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AG356

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I didn't plan to continuously update this thread because I usually don't like posting about things I didn't already execute, however everything I do is still a part of the journey and documenting it can probably benefit people who will go through this process themselves in the future and come across this thread.

So, besides the fact that there are good and bad things happening, I'll start with the good news first:

As I stated in the OP, I was expecting to break even at best and not making any profit at all. This was based on my calculations on the needed PPC costs and overall sale numbers. As I mentioned in a previous post ITT on Sept. 21th, I optimized my PPC campaign and reached a point of performance I'm happy to run 24/7. Additionally I made it to the first page on 3 out of the 4 main keywords which started to generate even more sales. I still ranked pretty low on the first pages, however I noticed a significant raise in organic sales. My sales climbed up to a constant >5-7 a day and I was quite happy about that.
My profit per sale is around 10€ (without PPC) so I was earning about 50€ a day which would equal to a 1500€/month net income. Theoretically I wouldn't have to get a job after graduating even if I lost all my savings and investments. Basically I've reached the first small step to freedom after 2 months of selling on Amazon and 8 months after starting this journey, which is quite nice.

On the filp side, selling at this rate my small inventory of 300pcs slowly but surely diminished earlier than I've calculated it to which left me waiting on the sidelines watching competitors keep selling while I stopped all my PPC campaigns and increasing the price of my product to not completely run out of stock (Amazon algorithm apparently punishes such happenings pretty harsh).

So after running the numbers again, the reduced PPC and warehouse costs, I'm actually 1000-1500€ in the green for this "business" year. This takes into account all the legal costs a business brings with it, insurances, software, all Amazon costs including the launch etc. It's not much but it's important to note that I only sold actively for about 2 month this year. Reminding myself of this always helps to see the possible scale and opportunity waiting in 2018 and helps to keep the big picture in mind, especially when the self-manipulative thought of working 9 months for 1k crosses my mind.

Today is actually the day my supplier finished the newly placed bulk order of around 2,2x the amount I started out with. I added three different variations to the product which should further set me apart from my competition and increase sales and ranking even further. I've luckily placed my order when Alibaba had a promotion event which allowed me to use an inspection service for free. I made sure to be very specific with my requirements and made an "cheat-sheet" on what's important to check for them to ensure the needed quality. I should hear back from them within the next days. The goods will go on board on Nov. 15th and will arrive on mid January.

Specifically on this product, I do not plan to stay in the 5-10 sales a day range. I will do everything possible to take the lead in this niche and take over the rankings on the main keywords for good. I will re-order a bigger amount about 1 month after receiving the current pending order to ensure that my storage can keep up with the demand.

Besides this, I will soon start to source two more products in this niche and under the same brand. I've already looked at very promising products but have yet to run the numbers.

Because of the fact that I'm basically out of stock now, my (Amazon) income stopped. (That's that for not getting a job ha!) No for real, since it's kind of a seasonal product it will most likely decrease in sales over the winter months which is something I overlooked in my product research (@Kim Yong Ho). Besides this, the reorder process takes at least 3 months which makes planing even harder and requires a lot of money to keep the wheel spinning. It's profitable and it's not that big of a deal, however a huge sell wave could shake up my whole planing for several months which is something I'm not happy with. To fight this problem, I will order a decent amount for the third order and store it in my "warehouse" (old farm) since there's enough space to do so.

Anyway, as I mentioned in my last post I planned to launch 3 new products in 3 months from the 1st of Sept to the 1st of December. By doing so, I could combine my initial launch effort with the organically increased Christmas sales to ensure a qualitative ranking on my main keywords. To do so, I started to source a new product which meets all the same criteria my first product did, but is WAY faster to produce and to ship. It's small and compact, light, has an insanely short production time and is suitable for express delivery / air mail while still being profitable. After some research, supplier chatting, samples etc. I decided on picking two suppliers to produce this product (Important: This was done due the fact that the supplier who produces my initial product basically knows that he's the only supplier I talk to and therefore is absolutely non-cooperative regarding pricing, production time etc. - They still do good work tho!) Funnily enough, one supplier cut his prices by 30%(!) after I told him that my main order will be produced by another supplier. Well, needless to say now it's 50-50 and depending on the quality of the mass production someone might take the lead for continuous orders.

As of right now, I finished the new brand, logo, packaging, negotiations and overall order conditions. One supplier is currently waiting to hear back from Alibaba regarding the payment options (there's a problem with T/T) and the other finishes up the last few peaks regarding the finished design. Both orders should be paid within the next 1-2 days and should reach my doorstep in around 3 weeks. This should be enough time to have a close look at them before repackaging them and shipping them out to Amazon to start the launch process at the last days of November. In the meantime I will create the product listing(s), get the product photos done (already arranged) and organize the launch to start right when they hit the Amazon warehouse.

I can go into more detail about this product once it's all done and running. That's about all about the current (positive) updates and where I am right now. But as I mentioned in the beginning, there are also negative sides which I want to address. Showing the sales and $ (even if mine are quite low yet) most likely is more appealing to the broader audience however talking about the negative sides of this is something I still want to address since I'm quite sure everyone will go through something like this in one point or another.

