Our guest on the 4th of February, 2019, on the sellerboard show was Kevin King.
We talked about Kevin’s Amazon business, picking products in 2019, selling Amazon businesses and much more.
Watch the full video here: https://www.youtube.com/watch?v=GUrlS-GN1P0
Speaker 0: A lot of people I think in the sky is falling on the freaking out what we can do you can’t make any money on Amazon and I say yes you can I think the opportunity is better than ever now about ninety percent or so the people that actually try to sell on Amazon sale building brands takes a lot of money or a lot of luck right place right time.
Speaker 1: Hello everybody and welcome to the sellerboard show my today’s guest is Kevin king we’re going to talk about Kevin’s story and how he became an Amazon seller how to pick products including nineteen or what matters. And also about selling in FBA businesses or brands because this seems to be a definitely a trend this year the market for Amazon based brands is definitely growing so let us know what you think comment this video below and give us a like and subscribe to this channel if you like it before we start one word will always answer and that’s sellerboard our profit analytics tool so if you were an FBA seller then they’ll probably you know it’s kind of hard to understand how much money exactly you’re making our product per day per unit per month. And what exact fees are are you paying also on every level of the account level of every product sold under brand or even an esky you so so bored this build expected for that would connect to the seller central account into I’ll pull all the data and basically show you your profits in real time and give you actionable insights into the data so you can back in some fees like storage fees if they’re too high to optimize PPC and basically make better decisions so it’s only nineteen Bucks a month so make sure you check out our free trial there’s a one month free trial the link is the description in the let’s start the show.
Speaker 1: Hello everybody and welcome to the seller board show my name is Vladi and today we have a very special guest oh my god is the one and only Kevin king himself hi Kevin.
Speaker 0: Hi how you doing man how’s everybody doing.
Speaker 1: Awesome hi how are you.
Speaker 0: Good to see you again we met in Europe last year at several different conferences and it’s good to see your face your smiling face again.
Speaker 1: Thanks Kevin! Nice to see you too! So tell me how’s the weather in Texas?
Speaker 0: The weather in Texas is that I don’t know just wait one day no change I’m in Austin Texas which is in the center of the state so it doesn’t get too cold here but you can get down and turn right sign up in the thirties which is close to zero a few days of the year.
Speaker 1: Okay but right now it’s actually a pleasant almost like a spring day and so.
Speaker 0: Very nice. All right we’re in the middle of the winter here in Europe so. Yeah. You know our listeners I think you don’t need no introduction to our listeners and viewers but maybe you can just talk quickly about yourself for those guys we don’t know yet.
Speaker 0: I’m just sure I’m in the I’m an entrepreneur for over. Since pretty much since I was born almost as about four years old haven’t ever worked out for any corporations or anything right out of college I started doing my own thing so I’ve been been us basically self employed for thirty years almost I haven’t got a paycheck from somebody else and long time I’ve had the ups and downs done all kinds of stuff in the in the television industry where I was doing a lot of reducing and Christopher televangelist talking a collectible industry in the in the E. commerce industry I started doing the commerce and but nice five ninety six. And back before there’s even a Google and so back before you can even do paper click advertising or anything like that started selling on Amazon in about two thousand mostly used Amazon back then as a almost like an eBay with does I would have extra stuff in the office I don’t want to sell instead of a drone on eBay sometimes I would go on to Amazon had that little but that’s that’s all yours. But I would list my used printer my used my DVDs or whatever might be selling on Amazon and then also I have a calendar business it’s seasonal so every year we produce a range of calendars and knows that no one Amazon starts on those. Basically as a vendor back in the early two thousands and then involved in the private I dabbled a little bit and arbitrage you know going down back about two thousand thirteen two thousand fourteen going you know finding ideals and the local stores in and buying cheap and selling on Amazon I quickly discovered that well that’s great that doesn’t take a lot of money to get started it’s very hard to scale that turns into a lot of work and I feel there’s a better opportunity in private label so I switch my focus in two thousand fifteen to private label. Launched us six branch on Amazon and then since then that’s involved I still have that those most of those couple those brands are discontinued but most of them I still have some partnerships or some other people and some other seller accounts I mean do you millions of dollars in sales and then I speak at events Amazon announced all over all of the world about twenty six or so last year.
