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New Niche, New Brand - Amazon > eCommerce > Retail

A detailed account of a Fastlane process...

Nrr

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I agree completely. Let me rephrase a little.

I am sure that I can get funding for what I need. However, I am not sure if I want to assume that much risk with my primary sales channel being Amazon. I am going to work on others but at the moment that is my biggest channel. While lenders may not know the inherent risks in Amazon I am not so naive.
Hi DrKSide

Do you know what is the price of shipping for .. :

1-Expedited Shipping
2-Priority Shipping
3-Standard Shipping
 
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DrkSide

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JonnyC

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I agree completely. Let me rephrase a little.

I am sure that I can get funding for what I need. However, I am not sure if I want to assume that much risk with my primary sales channel being Amazon. I am going to work on others but at the moment that is my biggest channel. While lenders may not know the inherent risks in Amazon I am not so naive.

Have you considered equity financing?
 

DrkSide

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Have you considered equity financing?
I have thought about it but so far have not seriously considered it. It would have to be the right deal with someone in order to make me give up equity.

However, that is a double edged sword. While I may get money out of the deal my experience with partnerships in the past has been less than stellar both from my own perspective and that of others.
 
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JonnyC

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I have thought about it but so far have not seriously considered it. It would have to be the right deal with someone in order to make me give up equity.

However, that is a double edged sword. While I may get money out of the deal my experience with partnerships in the past has been less than stellar both from my own perspective and that of others.

Agreed, you need it to be the right partner with the same general vision of what you want to build. I was fortunate to find investors who are directly involved in my industry, so they have tons of value to add. Additionally, we're clear on the fact that I'm still the decision maker/majority shareholder.

They'll have a seat on the board, but the voting on major decisions (selling the company, debt financing, entering new markets, etc) will be done by % of shares owned, so I'll still retain the main voting power.

From my own gut instinct and what I've heard from others, 50/50 partnerships sound like a nightmare and I'd avoid it 100% as well.
 

DrkSide

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EOM Update:

Amazon: $19,310
Website: $1,400
eBay: $100

Sales really didn't get kicked off until the 22nd so they were down for the month. My large order started to come in around that time and I was able to get stock to Amazon. Looking like average daily sales will be about $1,500 with my current skus.

Set up eBay listings for my main product and had two sales come from that channel. Going to explore putting the others up when I have sufficient inventory.

Inventory is a problem however. Even with the last large order I will not make it to the end of CNY with product B and will be cutting it close with Product A. The others should be fine since they are a cheaper product to make I was able to order more.

Focus on the next couple of months will be launching new skus to double my current number of 4. I have all 4 samples in hand and I am doing testing on them to verify that they are of a good enough quality.

I had a meeting yesterday with a local banker who may be able to help with financing new orders so I can grow and reach my goal for the year. It is going to be a hard push to get it done but it is possible. Plans at this point is to use financing to pay for current selling products and use profits to pay for launches.

If inventory will hold out February is set to be a record month even over November of last year.
 

DrkSide

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Persistence + Knowledge = Results
Screen Shot 2016-02-04 at 1.17.06 AM.png

We are 3 days into February and I have surpassed my sales for the same month last year. Add to the screenshot a couple of website sales and eBay sales.
 
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DrkSide

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Overdue Update:

Last month was the best month of sales to date. I was mostly in stock for the entire month but ran out early of product B which sold more than I had projected. It probably would have added another 5-7k on top of the sales.

February: $55,344.02
Amazon: $54,188.52
Website: $658.62
Ebay: $496.88

Challenges: I have had quality issues with one of my products. Just when I thought we had gotten them all fixed the last order (before CNY) was horrible. My supplier said this was due to trying to rush the order to get it out before the holiday. We have since had a nice chat about quality control and it seems they are on board. I have more on the way right now so we will see. Until I am 100% sure that the products are good they will be checked before they are shipped out to Amazon. I am also looking for backup manufactures for this product in case my current one can't get it right.

Keeping inventory has been a hurdle. I have gotten a line of credit for inventory purchases so that should be fixed with the next order. I also have 2 skus on the launch pad now that are ready to launch when I get the loc done (should be this week).

Total skus are up to 5 now and will be at 7 within a month. Also have 5-10 other products that I am doing research on. All will be viable but I want to launch what I believe are the best performers first.

Still working on our first retail placement. It looks like as soon as I have inventory for that product I will have an order and now they are interested in another product that just launched.

It has been a month of ups and downs so far. The quality issues and resulting returns had me at some very low points over the past couple of weeks. Offset that with going to Scottsdale for the Summit also gave me some great motivation.

