Oct 17, 2017
Whether you are buying or
building an Amazon business, you want it to be sustainable. There
can be a lot of mystery around buying or building an Amazon
business and what worked in the past may not work today. To explain
the difference between a sustainable Amazon business and an Amazon
business that is not sustainable, we brought in an
In this episode, Mark interviews
James Thomson. James spent five plus years at Amazon. He was
business head of Amazon Services and the first FBA account manager.
He is the President and co-founder of the PROSPER Show a seller education organization that shares
best practices for online businesses. He is also a partner
at Buy Box Experts a marketing agency for Amazon
James is an extremely smart and
trustworthy guy. We do business with a lot of intelligent people,
but he really stands out. Mark asked James what he would look for
in a business if he were going to buy it, and how to build an
Amazon business that would be sustainable. We talk about the
importance of continual product creation, and how it's much tougher
to be really good at selling on Amazon than it used to be. We talk
about the importance of having a brand beyond Amazon, the
importance of having more than one SKU, and so much
introduces himself and talks about what he learned at Amazon and
how he is on the other side helping sellers now.
number one problem FBA sellers have now is not paying proper sales
tax on the orders.
states are getting aggressive about auditing sellers. The state of
Massachusetts is suing Amazon to get a list of the FBA
sales tax amnesty program allows sellers to come forward and to
start collecting sales tax and back taxes are forgiven.
- To be
successful on Amazon every seller should understand what their
profit and loss is on every skew.
at the data and see what your return rate is along with right off
cost and acquisition cost.
- Understand your overhead cost things like
heating, shipping, warehouse, employees, etc.
yourself where your competitive advantage is coming from. With
Amazon there is no limit to the amount of competition you can have
on one skew.
- A lot
of sellers source exclusively for one particular brand.
- Private label brands are another common method.
You can make a lot of money, but you have to be extremely
- Sellers must excel in operational discipline.
You must have a daily, weekly, and monthly process. Inventory,
data, and making adjustments and course correcting.
need to know how to create amazing Amazon listings and to bid on
great advertising rates. Know how to play the Amazon
importance of building outside traffic such as Facebook
- Put a
value on your social media following because that is the secret
sauce to drive traffic to your listing.