your competitor’s. For wholesale and retail arbitrage, positive seller reviews are extremely important to establishing trust in your brand’s quality. Buyers want to hear from their peers if they can trust purchases coming from your seller account or if they should be concerned with used or damaged goods.
There’s been a lot of talk around reviews and Amazon cracking down on review fraud, so making sure you don’t violate Amazon’s Terms of Service for reviews is vital to avoiding suspension. Check out our video about Amazon’s recent “review crackdown”:
Final Thoughts: Learn from Failure
Look, it’s no secret – Amazon FBA can be a confusing and difficult platform to navigate. You’re bound to make some mistakes. What’s important is that you learn from your mistakes and minimize missteps in the future. Following our Amazon FBA guidelines is a good start, but to be truly successful, sellers should keep seeking out new information and staying up to date on changes.
There’s an old quote that states: “Complacency is the enemy of progress.”
Getting complacent or lazy at any stage of your FBA business journey is a recipe for disaster as it requires constant maintenance and upkeep to stay on top. By working hard and arming yourself with up-to-date information, you’ll have the tools you need to achieve Amazon FBA success.
In this episode, Anthony, Nick, and Fernando all share about their experience building teams for their businesses: how they knew they needed to hire, how they prioritized talent according to their business goals, and how they found the right people to grow.
Anthony Bui-Tran is an ambitious entrepreneur who built a million-dollar business at the age of 23 through manufacturing and importing consumer goods. Since discovering this opportunity he has been empowering others to design their ideal lifestyles through building location-independent businesses through his Facebook group and YouTube channel, Seller Tradecraft. In the near future Anthony plans to expand his one-on-one coaching to a digital course that will enable him to reach and help more people achieve their goals. In his free time he enjoys traveling, surfing and working out. When reaching out to Anthony you’ll find yourself asking, where are you now?
Fernando Campos is a serial entrepreneur who builds brands on online marketplaces. He has an aptitude for growth and in less than three years he has been able to generate over $10 million in revenue per year, grossing $20 million cumulatively. His expertise in Amazon strategy, product selection and business development has led to the introduction of over 200 products to the market.
Nick Young is an e-commerce entrepreneur who specializes in developing private label brands on marketplaces with a focus on process, team building and grit, he has scaled his pure play private label business to over eight figures in revenue within three years, grossing $20 million cumulatively. Prior to starting his business Nick worked in tech where he helped grow early-stage companies. Nick and Fernando are also both partners at Seller Tradecraft, an online community and digital education program for both new and experienced sellers.
Follow the Data Show Notes
Check out onlinejobs.ph where Fernando and Nick found their first hires
CASEY GAUSS: Deciding to invest in your business by building a team is a major decision. How do you know if it’s the right move for you? How much revenue should you have before making your first hire? Who should that first hire be, and how do you grow profit when taking on the cost of employees?
I’m Casey Gauss, your host for Follow the Data: Your Journey to Amazon FBA Success. In this show we leverage the data we’ve accumulated at Viral Launch from over 30,000 product launches and our experience working with over 8,000 brands to help you understand the big picture when it comes to Amazon, and more importantly, the best practices for success as an Amazon seller.
Cam is in China this week, our normal host. So today filling in for him is our producer, Becca Longenecker. In this episode Anthony, Nick and Fernando will all share about their experience building teams for their businesses, how they knew they needed to hire, how they prioritized talent according to their business goals, and how they found the right people to grow. Let’s get started.
BECCA LONGENECKER: Hey, guys. What’s up? This episode is the first in a series of episodes that we are doing with sellers Anthony Bui-Tran, Fernando Campos and Nick Young. In this series we’re focusing specifically on what it takes to scale your FBA business. A little introduction for who these guys are. Anthony is an ambitious entrepreneur who built a million-dollar business at the age of 23 through manufacturing and importing consumer goods. Since discovering this opportunity he has been empowering others to design their ideal lifestyles through building location-independent businesses through his Facebook group and YouTube channel, Seller Tradecraft. In the near future Anthony plans to expand his one-on-one coaching to a digital course that will enable him to reach and help more people achieve their goals. In his free time he enjoys traveling, surfing and working out. When reaching out to Anthony you’ll find yourself asking, where are you now?
Fernando Campos is a serial entrepreneur who builds brands on online marketplaces. He has an aptitude for growth and in less than three years he has been able to generate over $10 million in revenue per year, grossing $20 million cumulatively. His expertise in Amazon strategy, product selection and business development has led to the introduction of over 200 products to the market.
Nick Young is an e-commerce entrepreneur who specializes in developing private label brands on marketplaces with a focus on process, team building and grit, he has scaled his pure play private label business to over eight figures in revenue within three years, grossing $20 million cumulatively. Prior to starting his business Nick worked in tech where he helped grow early-stage companies. Nick and Fernando are also both partners at Seller Tradecraft, an online community and digital education program for both new and experienced sellers.
ANTHONY BUI-TRAN: My name is Anthony. I basically am a Amazon seller of three years. So is Nick and Fernando. But the three of us basically met through a mastermind group online, a Facebook mastermind group of million-dollar sellers and up. And then most recently I just like temporarily relocated to LA to kind of learn from these guys because they’re at the eight-figure level, and I’m at the seven-figure level. So I thought one of the cool things that we can talk about is like perspective of building a team to a seven-figure level and then like building a team to an eight-figure level, and then what kind of like perspective or mind shift differences that maybe like I have versus like them when it comes to building a team because I think that’s like a very big mental mind shift that I learned from just like being out here and like talking to them a little bit more about like how they’re scaling their team, and how they have like advisors, and how they really have like, you know, like more structured like systems and processes in place versus like my business.
BECCA LONGENECKER: So then how many people do each of you, like how many hires have you each made?
ANTHONY BUI-TRAN: I personally have seven part-time, and then –
NICK YOUNG: Yeah, we have, in total, about like 20 people.
BECCA LONGENECKER: Okay, nice.
NICK YOUNG: Yeah. And those are full-time.