So as of right now, I'm feeling that I will slowly but surely break down if I continue like this. For the past 4-6 months I did nothing but working at least >10 hours a day without a break. In the summer I was obviously working on Amazon and the product. What I didn't mention in the OP was that I was actively investing in the cryptocurrency market, learning about the technology, market, projects, companies and upcoming ICOs. At this point of time 10 hours are way too less, it was more like 12-14. I was hooked with the technology, the possibilities, projects and obviously the ROI I experienced in my first and further investments. Amazon started to run smoothly around the beginning of October, which was also the start of the new semester at university. I already mentioned it somewhat in the OP that university takes up your attention at some point of time, but now it got even worse. I don't know what's up with college/universities in the US, but when I read stories about the "college/uni lifestyle" I would think I live on another planet. As of right now we have about 3 projects running, one weekly documentation and the first of two bachelor thesis has to be written. I don't want to go further into this, but the projects are completed for real companies with real customers so it's not like the classic "projects" you submit on 11:57PM and call it a day. Another project demands a whole business idea, concept and plan which will be presented, when qualified, to potential investors and VCs. Even though I have no interest entering the system this stuff needs my attention in order to finish the degree. Funnily enough, this semester is by far the most interesting since we actually do REAL LIFE stuff and not play around in the theory, so I'm actually actively taking part of the individual classes.


Taking into account that the workload wasn't that small in the summer, it actually got worse now and I'm working at least 14 hours a day right now. Having an eye on the current product, planning and calculating the reorder process, managing the process, starting to source the new products, looking up the market & competition, arranging samples and picking suppliers, setting up the order conditions, payments and shipment for the new product, running the numbers on the new products/niche, always reading the latest news about the crypto world / reading whitepapers or general knowledge about the technology everyday, keeping up with investments, upcoming ICOs, forks, market movements and whatnot, all while still going to classes due to compulsory attendance, working on all those different projects and weekly deadlines is really starting to take a tool on me.

My mind is not even racing anymore.

It's going head over heels.
As soon as my alarm goes off in the morning it feels like the gates of a horse race open and five different thought patterns start racing through my head.

Additionally I injured my right shoulder 6 weeks ago which completely prevents me from lifting which is the only compensation I had for the past 5 years, the one thing where my mind would shut up and I could have my 2 hours of peace a day. This is most likely the biggest issue of all since not only my body is suffering, more importantly my mind is deteriorating as well. My concentration suffers and I feel like I can't take the workload anymore.I know that I was a way stronger version of myself not long ago, physically and psychologically, and that my current version won't be able to handle all of this much longer.

That's why I decided to gain back control as much as possible, rearrange my habits and try to increase my performance again to a level where I can handle this workload without feeling on the edge of a breakdown. At very least, I have to regain control of my mind again. It's the most important asset I have and I have to keep care of it.

I just wanted to give you guys a little insights behind the curtains. It's somewhat obvious that there will be downsides along the road, but they are often withhold in order to not rain on the parade. If I keep updating this thread I want to be authentic and show the good and the bad even though it's sometimes self inflicted.

I'm certain that it will all be worth it in the end and always remind myself that nothing in this world worth having comes easy.
 
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secondhanddog

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Awesome, good stuff!

Is there a reason that you didn't order more than one sample to validate your product before going all in?

From the suppliers I've used they are happy to provide up to 3 items as samples but won't supply more or do orders under 300 items (or $5000). Is that normally the case?
 

Walter Hay

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From the suppliers I've used they are happy to provide up to 3 items as samples but won't supply more or do orders under 300 items (or $5000). Is that normally the case?
You are dealing with the wrong suppliers, most likely traders, or else you haven't read my book to learn how to negotiate small orders including sample orders.

Can't post it all online, there's pages of it.

Walter
 

maituikas

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@steven - Just superb reading how punctual and devoted you are with you mission with Amazon. I wish you great success with this and I will follow your story for sure.
Myself, I have tried to approach Amazon Seller Central with slightly different angle. Not to deal with product/service development but instead be in between supplier and end customer. Keep the stock at suppliers physical storage space, advertise their products* and organize the dropshipping of the product to the end customer straight from the suppliers warehouse when the order has been received. Basically the only thing you have to do after successful implementation of automated tasks* and advertisement is mediation of the orders.

Automated tasks*
1.Daily export product data from supplier stock and convert/format it to Amazon readable format of .xlsx file
2. Make the stock file available to Amazon Seller Central

of course all of this is a simplified list of task that needs to be done and in real life the export-import scripting and other stuff takes alot of time (and money if you have to buy programming from someone). Also you need a hosting space where to keep all this data and export-import scripts.

Their products* regular home electronics, car alloy wheels and tyres.

I have to admit that currently my own Amazon project is on hold as I was too greedy and started with 100 000k + products and there were too many errors with the Amazon update process vs the product info .xlsx file. Some examples:

The SKU data provided conflicts with the Amazon catalog. The standard_product_id value(s) provided correspond to the ASIN B01ATM97W0, but some information contradicts with the Amazon catalog. The following are the attribute value(s) that are conflicting: part_number (Merchant: '13127' / Amazon: 'B01ATM97W0'). If your product is this ASIN, then modify your data to reflect the Amazon catalog values. Else, check your value(s) for standard_product_id are correct.