Roll with the punches and improve everyday and I will reach my goal.
 

Iwokeup

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I love this thread. GREAT numbers!

Also neat to have spent a nice chunk of time chatting with you at the Summit. :)
 
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illmasterj

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I followed up with the customer on the review as well as directly via email hoping to get a response so I can get them another unit for a true review.

How do you find the reviewer's emails? I find the negative feedback leavers typically don't use their name as their public display name, so I never manage to get in contact with them.
 

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How do you find the reviewer's emails? I find the negative feedback leavers typically don't use their name as their public display name, so I never manage to get in contact with them.

A few ways:

If they DO have their public display name, you can plug it into your email feedback software and see if it pulls their order. I suppose you could pull a report from Amazon with all order shipping info too, but I try to not pull big reports from Amazon because it's a PIA.

You can click around on their reviewer profile. Sometimes you can find their name on a wish list or something.

Worst case: I've a had a friend here from FLF who has successfully called into Seller Support and gotten them to give him the customers name and order ID number. Not sure his exact wording, but he basically kept saying that he wanted to make it right for the customer and ship them a replacement.
 

DrkSide

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How do you find the reviewer's emails? I find the negative feedback leavers typically don't use their name as their public display name, so I never manage to get in contact with them.
Similar to what @amp0193 said.

If their public name can cross reference I look up the name in either my email software or my order software and will send them an email.

It if doesn't I just comment on the review asking them to please contact me in order to fix whatever. Sometimes they do and sometimes they don't but it shows other customers that as a seller I am willing to help with issues and that I am proactive.
 
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The-J

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My man! I completely forgot you ever had a progress thread. I'm glad it got bumped, now I can see what's going on.

Are you concerned with the lack of sales volume through your website? Are you planning on getting that up? Or is it not so much of an issue right now?
 

DrkSide

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My man! I completely forgot you ever had a progress thread. I'm glad it got bumped, now I can see what's going on.

Are you concerned with the lack of sales volume through your website? Are you planning on getting that up? Or is it not so much of an issue right now?
It is on my radar right now. I am looking to do a redesign since when I started I chose a template that is really meant for a single product. Now that I have more it doesn't really work.

Once the redesign is done I am going to work on optimizing and running PPC to it. I have done more for optimizing on Amazon since that is what yields the fastest results.
 

ZMan26

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It is on my radar right now. I am looking to do a redesign since when I started I chose a template that is really meant for a single product. Now that I have more it doesn't really work.

Once the redesign is done I am going to work on optimizing and running PPC to it. I have done more for optimizing on Amazon since that is what yields the fastest results.

Hi man, awesome thread ! :)

Could you talk more about your product research and how you chose your niche ? what was the process involved ?
 
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business_man

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@DrkSide great thread and great progress. Really inspiring.

Have to simple questions if you don't mind answering.

1. Are you selling only in USA, do you get orders from Europe as well? Basically what's your strategy on this?

2. What's your initial capital? I had this question mid ways in to the thread but then I saw you answering some financial questions. So let's narrow up how much did it costed to start this snowball: creating prototype, making first order, marketing etc.

3. Fr how long you had a buffer to live without taking out $$$ from business? As I understood you did not paid yourself for some time.

Thanks.
 

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I know the panel of the guys at the summit seemed relatively unfazed by lack of website sales volume. It makes sense: why trust some random website when Amazon is a retail giant that has your back and is willing to refund you, take returns, deliver in 2 days, and more?

I'm not quite sure but my guess is that focusing energy on retail would probably be a better use of time. I have no idea though. @Vigilante @JonnyC @Likwid24 your thoughts?
 

DrkSide

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Could you talk more about your product research and how you chose your niche ? what was the process involved ?
I'll make a post about this but it will take some time. Probably later today or tonight.
@DrkSide great thread and great progress. Really inspiring.

Have to simple questions if you don't mind answering.

1. Are you selling only in USA, do you get orders from Europe as well? Basically what's your strategy on this?

2. What's your initial capital? I had this question mid ways in to the thread but then I saw you answering some financial questions. So let's narrow up how much did it costed to start this snowball: creating prototype, making first order, marketing etc.

3. Fr how long you had a buffer to live without taking out $$$ from business? As I understood you did not paid yourself for some time.

Thanks.
1. Yes, only in the USA. I don't get orders from anywhere else that I am aware of and do not offer international shipping.

2. I started with an order of about $300 about 2 years ago in a different niche. The first order for this niche I believe was about $1000.

3. I gave myself a buffer of about 9 months before I started taking money out. Edit: This was April of last year when I quit my job. I had 9 months AFTER I quit my job.
 
