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…answer your questions here on the podcast and I do it every single Friday coming back at you again today. Super excited that you’re here and that you’re tuning in once again. So, today what we’re going to be talking about two different things. We’re going to be talking about buying businesses and then selling hot trendy products. Should I? Shouldn’t I? What are the pros, what are the cons? All of that stuff so we’re going to be diving into those. I do want to invite you to ask your own question if you have a question. So, all you have to do is head over to TheAmazingSeller.com/Ask and do that. Just ask a question and if you have a question that is not pertaining to just Amazon, please, I welcome those questions because you guys know I’ve recently announced that the podcast is going to be more than just Amazon talk.
It’s going to be more about e-commerce but more about brand building and really how to go out there and build a real true business. And you’ve probably noticed the past few episodes and even the past 10 or 12 have been really, really focused on that which also brings me to something that I’m working on. You heard me already talk about it here on the past couple of shows and that is my Wednesday shows on YouTube. Now, I’m doing something as a test and if you didn’t hear this, well, you’re hearing it here for the first time. I decided to commit to showing up on Wednesdays, on YouTube and really mapping out more brand building type content and there’s a lot to dig into so I really need a whiteboard and really be able to drill in and really drill down into these topics. Now, I am going to be doing more of these as long as you show up. So, I need you guys to show up and the way that I’m going to know you’re going to show up is a couple of different ways.
[00:02:04] Scott: Number one, subscribe to the YouTube channel. All you have to do is go to TheAmazingSeller.com/YouTube, subscribe. I’ll know you’re there. I’ll know that you guys are getting value because I know that you’re showing up. Now the other thing you could do is leave a comment on any of the new trainings that I put out there on YouTube, on the channel. Comment. Let me know what you think. Let me know if there’s something that’s not making sense. Let me know if there’s something you want to see me include in the future. These videos that I’m going to be creating are trainings for building a brand. So, if you have been paying attention for any amount of time in the past six months, you’ve probably heard me talk a lot about that. If there’s something that’s not making sense or something that you want me to clarify or map out, draw out, let me know because I am going to be at my whiteboard in my office and I’m going to be doing these for you on YouTube, on The Amazing Seller channel. So, definitely, definitely go do that and comment and subscribe. Do that for me. That would be amazing.
Now, as you guys know, on Fridays I like to give you my thoughts, my thoughts of the week or just what’s kind of circling around in my mind, in my brain, and there’s always lots and if you guys are entrepreneurs or even new entrepreneurs, you’re starting to understand what I mean. It’s like, yeah, these things swirling around your head and what do I focus on and how do I stay focused? How do I not start chasing the next shiny object and all that stuff? And we all fall into that but I'm not going to go into that here today. I've already talked about that, but I will talk about it again in the future but what I want to really highlight here today is this. Be willing to fail. What do I mean by that? Be willing to take a risk. Now, that risk might just be you spending time doing something that doesn’t amount to anything or to you it doesn’t. You’ve learned through that process which I say over and over and over again.
[00:04:03] Scott: But perfect example is I’m going to start this YouTube thing. I’m going to start it on Wednesdays. I’m committing to Wednesdays. I’m going to do it for six to eight weeks, probably eight weeks at least and if you guys are liking it and enjoying it and you’re letting me know that and I see the people are viewing it, guess what? I’m going to do more. If it doesn’t, guess what? I’m going to step back and go, “Why? Why are people not enjoying this? Do they not need it? Do they not want it?” Now, I think that you will enjoy it. I think you will get value. I think that you’ll want me to show up and map things out outside of just building an Amazon business but really a brand and a business. I think you will, but I don’t know 100% until I actually create it, until I commit to it. So, I’m not just going to put one video out and go, “Here it is,” and if anybody likes it, great then I’ll keep doing them. I’m going to give it some time. I’m going to commit to six to eight weeks of doing this and you have to do the same.
So, if you’re just starting your business then you have to say, “Okay. How much time am I willing to sacrifice, to risk?” How many episodes of Lost am I not going to watch in order to try to build this business? Like, I mean simple stuff like that but that’s really what you’re risking in the beginning, not a lot of financial risk in the very beginning. It’s a lot of the research, it’s a lot of planning, even if you’re pivoting into another part of your business. Maybe you are already selling on Amazon and you’re doing pretty well but you’re scared and you’re nervous that competition is going to come in and just take over your sales and you’re worried about that and you want to build a brand. Well, what are you going to risk by building a brand? Time and maybe some resources, maybe hiring a VA for a couple of hundred bucks to do something for you. It’s not that big of a deal but you have to be willing to risk that. You have to be willing to fail at something. If you aren’t willing to fail, you’ll never put yourself out there and you’ll never know.