SKU does not match any ASIN and the product data provided is not eligible for ASIN creation.
We have temporarily removed your ability to create new ASINS because an unusually high number of ASINs have been created from your account. However, you can continue to match your products against existing ASINs. Please refer to the ASIN Creation Policy page for more information on how to avoid receiving this error message. If you believe your creation privileges have been removed in error, please contact Seller Support.

ETC

Apparently you have to fix these errors one by one and doing so on stock list consisting huge numbers of items takes too much time. So my lesson so far: Narrow the stock list significantly and start all over again :)
As I run a webshop in parallel then currently I do not have the time to start with this again in the near future but for sure I will try again :)

Good luck to you Steven and keep us updated with you progress!
 
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AG356

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Update:

I'll keep it shorter this time:
New product was chosen.
Samples were ordered.
Supplier got chosen and a total of 600pcs were ordered.
Packages arrived on Nov. 23 and Nov. 24th (2 different suppliers)

upload_2017-11-30_15-18-8.png

50% of the products were not packaged, 10% were damaged. E-Mail exchanges with suppliers and Alibaba trade insurance are necessary and currently held.
Repackaging of the 50%, labeling and so forth took about a total of 30 hours. After getting off Uni on Friday at 5:30PM I drove home and started to recommission every product, label it and arrange the delivery assignment to the amazon warehouse. I additionally arranged a product photo shoot on Sunday which took about 5 hours to finish. All of this was finished on 10PM Nov. 27th. The goods were sent out to Amazon on Nov. 28th.

I reached my goal of launching "3 products in 3 months" I set two posts earlier. I still have to finish the copy and plan the launch process as soon as possible, so I can hopefully catch the train for the Christmas sales to organically position my listing on top up for the long run. The past weeks were probably the most stressful in my life and it's still in the stars if it will pay off. I will surely not stop now and try my best to push the sales as much as possible.

As mentioned before I sold out my first product way earlier than I thought. I upped the price to not run completely run out of stock and learned that even doe it's currently snowing outside, people are still buying the product. I would have never thought that this would happen because it's a seasonal product. I wasn't sure who mentioned it, but I think it was @biophase who told me to be careful with assumptions that the product is seasonal and stop selling. You were right. I'm currently selling the last few I have on stock with 150% of the initial price.

The next shipment, which includes 2.2x the amount of the first order, should arrive on January 5th with 3 additional variations. I will re-launch it and will advertise it even more aggressive due to the newly available stock amount, trying to rank in the top 3 of my main keywords.
 

stavedeve

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Thanks for the kind words guys, I appreciate it and hope I could provide some information.



Yes it is possible to ship the goods directly to the Amazon warehouse. However you have to label the boxes beforehand, so you have to submit the labels to your supplier so they label them for you. Same goes for the product labeling, but this can be outsourced to Amazon for .15$ per product (at least on the GER marketplace).

I personally didn't go through this process but I've read about it in blogs and in several threads of @biophase.

I would also suggest to have a close look at the first shipment by yourself. I know there are inspection services but I still prefer to check the quality by myself. Especially if it's a new supplier sending the first bulk order.
Great job man! Very inspirational.
 
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Musashi

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Thanks for this thread Steven.

Can I ask for what profit margins you are aiming for when sourcing new products? Im based in Germany as well and currently also in the research phase. So far, customs + value tax make it quite hard to find profitable products.
 

AG356

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Thanks for this thread Steven.

Can I ask for what profit margins you are aiming for when sourcing new products? Im based in Germany as well and currently also in the research phase. So far, customs + value tax make it quite hard to find profitable products.

I usually use the overall expenses I have for a product (product cost+shipping+tax/customs) and aim for at least 200% net profit of those. This allows me to theoretically order two more products per sold product which furthermore means I won't run into cashflow problems and consequential inventory problems.

Example:

30$ sell price (cross revenue)
-10$ all amazon expenses (FBA + monthly subscription + damaged goods)
-7.5$ overall product expenses (product cost+shipping+tax/customs)
= 15$ net profit (or 200% of the overall product expenses)
 

Telamon25346

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gotta say i love this thread, your journey so far has motivated me. keep it up :smile2:.

i like what you said about this forum being like a river of "golden nuggets" and it is absolutely true, i learned more from this forum and MJ's Books in the past 4 months than i have about entrepreneurship in the past year.
 
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NanoDrake

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Hey man, great story! sending some rep!

Just wanted to ask you a questions since I'm a little bit curious:
Isn't going on Amazon with just a private label product a little bit risky? I mean, I'm working on how to create a community and some followers before launching a product, so I know they are buying my brand instead of some unknown "oh I just need this xyz"
I'm taking this approach since there is a lot of "brand factor" in my market and perception is all
keep up! if I'm in Austria again will love to buy you some "Omnipollo" :D
 

Temujin

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Hey man, great story! sending some rep!

Just wanted to ask you a questions since I'm a little bit curious:
Isn't going on Amazon with just a private label product a little bit risky? I mean, I'm working on how to create a community and some followers before launching a product, so I know they are buying my brand instead of some unknown "oh I just need this xyz"
:D

Regarding it being a little bit risky, I would say no, Amazon is great for their traffic and getting market feedback on your newly launched product. Of course, there's the risk of the upfront cost and not making any sales. Amazon will not damage your branding, but I would treat it as a place to sell your product to people that "just need xyz".