BECCA LONGENECKER: Well, I guess I’ll just jump in and ask the first question. So the first thing I was wondering is if you could, Anthony and Nick and Fernando, if you want to start [technical difficulty 0:04:59.0]
ANTHONY BUI-TRAN: Okay, yeah. I have an interesting one. So when I started thinking about outsourcing it really stemmed from like The 4-Hour Work Week. So I was reading that book while I was working my corporate job. So I knew in order to scale my business I had to make more time, right? And I knew that I couldn’t physically like free up more time in my schedule in terms of like balancing work, gym and then my social life. So I realized I was like, oh, I can just pay someone and buy their time, right, and leverage that. And then The 4-Hour Work Week was one of those ways that I realized that you could, you know, get work help overseas, and I looked into it a little bit more, and then I realized that, you know, balancing my full-time job with a VA, like I would have them do a lot of Amazon stuff and then some very, very minor work stuff for me, and balancing that out in my personal life. And that was just basically like the first, very first start of getting a hire. And then after that successful experience with my first hire – and he’s been with me ever since – I just really wanted to build out more and more.
FERNANDO CAMPOS: Yeah, so for Nick and I, I would say this was about like six months in, and it was probably honestly too late because I think we were doing like probably around like 80, 90 grand in revenue at the time, I guess for perspective.
ANTHONY BUI-TRAN: And it was just you two?
FERNANDO CAMPOS: And it was just us two. And then the first person was like kind of a customer support, kind of administrative person. She’s still with us today. It’s like pretty amazing. And she actually ended up bringing her husband on to the team as well, which was pretty cool, like a few months later. But yeah, I would say that it was probably too late. I think in retrospect it would have been better to make that hire earlier, like thinking about like how you value your time, and let’s say $100 an hour or $200 an hour, and then thinking about how you’re spending like a majority of your time, and whether you can outsource those specific like tasks at a lower rate than what you’re valuing your time at. And so yeah, whether it’s like, you know, sourcing, or customer support or graphic design, like all that kind of stuff, I would have definitely done it earlier now in retrospect.
NICK YOUNG: Yeah, yeah. And I think, you know, it’s constantly a struggle. I mean I think every entrepreneur when they’re first starting out, especially for me, I know I struggled with the, you know, trying to be a perfectionist with how everything was done. Naturally when you own a business you never think anyone is going to care as much as you do. So I always felt like I wanted to delegate, and when I did delegate it had to be the way that I wanted to do it. But you know, I think quickly we realized as we scaled that, you know, if you hire the right person they’re going to do a better job than you will because naturally they’re going to be dedicating more time to it, assuming that they’re smart enough. And I think that’s really the process of how we need to learn as entrepreneurs to let go. And it came down to just hiring the right people and not hiring people that could only take delegation, and instead finding people who could actually think on their own, and that was really a crucial shift for us, being able to let go and find the right people to kind of let it go to, if that makes sense.
CASEY GAUSS: So guys, to give everybody some context, would you guys mind sharing kind of how many people you’ve hired over what period of time, what those hires look like, just giving everybody some context around what’s going on in your guys’ business so they understand where all this advice is coming from?
ANTHONY BUI-TRAN: Okay. Yeah, for me, starting out essentially, to get to the point where I was, or I am now as a seven-figure seller, the first thing I ever outsourced was customer service because in my opinion that was like one of the things that I just didn’t really enjoy doing because I mean it always comes down to the same example, like someone would ask me like what color like the shirt is, or what color an item is, but you know the listing obviously says it’s like black. The picture looks like it’s black, and then like when a customer asks me that, for some reason I personally get a little frustrated with that because I feel like it’s a very obvious answer. But at the end of the day, like you want to hire someone that cares in responding to like customer questions like that more than I guess I would in that situation. And then I realized that I’m wanted to reduce the amount of decisions I was making in my business because those really like kind of wear on, I guess, like my mental energy. So customer service was like the first thing I outsourced.
And then down the line it got to I would outsource like random different project [tasks 0:09:50.0] versus getting a full time VA. So I would get some like listing optimization done, product photography I would outsource that to like certain people and then just compare really, right? Because I started doing it in-house, and then I realized I was like okay, I don’t want to invest in all this equipment when I can just pay someone to do it professionally and they’ll get it done the right way because I was spending too much time researching. I would say okay, this is how I should make like a perfect like lightbox. And I was like how often am I going to use this thing? Maybe like, I don’t know, a couple times a month. Maybe I’d have to edit it. And then it got to the point where I wanted to also focus more on I guess like YouTube and my Facebook group. And so some of the other hires were just like video editors.
And then it was mainly working with my first VA. He was kind of like a jack of all trades, which is what I really like about him, and he’s just – he, I wouldn’t say he knows everything, but he knows how to like Google. And I think that’s probably one of the most important traits, having someone on your team that is like their ability to just learn things on their own. That’s probably more important than – I mean of course like you want to find people that are experienced, but when there’s always going to be new things to learn in business, and I think if, you know, someone on your team just like has ability just to learn on their own or just knows like when to reach out, or knows how to reach out effectively, like one of the things like I always ask my team is if they have a question they’ll ask me. They’ll like say like, should I respond to this customer this way? And they’re like, instead of asking me how do I do this, they’re like I think I should respond like this, and they provide an example. And then I’ll tell them like yes or no, or I’ll give them suggestions of like hey, like I think you could just add some more details here, some more context here, and like training them to just think on their own like that has been like invaluable for my business.
FERNANDO CAMPOS: Yeah, so for us in the US we probably hired like overall maybe eight people in the US. We’re down to five now here in the US, and then we’ve hired at least 25 overseas I think. But our overall team now covers a little over 20, and I would say that we’ve pretty much like been able to build like a team to manage like every aspect of the business. I think the one that we hold probably a little bit, the most close to our chest is like kind of product selection. But we have someone that’s in charge of like finding the products that we approve of. We have new inventory planning, logistics, support, you know, marketplace management, like wholesale and retail. Pretty much like everything is actually done mostly overseas now.