Speaker 0: Then I also I do training with the for people who are just new to the business online learn how this is assisting work for private label at the freedom to go dot com and then I train with many coats who as the healing ten software I’m not part of healing chan but he has that software and we and Illuminati mastermind we teacher experience sellers how do I have to take the business to the next level.
Speaker 1: Nice so look I’m very excited to pick your brain into the dive into some middle.
Speaker 1: Secrets of your own if you’re pro sizzle doing private label on Amazon so my I guess my first question would be is said you switch to private label twenty fifteen I mean obviously all the things changed since then but the yeah wow what would you say what’s the most important thing that has changed.
Speaker 0: Well probably the biggest thing I changed was what happened in October two thousand sixteen when I you could do incentivized reviews anymore back when I first started that was a major a major.
Speaker 0: In a bandaged to watch a product you can just kind of game the system but since that since I took that away that’s the probably the biggest internal change at Amazon but the external changes Amazon probably the biggest one is the software tools like you like us on our board and all that you know there’s there’s hundreds of tools out there but when I first started there was about five or six tools there is I think jungle Scott was just getting going and there’s a couple other kind of rude ones there’s no tools like yours your name are some of the others that we could keep track of your profits on the keyword tools I think there’s martial arts I see things it was a very very rudimentary also from a seller’s point of view the tools today are so much more sophisticated.
Speaker 1: Well.
Speaker 0: You know we had were Amazon actually at least in the US was on for about a year there the tool sadness but your tools and access to actually real data on Amazon.
Speaker 1: Not.
Speaker 0: That recently one way Amazon Jamison change that fact close that loophole and so a lot of people I think in the sky is falling on the freaking out what we can do and I’m like this is like it was a year ago it’s no different you know we’ll go back to the estimation stuff it’s close enough and there’s there’s other ways to figure out.
Speaker 0: What to do in the tools the tools are so much more sophisticated so as a seller you know whether you’re new or whether you’ve been doing it for a while you’re at a big advantage now over the past.
Speaker 1: What about the competition.
Speaker 0: The competition on Amazon is your servicer I mean there there’s more and more people trying to get in this game with the thing is people always say is it too late in that I missed the boat it’s you can’t make any money on Amazon and I say bowl.
Speaker 0: VS that yes you can I think the opportunity is better than ever now but you have to treat it like a business it’s not a you know there’s all these courses and all these YouTube videos and all this crap out there what people are saying.
Speaker 0: Basically making a catch by my course I teach you how to get rich and will not quit quit your job and go live on the beach and drink margaritas the rest your life that’s that’s not gonna happen for most people it’s really true like a real business you treat it as a long term thing maybe don’t quit your job right away you build this over a year two years three years the opportunity is a great so. About ninety percent are so the people that actually try to sell on Amazon fail and most of those people fail because they’re either they don’t they don’t understand the math this this is a data analytics business all about numbers so if you’re not good with numbers you gotta get somebody on your team that is so if you’re good with numbers at and understanding the whole process of how everything works. You can do very very well problem right now we have this excuse me I’m sorry was all.
Speaker 0: So the process right now I will I mean I think the opportunity is better than the biggest problem we have right now at least in the US and in Europe especially do is with these Chinese sellers there’s a whole movement over in China were love you don’t wanna play by the rules and they have access to some inside information and they’re doing next win at all cost and so on some of the lower priced items in the commodities the cheaper stuff it’s getting pretty cut throat and and pretty bad but there’s tremendous opportunity outside of that I mean like my products on the millions of dollars a year I don’t have anything that has a B. S. R are below three four thousand.
Speaker 1: Okay.
