We’re continuing our series on “Overcoming Your Amazon FBA Fears“ today by looking at another set of fears that we want to replace with truths to help us take our FBA businesses to the next level. Today’s fear has been a big one for me (Rebecca) and Stephen to deal with over the past couple of years, but thankfully we’re working our way out of it.
Many Amazon sellers, including us, didn’t start out with a limitless bank account full of money that we can invest in our business. If you’re like us, maybe you started off finding inventory you could buy at garage sales or thrift stores for a dollar or two that you could sell for great ROI, and you work hard to keep your overhead costs low so that you can use all your profits to reinvest in inventory and hopefully pay a few household bills.
That’s pretty much the situation Stephen started off in. Not a lot of wiggle room or excess cash lying around to use for “extras” in the business. Extras like services that would speed up some of our processes, but would also eat away all our profit. Services like deal lists, feedback removal, prep services, repricers, listing programs, scanning apps, and category approval services.
My goal for today’s post is to convince you that some of the services you might view as extras really shouldn’t be considered extra. Maybe they should be considered essential, if you want to see your business grow.
My goal for today’s post is NOT to sell you particular services. I want to sell you an idea. I want you to take the time to consider whether your business is missing out because you’re struggling to justify paying for services. Please notice that we are not including any affiliate links to particular services in this blog post. We aren’t trying to sell services through this post. We’re trying to help you deal with a very real hang-up that could be slowing down your FBA business.
So, here are 3 fears about paying for services for your FBA business, along with the ways you can overcome these fears:
FEAR #1 – I’m afraid of letting somebody besides me run my Amazon business.
TRUTH – Yes, you are the best person to run your business. It’s yours. And you really should have hands-on experience at running every aspect of it before you hand any part of it over to someone else. But time is money, and after a certain point any business cannot grow unless you multiply yourself, either through outsourcing or through automation. If you continue to spend all your time doing things that anyone can do, then you quickly run out of time to do the things only you can do.
ACTION – As a first step towards automating your business, try outsourcing a task that you really don’t enjoy or that you don’t do particularly well. It’s easier to assign someone else our dreaded tasks than the tasks we don’t mind, even if they’re draining our time.
FEAR #2 – I’m afraid I can’t afford to pay for a service; my business is still too small.
TRUTH – I hear you on this one. I really do. This has been a huge stopping point for me and Stephen. But the truth is that this logic only works up to a certain level of doing business. You have to look at whether you have more time to spend or more money to spend. Once you have more money than time, then your business just will not grow beyond a certain threshold without spending some money to get your time back. Trust us on this one. We’ve learned it the hard way. There are areas where we wish we had spent the money for services a little earlier, rather than running ourselves ragged trying to get more work in each day.
ACTION – Think about the added cost of a service in terms of cost per item of inventory, and work that extra cost into your cost of goods when you’re making buying decisions. For example, if it costs $1 per item to send your inventory to a prep service, start adding that $1 into your calculations for how much ROI you need before you’ll buy an item to resell. Soon that extra $1 will seem like nothing, but you will have gained a priceless amount of time back that you’re no longer spending on prepping inventory. This concept works with other services too, but it may require doing some math and creative thinking on your part to come up with an approximate cost per item.
FEAR #3 – There are too many services (and types of services) available. I can’t figure out which ones are the most beneficial for me to add at this point.
TRUTH – Though it can be overwhelming to think through whether it’s actually worth it to add a service, it can’t hurt you to spend a few minutes coming up with a few pros and cons for a few services. No one says you have to add all the services in all the world all at one time to make your business grow. Just one new service could be all it takes to make a vast difference in your business.
ACTION – Choose one service to try out for a period of time, whether it’s a deal list or feedback removal or a repricer. Most services offer a 7-day free trial, or even a 30-day trial in some cases — or at the very least, they should offer some type of money-back satisfaction guarantee. If they don’t make it clear on their website what their money-back policy is, shoot them an email to ask about it before you sign up. While you’re at it, ask any other questions you might have before you get started. You’ll get a good indication of their customer service and whether or not this is a company you want to work with.
