Deal or No Deal?

[Guest12120]

<div class="bbWrapper"><b>Here is the deal:</b><br /> <br /> You are given an opportunity to sell a product that is a best seller on Amazon. The current seller (brand owner) has to remove the product from Amazon so <br /> would have to open your own e-commerce store. This product is patented and you would be the only seller. You can&#039;t use the brand&#039;s website, so you wouldn&#039;t have any SEO advantage. You can&#039;t use any customer data. <br /> <br /> <b>Here are the product details:</b><br /> It&#039;s a leak and spill proof water bottle for kids - huge market<br /> It has over 2,200 reviews on Amazon with the average rating of 4.5 (you will be able to transfer them to your store) - exceptional quality<br /> Current sales are over 250 units a day on Amazon - high demand<br /> The MSRP is very attractive - 2 bottles for $11.99. You can&#039;t increase the price - very affordable<br /> Cost of goods sold is only $2.45/2 bottles (79% margin) - sweet margins<br /> <br /> You have access to 100,000 units, so you won&#039;t have to worry about selling out. You are responsible only for the units you sell, so you won&#039;t have to pay for the inventory ahead of time. You won&#039;t be charge for storage either.<br /> <br /> Brand owner will provide any images or videos you will need for your ads. Including customer video testimonials. <br /> <br /> The cost of shipping with FedEx would be $4.99 per 2 bottles. You will charge your customers the same. Small shipping fee most likely wouldn&#039;t affect the conversion rate too much. Delivery time 2-7 days. Same day fulfillment. <br /> <b><br /> Conditions of the deal are the following:</b><br /> You have to use Facebook Ads to send traffic to your store. New ad account. New Facebook Pixel. Cold traffic than retargeting when you build your custom audiences. <br /> You have to spend at least $5k/month on ads. <br /> After 60 days: If you are profitable, you get $10k bonus. If you lose money, you will have to pay $10k penalty.<br /> <br /> <b>Would you take this deal? </b></div>

 

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[broswoodwork]

<div class="bbWrapper"><blockquote data-attributes="member: 132" data-quote="JScott" data-source="post: 807684" class="bbCodeBlock bbCodeBlock--expandable bbCodeBlock--quote js-expandWatch"> <div class="bbCodeBlock-title"> <a href="/community/goto/post?id=807684" class="bbCodeBlock-sourceJump" rel="nofollow" data-xf-click="attribution" data-content-selector="#post-807684">JScott said:</a> </div> <div class="bbCodeBlock-content"> <div class="bbCodeBlock-expandContent js-expandContent "> On second thought </div> <div class="bbCodeBlock-expandLink js-expandLink"><a role="button" tabindex="0">Click to expand...</a></div> </div> </blockquote>I love how you can watch successful people&#039;s minds work in real time on this forum.</div>

 

[Guest12120]

<div class="bbWrapper"><blockquote data-attributes="member: 132" data-quote="JScott" data-source="post: 807684" class="bbCodeBlock bbCodeBlock--expandable bbCodeBlock--quote js-expandWatch"> <div class="bbCodeBlock-title"> <a href="/community/goto/post?id=807684" class="bbCodeBlock-sourceJump" rel="nofollow" data-xf-click="attribution" data-content-selector="#post-807684">JScott said:</a> </div> <div class="bbCodeBlock-content"> <div class="bbCodeBlock-expandContent js-expandContent "> But, for someone who knows Amazon and FB advertising, it seems like a no brainer. In fact, with a current 250 sales/day on a patented </div> <div class="bbCodeBlock-expandLink js-expandLink"><a role="button" tabindex="0">Click to expand...</a></div> </div> </blockquote>You can&#039;t sell it on Amazon. Just your new E-commerce store. <br /> <br /> All you have is a unique market proven product with tons of social proof with great margins.</div>

 

[minivanman]