[00:06:02] Scott: Now, let me give you a couple of examples of how this worked for me. Now, some of you may or may not know. I started a couple of different podcasts over the past five years. One of them was more about just the broad vision and the broad thoughts on marketing because I know that I can walk into pretty much any business and I could help them in marketing. I'm still blown away that there are million-dollar companies right now that don’t understand building a list and email marketing. I’m just blown away by that. So, you guys that are paying attention here on this podcast, you guys hear me talking about this, you guys understand kind of how everything fits together, you guys are way ahead of the curve because a lot of big businesses even though they’re big businesses, they’re lacking these simple skills or the fundamentals. But basically, I said I’m going to go ahead and create this podcast and I did it and I think we did over, I don’t know, maybe 20 episodes or something like that and the traffic was just not there.
I wasn’t getting any traction because guess what, it was like every other podcast. How to market your business, how to do digital marketing. It’s just too broad and I’m up against all of these other people that have been doing it for years. So, what did I decide to do this time around? Let me focus on one area and go all in on that one area. What was that one area do you ask? It was Amazon. It was focused on Amazon because that’s what I was doing at the time and I still am but that’s what I was focusing on. So, like there’s not a resource out there that is giving the market the information on just this part so why don’t I document my story and do that? And I’ll just focus there. I won’t focus on marketing outside of Amazon at that time. Now, as you see and as you can kind of see how this whole thing is unfolding, after three years of publishing consistently and a lot of it is e-commerce, a lot of it is Amazon-based but now we’re starting to pivot.
[00:08:00] Scott: Because now I have people that know, like, and trust me, hopefully, you, and you’re willing to say, “Okay, Scott, I want to hear more about this stuff over here.” We’ve got the attention. The same thing happens when you are trying to start a new brand. You have to figure out, “How do I niche that down?” I recently did a coaching call and I recorded it and it was episode 524 with Lori and we talked about her going into the keto market. And I said, “Okay, let’s dig into this,” so we did, and she wants to go in where she helps women and she wants to help them in keto dieting. So, we looked, and we did a little bit of research. We niched it down from keto to keto for women to keto for women over 40. So, now instead of her going out there to the masses, she’s going to a smaller section of or a segment of the audience or of that market. Same thing I did. But the first time around I didn’t know that, but I learned a ton and guess what else I learned?
I learned how to record. I learned how to speak into a mic. I learned how to edit a podcast. I learned how to post and upload a podcast. I learned how to create a feed. I was able to create all of the nuts and bolts of creating a podcast and just wasn’t the right fit at the time, but I learned all that stuff through that process. I did another one, a short one in fitness when I was 40 years old which I’m 45 now. I was big into fitness more so than I am now which I probably should get a little bit more in, but I am still in, just not as much as I was there. And I was 40, probably going through like a midlife crisis type thing and I got in really, really good shape and I really was passionate about it. And I still am passionate about health and fitness, just not as much as I was then, and it was more of strength training and all of that stuff and I started a podcast with a buddy of mine and we did a few episodes like five or six or something like that and then we just kind of, eh, we weren’t really getting anything, and it was kind of a task and we just weren’t into it.
[00:10:02] Scott: I thought I was going to be into it, but I just wasn’t into it. So, we stopped it, but it was a lot easier to get that one up and running versus the other one that I did. Now, this one here, The Amazing Seller, I committed to and again I almost didn’t do it because I failed in the past in my own mind and I said, “You know what, I’m going to go ahead and give it another try but this time I’m going to do it where I’m going to niche it down something that I’m doing currently, something that I can give people the play by play and the market is lacking,” and that’s what I did. But learned a ton. I learned that niching down is really important especially in the beginning. Now eventually you can widen that. If you’re going into bass fishing, we can eventually go into fly fishing or we can eventually go into just fishing as a whole, but we have to kind of niche down and again I learned that by doing but I was willing to, and I’m using the air quotes, “fail” but really not fail, just something that doesn’t work all that well. It doesn’t mean we fail. You don’t fail until you give up. That’s what it is, right?
Or maybe you are launching products and it worked really good three years ago but now you’re finding that other people are coming in really fast and the only thing you can compete on is price and that’s a problem so now you want to build a brand. You still got out there and did it and if you did the same thing you did three years ago, you might fail today in the eyes of like success but now you know I’ve got to build a brand over here, but I know I’m going to launch products, so you already have that asset. You’ve already done that so be willing to fail. That’s it like just be willing and I don’t – I say the words fail because we all look at it that way but it’s not necessarily failing. I don’t think you failed until you stop. Something didn’t work. Pivot a little bit, go at it a different angle, and see what happens. All right. So, there’s my intro rant. Hopefully, you guys got value from that but just be willing to fail and a lot of times the failing part of it really is risking time that you might lose for putting in the time and not getting what you expected back in return.