Speaker 0: All my stuff is like out of that range you’re below thousand BSR in going after the big high sellers the thing selling fifty a hundred two hundred a day the cheaper stuff that’s under twenty Bucks it’s cut throat and I don’t recommend people play there especially if you’re new but it there’s tremendous opportunity in the middle attack where were these people aren’t aligned and because Amazon has grown even since two thousand sixteen Amazon’s doubled in sales and use the nine states so what used to be a two thousand BSR maybe is a four thousand dollar five thousand but it’s still not as much so there’s good opportunity opportunity there but you got to use the tools and you really guys you know you something like sellable or some other whatever your tool is to stay on top of your numbers and I think that’s where a lot of people make a mistake is they have cash loan them money coming in but they really don’t know their numbers you see it on Facebook groups I’ve got a sixty percent profit margin or this or that or the other when they’re not factoring in all the costs and all expenses properly and once you do that it can make a difference I mean for instance and my products I’m I’m not one these guys that has hundreds of products I don’t miss too much some people like they just keep adding products and I get hundreds of thousands for me I treat like a stock I want a portfolio of products maybe fifteen or twenty twenty five at the top and and that’s what I manage and that what’s manageable by one person’s manager want me I don’t have to have a big team they office I’m not trying to scale this to bank to be a hundred million dollar company or something to me that’s just more headaches and more I don’t want that I want scale it’s where I can manage it make really good money and have a lifestyle that that that I want to live and so I use tools you know like sellable or another and then some of the other ones for like you done ten has a tool that’s built into the terms of their software called profits and after six months of the product if it’s not making me personally at at least two thousand dollars a month in process.
Speaker 1: Well. I dropped the product I get rid of all that for some people they may save two thousand dollars a month that’s you know. That’s life changing while the hell would you ever drop that. It’s just a different perspective so some people may not do that they’re happy with that but for me I can take the same money and maybe put it into another product that can make me for five thousand dollars a month so it’s a diplomatic capital and yet.
Speaker 1: Well I think that some of that so valuable for me because like I know we have a lot of bigger larger customers or have huge accounts and I noticed that this business is kind of hard to scale no because when you start delegating start hiring people and when you have like more than one hundred products or even even more than fifty parts come so complicated to manage the cash to manage the purchasing but just I mean. It’s hard to scale I mean Amazon makes it pretty easy to scale from a selling point of view it like you said yeah you got if you start adding more products than its cash flow thing it’s a you more listings more people more VA’s and so that I don’t want to do that I want to find those you know not everything’s gonna succeed but you know I have my failures that’s okay it’s rare that I lose money on something you can usually even after.
Speaker 0: It comes out the gate in the first five reviews one stark and hopefully come close to breaking even get the money back. But but it’s a and another thing is you know I don’t want to have a home yes a lot of people have like say they have temperature might be one or two of those products are their bread winners are the ones are making all the money yeah and the rest of my discount is theirs I don’t like I try to try to avoid that because if something goes wrong with that one or two products are kind of shrewd yeah so I try to I mean avoid that. That you drive like you don’t have like a couple dozens of products and a couple of hundreds.
Speaker 0: Yeah.
Speaker 1: And and you know make sure they’re they’re selling better. Or you have selected national is the thing to that that kills a lot of people in this business I mean it this is a very intensive cash intensive business especially if you’re successful this the more successful you are the more money you need to buy inventory and pay for deposits and get ahead of it and then wait to get paid and it’s become a big juggling act and that’s why I tell people look the biggest opportunity here in an Amazon business is not to try to make a big profit from Amazon business is to come into it and think about selling this business because right now there’s nearly a billion dollars and private equity money that’s out there here in the United States I’m on the board of advisors for a one a one commerce it’s a company that’s buying a hundred Amazon businesses over the next few years.
Speaker 1: Well.
Speaker 0: They’ve got a lot they got over a hundred million dollars and a and capital and so their goal is is the way it is to come in and buy the buy a profitable businesses but they have the money where maybe me and you were selling maybe in the US and we know there’s a good opportunity to sell in Europe but we’re like man I just can’t slow I don’t have the money to flow more inventory and buy more much more in the way it but they do so they can come in and almost overnight double a business just because they have the money in the scale and so.
Speaker 0: When you sell when it when you optimize your business to sell that’s when the big payday Assoc let’s say you have a you get to a million dollars in gross sales on Amazon doing private label and that’s a typical margin for most big sellers that a realistic margin private labels around twenty percent after you factor in all your costs all your TV see all your shipping all your software tools all your everything maybe twenty five twenty just some people get about thirty but it’s pretty rare to go bust thirty if you really truly.