ANTHONY BUI-TRAN: What was your first hires for you guys?
FERNANDO CAMPOS: Support and admin.
NICK YOUNG: Yeah, definitely support and admin. Yeah, for sure.
FERNANDO CAMPOS: And you know what we found is like as we – you know, I think it’s always like when you’re first starting out naturally you’re going to do it based off of like what’s taking up most of your time. But we found like as we’ve grown to scale we really had to gain a lot of thinking towards how we’re breaking out the organization, especially as we approached the eight figure mark, you know, we realized that we had to start breaking out the business into business units, too, so that, you know, we could structure each business unit to have like, you know, it’s own P&L, its own way of tracking the effectiveness of it. And that just started to make more sense as we grew, you know, the different channels we were selling on and also the amount of products that we had. And so I think that has really allowed us to have a lot more efficiency and structure in terms of how we collaborate with one another and, you know, as we’ve grown. And that’s something that I think, you know, we’ve really tried to put a lot more thought into more recently.
CASEY GAUSS: Awesome. So when you guys made that first hire, Fernando and Nick, what size company were you? What was going through your mind? What were your hesitations, and how did you overcome those?
FERNANDO CAMPOS: Yeah, I don’t know if we had too much hesitation. So we both had outsourced specific like roles, or like I guess tasks in previous companies, like previous startups that we had worked at. But yeah, they were in charge of like basically – I mean at the time we probably had about like eight products maybe, eight, 10 products. And so we were just building out like a lot of like – a lot of like inquiry in terms of like product questions and like, you know, following up for like reviews and all that kind of stuff. And so I think all like the really like tedious parts, I mean the beautiful thing about Amazon is they take, you know, a huge percentage of the customer support. But anything that did kind of come through, they kind of oversaw all of that I would say.
NICK YOUNG: Yeah, I would say that what we really, you know, did was, you know, the model was new to us at the time, right, so when we just started. So we really wanted to trail blaze and it just make sure that we understood all parts of the process to begin with. You know, I’m a believer that you do have to delegate what you understand first. And so, you know, I remember answering customer support questions. And you know Fernando was like, look, you shouldn’t be doing this. And I was like yeah, you’re right. You’re totally right; I shouldn’t. And so that’s when we made our first hire. And then as we had this additional resource, you know, we realized okay, well she has extra time. She can go ahead and copy this. She can follow up a customer review. She can do all these things that we realized that were on our list but we just didn’t get time to, you know, handle because we were limited on time since, you know, we wanted to focus our time on growth. But we always found ourselves hampered by supporting the operation, and that’s when we realized okay, we need to, you know, push this off to, you know, that support person. And eventually, you know, we started to structure the tasks as like this is that type of role, this is that type of role, as they just became more frequent.
BECCA LONGENECKER: How did you guys find your first hires? Where did you look for people?
NICK YOUNG: I would say online jobs.ph is a great one. You know, there’s a lot of people who are really familiar with remote work. A lot of people actually have Amazon experience. That’s where we first started. And we also, you know, we mentioned that Fernando and I, we both came from companies that deal with outsourcing. I actually came from a company that did outsourcing for a lot of big internet companies. So I had, you know, someone that I worked with there before, and I just got a referral. So she was actually like, you know, the sister-in-law to someone I worked with closely in the Philippines over there. So that, you know, that was, you know, how we first got started. And then she brought in her husband. But eventually as we wanted more, you know, we also created a referral system internally for people that they trusted that they could bring in, and that worked up to a certain point until we needed actually more employees than they could find for us.
FERNANDO CAMPOS: Yeah, I mean it’s now, I have to say, we just recently brought on like a recruiting HR person. So they’re in charge of building out your own applicant tracking system. And this is a – Anthony’s laughing because this is like a huge hire for me. Like I was really excited about it because I spent like a ton of my time doing interviews for new hires, and, but yeah, I mean she’s been amazing. And I think one of the really interesting things is that like I think a lot of people would just kind of go to Upwork or OnlineJobs because it’s really easy. You make a post, and then, you know, you get a ton of like submissions, and then you kind of choose. But I think one of the big changes we made maybe like eight months ago was actually treating hires overseas, like in terms of recruiting, the exact same way as if they were like a US hire, and so investing the same amount of time, same amount of interviews, like the same type of process in terms of, you know, doing like quick phone screenings, actually like a reaching – doing like kind of outbound or outreach like [unintelligible 0:17:33.9], maybe taking out a job [unintelligible 0:17:36.3] the need to like really investing the time because we’ve made some like incredible, incredible hires overseas. And like now we’re just kind of like raising that bar in terms of like I think in the beginning it was just like oh, we’re going to pay them like$4.00 an hour. It’s like fine. Like, they’re smart enough. But now we’re kind of holding out, like especially for like these like really like crucial roles to our organization, like inventory planning, we wanted to make sure that we had like the best, like the smartest person that we possibly can in this specific role because it’s such a crucial part to our business.
BECCA LONGENECKER: Yeah.
ANTHONY BUI-TRAN: Who was that last hire you had? What was like her background? The one for inventory planning?
FERNANDO CAMPOS: Well, it’s a guy.
ANTHONY BUI-TRAN: Or a guy, yeah.
FERNANDO CAMPOS: Yeah, I mean he came from like the Harvard of the Philippines, was like in charge of inventory planning for like a grocery store with like, I don’t know, a 98% like confidence interval. I mean it was just like way more sophisticated than what we had been doing in the past. Like his spreadsheets right now are so beautiful, like I kind of – I tear up a little bit. It’s really nice.
BECCA LONGENECKER: That’s awesome. Yeah, so making the right hire sounds like definitely has been part of your success. But I’m also wondering how, especially with teams like overseas, how do you guys motivate your teams and ensure like a standard of quality for your work that your employees are doing?