<div class="bbWrapper">No. I don&#039;t follow rules very well so it wouldn&#039;t be for me. This is like working for someone else and following their rules.</div>

 

[Guest12120]

<div class="bbWrapper">I just saw on Twitter that the company that I used for the product example in this thread just recalled 5.7 million kids water bottles <img src="/community/imgs/emoticons/em-horror.png" class="smilie" loading="lazy" alt=":eek:" title="Eek! :eek:" data-shortname=":eek:" /> Disregard this information when making your decision if you would take this deal or not.</div>

 

[Champion]

<div class="bbWrapper">Hehe... your conditions about the deal really got me scared now.<br /> <br /> Im launching an UNTESTED product in my own shopify store and planning to get traffic through fbook ads. <br /> <br /> Lets see how this goes lol <span class="smilie smilie--emoji" title="Big Grin :D" data-smilie="8" data-shortname=":D">😀</span></div>

 

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[1step]

<div class="bbWrapper"><blockquote data-attributes="member: 12120" data-quote="pkom79" data-source="post: 807690" class="bbCodeBlock bbCodeBlock--expandable bbCodeBlock--quote js-expandWatch"> <div class="bbCodeBlock-title"> <a href="/community/goto/post?id=807690" class="bbCodeBlock-sourceJump" rel="nofollow" data-xf-click="attribution" data-content-selector="#post-807690">pkom79 said:</a> </div> <div class="bbCodeBlock-content"> <div class="bbCodeBlock-expandContent js-expandContent "> All you have is a unique market proven product with tons of social proof with great margins. </div> <div class="bbCodeBlock-expandLink js-expandLink"><a role="button" tabindex="0">Click to expand...</a></div> </div> </blockquote><br /> Margins sound good but you only have $9.50 or so to acquire customers. No way I would bet $10,000 that I could acquire customers at that price. I feel like most people with kids have seen the bottles that you are referring to so I doubt this would go viral and I don&#039;t see another way to acquire customers at $9.50.</div>

 

[Tourmaline]

<div class="bbWrapper">Too low margins, as <a href="https://www.thefastlaneforum.com/community/members/13193/" class="username" data-xf-init="member-tooltip" data-user-id="13193" data-username="@1step">@1step</a> pointed out</div>

 

[Jaden Jones]

<div class="bbWrapper">So many things could go wrong here, and you have no control.<br /> <a href="https://www.thefastlaneforum.com/community/attachments/vogmgtr-webp.26923/" target="_blank"><img src="https://www.thefastlaneforum.com/community/data/attachments/23/23552-169ec8e6d440dc0756de4c73253a848a.jpg?hash=fCO_9NAAdm" class="bbImage " style="" alt="voGMGTr.webp" title="voGMGTr.webp" width="267" height="200" loading="lazy" /></a></div>

 

[Guest12120]

<div class="bbWrapper"><a href="https://www.thefastlaneforum.com/community/members/13193/" class="username" data-xf-init="member-tooltip" data-user-id="13193" data-username="@1step">@1step</a> and <a href="https://www.thefastlaneforum.com/community/members/68278/" class="username" data-xf-init="member-tooltip" data-user-id="68278" data-username="@Tourmaline">@Tourmaline</a> are correct. Even though, you would be selling a proven high demand product with a great margin and minimal risk, the price is just too low to make Facebook Ads work.<br /> <br /> Product Price - $11.99 + 4.99 shipping = $16.98<br /> <br /> COGS - $2.45<br /> Shipping - $4.99<br /> Payment Processing - $0.79 (2.9%+$0.30)<br /> Cost (before ad spend) - $8.23<br /> <br /> <b>Max Allowed Cost Per Purchase - $8.75</b><br /> <br /> I&#039;ll create another post where I&#039;ll break down why CPP this low is extremely high to achieve at scale.<br /> <br /> If your business requires Elite Top 1% Ad Performance to be profitable, it&#039;s probably not a business you want to be in.</div>