Speaker 0: The ferret yourself with all the numbers but let’s say you have a twenty five percent margin so that means that on a year you’re making about two hundred fifty thousand dollar profit if you’re doing a million in sales.
Speaker 1: Well.
Speaker 0: That’s on a piece of paper I can tell you you’re not putting two hundred fifty thousand dollars in your pocket right yeah because you have to use that money to reinvest reinvested by more inventory to get ahead of the game if you’re trying to grow it’s not trying to grow maybe it’s loading on your pocket if you’re trying to grow it the so you could sell that company for between two and five acts so somewhere between five hundred thousand a little over a million dollars in cash and so what a lot of people are doing is they’re taking that building the company and then in two in two three four years St okay let me sell it get a nice Pollock cash that you can put in your pocket and then they’re going doing this again I have a nine to pizza you can’t sell the same categories same thing but maybe get half a million Bucks you put one hundred thousand your pocket pay some bills taken nice vacation by house whatever it is you want to do any now you come into it with a hundred thousand dollars to start we said maybe the last time we only had five or ten thousand dollars and you can go much faster and you know what you’re doing and then sell it again in a couple years and that’s that’s where the big leverage is right now and the reason this company like one one commerce there’s more what reason they’re buying on is because if they can buy a hundred of them let’s say man you said a large for two acts once the higher the sales goal is to get the sales up.
Speaker 0: Bigger the multiple is so if they can roll on roll on roll up a hundred of these thank you get maybe a ten X. multiple.
Speaker 0: Down the road so it’s a financial plan but someone like Amazon might come in and buy something like that and make it all their own private label or maybe Procter and gamble or who knows so this tremendous opportunity out there but you got to think about this stuff and you gotta make sure your books are tight and you’re keeping the track of everything and you’re not taking too much money out over spending really optimize that value but that’s where the big opportunity is and you don’t have to live in the U. S.
Speaker 1: I mean if you’re selling in the US you do have an advantage but you know you can being anywhere in the world and and sell the business and they’re buying it’s just not to be a US based Amazon best I can be selling in Germany for example or somewhere to. So. There’s good opportunity there.
Speaker 1: That’s interesting I’ve actually never realized realize this and I know there’s a lot of talking about this so brokers and you know you see them now and then but I didn’t realize there was such a huge game look let me ask actually one thing before all we talked about you know wasted to build such a business which is sellable but I’m interested in in the following there are some people are saying like you need to go for brands you know and build a brand new build a strong branch right but mostly. Well like at least our community starts on Amazon right. And Amazon is I believe also about gaming the system. Or you know playing by the rules but taking the system right so what do you think like.
Speaker 0: Would you rather go recommend to go for a strong brand with Instagram and everything or you know just do your job and basically I understand that the techniques the system what would you recommend for first.
Speaker 2: I recommend I mean number one there’s a lot of hacks out there there’s a lot of like you said gaming the system and I really think most of that stuff a short list most of the people that are trying to do that they’re looking for short cuts and they’re looking for ways to get an edge and sometimes it works but a lot of times it’s short lived or it backfires so I just recommend people focus on the fundamentals which is finding good products that are in demand and and and have a haven’t produced well and make sure you differentiated great really good listing was really strong photos. And I mean really strong so spend some money there.
Speaker 2: Know how to launch the product right and then just rinse and repeat stalkers on the fundamentals I’ve never done you know people do stuff with to get reviews for example where they’ll have their friends and family or they’ll just pass on by and then they’ll pay pal mac the money or the do all kinds I’m never done any of that for any of my business is. And I don’t want you because those things while they might work sometimes they can also get you know a lot of hot hot water if you ask you’re not in control.
