You should by now have your Amazon account starting to gain some momentum and your systems and processes taking shape. The temptation for many is to scale too quickly. You should by now have your Amazon account starting to gain some momentum and your systems and processes taking shape. The temptation for many is to scale too quickly.
By this I mean, you launch into USA, UK, EU, Canada all at the same time before you have learnt the basics. Most will need at least 6 months to build your skills, experience and contacts.
It is certainly possible but I recommend you focus on one country first and learn the ropes. There are many traps and moving parts so keep it as simple as you can at first. If you already have experience then you are in a better position but I caution you to slow down and learn how to do this consistently first.
The first product tends to be a practice run. Some of you will hit a home run and you’ll be on cloud nine, some will be selling steadily and many of you will be struggling. It’s just the way it is unfortunately. I don’t think any is better than the other. You can lose the home run as fast as you make it so don’t get yourself down if you are going slowly. You can still win the war!
The good news for the strugglers is that if you find a way through and stick at it you will “earn your stripes” and get your cash flow going. For most it just takes practice so be prepared to work at this.If you follow my guide in the first 2 phases I am sure you will do more than fine but don’t think you won’t have to work because you do! Don’t quit. Learn the skills and battle on!
So scaling consists of diversifying across product lines, product categories, Amazon Countries, Sales platforms like Ebay and increase activity on your ecommerce website. As well as this you will need to expand your team, your management and consider some sensible use of funding to help keep the machine moving forward.
When considering Phase 4, you should, by now, have a very clear idea of where your business is heading.
You have a product line that is profitable, a solid brand evolving, a community of customers and processes and systems that are nurturing them. Your team is developing the culture you want and it has an organised feel to it. It is starting to run itself. It is becoming more predictable. Yu can identify weak points more easily and as a result can target where you need to improve your systems.
Remember we are attempting to satisfy 2 main longer term goals:
- To sell the business for a large “retirement” lumps sum or
- To attract an investor who will inject further expansion capital and add new skills, contacts, markets and experience so you can sell for a much improved figure than if you carried on without their input.
Phase 4 is great fun as you start to introduce more products, more distribution channels, more strategic partnerships and methods of promotion. The business is running itself by often self-funding your expansion and increased activity. You are now working most of your time ON your business NOT IN it! It’s a great place to be. You are now in control, NOT Amazon or Ebay. You are Captain of your own ship because you have built the foundations correctly.
You know how to set up your platforms and pick the right niche and products for your branded product line. It is personalised and your goal is to build a community of people you can “attract” NOT sell. (Phase 1)
You have a killer product launch promotion in place and are continually adding the latest and greatest traffic and conversion strategies to your marketing (Phase 2). There’s a lot going on but you have a team looking after 90% of the tasks you need to get solid foundations laid. Your team is managing the business (Phase 3). Your team are sending you the reports you need to make intelligent decisions with your accountant and other professional team members about what to implement next to help scale the business in a controlled and financially responsible way.
Now in a perfect world you would have a complete team and system in place where you just turn on the switch and it all happens seamlessly without issue. It is, of course, never a straight line. Gaps will appear and some areas will evolve faster than others but I am sure by now, you get the concept?
The numbers and the market will tell you when it is time to scale and make that push to the higher levels. (Phase 4) You have to earn the right for this so if you have evolved your first 3 phases to a decent enough level you will know when you are ready. It will be obvious. You will feel prepared and the decision will make sense based on your numbers and commn sense, not because some internet marketing guru told you to do it asap.
The main issue is grow at a sensible pace. Many businesses fail because they grow too quickly and do not have the skill and experience to handle it. For example you launch your first product and it goes crazy. You are making $300K a month before you know it and with that comes a lot of new challenges with inventory management, suppliers and competition. If you don’t know how to handle it then it can be a very hard job hanging on to your market share! It all sounds great but it doesn’t mean it’s a picnic with no challenges. There’s NO such thing!
You don’t know what you don’t know and when you sail into unchartered waters and have no-one around advising you who have already been there, done that, you can get yourself in a mess. In this situation you don’t know what can be a problem so it comes out of nowhere and surprises you. This can be a very painful and expensive learning curve if not managed properly. It can derail you from getting to Phase 5 and making that big payday so only take on Phase 4 when you feel strong and ready for the challenge.
If you ever feel out of your depth, just email us and I am sure we can help you negotiate through the situation if you need a friendly ear. Just email us and we can have a chat. Not a sales presentation. Just a friendly chat to help you consider your options.
So let’s get onto the main tasks we need to look at in Phase 4.
Here are 7 main possibilities to consider:
- Open up Amazon UK/EU, Japan and consider others like Mexico, Canada.
- Expand Product lines on Amazon
- Diversify across categories and sub-categories
- Open Ebay Accounts in multiple countries
- Transfer Products onto your BRANDED Ecommerce Website and implement an external marketing plan
- Add new team members
- Explore Funding Options
1. Open up Amazon UK/EU, Japan and consider others like Mexico, Canada.
This is the obvious next move. It all sounds fantastic but you MUST know what you are doing and have a clear plan and have a team to help manage your accounts. Setting up your accounts incorrectly in these other countries can be a massive issue so make sure you get the correct advice. Go to our resources and services pages on our website for more information to help you figure out when to get set up overseas and what to do. We’ll take away the headaches as best we can.
2. Expand Product lines on Amazon
In Phase 1 I talked about the importance of selecting the correct niche with solid product lines NOT just a product or unrelated products in different categories. If you did this the right way you will already be ahead of the game. Your product lines complement each so you are serving the needs of your demographic.
3. Diversify across categories and sub-categories
The product line will not all be in the same category. There will be many that will be related but in different categories and sub categories. For example, let’s say you are selling home brew beer kits in home and kitchen category. You could have a line of BBQ tools and accessories in the outdoor category that complement that very well.
4. Open Ebay Accounts in multiple countries
Get multiple selling channels open asap. Ebay USA, UK, Australia and any others you like. It isn’t as hard as you may think. You can also open an Etsy and Rakuten account too. They aren’t a huge priority yet but certainly get your products on them as it all helps you get to the magic $15,000 a month net profit income and beyond.
5. Transfer Products onto your BRANDED Ecommerce Website and implement an external marketing plan
You should have a basic site already but now we are talking a fully branded and optimized ecommerce site of your own. This is a big deal. It isn’t just a testing site, This is your HQ. It is YOUR BABY! Treat it with care! You need to know what you are doing and so does your team. Find out more on our services page. No hard sell. Just get the job done properly for minimum investment but make sure it gets done professionally.
6. Add new team members
I love building my team. It gets me pumped to see my team members learn something new and grow into a role. They increase their skills, build their confidence and feel a part of the family. As you increase your activities you will need more staff and systems to handle them. You can’t build a real business with intrinsic value worth REAL $$$ without solid systems and processes! PERIOD.
7. Explore Funding Options
Finance may start to become important in order to smooth out any bumpy times. I am not a big fan of you going into debt until you have proven your skills and your cash flows are solid in order to service the debt. Be SUPER careful with this. It is usually the ones who are desperate who get funding too early. Yes it can still work but we area about how to reduce risk not increase it on long shot premature hope.
We will go into a lot more detail about these considerations and how to piece it all together. For now just let all these 4 phases wash over you. You’ll get to the end and work out how you feel about it in reality then. For now just get involved with the community. Let’s be GREAT Ecommpreneurs together and reach for those goals we hold deep inside. Let’s achieve them together.