People buy the product, then they will buy the brand, so you need the product to provide real value for your customers, then they will choose you over competitors. Use platforms like Shopify and Instagram to create your brand and facebook/instagram to advertise the image of your brand.
 

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You did a great job with your detailed documentation of the process.
Reading it felt like actually walking with you through the whole experience.
Thumbs up!!!
 
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NanoDrake

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Regarding it being a little bit risky, I would say no, Amazon is great for their traffic and getting market feedback on your newly launched product. Of course, there's the risk of the upfront cost and not making any sales. Amazon will not damage your branding, but I would treat it as a place to sell your product to people that "just need xyz".

People buy the product, then they will buy the brand, so you need the product to provide real value for your customers, then they will choose you over competitors. Use platforms like Shopify and Instagram to create your brand and facebook/instagram to advertise the image of your brand.

Hello Temujin,
Thanks for your insight, although I would like to ask you another question if you allow me.
How you make your customers understand your product is the best? after all, if you aren't the first in the category, is pretty hard to convince them to buy your product via just listing, isn't it ?
Amazon is indeed great for the traffic they have, in my category (cosmetics) Women start their shopping "adventure" there. For us is always "story first, shampoo second" that's why for me is always hard to understand Amazon businesses, "ok but why they should buy from me?" it's always a question that pops in my head
 

Dave Daily

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@Steven. Great story. I look forward to seeing your progress with your private label project. I expect, at your current rate, you'll be free from the need to have a job by late 2019. I'm rooting for you.

Just to play a little devil's advocate here, isn't Amazon largely in control of your destiny at this point, thus making your business in violation of the law of control? What happens if Amazon changes its policies all of a sudden, like the Youtube adpocalypse?

Before I get flamed, LOL, the answer to my own question might be that timing is important and since Amazon is currently a great sales channel, you SHOULD use it. And as you said in your post, there are other things you can do like hitting up influencers on Instagram (Gary Vee style) for a shout out and build your brand in other ways.

I'm twice your age and admire your strength. Of course, we'd all like to know what your product is, but I suppose you're trying to avoid some folks from competing with you. I'm new here, so I'd like to hear from others about precautions they take on this forum, in terms of protecting ideas, etc.
 

jmusic

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I remember vividly sitting in front of my damn laptop from Saturday morning to Sunday night researching each and every damn Youtube channel of their competitors while documenting the whole task. Because of the fact that I used to produce videos for Youtube a year or two back and accumulated nearly 2.5 million views till date, it took me about 4 minutes to recognize that they wouldn’t stand a chance using Youtube to promote their product since the CEO told us at our first meeting that they don’t plan to invest any of their marketing budget (strong wtf).

I smell a need there!

Well, a minor detail I might not mentioned was that I told absolutely no one what I was doing.
No one.
Not a single soul.
I just couldn’t take the thought of the negative sh*t people spread like sprinkles over every idea or dream which doesn’t fit the norm. Especially friends and family will be the first one to discourage you when you’re trying to change and try new things as sad as it is. However I knew exactly that the outcome of all of this purely relied on my actions and what I was willing to do. I decided to work in silence, patiently crafting away on my future life and wrestle down one problem after another.

Very true. It's easy to crap all over other people's dreams/ambitions, etc. There's even a term for the online version of the same behavior (as old as the hills, btw).

Urban Dictionary: Thread Crapper

It was such a great feeling seeing the product of so many hours of work, so many long nights and so much effort finally reaching the first major milestone in this whole process. But the whole thing didn’t go by without some scratches. Passing the semester, which was by far the most difficult and workload heavy semester so far (100% compulsory attendance, no gender studies fairy-tale BS degree), going to the gym at least 5 times a week and eating/cooking/preparing meals accordingly, running errands for the apartment and sleeping an average of 5 hours a day for months on end hit me like a brick after some of the constant tension was released. I thought I would take a day off and try to relax a little bit. Well…

I've heard it said before, that if you want to get something done, ask the person who is already busy, not the one who is idle.

I was really damn mad at Amazon before reflecting what happened:
I relied on them to fix the problem for me. I didn’t give 100% to solve the problem by myself. I told myself that there was nothing I could do in the meantime and slacked off for a couple of days. I tried to fix it myself a few times, but I never really committed 100% of my focus on it before finally coming across the made mistake. I accepted that it was my fault because I changed the dates and couldn’t remember that I did so. This was a good reminder for myself that I am in charge of making this work. It’s all on me and if I fail I have no one to blame but myself.

Lesson very well learned! No one cares about your business as much as you do.

I decided to pull a risky move and increase the price from 25$ to 30$.

I've also heard from marketing/copywriting channels that increasing prices can increase sales because it raises the perceived value.

At mid-August I gave away the last few codes in my last attempt to climb up the listing ladder. Since I always thought highly of paid advertisement, I started to download the gathered information of the PPC campaign and carefully go through each and every keyword. I looked it up how well it converted and how much a click would cost me. I rearrange different keywords, bids and also started an automated campaign back up which converted good enough to make me at least 5$ profit per piece.

The following days probably changed up too much and my sales plumbed to one and zero sales, which ultimately led to me not touching it anytime soon. I rehearsed the settings and let it run. The mistake I made here was surely my impatience. Keyword campaigns need time to gather enough data and I knew that, however I changed up too much in a short period of time with led to this outcome. If you want to make changes, change one thing at a time to see how it impacts the performance.