Speaker 0: So. There’s two different thought searing a year like you said a lot of people are saying you got to build a brand built a brand or brand I don’t know how to percent agree with that I think there is a time and a place for brands and if you’re able to do that what a brand is not just putting a logo on our products a lot of people saying let’s put my logo on a product brand is going after. A specific niche of people and trying to create products that enhance their lifestyle or make things easier for them and that they identify with and that they appreciate and building brands takes a long time and so if you want to build a brand that’s great Amazon is a great place to start to because the people are there but eventually you have to get off of Amazon and onto your own Shopify site or your own side which is difficult to do it takes a lot of money so what I recommend people do is focus on the on the private label side in maximizing your opportunities on before you start worrying about building a brand and going off of Amazon because most people are doing this don’t have a lot of money building brand sticks a lot of money or a lot of luck.
Speaker 2: Right place right time so I recommend focusing on whichever market Amazon what is Europe or Japan or US wherever it is you’re selling optimize their and then before you go off to show on the Shopify or to try to build your brand and running space book ads to get people to buy directly from you go take your product to one the other Amazon market source expands internationally because you’re gonna. You can make much more money a lot more money a lot faster that way get your products out there and then start thinking about okay now that the rolling and making me some good cash maybe even selling it. And then taking that money and then starting to create a brand so you can do it properly but there’s a lot of money where you can just I mean I disagree with people who say you have to build a brand that spend all this time also the Amazon because one of Amazon people always say well one of them was on shuts me down one of my account gets closed. I can tell you for nine nine percent of people that are off Amazon I have a Shopify cited or the right place is just it’s not gonna matter spike one percent are business.
Speaker 0: Yeah.
Speaker 2: It is so small and I know one on one congressman there a value waiting businesses people always say well if you’re selling off of Amazon your business is gonna be worth more yeah maybe in some cases but if you’re selling off of Amazon and it’s only two or three percent your business your business at once more it needs to be about thirty percent to thirty percent of your sales are coming from off of Amazon thirty percent more land and then add some value but that’s difficult to get to that point.
Speaker 0: In the beginning so.
Speaker 2: I think you should go in and you should try to serve a certain type of customer so like if you’re going to you should just I don’t think you should just do haphazard products I don’t think you should say I do this one over here in the snow here and it’s just crazy mix and you look at your seller store and it’s like let’s let’s look it looks like a Walmart or something and there are already looks like you know just all kinds of crazy I think you should try to narrow down like I said I have six brands and I try to stick things inside each one of those brands you know there’s a dog in the dog brand stuff for dog lovers and everything is high quality arts this type of consistency through it and overtime a brand will emerge off of that. But that’s my thoughts on that.
Speaker 0: Yeah I think I I agree with you because some like building a strong rep at basically the lane my impression is it’s better to do your homework and to be good at selling on Amazon and then and I’ll start from there and rather read about Amazon’s it’s it’s easy I mean if you’re gonna run try to build your own brand also I was on you gotta learn Facebook ads in Instagram and Google and you gotta drive traffic and get the eyeballs and it can be expensive and time consuming first if you go to Amazon where the people are already going hello there and then use that data there to build a list that you can then create lookalikes and other stuff on the Facebook it’s gonna make your brand building or selling off Amazon easier down the road because you’re gonna have a and you can get all the lodging stops and it’s just so much better place to launch something.
Speaker 0: Let’s get more specific what would you recommend for twenty nineteen in terms of speaking at the product I’m going to give us a couple of criteria.
Speaker 2: On for twenty nineteen not I like I would stay away from the commodity stuff the stuff that’s under twenty Bucks I think the biggest opportunity is in that fifty dollars to two hundred dollar price point range.
Speaker 0: Well.
Speaker 2: I think there’s there’s no you’re not gonna sell on most cases you’re not gonna sell twenty fifty a day but you don’t need to.
Speaker 2: Five five units today or ten years today anything like the same kind of money differentiation is key you’ve got to differentiate not just too many major products that you may be able to just find the same thing stick a label on it and then they wonder why they have hijackers in there they wonder and there’s no protection have to differentiate the product You have to.