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DrkSide

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I'm not quite sure but my guess is that focusing energy on retail would probably be a better use of time.
Retail is something that I am looking at. I have an order from a small retailer but don't have the inventory to fill it. I also do no retail packaging so that is a detriment.

Something that I am looking into this week is a manufacture for sleeves to fit my boxes that are retail oriented. What I am looking to do is to be able to make my current packaging look good without the added cost for online orders.
 

Vigilante

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I know the panel of the guys at the summit seemed relatively unfazed by lack of website sales volume. It makes sense: why trust some random website when Amazon is a retail giant that has your back and is willing to refund you, take returns, deliver in 2 days, and more?

I'm not quite sure but my guess is that focusing energy on retail would probably be a better use of time. I have no idea though. @Vigilante @JonnyC @Likwid24 your thoughts?

Do both. If anything, the web site serves as social proof and more data. It will always be your most profitable sales channel, even though the volume will be less. Every legitimate business needs it's own web presence.

I am in the process of building out a shopify store for a brand that will initially only have a handful of items. However, when consumers go to do more research, I can reel them in, hopefully close them, or at least give them some additional content and start to create a relationship engagement.
 

JonnyC

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I know the panel of the guys at the summit seemed relatively unfazed by lack of website sales volume. It makes sense: why trust some random website when Amazon is a retail giant that has your back and is willing to refund you, take returns, deliver in 2 days, and more?

I'm not quite sure but my guess is that focusing energy on retail would probably be a better use of time. I have no idea though. @Vigilante @JonnyC @Likwid24 your thoughts?

I don't feel qualified to give you advice on how to to direct your efforts or anything like that. I will say that for me the decision was due to wanting the ability to generate sales in person and through trade shows.

On Amazon, we're (technically were since we're out of stock right now) doing a decent volume but the company wasn't profitable; almost at the breakeven point just from that channel. And there's only a couple brands doing enough volume in my niche to be profitable from selling just one product on Amazon.

I wasn't sure my product had a big enough margin to be profitable with paid traffic outside of Amazon*, so I felt like it was a safer investment of time/money to get retail packaging made and try to get into stores.

After the initial investment in design and boxes, it's just going to be a matter of hitting up enough stores and talking to enough people. Plus I have an advantage in that I got an awesome distributor on board so that's going to help a lot.

Vigilante has a great point that regardless, you should have your own site. We outsell almost all our competitors on Amazon and I think it's because I took the time to build out a site with lots of content, good social profiles with more than a couple hundred followers. It just makes the whole operation look more legit, even though it's still just me in my basement running around doing everything.

People will Google your brand and then buy on Amazon.

*After talking with some people at the meetup in Arizona, I think with a couple tweaks I could increase the average order value and lifetime customer value enough that paid traffic might make sense. This is another one of my focuses in 2016 aside from the retail side of things and launching more products. I think owning the customer data and the entire brand interaction is incredibly valuable, and helps to create life-long customers that refer friends and family.
 
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illmasterj

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Similar to what @amp0193 said.

If their public name can cross reference I look up the name in either my email software or my order software and will send them an email.

It if doesn't I just comment on the review asking them to please contact me in order to fix whatever. Sometimes they do and sometimes they don't but it shows other customers that as a seller I am willing to help with issues and that I am proactive.

Thanks to you both. This is my standard practice - I've only had 2x 1 star reviews but I've not been able to get in contact with either.
 

DrkSide

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Long overdue update:

March: $49K
April: $19.5k
May: $55k
June: $72.5k

YTD: $283k

So, from the numbers you can see that sales have fluctuated a bit. April had inventory issues and I was able to place a very large order which resulted in the numbers for May and June. I was out of stock on one of my better sellers even in June so it could have been better. Last year was a total of $160k in sales so I have already blown past that.

Struggles:

Capital - This is the largest issue I have right now. I have been bootstrapping this from day 1 and while I have made a lot of headway with just using cash on hand every time I think I am caught up I get more sales. Sales get sales, so the more I have in stock the more I sell. I have not had a full month of inventory on all products at once to know what the true numbers should be. I have chatted with a few people about this and am working on getting it resolved at least partially.

Focus - I have stopped launching new products right now to put money into growing inventory levels. This has made me realize that I really love to work on growing the business but hate working in it day after day without being able to grow. Without being able to launch new products my focus has dwindled somewhat.

Quality Issues: I am still struggling to reign in my manufactures to keep with the quality of product that I need. I am refining my order process and detail instructions to head this off as well as looking at a 3rd party inspection service to do onsite quality control. Also I am finding backup suppliers that can manufacture my products and possibly move into the main spot depending on quality.