A/B split testing is also a good idea; run the changed version in parallel with the old.

I know for sure that this is only the beginning and that I have a lot to learn, but I saw that it CAN work out if you try hard enough. There is still a more than enough room for growth; I’m still sitting on page two of most of my keywords which leads to nearly non existing organic sales. If I manage to claim my place on the first page I could imagine reaching at least 10 sales a day. There are also a lot of open options regarding advertising. Brand building, social media, influencer marketing, email marketing, lowering PPC costs, adding new products and try to bundle them and so forth.

If you’re now thinking why I would continue to do this if I made close to zero profit this year the answer is simple: I’ve learned so much in the whole process of doing this that even at a loss this year I would still profit greatly in the long run. I now know the exact steps I have to take to source, import and launch a product on Amazon and this is something no one can take away from me. I still have a so much more room for growth about this whole process that I am very optimistic about the future. I have yet to find more cost and time saving ways to source and import new products, find new ways to increase the value for the customer and try to incooperate the feedback of existing products for new orders to fully satisfy the needs of my customer. I can always learn more about marketing and advertising, optimizing PPC campaigns and perfect amazon SEO and that’s exactly what I’ll continue to do each and every day. Even if I decide to step back from this product there’s nothing stopping me from researching the market and identify new people’s needs and value cravings which I am more than happy to provide for them.

Love this! Learning while earning. Someone with a sidewalk mindset, if they even took a risk like this, would be writing this off as a failure due to low effective hourly rate, etc. Your "miracle home run" gets closer and closer.

Before I wrap this up I just want to thank specifically three persons on this forum for their valuable lessons they teach each and every one of us every day (even if they probably never heard of me lol).

And last but not least and a direct product of MJ: This forum.
This forum is like a river filled with gold nuggets. If someone is patience and dedicated enough, you can pick all those little nuggets out of the thread-river and mold them together to an entrepreneurial dowser which will finally and absolutely lead you to your goal. The only thing you have to do is to listen, learn and ultimately act.

And so is this thread!
 
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Temujin

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Hello Temujin,
Thanks for your insight, although I would like to ask you another question if you allow me.
How you make your customers understand your product is the best? after all, if you aren't the first in the category, is pretty hard to convince them to buy your product via just listing, isn't it ?
Amazon is indeed great for the traffic they have, in my category (cosmetics) Women start their shopping "adventure" there. For us is always "story first, shampoo second" that's why for me is always hard to understand Amazon businesses, "ok but why they should buy from me?" it's always a question that pops in my head

That's the hard part about Amazon, there's really no way to showcase you're the best other than through their review system and even that happens to be paid for. When I did FBA what made us stand out the most was the quality of the product photos and the descriptions. You need to combo PPC with good reviews and seller rating to slowly climb your way to the top. For example, one of my products was the exact same of many others, the way we stood out was simply adding more professional looking packaging and much more in-depth descriptions (Certain keywords in the descriptions for ranking). For Amazon specific, I would hone in on the PPC aspect and try to rank top on certain keywords that aren't super competitive and try to build reviews. (The review tactics a few years ago don't necessarily work anymore)
Side Note: You don't have to be number one on the category, you want to be number 1 on specific high trafficked keywords (misspellings and your product differentiators). For example, the keyword "collagen" or "skinare" - misspelled on purpose.


Instead of "story first, shampoo second", try to switch gears on to why your product is right for them. Customers are selfish, they don't care about who you are, they want to know your product will get the job done. Your story and branding will come after that through your customer service and quality of your product.

Hope that answers your question.
 
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AG356

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Sorry for the delayed response, I'm busier than ever.

@NanoDrake, @Temujin pretty much said what I would have stated.


@Steven. Great story. I look forward to seeing your progress with your private label project. I expect, at your current rate, you'll be free from the need to have a job by late 2019. I'm rooting for you.

Just to play a little devil's advocate here, isn't Amazon largely in control of your destiny at this point, thus making your business in violation of the law of control? What happens if Amazon changes its policies all of a sudden, like the Youtube adpocalypse?

Before I get flamed, LOL, the answer to my own question might be that timing is important and since Amazon is currently a great sales channel, you SHOULD use it. And as you said in your post, there are other things you can do like hitting up influencers on Instagram (Gary Vee style) for a shout out and build your brand in other ways.

I'm twice your age and admire your strength. Of course, we'd all like to know what your product is, but I suppose you're trying to avoid some folks from competing with you. I'm new here, so I'd like to hear from others about precautions they take on this forum, in terms of protecting ideas, etc.

Yes you're 100% right. I absolutely rely on Amazon and if they decide to change things up I will have to suffer the consequences. I learned that lesson after they deactivated the export option on 90% of my products to Austria/Switzerland for a whole 12 weeks. Usually they take 2 weeks, but even 20 support email wouldn't fix that. Watching my whole launch strategy I had already set up for the Christmas season (new product) and the the spring season being pulverized showed me that I'm nothing but a small dot on Amazons radar. They don't care if one seller more or less sells a certain product and it's understandable when you make nearly 500M revenue a day. But that's the risk you have to take if you want to use a established online marketplace with a huge consumer base like Amazon.

There's a lot to say about the process right now but I'm short on time. I will update the thread for sure addressing everything that happened so far soon.
 