Speaker 2: Also I mean there’s opportunity in licensing so and I think that getting licenses for you know it doesn’t have to be just me. But again base some mid level license or some news TV show or can be like the U. S. army if you’re making camping equipment your license from the U. S. army yeah you might have to pay him seven percent is a licensing fee but you can say this is a U. S. army flashlight or US army backpack or whatever is gonna make it stand out because they already have a brand you can use them in our layoffs somebody else’s brand. I think you really got to know your numbers and do your homework. And don’t follow you know there’s so many big horses out there that and a lot of you to people and stuff let’s say you you know you got to find a product that weighs less than this amount and cost less than the asking you can air freighted and they show parameters of how to use tools like what X. X. ray on him chanted jungle scout or whatever it is. And everybody does the same thing everybody thinks this is a magic formula and what happens is you find a product and get all excited you know I got mad I just found it you call you can get ordered by the time you know launch there’s a hundred other people somethings that same thing you know like where the heck did they all come from so you I I that’s what I teach in the state of Texas I don’t teach formulas I don’t say this is the five steps I teach you how to think and how to analyze the data and all that.
Speaker 2: How to use the proper tools to actually figure out what everybody else is not looking at and how to really figure out a lot of times it’s not the big G. words you want to go after people are always like well this keyboard has twenty thousand searches a month in this other one has two thousand to go after this twenty thousand one orto launch into right for that they have to give away a lot of positions that they have to do a lot of PPC or give away a lot of the big launch and a lot of times the real money is in the smaller keywords because there’s so much more competition on the big ones but the focus on the smaller key words especially if those are converted to sales and lots I seen some of the data from Amazon some leak data that’s come out of China I’ve seen some of that in a lot of times that a big G. word might have a really low conversion rate maybe say twenty thousand nonsurgical month I have a five percent conversion rate so it’s only a thousand sales a month being made for all the guys also that you are.
Speaker 0: Yeah.
Speaker 2: Another one that’s a two thousand searches a month I have a fifty percent conversion it causes more dialed in. So it’s the same numbers of thousand sales but there’s way less competition.
Speaker 0: Yeah.
Speaker 2: So you got to look at those kinds of things in this tools like union tends cerebral tool is really good at finding those little those little windows when you compare your products other other products are using the reverse essential it’s got some extra features most tools on you can find some really bold opportunities.
Speaker 0: So what would you recommend in terms of BSR or sales per day like should not attend?
Speaker 2: I don’t pay attention to my BSR I don’t care what my BSR is on here my competitions bazaars to many people look at me aside and focus on I don’t care I really don’t challengers are making money as a Macon is a given me the return that’s another another area where a lot of people make a mistake when choosing products as they look at profit we don’t look at our why that’s a mistake I made in the beginning as I focused on profit to. Also it is not where it’s at it’s an R. O. Y. return on investment let’s take an example let’s say I’m selling a great make which a product I used to sell. I would order a thousand of them and they still cost nano nine Bucks apiece or whatever something like that now someone for like forty Bucks. So I would go and and but it would take me in because they were slow moving I would take me three months now selling about three hundred a month or so.
Speaker 0: Yeah.
Speaker 2: In a day these things so it took me three months to basically get my money back and that’s so. And I was making in about ten Bucks an H. one so basically to double to double my money to get a hundred percent ROI return on investment I would have to take a three much less I could find another product maybe I’ll buy a thousand active Salamone a months and I’m not tying up my money is much and still making the same money now my ROI just went from a hundred to three hundred percent.
Speaker 0: So.
Speaker 2: Toxic on here are on they are why the return on investment that’s how you can scale this business faster with less capital and you can make real money so profit is important process is important but the real number you need to focus on it is return on investment I recommend you don’t do anything under a hundred fifty percent ROI you can avoid it.
Speaker 2: How to find products were you worried? It’s about a hundred fifty percent ROI and typically that means that whatever you’re buying it for if it’s a lower priced item you need to be able to sell it for four to five times what you bought it for at a minimum.
Speaker 0: Well that’s interesting well.
Speaker 0: Thanks so much for listening I hope you liked it please make sure to subscribe to our channel and give us like if you like this video and also check out sellerboard, a profit analytics tool for Amazon sellers and our mission is to build the world’s most accurate profit analytics tool for sellers and we have a free trial it’s one month for free and after that it’s starting at nineteen Bucks a month so be sure to check that and let us know what you think.
Speaker 0: Thanks so much and see you next time bye bye.