NICK YOUNG: Yeah, I mean I think one of the important things is – I mean first off, you know, I think you have to be clear on the KPIs. You have to be clear about what you – what their goals are for their role and how you measure them by. You know we implemented this thing called OKRs, which is something that Google has implemented. So it’s objective key results, and it basically – it’s set from the top down. So you know, you set an objective key results for the company as a whole, and it kind of cascades down across each department. And they have something that kind of goes into that, you know, key result. So you want to make sure everyone is aligned. But I think on top of that, I think, you know, one of the main things that helps people when they’re working on a team is seeing the level of work of the other people they’re working with, right? So you know, we want to make sure that like every person when they come on, that they’re working a team. But also they want – we want to make sure that the team members that they’re working with have, you know, produce high-level and high-quality work. And I think that’s really important because then they’ll realize that they’re accountable to people who really depend on their work. And you know, all their peers are really producing and performing well, and it becomes exciting because everyone is really caring about what they’re producing, and everyone feels like they’re elevated to their highest ability, if that makes sense. So I think making sure that you have that team environment, making sure that they’re collaborating with one another, is really important. And when you hire the right people they enjoy working with other top-tier people. And I think, you know, that’s something that we don’t necessarily have to be involved in day-to-day. They’re just aware of it because they see the level of work that’s produced.
FERNANDO CAMPOS: One other aspect of like motivation I would say is like really – is like the kind of communication and having them fully integrated. I mean like we hear of like a lot of other sellers will kind of refer to their team as kind of VAs, and like you know they’re kind of like part time. They’re looking for a bunch of different companies. I think our approach is a little bit different, where we bring people on like full-time onto like our staff. They’re included in all of our communication. They have their own email. They have like, you know, kind of welcome training. They have like a buddy. Like I mean they’re – they’re just really well-integrated into our team. Like the same kind of red carpet, if you will, as if they were like here in LA with us. And I think that is like a really big kind of like mindset shift for them is that, you know, we’re paying them every two weeks like we would pay employees here, and like we’re really just investing in them. We’ll pay for monitors and like technical equipment that they need. Like we really want to make sure that they feel included. And then so that as the team grows and it becomes like more and more distributed, that they are always feeling like they’re like really a part of it. And part of the responsibility for our new like HR and recruiting team is to build out like kind of teambuilding and different types of kind of ways of building [unintelligible 0:21:49.4] for a team that’s like scattered all across the world.
ANTHONY BUI-TRAN: And then just to add onto that, my little tidbit is like me and my team, we use a lot of – we use this Google Chrome extension called Loom, L-o-o-m, and basically it records your screen, and it records you talking at the same time. So like whenever like I’m trying to explain things, or someone on our team is trying to explain things, explains or explained their question, like it’s feels a little bit more personable. Just like seeing someone’s mouse move across the screen, and you see like their face talking as they answer questions. And that’s how like we relate and send a lot of messages back to each other, especially if they’re long. And my team, like we don’t always enjoy – well, I don’t enjoy typing a lot of times, so I enjoy making like these videos. So I’m like okay, like this is how you do this and that, and then they’ll like create out like the SOPs and everything. But when I’m making those videos I try to be a little bit more enthusiastic and happy, and I’ll just like maybe tell them like one tidbit about like me, or like I’ll tell them like hey, you’re doing a good job on this, like just some quick feedback because I think in a very virtual setting you don’t always get that much of like an intimate setting because some of my team members, like most of the time we just like talk through like Slack. And we don’t always like hop on voice calls. Like I’ll go on like maybe – there are some people on my team I haven’t like talked to like on Skype via voice call in maybe like two months or so. Some people are just Slack. So I just try to be more intimate and personal whenever possible, just in like a virtual team environment.
BECCA LONGENECKER: Yep.
CASEY GAUSS: Nice. Fernando and Nick, for your people in the US, do you guys have an office, or are they remote as well?
FERNANDO CAMPOS: Oh, so we do have an office here in LA. So four of us work here regularly. One person kind of comes in and out, kind of our developer that’s building like all our internal tools. But yeah, for the most part we are here in LA.
CASEY GAUSS: Nice. So I imagine you guys have made mistakes in the hiring process. I know we have at Viral Launch.
FERNANDO CAMPOS: No, we have 100%.
CASEY GAUSS: What are some of those – what are some of those mistakes, if you want to share? And then like what have you learned from that?
NICK YOUNG: That’s a great question.
FERNANDO CAMPOS: Yeah. So one of the things that we recently added – so like I guess a mistake was not doing this, but we actually recently added like a case study into our process. So we kind of – Nick and I will sit down. We’re like okay, we’re going to hire an inventory like planner. Like okay, what do you think is like the most difficult part? Maybe it’s like the forecasting and managing so many SKUs. So we will come up with a case study, like specifically like using like our own a data, and we’ll just like kind of export it out. And then like here’s an issue where we like kind of ran out of stock, and then just see like how they would like plan it. So we’d send them like a bunch of raw data with like a quick like Word doc just saying like hey, you know, here’s the situation for this SKU, like how would you handle it based on like, you know, here’s your production time, here’s your lead time, like all that kind of stuff. And then we see what they send back in terms of like kind of a report on our analysis. And then in the next interview we actually have them like walk through it. And then so we’ll ask questions that were both on that assignment, and then other, like other questions that were not included there, just to see like their critical thinking and like their understanding of the subject. And I think you could do that pretty much for any role that I’ve seen, that we ‘ve – at least that we’ve hired so far. And I think that’s been like probably one of the best ways that we can just see like where people, like where their understanding is of the subject matter before even going through like a lot of the, of like the personality and culture like parts of the interview.
CASEY GAUSS: Nice. So have you guys had to let people go then?
FERNANDO CAMPOS: Yeah, yeah, definitely.