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I have a question for you Steven but also for everyone who got an answer,
If you choose a product from a supplier but you also want this product shipped already with his packaging :

Do you ask for the packaging supplier to ship the packaging to the product supplier and he will do the assembly himself ?
OR
Do you simply order the packaging & the products separatly and assembly them at your house / fullfillment center, and then get them shipped at Amazon FBA
> If this option, is it costly to ship your products at Amazon FBA with DHL ?

Thanks for your thread Steven, Action taking and experience is the key ;)
 
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Thanks for this amazing thread, it's inspiring, can't wait to see how it will go!
 

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Please continue this man, I am thrilled.

I live in Germany and you are actually exactly doing the same stuff I am dreaming of right now! Amazing man!
 

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Alright, since I do still receive likes and comments on this thread, I'll update it real quick how things are looking currently.

Just a disclaimer, if you do try to avoid negativity you might not want to read through this.

I try to keep a chronological order on what happened so far and hope I do not get things mixed up. So, onward from my last update I've posted on Nov. 30th 2017, the following things happened:

The new product was sent to Amazon and I had an exact launch strategy laid out, i.e. the coupon codes, giving some away to friends etc. In order to save some money, I wanted to send them to my friends first, since I know a lot of those reviewers only try to get a freebie and don't even use the product. As some of you might caught from the OP, I'm living in Austria which is included in the German marketplace of Amazon (Germany/Switzerland/Austria).

As soon as my product hit Amazon, I wanted to start the launch because I was already late to catch the Christmas season. As soon as I asked some friends to purchase the product, the first problem popped up: Delivery to (insert address in Austria) is not available. This exact problem occurred back when I launched my first product back in summer for whatever reason. Amazon stated that they have to inspect the products before they are open for "exporting" them to Austria. REALLY LONG story short: The product was disabled for 12 weeks. Yes you've read that right. One whole quarter of the year. I did however manage to get a review within the first 3 hours of listing the product! - A one star review, probably from a competitor, before I've even sold the first unit. I've managed to get it deleted with the help of the Amazon support, however I was everything but happy at this point.

The disabled export option to Austria completely ruined my launch strategy and the only option I had was to give away freebies to random people and hope that they would review the product. After giving away 30 samples, I've gathered about 8 reviews and the first 1-2 orders a day slowly came in. A few days later, all the reviews were gone. Till this date I don't now why because they were all marked as non-verified purchases, however people were not able to review anymore. I guess it was a change in the Amazon policies but I'm still unaware till date.

So, Christmas season is over, I've completely missed the train and sit on about 500 products with a zero review product. At this point I'm devastated because I've precicely tried to plan everything through and make time for Amazon since I'm juggling University lectures, a 40-page thesis about the blockchain technology due in a few weeks, exams and other tasks I'll mention later on.

At this second order of my first product got delivered. I've made time for three days full of packaging, labeling and inspecting and worked my way through the 1000 products that arrived. All of this was done in a comfy wood shed at about 5°C (or 41°F) the days after Christmas.

I've been out of stock since about 2 months on this product. I didn't miss "too" many sales during the time I've ran out of stock till now, however I've miscalculated it by at least one month of normal sales before the start of winter would shut down the sales of everyone in this nische. However this gave me time to do all the work mentioned above and planing through the partly delivery to the Amazon warehouses.

Besides that, I've made up a re-launch strategy to regain the ranking I've lost due to being out of stock too early. Two months passed with barely any sales (Jan+Feb) and I've relaunched the product at the end of February, trying to get in front right when the season starts to pick up again (around mid-March based on Google Trends & the BSR ratings of competitors over the past years).

The sales on the product went "ok" hovering about an average of 4-5 per day for the first three weeks of March, yet still having random zero sales days in between. I wasn't too concerned because the absolute main season should start around the beginning of April, for which the sales numbers mirrored my predictions quite accurate: Ongoing from the last week of March till about 10 days ago, the sales of this product averaged about 7-8 which equals about 5000$/month in revenue.

I wasn't happy but I wasn't super disappointing either. I just wanted to reach my first goal I've set myself before I even started of 10 sales/day for 30 days straight and aimed for 30 sales a day once I've added two new products to the nische, for which I started another product research. I was already back in contact with my supplier to place another bulk order to avoid running out of stock and I planned to order twice the amount of the last order since I was confident that the sales will increase the closer we get to the summer months.

All of this happend until about 10 days ago when things went downhill. Fast.

I'm quite sure I haven't mentioned it in here, but I realized last autumn that my PPC campaign would randomly get HUGE spikes in it's CTR paired with insanely low CR rate which would take out my campaign within minutes after starting it. Usually I can let a 25$/day campaign run a whole day and it would be depleted an hour or two before midnight, but now the budget was spent nearly instantly after I started the campaign.

I instantly thought that something's wrong, especially since more than often I wouldn't even get billed or only a small portion of the clicks, meaning they got filtered as spam clicks by Amazon. However this is only a little consolation if you're realizing at night that your PPC campaign was deactivated the whole day and your sales dropped by 60-70%.

Back then I contacted the support that there's something wrong and I already had a theory who's behind this. I was nearly out of stock so I did let them fob me off with those copy+paste answers the support employees can choose from.