[00:12:03] Scott: But if you look at it differently what you really did gain from the time you spent, you’re really learning through that process so just really try to understand that.
All right. So, let’s jump into today’s first question which I’m pretty fired up about because it’s a good one and we will dig in. What do you say? Let’s rock and roll.
[00:12:23] Joe: Hello, Scott. This is Joe Gracia – 12:24. I’m brand new to the drop shipping business. I know nothing actually, but I did look at buying stores on Shopify. What are your recommendations and your suggestions? Thanks for any input you can give back.
[00:12:39] Scott: Hey, Joe. Thank you so much for the question and welcome to the e-commerce world and drop shipping is just another way that we can enter into the e-commerce space. And it sounds like you are not necessarily getting into the drop shipping business I guess because the way that I read it was you might be buying a drop shipping business but in turn, you can also then launch your own products. I hope that's what I'm hearing because if you're just going to buy a drop shipping business from the people that I've talked to that I've done dropped shipping especially nowadays, the margins are very, very thin and you are competing with a lot of other drop shippers that have those same slim margins and it's really who is willing to make the least amount of money is really what it comes down to and still turn a profit. I've heard that they’re sometimes as thin as like 5% which is not really a lot especially if you need traffic and even if you wanted to try to build a brand and, in the end, you’re really selling someone else’s brand, not your own.
Now, what I do like about this is if you're able to buy a drop shipping business or any business for that matter and I'll talk about other ones that we could be looking into is we have traffic. Hopefully, if you're looking at it from the way that I would look at it is I want to see the numbers in traffic. How many unique visitors is their site generating every single month? Now, hopefully, it's a home base as I talked about in the last episode, in Episode 525, where I talk about your home base. Hopefully, this is their home base but then they recommend other products and they just happen to be drop shipping those other products where you would come in and where this would be a really good opportunity is if you came in and go, “Oh, it’s a fishing drop shipping business,” and you see that traffic is coming in not necessarily for brand names either by the way but just for those types of products and the traffic is coming in.
[00:14:44] Scott: And for you to be able to pick and choose what products you want to private label that you could switch out with a dropship and be your own private label product. Whether that’s then you’re going to push sales on Amazon or you’re going to push that traffic over to your own funnel, whatever that is, that could be a really good opportunity because then you can look at the business as a whole and see where most of the sales are coming through. There might be five to ten products that are just top sellers and you’re like, “These can totally be private labeled, and I could probably focus more on the energy of the brand towards these products and then I can start to drive sales on Amazon. I could start to drive sales on my own ecommerce platform. I could build my own sales funnel like all of those things.” But that would have to be really, really clear as far as you being able to see that and then knowing that people aren’t just buying those drop shipping products because of the brand. Okay. So, that I would be careful with and I would want to know that.
Another great opportunity for anyone listening right now is, yes, buying existing businesses and I don’t mean to have to be massive businesses. I just mean businesses that have traffic and sales and the sales would preferably be from an Amazon associate’s account or someone that is an affiliate for those products. So, if you bought again a fishing site and they’re getting let’s say that they’re making $1,500 a month in affiliate commissions. Well, $1,500 in affiliate commission at like 6% is quite a bit if we were able to then say, “Well, instead of getting 6% commission, what if we could get 30% commission or 40% commission?” Well, that’s what could happen if we switch out those products with our own products. So, now we’re not guessing what the market wants. We know it because the proof is there. They’re buying that product.
[00:16:40] Scott: Now, maybe those products are already private label products. That's even better because now they're like, “Well, we just flip out our product with those products, do a similar job, make it even better and now we can dominate that market. Now we're going to also have this asset that's driving traffic, that's bringing traffic in, and now all I have to do is convert it over to my product.” And in the time being until I get those products made, I could be still making money on that site. A lot of times a site like that let’s say it’s making, let’s make it easy, let’s say it’s making $1,000 a month. You can expect to pay between $20,000 and $25,000 for that site. And the reason is because what they do is they generally do that as a monthly net income coming in so net meaning profit and then from there what they’ll do is they’ll do a 20X or 25X on that. That’s generally how that works. Now, there are some other cases where there’s already an FBA business up and running.