NICK YOUNG: Yeah, I mean, you know, we’ve had to let some people go, for sure, and that’s always not fun. I think if someone is, you know, remote it’s definitely, you know, a little easier than doing it in person. We’ve done both. But yeah, I would say, you know, ultimately it comes down to performance, and I think we’re always very clear about performance. I mean, I know Fernando and I, we always make sure to communicate exactly what it is that we’re looking from them and where they’re missing the mark. And then what we do is we actually create a performance plan. So we’ll say look, you have like 30 days. Or you know, let’s say 60 days. These are the things that, you know, we’ve been asking for and we haven’t gotten from you. And I need you to create steps to figure out how you’re going to, you know, fix this problem. And so you know, it gives, you know, employees opportunity to figure it out. And they know that their job is on the line. And I think sometimes, you know it works, and sometimes it doesn’t. Sometimes it gives them exactly the fire that they need under their butt to realize okay, crap, like I have been underperforming. I need to figure it out. And in other instances it just makes it clear, if they don’t fix it, that that’s exactly like why we’re letting them go. So I think, you know, having that clear communication has always been kind of the foundation of how we work with employees so that they fully understand where they stand with us. And we always – you know, well we try our best. I would say, you know, it’s hard to deal with this, but we try to do like quarterly reviews with our team members, and if not quarterly, then we do it semiannually, for sure.
CASEY GAUSS: Nice.
BECCA LONGENECKER: So can you talk about what the advantage is to having like a team as opposed to kind of like a scattered network of freelancers and how you feel that has like given your business a competitive advantage?
FERNANDO CAMPOS: Yeah, so I mean I think it really depends on the stage that you’re at. I think in the beginning like a scattered team of freelancers can work. But I think the competitive advantage of having like a dedicated team, at least in my opinion, is that people are going to start taking more ownership. I think naturally if you’re like a freelancer then you’re a little bit less invested in any one company because you’re spreading time with, you know, several companies. And I think for us having these like dedicated people that are like, you know, in charge of logistics or in charge of, you know, product selection, like they work with us closer. They’re like – they’re in all of our communication, and so in terms of like being able to step up and take ownership, that I don’t know if we would get as much with like a freelancer. For instance, we made a hire that was in charge of like all of our systems, and she came in and put together like all of our supply chain from like our purchase orders, to our orders in production, and to like our shipment monitoring and then tied it all the way into finance, all in a software called like Ragic, all from scratch. But like she was able to do it really quickly, like within a month, without me being as involved because we had someone that was in charge of all the purchase orders. We had one person that was in charge of logistics. So she was able to like do one-on-ones with them. They’re all internal. And then to kind of brainstorm, like okay, well how does this need to look? Like where are the sticking points like right now, and then being able to put that all together within 30 days just because we had internal people that like had invested interest in this process being smoother.
NICK YOUNG: Right. And you know, Anthony mentioned The 4-Hour Work Week. You know, that’s also been super influential for me and Fernando. And I think realistically, like having a team of freelancers, I think it makes it more difficult for your business to exist outside of you. You know, it’s always going to be centralized. You’re always going to be the body that knows the most about your business. And I think, you know, for me and Fernando I can probably – I mean I’m sure Fernando can say this as well, but like there are parts of our business that we don’t know like how it happens, but it does happen, and I think it’s because we have people in charge of making those things happen. You know, we’re focused on the results, and we have the key indicators that tell us if something isn’t working. But ultimately it falls on those people. And so, you know, if we’re training someone and they come into business, having a team allows, you know, there to be multiple experts within the company that people can learn from. And so I can easily just say hey, talk to this person, talk to that person, and they’ll be able to get that body of knowledge without us having to be directly involved. And I think that’s kind of the efficacy of having, you know, something that exists outside of you as the entrepreneur and the business owner. And I think it allows it to kind of organically grow and [breathe 0:30:27.1] outside of you.
ANTHONY BUI-TRAN: Yeah, and then for me, I guess my favorite thing is there is all this stuff – I feel like – I don’t know of this is like a real phrase or not, but I like to always say that I’m a first time entrepreneur. So this is my first time running my own business, like really like handling like everything, making all these hiring decisions. But in terms of like perspective of like running a business, I’ve never done it prior to this point. And after meeting with Nick and Fernando I realized like okay, like to get to where they’re at versus where I’m at, it’s like they had like department heads, and it’s like okay, like I don’t have that in my business. So that’s like, you know, along the way, like as a smaller seller, I’m like okay, like these are things that I’m happy that I know like are on kind of like a roadmap to do. So just like having department heads, having full-time hires, like for the exact reasons that they were talking about. But it wasn’t until I like really met them and started networking with other sellers that were bigger than me that I realized that these were like the moves that you need to make in order to like 10 X your business, really. And that was like one of the biggest like mantras for me, you know, just like their whole hiring process is like really, really in depth compared to like mine. I know for like some of their like hires they’ll go like what do you guys do like 20, 25 interviews? Like when they told me that, when Fernando told me that, I was like what? I was like 20 to 25 interviews? And then so I’ve been with like Nick and Fernando like for the past three months. And like all at the , time like from the outside looking in it’s like they’re always like on – they’re always on like a hiring call like every single day. They’re always trying to hire like this other person, or they’re trying to find like the perfect candidate. And that brings me back to like what they were saying about like building like the A team, right?
When I’m hiring people what I’m currently doing is like I’ll look at – you know, I’ll get the applicants from like Upwork or OnlineJobs.ph, and I’ll like kind of choose like the top five, and I’ll narrow it down. Like I’ll interview like those guys, and I’ll just like pick the best out of that. But I feel like I don’t dive down as much as like they do in their business to like find like the exact perfect hire that’s, you know, for like say their supply chains, like you know, someone who’s like managed like grocery stores and like make sure like bananas were always on the shelf, you know? Like for me it’s like okay, like this person is good enough. You know, I didn’t realize that – you know, and now like my perspective has changed to where it’s like I want like the best person, like, you know, like maybe you have to wait a little longer. And I’ve heard multiple people say this, but you know, a bad hire is going to cost more than a good hire.
FERNANDO CAMPOS: Right.
