Growth is painful, but so is the alternative. Last year I grossed $65,817.07 on Amazon, having started with their Fulfillment by Amazon program in April after running into some guy at Costco who is a Pastor at Southeast Christian Church looking at some Nike hoodies for resale.
I’ve grossed $63K in the first quarter of 2018, and I’ve been focusing much more on making my margins of 25% minimum (after fees, shipping and other expenses). I’ve sold some very high dollar products at minuscule margins that were simply not worth selling, so the gross numbers really don’t matter unless the margin is there. It feels pure vanity to brag about big gross numbers knowing that the profit margin is all that matters, which you don’t see in a screen-cap.
I think it’s funny when people assume that selling on Amazon, eBay or anywhere for that matter is passive. Granted, when Amazon fulfills my orders with the inventory that I store at their warehouses it saves me the work of shipping the product and dealing with returns, but that is why it is so scaleable. Most of my time is spent maintaining my listings because I do my own repricing to stay competitive, and sourcing more product. If you want your business to grow, you need to feed the beast. Amazon’s FBA program makes for a hungry beast that has an insatiable demand for product.
So the key to Amazon FBA is sourcing profitable merchandise and having the capital to buy it. My first deal was buying 82 pairs of golf shoes that, come to find out, I couldn’t sell on Amazon. But I figured it out anyways.
I’ve sourced plenty of products. Some have done well, others have been losers. Double down on the winners and cut the losers seems like a principle that works well in most areas of life, especially ecommerce arbitrage. I’m learning to test products more, and then wait for the right time to really commit to buying larger amounts of product.
I save more money now when I find a real winner product by buying wholesale quantities and having them shipped LTL via tractor trailer. I’m excited because I’ve made my largest purchase last week, two pallets which will be headed to an Amazon warehouse tomorrow.
The bottom line is that if you want to make it happen, you’ve got to hustle. If I don’t hit the ground running tomorrow morning, then I’ll have no chance of grossing over 100K in Q2. If I don’t work smart, may be I will gross that much but not make much profit at all, and earn a pittance for all of my “hard work”. So my focus is on being active and dynamic, keeping my eyes open for opportunity to come my way, executing upon good information and being an overall practitioner. Stay hungry my friends.