I like the Amazon Associates thing a little better because it’s an opportunity that’s not being taken advantage of and then you can buy that site for less. And the reason why you can buy it for less is because if you’re going to buy an FBA business that’s already up and running, let’s say that their net is $10,000 a month, well, now that’s going to cost you either $200,000, is that right? Like, 20,000, 10,000, 200,000, yes. So, that’s $240,000 possibly or maybe $250,000 for that same type of business because they’re netting more because they’ve already done what you’re going to do on a business that you could scale by just switching out the products with your own products. The one thing you want to be careful is when you’re looking at these types of sites is you want to make sure that that traffic coming through is organic. You want to also make sure that they haven’t done any spammy stuff as far as getting links over to their site that’s pushing up the algorithm in Google so this way here they get ranked.
[00:18:39] Scott: So, it’s kind of they’re gaming, not even kind of, they’re gaming the system in a sense just like Amazon, sellers are gaming the Amazon system. It’s the same thing in Google. You can game the system by getting a whole bunch of backlinks and then from there you're going to get rankings. Problem is once Google catches up to whatever hack they’ve done, they’ll wipe out the links, you lose your rankings overnight and then you have no sales and now you’re back to zero. We don’t want that to happen. But if you do your homework and you have someone that you trust go through that and validate that stuff for you, that could be a very, very good opportunity. Now there’s a couple of places that I would check out. There’s Empire Flippers. They are really reputable in the space and they do have a lot of sites that aren’t necessarily just FBA that they are earning an income on affiliate sales. The other one is Quiet Light Brokerage. Joe Valley over there you can get in touch with him. I’ve had him on a podcast a few times.
But I’ll drop these links in the show notes but definitely do your homework on any of these sites or any deal that you would do, do your homework, make sure that you have someone that you can trust to kind of point you in the right direction to make sure that you’re buying something that you know that you could scale. All right. So, long-winded answer. I like it, drop shipping thing but then turn that into a private-label thing. I like that but if you’re just buying a drop shipping thing, I’ll be a little nervous about that one. I wouldn’t want to go in and buy something in a drop shipping thing that I know that my competition could basically come in there and just keep shrinking my margins which I don’t want that to happen, so I don’t want it to happen to you either. So, anyway, that’s my long-winded answer. So, let’s go ahead and listen to another question then we will wrap this baby up and you guys can get out there and make it happen. What do you say? Let’s do it.
[00:20:29] Sam: Hey, Scott. This is Sam tuning in from Pennsylvania and awesome podcast, man. I’ve been a long-time listener for about a year-and-a-half now and I don’t think I’d be where I’m at with Amazon without your help and all the value you’ve given me over the years. So, I was just listening to the podcast you had with your daughter and it actually got me thinking about the product I recently invested in. It’s a product I’ve found of Alibaba. Originally, I thought I was to be second or first to market with it. It turns out I’m going to be second or third and it’s a product that pretty much anybody can buy off of Alibaba from the supplier. It’s one of those hot products right now where they’re constantly updating and developing it which I’m sure will fizzle out soon, but I want to get your take on the difference between getting a product that other people can sell that’s widely available or creating your own product which is designed by somebody that you hired which is completely original and your own. For instance, the Sharkbanz, I know that you can’t find those off Alibaba. Those guys invented that and they’re selling those on Amazon. So, I wanted to get your take because I started to build a brand around it and, yeah, I just wanted to see what you thought I should do as far as long-term. Thanks.
[00:21:54] Scott: Hey, Sam. Thank you so much for the question and it’s a good one and I see this happen to a lot of people especially now versus three years ago. Three years ago, you could get a product to market and it would be a while before someone would come on your tail and you’d be able to ride that out and by the time someone did come in, you’d be dominating that space. It’s gotten a lot shorter as far as you come to the market with a product and then it's a matter of maybe 60 days and someone else could be on your tail because once they see it after they get it manufactured, they’re going to be on your tail. And if you don’t have other things in place, the assets that we’ve talked about, building the email list, building your external channel, your own sales funnel, like any of that stuff then, yes, it is going to be really hard and risky because if you’ve purchased an extra 3,000 units because your first 1,000 you blew out in no time and now all of a sudden there’s five, six, seven other sellers in there, now you’re sharing those sales because you’re not having any other way to sell them other than through the same channel.
So, we need to do is we need to figure out if we can sell this outside of just Amazon. And if we can, then that’s good but you have to go out there and do those other things. Is this also a trendy product that is only going to be like hot for a certain period of time or is it something that you know will probably be around? And let’s use the fishing example. Is there a new lure that’s on the market that’s doing really well? Is that a lure that’s going to work five years from now or is it only going to work in the next three months because it’s a hot trend right now? I don’t know the answer to that like only the person in that market would probably know. One way also is to look at Google trends even related to what you’re talking about selling and see what that looks like. See if there’s definitely an upcoming trend because you want to be careful with that.