ANTHONY BUI-TRAN: So you know, like invest that money into like – and what they also do is like besides OnlineJobs, you know, sometimes they would use like LinkedIn from what I understand, or like their referral networks. Some of my other friends, you know, like Facebook ads, or they’ll like go find like Facebook groups, like specifically for certain positions. And for me, like I just don’t go that far out of my way to really find the perfect hires. And that’s why like I’m excited that they got an HR person because I know like a day in and day out they’re always like on all these different calls. So like I know like how impactful – like I never really realized how impactful an HR department or team was until like just like hearing about all this. I was like oh man, it makes like such the biggest difference, especially with like you can free up so much time like figuring out like which candidates to like just hop on a call with versus like screening like, you know, 20 people, like and they can really help with that stuff.
NICK YOUNG: Yeah, I didn’t realize the importance of that until five days ago when she started. Yeah, I mean, you know, Fernando has been saying that we need to do it, and I was like I’m not sure. And then she went on and she did this awesome thing where she implemented like a – what’s it called?
FERNANDO CAMPOS: BirthdayBot?
NICK YOUNG: No, no. Well, that’s cool, the BirthdayBot, but implemented this tool that basically pulls all of our employees of like their satisfaction and different degrees of, you know, parts of their business like autonomy and ambassadorship or whatever. And then it was really cool to see it. So everyone responded, and they’re all anonymous feedback. And so it was really cool to see that like everyone was really happy with their jobs, you know, and to see that like everyone, you know, felt like everyone else was talented. I mean, it kind of confirmed like our initial, you know, belief and I guess what we had inferred from our experience that like we were going the right route. But to be able to see that and have a pulse on the company and to realize that like hey, you know, what we’re doing is working really, really was helpful and impactful. So yeah.
CASEY GAUSS: What is the birthday thing?
FERNANDO CAMPOS: Oh, it’s like a – so now we get notifications like for everybody’s birthing on the team. So we can do some kind of celebration thing, or if they’re maybe overseas we can do some like, some kind of like gift or, you know, something like to just, to acknowledge like hey, it’s your birthday, you know?
ANTHONY BUI-TRAN: Yeah, a little thanks.
FERNANDO CAMPOS: And it’s all automated, which is really nice because it’s all through Slack.
CASEY GAUSS: So as you guys start hiring like logistics people, HR, I imagine some of them you aren’t as comfortable in or have less knowledge, so how do you properly – this is something that I’ve been experiencing, so we’ve just started hiring at the director levels. We just hired a Director of Engineering, Director of Marketing, Director of Customer Success, Director of Product, like all these positions that, you know, I don’t have that much experience in. So I don’t know what the ideal candidate looks like. Have you guys run into this, and if so, how do you get over that to then finally making that hiring decision?
ANTHONY BUI-TRAN: Well, I – just from the outside looking in – I asked Fernando this like the other week. And I was like how do you like hire for like – how do you know they’re a good supply-chain person? And he says like when he screens all of them, like he learns from like each interview, you know? So he picked up different tidbits on like what each person, each candidate like has done in like experience, and then also like you look up some stuff on your own, but usually he can kind of like get a lot from the interviews from what I understand.
NICK YOUNG: I think that’s always constantly a challenge, for sure. I mean I definitely think it’s something we rub up against for sure, especially for senior hires. Like how do you know if you’ve never done it before? I mean, I think one of the things that, you know, we really try doing a better job of is getting advisors, so people who are really excellent at what they do in a specific role at a company we admire. And so now, you know, we realize like the value it adds is great, and we’ll regularly get dinners with them. And we’ll also include them in part of our hiring process if it’s a major role. So I think, you know, to leverage their expertise is great because they understand what we’re looking for. They know us, and they’re willing to lend their expertise in terms of, you know, whether they think this person is credible or not.
FERNANDO CAMPOS: Yeah, I mean two other things. I guess one is kind of like a feeling. Like if it’s – yeah, someone that’s really crucial to the business like a director, you know, like you’re paying like a higher salary, all that kind of stuff, I think about after, like after the interview how do I feel? Like I’m not like really excited about this like person joining because I know that they can like quickly, you know, if you have like a good Director of Marketing, like they will pay for themselves and like and more like, you know, within their first like let’s say six months. And so if I have that like feeling this person really knows like their stuff, then like I think that’s one big piece. And then the second piece is we’ll find a friend that’s in like a similar role, so like again like the Director of Marketing, or like a VP of Marketing at another kind of consumer products company and ask them to do the interview. And I think that’s been really helpful. Like I know for us like finance is like something we like understand but we’re not like as technical as someone who is a Director of Finance. So we’ll ask one of our friends that’s in that specific role to do the technical interview for us. And that’s been really, really helpful in terms of asking questions we would have never thought of.
CASEY GAUSS: Nice. Can you walk us through what your typical hiring process is, everywhere from where are you putting out these job postings? Okay, someone puts in their resume. What do you do there, all the way up to okay, now it’s day one, day two at the company?
FERNANDO CAMPOS: Yeah. So this process has been really interesting especially since we’ve had a recruiting person for all of like 10 days now. But basically so now all the candidates are coming through actually are Airtable where they fill out like a pretty long survey, which is –
ANTHONY BUI-TRAN: Tell them what Airtable is.
FERNANDO CAMPOS: Huh?
ANTHONY BUI-TRAN: Tell them what Airtable is.
FERNANDO CAMPOS: Oh, so Airtable is like this really cool platform. It’s kind of like a really powerful Excel that can pull from different like, different areas. But we use it both for like our analytics of our products so we can see like our weekly profitability, but it also has like other kind of templated forms that can – kind of similar to like kind of Google surveys and stuff like that. But it makes it really easy for a candidate to upload their resume, you know, include their Skype, like you know, where they’re located. You can have them like answer specific questions related to their job so that you just see like do they really – are they actually putting time in to fill out this like application for us or not really. And versus like OnlineJobs you can kind of just like click, copy and paste your normal paragraph and then submit and then move on to the next application. But yeah, I mean in terms of like okay, so where we’re gathering the applications is for sure OnlineJobs. We’ll do outbound outreach through LinkedIn. We just started doing kind of like Facebook where it’s kind of like what Anthony was mentioning. If there’s like a specific type of Facebook group for that, you know, particular industry or like type of role.