Fast forward to now: The same thing is happening again and is completely putting me out of business. Since about 10 days my PPC campaign is getting pulverized as soon as I turn it on, not only bullying me out of PPC sales but also damaging my ranking. My sales are down 90% and I'm absolutely furious.

The same competitor I've suspected that's behind this back in autumn is re-launching his product(s) in this niche right now, running a huge campaign with PPC, fake reviews with the PayPal method (all verified reviews) and actively putting everyone out of the PPC business on certain keywords.
It has come so far, that my product got an "Amazon's Choice" tag with their brandname in it. They probably searched for the same phrase over and over again with a bot and clicked on my ad which resulted in the algorithm to put the Amazon Choice tag on my product, with their brand name in it, which was a phrase that's so absurd that I can guarantee not a single real buyer would look for this:

(It's a pack of 3 pieces and looked as follows: 3 x Productkeyword1 - Productkeyword 2 x 3 by CompetitorBrand)

At this point in time I'm absolutely outraged. The CTR increased by over 600% in comparison with the whole last month and the CR plunged into nowhere on the PPC campaigns. The signs where so obvious that I was being targeted (and probably other competitors as well) that I didn't wait to contact the support, for which I already had stomach pain just thinking about how well this will surely end.

After talking to the support which obviously had no idea what was going on and sent me the same copy+paste I've received back in autumn, I begged them to forward me to some specialists that can look up the IP addresses from which the clicks come from.

This was 7 days ago. I've reached out to them again yesterday and only received a "they are busy, patience etc." reply.

I had to cancel the order I was planning to place at my supplier, had to cancel on the logistic provider and had to put everything on hold.

This single product, which was generating about 5000$ revenue per month and was ranking better and better by the day, has now fallen off on a lot of keywords already and is generating basically nothing because some suckers decided that it's fair to pull every s*** move there is in the books.

I'm feeling absolutely helpless and I hate it. This is the the full and absolute risk that comes with having no CONTROL about the most important things there are in your business. Just like that you can get absolutely destroyed without you having the smallest chance of reacting at an acceptable speed or sometimes at all.

I have absolutely no clue what I should do now.

I can try to make a huge documentation about all the violations that competitor has amassed throughout all of his products and hope that they get banned. However those are things that can be assumed and probably not proven except you can get into their tester group and document the PayPal refund process.

I have no idea how this will play out or what I should do next, so if someone who've been through this is reading this, I would be open for any kind of advice. The evidence is crystal clear to everyone who's selling themselves but seemingly not for those who are in charge (Amazon).

Yeah, that's how things are going right now.
 
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ygtrhos

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First of all, thanks, I am very glad that you are updating us on these and getting us informed about your process! I am completely hooked in this subject because of you and 2-3 other writers.

I am completely a newbie but I have an idea.

Like you said, your problem is control. You have little control over your distribution and that is why you are getting such a problem. Amazon is your only distribution channel.

So since now you have got a viable product and a brand that floats your boat, why don't you switch to other distribution channels?

What comes to my mind is ebay or rakuten or you can build your own simple shop with your own domain and give the same money on Facebook ads.

Then you will not be helpless anymore. ;)

I do not know if you can solve your problem with Amazon but I think there are ways out of that situation.

Let us know if you need help!

p.s. I do not think your post is negative. Shit happens. It is not like you are complaining about something, you are just expressing your current problem. Life is not always sun and rainbows.
 
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jmusic

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I don't think your post was negative, it was more like #realtalk. Life ain't all sunshine and roses and many folks pretend that FBA is so easy with nary a mention of the black hat stuff that goes on behind the scenes (usually they have a course to sell...).
 

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Hey @Steven. thank you for sharing your update with us. I am sorry to hear that you are struggling with unfair competition.

I started with FBA back in 2016 and sourced a cheap and light product according to the recommendations of the "gurus". It was a drawstring bag with an Aztec pattern and I had my fair share of experiences with unfair competitors as well.

My listing got hijacked because I haven't registered my brand from the beginning and later Chinese sellers undercut my pricing so much that I was never able to compete. I failed to resurrect the product sales and at the end, I pulled the ripcord.

Not sure if you already found a solution to maneuver through this misery or not.

I started to build an authority site around a topic and I want to sell my own physical products again as soon as the traffic is sufficient. At the moment I am monetizing it with affiliate marketing.

It's difficult to give you detailed advice without knowing your niche/product, but maybe you can build some great content marketing around your topic or even a landing page for your products to sell it directly?

You could embed the positive Amazon reviews on your sales page.

If you have more products and want to create an online shop I would not use Shopify (I think they are still not a 100% compliant to German/Austrian law).

I would take a look at supr.com, which is free and comes with the payment processor Wirecard built in.

All the best on your journey!
 
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Minus9

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I started my first Amazon product at the age of 16. Failed that product - lost $2000.
Started my second product age 17 after getting someone to invest $1200 into the project - made $10,000+ the first 5 weeks, making $100-200/daily while at school, home, sleeping etc.

Now I help others and mentor them on FBA.

I've been in your position before, let me tell you this.

1. You should always use the FBA calculator that you can find here.

2. I've never really went through the same process as you because you shipped your items to you and did a lot of stuff, which I would assume costs you a lot? I've never touched my own product, ever. Though, I should! I should have samples. It's a little unnecessary sending the entire lot to your home instead of directly to Amazon. (But I read briefly that there are some issues in Germany, according to you? Not sure.)