[00:23:56] Scott: But if it’s something that you know that people will use today, and they’ll use it five years from now then I don’t see that as being a problem. But one thing that you did mention is that you said that you’re currently building a brand around this. So, if you’re building a brand around it by things that we’ve talked about in other episodes and in my new YouTube Wednesday training that I’m doing there on brand building, if you’ve done those things like built your home base, started to develop your own content, went on YouTube or any other social media platforms started publishing content, getting traffic back over to your home base, your blog, your website. Are you collecting email addresses? Are you emailing them at least once a week? Are you trying to amplify your content to get it in more people’s hands? All of those things. And then even if 10 more people come on Amazon, yes, you can still compete there.
Yes, you can still battle there but it’s going to be a lot easier to push sales from your external traffic and bump your sales and then pretty soon they’re going to be probably dropping off because they’re not going to have those assets and those resources. So, the only way that I would say to go forward here is to make sure that you’re able to drive your own external traffic to your products to then bump sales but then also even have your own external channel that could be all on its own that you don’t even have to worry that Amazon might have a ton of competition. So, that’s what I would definitely recommend. Now, you talked about like making your product unique or going out there and finding it on Alibaba. If you search right now on Alibaba for stainless steel garlic press, you’re going to find a bunch of different ones and you’re going to then go and take one of those and then go to Amazon and you probably see 20 or 30 of the same ones and sometimes they don’t even change the image. That’s bad.
[00:25:53] Scott: So, you have to find a way to make yours unique in some way. It could just be the look. It could be the box style. It could be an extra strap. It could be an extra inch added to the handle. Whatever it is and then it will be harder, and it’ll take longer for someone else to knock that off. But even if you create something from scratch, it is really just a matter of time before someone else will come in and copycat it. But the one thing they can’t copycat is you and your brand if you have a face to the brand, your resources, your home base, your email list, your Messenger list, your custom audience in Facebook, your Facebook presence like whatever it is like they don’t have that. That’s why that’s the long-term play for anyone out there. If all you’re going to do is find a product by looking at a tool which I’m a fan of tools but if you’re only going to look at that and have it serve up a product that’s selling right now, it’s just going to be a matter of time before someone else comes in there and does the exact same thing.
That’s it. Like it’s going to happen and there’s nothing that’s going to differentiate you unless you have a patent and if you have a patent, you still have to fight the patent. You still have an attorney reach out and do that back and forth stuff. Now, brand registry, that will help you in the future, 2.0 right now, could, we’re not 100% sure yet, but could lock your listing so people would have to request to sell your style of product but that’s just kind of like a retail arb thing where people could sell on your listing. That doesn’t mean they can create their own listing. So, you’re always going to have that. I mean there are so many knockoffs of even major brands that have major patents and then they have to fight them off and all that stuff so that's always going to be happening but what’s not going to happen with everyone that just launches a product is them building a brand and these assets that we keep talking about that for the long haul this is what will separate you from the crowd and from all of the competition.
[00:27:56] Scott: So, that’s what I would recommend and hopefully this has helped you or at least gave you a little bit of clarity as far as what you need to do and what you need to commit to if you’re willing to go down this road. All right.
[00:28:09] Scott: So, that is going to officially wrap up this episode. Two questions this week that I did, and I might just go to two because I have my pre little rant that I generally do which you guys have told me in the past you guys are digging, you guys are loving, and I’ll answer two. That way we could still keep these to under 30 minutes which is always a stretch for me, but I think it’s important for you guys to understand that those weekly thoughts that I gave you because like this week being willing to fail. That’s a big one. We have to understand that’s something. I think that’s important and I want to always give you guys at least one of those nuggets and then again, I want to answer at least two questions on these ask Scott sessions.
So, that is going to officially wrap this up. I want to remind you the show notes can be found at TheAmazingSeller.com/526 and also, I want to remind you that you can head over to YouTube at The Amazing Seller channel and you can subscribe there, and you will get all of those new training videos that I’m going to be doing. They’re going to be published on Wednesdays. If you subscribe and if you click that bell on YouTube, you’ll be notified when they go live and then from there you can continue to build your brand and I would be teaching what I’m learning and things that I’ve done in the past there and I’ll be breaking them down on the whiteboard and really digging in and mapping them out for you.
All right. So, guys, that’s it. That’s going to wrap it up. Remember as always, I’m here for you, I believe in you and I’m rooting for you, but you have to you have to, come on, say it with me, say it loud, say it proud, take action! Have an awesome amazing day and I’ll see you right back here on the next episode.
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