And then I would say that’s pretty much it. We’ve tested – we tested ZipRecruiter and like a little bit of LinkedIn ads. But like, but those main three, OnlineJobs, outbound outreach and then Facebook groups have been like the best like ROI so far in terms of like time spent. And then so now as a – now that we have the full-time recruiting person, that we’ll have a meeting with her before and to get like all the job recs, like what is the most important parts of the role, like what are the hours they’re going to need to work, like what are the main things that we’re looking for. And then she’ll actually do all the resume screening and the first round of phone screening for all of our candidates. And then those kind of finalist candidates will get passed on to Nick or I, depending on which department it is or to the department head, I guess. And then it will go through that kind of like gauntlet of like talking to the department head, then talking to Nick, and then to me. And then if it’s like a really important role or one that we’re not as comfortable hiring completely on our own, then they’ll also go through a technical round with a friend of ours.
CASEY GAUSS: Nice. Do you guys look at references at all?
FERNANDO CAMPOS: We used to. We kind of stopped to be honest.
NICK YOUNG: I think it depends. You know, I think in the Philippines, like it was overseas. I don’t think it really works well, to be honest, because I think just culture-wise, you know, they tend to be very, you know, non-confrontational, so you know, they’re going to be nice no matter what, you know? I think overseas is hard to really understand that reference thing. But I think if it’s in the US, yeah, I think we’ll definitely call references, especially since there’s more on the line. You know you’re paying them a salary. We’re based in California, so we have to pay a lot of taxes and that kind of stuff. And I think also when you’re screening references in the US, you know, you can have a more in-depth conversation with them and really dig into their experiences. And if it’s anything less than an A+ then that’s kind of a red flag, you know, because naturally they’re going to choose people, you know, who are going to be in their best favor. So we’re looking for any reason why, you know, the person might not be giving them a full-fledged recommendation.
FERNANDO CAMPOS: Yeah. Actually one of the things that we do is kind of like a top grading kind of tactic that I recently learned about, which is, again, for US hires we will mention in the first interview that we will be checking references. And like the theory behind it is that if you kind of mention that like at the beginning of the interview, then they call it like truth serum where that candidate is much more likely, since you kind of set that ground-floor, like okay, we’re going to be checking references and validating things that you said, that they are more likely to tell the truth in the interview versus if you didn’t –
BECCA LONGENECKER: If you could do anything differently, if you could go back and do anything differently would you? And then also, who would you recommend – for like FBA sellers – who would you recommend build a team? I’m thinking like for some of our newer sellers who are listening who might be thinking like this is something for them later. Yeah, what kind of person?
NICK YOUNG: To hire?
ANTHONY BUI-TRAN: Yeah, I think, I mean the first hire, in my opinion, should be like an admin person. Once you get to the point where you know your time could be better spent elsewhere and you are bringing in income, it does make a lot of sense, in my opinion, to get that first hire to do your admin stuff, kind of like what we were saying earlier about like customer service, following up on reviews, things like that. But in terms of like if I had to start over and like really do this whole process again, like what would I do and what I? So if I could start over, yes, I would totally love that cheat code. And based on like what I know now, but basically like the biggest thing would be to find mentors, right? Just find people bigger than you because like for me – I always say this, but there’s things you know. There’s things you know you don’t know, and then the biggest part of this whole pie is the stuff you don’t know you don’t know. And like the last like three months for me have just like been like tapping into the stuff that I don’t know that I don’t know. And like in terms of like, you know, businesses having like advisors, like I knew that was like a thing, but I just didn’t think like people in the Amazon business like started doing that really because the sellers I felt like I was surrounding myself with didn’t think on that level. So it also kind of depends on what your goals are, right? So if you want to get to a certain mark, find sellers that are already at that mark because then he can really just like, you know, just dissect like what they did to get there and like – you know, people don’t mind like giving advice. And it’s cool for, I think, other sellers to like really reflect back on their journey and really understand like hey, these are like some pivotal moves that like got me to this point, or like this is what’s really working in my business, you know?
BECCA LONGENECKER: Right.
ANTHONY BUI-TRAN: So that’s what I think, yeah. NICK YOUNG: Yeah, I think for us like I mean ultimately I’m a firm believer that, you know, you have to go through an experience to really learn from it, and you know, you have to have moments of crisis in order to recover and just be stronger. So I mean I think if I could change things I would definitely like do that. That would be awesome. But I’m really grateful for those experiences. But I would think probably the main thing I would hone in on is know your numbers and really understanding like on a per SKU basis how much money you’re making or losing after ads, after all of the fees because I don’t think a lot of sellers look at that. They’re just looking at the top line revenue, and that’s something that we were focused on for a long time, and I think it – you know, it really put us in crisis point where we just weren’t able to manage our cash flow effectively, and we had to kind of work ourselves out of that hole.
And so I think having clear direct numbers around what, you know, what, you know, what guidelines you’re going to set to say okay, I’m going to keep this product or I’m going to let go of the product, and being really stringent about that. I think people get too married to a product, and we definitely had that. And then ultimately it ends up bringing your business down because you’re not managing your cash flow effectively. You know, those SKUs are taking up a lot of cash for you to keep up. But you’re really not making much money. So learning to let go of those bad products and reinvest into the good ones, and ultimately I think that’s, you know, that’s something that I wish we had done earlier. But you know, I think, again, without going through that experience we wouldn’t have known.