In the previous post on Overcoming the Fear of Selling Used Items, Stephen gave you some homework to look around your house for a used item to sell. Today’s homework is to take one of the action points above and put it into practice: 1) Identify a task you don’t enjoy or don’t do well that would be something you could outsource or automate through a service; 2) Do some calculations on what adding a service to your business would add to your cost per item when you buy inventory; OR 3) Take the leap and do a trial period for a service you’re curious about. Better yet, do all three action points and see what a difference it could make in your business!
Please let us know in the comments which action point you’re doing for your homework. Or let us know if you have a success story for your business that came from paying for a new service. We love to hear from you!
Great blog post. RepricerExpress customers are happy to pay for our repricing service due to the fact it saves them hours daily and from the monotonous task of manually repricing.
Great Posting, I feel as a small business we truely need to know all aspects of Sourcing, Processing, Pricing and Infrustructure. As soon as one of these areas have become too burdensome as you’ve noted, (for me this is the Processing) I want to hire someone to handle it. I tried two Virtual Outsourcers for other Tasks yet I really didn’t have a strong grip on my business last year. Now I Outsource half of my Sourcing to multiple Lists, Feedback and FBA Listing. I believe if you can get these running up front in your business you’ll lay a better foundation for the near future. I ran into CashFlow issues this 3rd Quarter that slowed me down greatly, yet I believe if I was just “a one man show” even during this time my business would have crumbled. Fortunately I was able to hold it together until the CashFlow was able to recontinue. Let these services save you time which is money, allow you personally to focus on what makes you money and allow other Tools and people double, triple quadruple your business! Thanks Stephen!
I love how you’ve outsourced half of your sourcing. Awesome!
Hi!
Was just curious if theres a certain company or companies you use to outsource your sourcing?
Martha
Hi Martha,
Right now we’re using Cyber Monkey Deals to do a lot of our online arbitrage (OA). We currently have two subscriptions with them (the 3% and the 5%x25), and we’ve tinkered around with other ones that they offer as well. I really love their interface. We’ve also tried out the Your Sourced Inventory clothes and shoes list and have really enjoyed that deal list as well.
Great information on your post! I am rather new to selling on Amazon, under a year. Currently I use Inventory Lab to handle the financials. I am so ready to hand over the processing part of my business. Not really thrilled with packing everything up and shipping to AZ. What service would you recommend to do this and how does that work for RA? Even if I shipped my RA products to an outside service to process, I am still packing and shipping.
Also, if I use a repricer, doesn’t that just contribute to driving prices down instead of up?
Thanks for the info.
Thanks for commenting, Tee C! On the question about a service for prepping and packing, if there’s not a local place for you to drop off your RA purchases, then I would suggest looking into hiring someone to come in and help you prep and pack from your location. There are people who ship their RA purchases to a prep center, but you end up paying for the shipping twice, and not at the AZ partner rate for UPS — so unless your business model can handle that extra expense, it gets pretty pricey. But having someone come in and help at your location can be very affordable (this is what we do).
About the repricer, most repricers allow you to set parameters so that a “race to the bottom” does not occur. Many people use repricers only for *increasing* the prices of their items when their competition no longer is selling that item, so they have the potential to drive prices up rather than down.
Hope this helps!
Rebecca-
Can you explain how to use repricers to increase price. I am using a repricer-the free one on A Z – starting yesterday and I am worried. I tried it once, 2 months ago, and I got rid of it but, I have so many one-off SKU’s that I need to use one. I am a new seller 6 mo. and I don’t want to create a “race to the bottom”.
Thanks-
Sarah Dugo
PS. You and Stephen are wonderful-I have taken a few of your classes, I really appreciate all of you help.
Hi Sarah, thank you for your kind words! I’m afraid I don’t know how to help you with setting up a repricer. I am currently manually repricing my inventory, although Stephen uses a repricer for his inventory and is working on an upcoming blog post on the topic. My best advice would be to make sure you watch all the available training videos for the repricer you’re using.