I rely a lot on my way of doing product research and I know what's a good and bad product to sell.

3. The REASON your product has bad competition is because of the following reasons:
You're on a product that has low barriers of entry thus making the competition relatively higher which gives a more likely chance that people will do anything.
You've chosen a bad quality product? I don't think that's the case here.

4. Amazon FBA is a great business model - except for Amazon itself. It's terrible in terms of customer support and one reason I really dislike Amazon is due to the fact that you're not 'independent'. At any time, you can lose everything there.

If you got any questions, shoot them my way.
 

FreakyThomas

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I started my first Amazon product at the age of 16. Failed that product - lost $2000.
Started my second product age 17 after getting someone to invest $1200 into the project - made $10,000+ the first 5 weeks, making $100-200/daily while at school, home, sleeping etc.

Now I help others and mentor them on FBA.

I've been in your position before, let me tell you this.

1. You should always use the FBA calculator that you can find here.

2. I've never really went through the same process as you because you shipped your items to you and did a lot of stuff, which I would assume costs you a lot? I've never touched my own product, ever. Though, I should! I should have samples. It's a little unnecessary sending the entire lot to your home instead of directly to Amazon. (But I read briefly that there are some issues in Germany, according to you? Not sure.)

I rely a lot on my way of doing product research and I know what's a good and bad product to sell.

3. The REASON your product has bad competition is because of the following reasons:
You're on a product that has low barriers of entry thus making the competition relatively higher which gives a more likely chance that people will do anything.
You've chosen a bad quality product? I don't think that's the case here.

4. Amazon FBA is a great business model - except for Amazon itself. It's terrible in terms of customer support and one reason I really dislike Amazon is due to the fact that you're not 'independent'. At any time, you can lose everything there.

If you got any questions, shoot them my way.
Thanks.
How did you find and choose your products ?
What are the most important criterias ?
 

Longinus

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I started my first Amazon product at the age of 16. Failed that product - lost $2000.
Started my second product age 17 after getting someone to invest $1200 into the project - made $10,000+ the first 5 weeks, making $100-200/daily while at school, home, sleeping etc.

Curious, what happened after those 5 weeks? How much money are you making now? Is that profit or revenue? How much profit?

It's pretty easy to "make $10k" (revenue) in a short time on Amazon, but that says nothing about your business in the long run, let alone profit.

What you're writing is pretty common information. I'd expect more expertise from a self called mentor.
 
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Kaizen502

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I rely a lot on my way of doing product research and I know what's a good and bad product to sell.

3. The REASON your product has bad competition is because of the following reasons:
You're on a product that has low barriers of entry thus making the competition relatively higher which gives a more likely chance that people will do anything.
You've chosen a bad quality product? I don't think that's the case here.

If you got any questions, shoot them my way.

Thank you @Minus9 for joining the conversation.

Could you elaborate more on #3? What are the criteria for a product with high barriers of entry?

Do you source expensive products, products that are very technical or need certain certificates, oversized products a lot of the beginners are scared of sourcing because of the high inventory costs?

I am also curious about your way of doing product research.
 

Minus9

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Thanks.
How did you find and choose your products ?
What are the most important criterias ?

Curious, what happened after those 5 weeks? How much money are you making now? Is that profit or revenue? How much profit?

It's pretty easy to "make $10k" (revenue) in a short time on Amazon, but that says nothing about your business in the long run, let alone profit.

What you're writing is pretty common information. I'd expect more expertise from a self called mentor.

Thank you @Minus9 for joining the conversation.

Could you elaborate more on #3? What are the criteria for a product with high barriers of entry?

Do you source expensive products, products that are very technical or need certain certificates, oversized products a lot of the beginners are scared of sourcing because of the high inventory costs?

I am also curious about your way of doing product research.

The same thing happened to me, I chose a 'bad' product and used a little more unethical ways on getting my reviews - but after the wave where all reviews got deleted and many were affected including me, my ranking dropped. (As well as random people jumping on my listing and trying to sell.) hence why it's important to differentiate yourself in terms of brand-marking your products which at that time I didn't have the budget to do so.

Out of the revenue, around $5-6k profit in the first 5 weeks. Went for a few months and then decreased. I decided to milk it and sell ownership rights to get into something else while also mentoring others. Bare in mind, while I may not know everything, I can tell a lot of things on Amazon in terms of what is a good and bad product. Now I am saving something that requires a little more and has less competition.

Like you said, either products that seem hard to do, technical, certifications etc. All these are barriers of entry. The more they are, the less people are going to get into the market because it "seems complicated" which rules out a lot of people. Those who get through these barriers and is able to sell usually is able to achieve success.

I am not perfect by any means but I do recommend that you don't use product research tools, they suck. Only use the stats extension to get an average x amount of sales, revenue etc. to understand whether this is a market you should get into.

Some ways you can research is first finding the inital first products, even if they're bad. Look at those who do FBA and are selling successful products, if that product is too competitve for your budget, take a look at their seller profile and see what they're selling. A seller will always want to sell good products. Don't look for trendy products, look for those who are already established and proven to have a constant source of income.

And then use the tool to run the numbers and take a look at those with a little less competition. There's more to it, I am not that good at explaining it in a forum post.
 

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