FERNANDO CAMPOS: Yeah, and I guess to reiterate kind of points that we made earlier, I guess if I were to do things differently I would hold our like overseas team, like in terms of the interviewing process at a higher standard, like you know looking at them like as if they should be like equal or not more talented in this specific area than me or than who I would have hired in the US because I think that has elevated like the average ability of our team, and I think that was like a really big thing. And then also just like learning to delegate like earlier. I think yeah, we kind of held onto like certain tasks, like oh you know, this is too important, or you know, inventory planning, like you know, it’s too – like we can’t be out of stock. We need to like hold onto this. And then like realizing that there was just people out there that are way better that have been doing this for years, and like this is like their dedicated focus versus like us trying to do everything and holding certain aspects of our business to our chest. I think those are probably the two things I would do differently. And then in terms of hires, like yeah, either for sure like the first one for me would either be like a customer support person or admin, or this kind of like jack of all trades that can handle that as one aspect, but can help with like, you know, finding new products and like handling asking for reviews and all that kind of stuff as part of – as like kind of like a right-hand person I would say.
NICK YOUNG: Yeah. I think communication is going to be really key, especially if it’s like a remote person. So someone who is willing to, you know, speaks English really well or speaks your language really well, you know, is very – over-communicates rather than under-communicates. That’s going to be major because you know, you’re going to be sending them all this stuff. They’re going to have to ask questions. They’re also probably going to have to give you updates. You know, when you don’t see them in person there’s a lot of stuff that’s missing. So you know I think that jack of all trades or customer support person needs to be very, very proactive about communicating.
BECCA LONGENECKER: Well, thank you guys so much. That was so educational.
NICK YOUNG: Thank you guys for having us.
BECCA LONGENECKER: That’s all for this week. Thanks for joining us on Follow the Data. For more insights and reliable information about how to grow your Amazon business, subscribe to the podcast and check us out on YouTube. We have tutorial videos for all of our tools, as well as webinars that go more in depth with pro tips for how to really get the most out of the tool.
CASEY GAUSS: If you’re listening to us on iTunes don’t forget to leave a review and rate the show. If you’re an Amazon seller you know how difficult reviews can be, and you know how important and critical they can be to your success. Same is kind of true here on iTunes or wherever you’re listening to this, so we’d love it if you could leave us a comment if you’re listening on SoundCloud, leave a review if you’re listening on iTunes. Overall, we love feedback, and we’d love to know how we can improve the show for future episodes for you. And if you know a fellow seller who is trying to build their FBA business, tell them to check out this series and the rest of the Follow the Data episodes. We want to be a resource for sellers and the information source in the space, so please tell your friends, spread the word and share the data.
BECCA LONGENECKER: Thanks again for listening, and as always if you want to be featured on the show, have an Amazon-related question or an idea for an episode, feel free to leave us a voicemail. Our number is 317-721-6590. Until next time, remember, the data is out there.
The newest feature of Brand Registry 2.0 has arrived: Amazon Stores.
Amazon is constantly introducing benefits to their Brand Registry program: trademark/copyright protection, Enhanced Brand Content, and now the ability to create Amazon Stores.
What are Amazon Stores?
According to Amazon, Amazon Stores is a free self-service product that allows brands to create single or multi-page Stores to showcase their brand value and product selection. Features of Amazon Stores include:
Own a unique Amazon web address (amazon.com/your-brand)
Create multiple pages to showcase your product catalog
Start with pre-made mobile and desktop layouts
Receive traffic from Amazon search and detail pages
Each Amazon Store page is made up of a header, footer, and content tiles in between.
How do you set up an Amazon Store?
To access Amazon Stores, login to your Seller Central account and click Storefronts > Manage Stores.
If your brand is enrolled in Brand Registry, you’ll see a “Create Store” button. If your brand is not enrolled, you will see a “Register a brand.” button, as only registered brand owners are eligible to create Stores.
If your brand is registered, you’ll head to the Store setup page. First, you’ll add your brand’s logo and then select your page template. There are four template options:
Marquee: designed to act as a brand or sub-brand gateway page.
Highlight: showcase related products and related content.
Product Grid: display large number of products.
Blank: customize your own layout.
With a template selected, you can edit everything in the Amazon Store builder. Amazon outlines the Amazon Store Builder this way:
“Page Manager: used to create, select, move, and delete pages from the Amazon store.
Preview Window: provides a live view of the current page. It can also be used to select a tile to edit in the Tile Manager.
Tile Manager: used to add, edit, move, and delete tiles from the Amazon store. Tiles options include product, text, video, and image.
Status Bar: provides the current moderation status of the Amazon Store (not submitted, in progress, approved, or failed) and displays any error messages.”
As you’re editing, you can preview your Amazon Store to see what it will look like. Once you’re happy with your Store, you can “Submit for publishing.” The review and approval process may take several days, and you cannot edit your draft during the moderation process. To avoid a Store rejection, follow the Amazon Stores Creative Guidelines.
Amazon’s main priority is its customers. It always has been, and it always will be. Let’s be honest… the overall aesthetic and UI/UX of Amazon isn’t the best in the world. So it’s no surprise that the company is rolling out features that will enhance the shopping experience.
Honestly at this point, we’re not sure how Amazon Stores will affect the overall shopping experience. Right now, a shopper finds what they are looking for by typing in a search term, looking through results, and selecting a product that fits their needs.
However, it would make sense that Amazon is setting up for an additional way to drive traffic through these storefronts in order to make the shopping experience more enjoyable. Afterall, Amazon does advertise that Amazon Stores will “build a new shopping experience.” Here at Viral Launch, we are just really interested to see how that shopping experience will change.
Is Amazon taking a note from Macy’s by including branded sections located throughout the store? In case you haven’t noticed, Amazon has been actively making changes to the shopping experience already. When searching keywords such as mens watches or womens shoes, Amazon no longer shows search results directly.
Will Amazon start to identify “trusted” or “popular” brands for particular product markets, such as a search for vitamin c serum resulting in a few popular brands plus a few search results? We’re interested to see.
This could be Amazon’s way of weeding out sellers who aren’t serious about their business and rewarding those who are. After all, Amazon is a better place for consumers when their merchants are serious about providing a good product from a good brand.
For this reason, take advantage of Brand Registry, if you’ve been reluctant to pull the trigger thus far. Along with the brand protection, brand support, and access to EBC, the program allows for Amazon Stores, which could become increasingly valuable as Amazon continues to evolve.