A lot of people ask me how to scale their business. They get to a point where they have 2, 3 maybe 5 products online and are either facing cash flow problems or don’t know what to do to grow to the next magical number.
When I have calls with them to find out what can be done it is often one thing that they overdo - optimizing. Be it their listings, backend keywords or PPC marketing.
Don’t get me wrong this is important and you need to optimize to grow from 2 pieces a day to 10 pieces or more. But it doesn’t mean thats what you should be doing all day.
Second reason I find is that they are obsessed with numbers, hijackers, copy cats or their competition. Again, you do need to look at these things but honestly I have better things to do than obsess about my numbers or competitors.
When I put my French Press case study out there in public I didn’t worry about copy cats. Because if I would have decided not to do it I would have missed out on a product thats making me good money for over 6 months. First of all I wanted to document on a generic product how the process is done and second if I make good money for 6 months with that product and then the competition comes so be it. In those 6 months I will already have developed my next products or built further passive income. Yes it is frustrating when someone copies you but that happens in every business. Move on.
I understand that if you have 1-2 products online its very exciting to look at your growing numbers by the day. But you can only grow that much if you try to optimise all the time and not look into developing new products, your brand, your company or your idea.
I am sure most of you heard of guys like Will Tjernlund (24 year old Multi Million $ seller or was it 25 ? :) ) or Ryan Moran (Freedomfastlane). Yes they do perfect their listing, photos, keywords and such but they don’t obsess over it. They rather take action, develop the next product or make a call to a wholesaler or factory and land another exclusivity deal that will make them thousands of $ while we review our keywords for the 50th time.
If you recall in my last blog post I was in Hamburg at a conference and Will was also there. After the conference sitting together on the last day before everyone went home while most of us were discussing strategies on optimising, Will found another product online, picked up the phone, called the sales rep of the company in the US then and there, offered them to purchase and list for them on Amazon exclusively and landed another deal that will make him (hopefully) thousands of $. I wasn’t there in person but I was told by my friend who organised the event. Reminds me of a famous saying from Scott Voelkers (The Amazing Seller) podcast “Take action”. I know easier said than done but it really is just that - pick up the phone, make the call, negotiate and place the order. Don’t over procrastinate and optimise - go for your next product. Obviously research and product validation has to be done but hopefully you don’t fall into paralysis/analysis.
All of these guys also outsource many parts of their business. That could be virtual assistants for your customer feedback, letting professionals handle your sourcing and manufacturing in China or copywriting for your listings and products.
Why is optimizing your listings less important than developing new ideas and products?
I’ve touched on this in the last blog post also:
Constantly re-inventing yourself and focusing on the direction of your company – because there is no one there to tell you what to do. You are responsible for the success of your business.
If you only focus on optimising who is going to develop new products and strategies?
Scaling up with more products means you need more cash.
Which brings me to the second issue why people stagnate - cash flow. Yes Amazon makes a nice income after a while but what most people forget is that a lot of your cash will be tied up in inventory and re-orders, especially in the beginning.
Therefore diversify your income and don’t put all eggs in one basket.. At least at a point where you are making 2-3000$ profit a month on Amazon to support your lifestyle, pay your bills or put even more money into the business. As I explained in my last blog post I made the mistake myself taking out money of the company in the beginning. Today I put nearly every $ made back into my business. That’s how you scale up. Because what is the money good to you in your savings account when you can re-invest it into your business and double it at a much much faster rate than the banks interest rates. Yes of course I put money aside for the rainy days and save up a bit of cash but its less than 10% of my monthly income. If you want to scale up you need to invest in yourself and trust your abilities.
Therefore to generate more cash flow and pay your bills diversify your income stream as soon as possible. Or maybe you are doing this on the side and still have a full time job? Also good but there are still ways to generate extra income.
1) Your own eCommerce store
Ok not the ideal way because you will need more cashflow but you can start by adding a small quantity to your next Amazon order placed in China and send it to your warehouse/garage/fullfilment center selling trough your own eCommerce site (Shopify for example). This can be a trial and test and if it works out you can decide whether to continue the eCommerce lane or not.
2) Teaching your knowledge
Have you heard of UDEMY? It’s the largest website where instructors/teachers can offer their knowledge in the form of an online course and over 5,000,000 students can view your (paid) content. The downside is that UDEMY takes 50% of the cut (unless you send the traffic there). But you could also set up your own site and offer your course trough that way, all the money goes into your pocket. If you aren’t familiar with setting up websites and online courses you can try teachable.com which offers people templates and ready made landing pages for your course for a 3% commission.
3) Starting a blog
I never was much of a writer or blogger. I started my first blog in 2006 with a few entries now and then. I had no idea what I actually wanted to blog about or how this whole blogging thing works. So the blog kind of died down until I started my first actual blog (ImportDojo) in 2015. There are so many ways you can make money trough a blog and while I don’t recommend you start the next cooking or travelling blog (very competitive) there are still so many niches people like to read about or make money in. That could be a small niche like home brewing, diving harpoons or whatever. Just making things up her as I go :)
Check out this excellent resource on how and what you should do when starting a blog: onestep4ward.com
Ideally the blog is somewhere in the nature of your physical products that you are selling. Say I sell a French Press I should naturally start a blog about coffee, coffee machines and such. Good thing is the sooner you start a blog or social media presence and the more followers you get the more traffic you can bring to Amazon or your eCommerce store. On top of that you create authority among your readers. People trust you and are willing to purchase your product. Key to blogging is (I find at least) is to give a lot of value. You can also integrate a eCommerce shop (or direct people to your Amazon store) at some point in your blog to create extra income trough physical products on your blog.
You can put up your skills for sale. Be it trough a course or trough a personal one on one phone call. You can either integrate coaching calls trough your own site/blog or even list your skills on sites like Clarity, UpWork, Fiver etc.
5) Writing eBooks
As I said already I was never much of a writer but I just put my knowledge on paper. Plain, not very entertaining and fact/experience driven. People need that especially if you are in a niche where you have experience and people can rely on your knowledge. Information and knowledge equals money. Start writing a 15, 30 60 pages eBook and put it on Amazon or your own site. Even if it “only” makes you 30$ a month.
6) Approach retailers
I started the other way around. I went to retailers first and then onto Amazon. But that’s because I have 17 years of experience and contacts in retail. If you have a well selling or unique product on Amazon, retailers, brick & mortar stores will approach you. Believe me, it happens eventually. And even if not - walk down to your local retailer and speak to the Manager if they are interested in buying stock for their store. You can also do this online and approach retailers that you think may fit with your product. Do your research, prepare yourself properly put on a suit and try to get a meeting with the purchase department.
Every dollar counts, ESPECIALLY passive income. I don’t care if I work 2 weeks non stop on a new project and it “only” brings 50$ a month extra. Thats 50$ I didn’t have before and ideally I don’t need to do anything for it anymore and I still make that every month. Imagine if you have 10 projects or side/passive income that make you 50$ each. Thats 500$ a month for a few weeks work. The key word to diversifying and building passive income is hustling and grinding. Passive money takes a long time to build up but believe me the sweat and tears are worth it.
Key points today to scale your (Amazon) business:
- Don’t over optimize your listings - spend the time on developing new products
- Build more income streams, especially passive money.
- Use your passive income to pay the bills. The profits from Amazon go back into Amazon (or other businesses) creating more products up to a point where you either sell it all, retire on a beach, keep working or just spend time with your kids at home.
Pheew another motivational post, didn’t plan on that. I hope there’s something in it for you nonetheless :)
All the best and happy sourcing,