The Good:

Wholesale: The one retail store that has been buying from me recently placed their largest order to date. This is their 3rd and each one has grown. I also have another interested party that I have to go see that could prove to be very lucrative and high volume.

PPC: After having a consulting session with a fellow fastlaner I was able to get a better grasp on optimizing my PPC campaigns in Amazon.

Growth: While I haven't been able to launch new products I have seen good growth. Sales are trending up even with the same sku count and I have not hit the ceiling yet. The website redesign still has not been done. This is 100% my fault as it took a backburner due to the inventory issues.

New Goal: I have set a goal for myself that by the first of October I will have this business automated completely to where I do not have to do anything for it to keep running. Our original plan was for my wife and I to run this but upon further discussion that won't get us to where we want to be. Most of the daily stuff that needs to be done is customer service and shipping out/receiving inventory. I can either find a prep company/fulfillment center to ship and a VA for customer service or I can hire someone to do both for me. At this time I am leaning towards hiring someone since from the initial numbers it will be cheaper and will keep more control in house.
 

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I'll make a post about this but it will take some time. Probably later today or tonight.

1. Yes, only in the USA. I don't get orders from anywhere else that I am aware of and do not offer international shipping.

2. I started with an order of about $300 about 2 years ago in a different niche. The first order for this niche I believe was about $1000.

3. I gave myself a buffer of about 9 months before I started taking money out. Edit: This was April of last year when I quit my job. I had 9 months AFTER I quit my job.


Did you do the "product research " thread eventually bro ?

im stuck on the phase, even used jungle scout but I just dont know where to start.

Your help could literally change my life :)
 
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DrkSide

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Neglected this thread for awhile so I figured it was time for an update. Not much new in the way of strategies but some great growth.

Ended 2016 with a 550% growth over 2015 just missing the $1m mark.

Sales are at a consistent high 5 figures or low 6 figures a month. The end of last year was spent keeping current skus in stock vs expanding sku count but the first half of this year has been focused on expanding skus. I will double the sku count within a couple of months. Some I am going deep on and some I am not just to see what the sales volume is. Also, some will be used for cross sells for website purchases now that I am getting some volume on the site. Nothing like Amazon but it is constantly growing and I am running PPC traffic now. It is almost breakeven but I am still letting it run to get the data to be able to make decisions on it.

I have seen some new competition enter that are doing well. It has kicked me off my butt to optimize and grow vs just get complacent with where I was at.
 

Iwokeup

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Neglected this thread for awhile so I figured it was time for an update. Not much new in the way of strategies but some great growth.

Ended 2016 with a 550% growth over 2015 just missing the $1m mark.

Sales are at a consistent high 5 figures or low 6 figures a month. The end of last year was spent keeping current skus in stock vs expanding sku count but the first half of this year has been focused on expanding skus. I will double the sku count within a couple of months. Some I am going deep on and some I am not just to see what the sales volume is. Also, some will be used for cross sells for website purchases now that I am getting some volume on the site. Nothing like Amazon but it is constantly growing and I am running PPC traffic now. It is almost breakeven but I am still letting it run to get the data to be able to make decisions on it.

I have seen some new competition enter that are doing well. It has kicked me off my butt to optimize and grow vs just get complacent with where I was at.
I love what you're doing man! It was a real pleasure meeting you at the last Meetup and I'm extremely happy that you're seeing increased success. :D

IIRC, you also know how to handle competitors.
 
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Neglected this thread for awhile so I figured it was time for an update. Not much new in the way of strategies but some great growth.

Ended 2016 with a 550% growth over 2015 just missing the $1m mark.

Sales are at a consistent high 5 figures or low 6 figures a month. The end of last year was spent keeping current skus in stock vs expanding sku count but the first half of this year has been focused on expanding skus. I will double the sku count within a couple of months. Some I am going deep on and some I am not just to see what the sales volume is. Also, some will be used for cross sells for website purchases now that I am getting some volume on the site. Nothing like Amazon but it is constantly growing and I am running PPC traffic now. It is almost breakeven but I am still letting it run to get the data to be able to make decisions on it.

I have seen some new competition enter that are doing well. It has kicked me off my butt to optimize and grow vs just get complacent with where I was at.

Hey Drkside just wanted to say thanks for sharing your journey with the forums. I read thru the entire thread and found this very inspirational.

I'm in eCommerce retailing others' branded products through Shopify. Basically, I've found a niche that is in need of simplification and housing all product brands in one location with limited competition. In the process, I'm developing my own brand in the market.

Your journey with manufacturing has gotten me more interested in stepping down that path as well. More risk but more reward potential. Looking forward to learning more from your success!
 

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