Editor’s note: Today’s guest post is from online selling superstar Ryan Grant. You can find out more about him and how he’s been successful at Online Selling Experiment. He has been in the online selling business for seven years and full time for the past two. He’s learned a lot about scaling up a business in his time, and he’s here to share some of that advice with you.
Additionally, Ryan does have a fantastic book he wrote regarding outsourcing, you can check it out here.
Minor edits may have been made for appearance.
I am honored that John asked me to do this guest post here on the blog. My name is Ryan Grant, and I have been selling on Amazon since 2008. In September of 2013, I quit my full time job as an accountant to pursue selling online as a full time income. So far I have been very fortunate to have grown my business very quickly, which is largely what this post will be about. I will be sharing some of my top tips that have helped me to grow my business. I went from sales of about $10K per month in November of 2013, and have exceeded $100K in sales every month since May of 2015.
I have documented my journey to creating a full time income where I share my financial results monthly, as well as tips and tricks related to selling on Amazon on my blog: www.onlinesellingexperiment.com.
Tip #1 Keep your capital in your business
The first tip that I have for today is to reinvest and keep as much capital in your business as possible. The fastest way to grow an Amazon FBA business is to continually buy more and more quality inventory, and the fastest way to buy more and more quality inventory is to have as much capital at your disposal as possible. Essentially what this means is that you should do your best to delay pulling cash out of your business as long as you possibly can. Personally, I did not begin drawing money out of my account until January of 2015. For the first 15 months I was full time I did not take any money out of my Amazon FBA business. Even now, I take out a relatively small salary (less than what I was making at my prior job) out of my business. I am planning on leveling off spending in early 2016, and at that time I will have the ability to pull additional money out of the business, should I choose to do so. By keeping more money in the business the results are able to compound, and ultimately grow faster. The longer you wait to pull money out, the more you should be able to pull out when you choose to do so.
Tip #2 Outsource
You only have so many hours in a day, so today’s second tip is to build a team and outsource pieces of your business. My goal with outsourcing is to outsource anything that I can have done by someone else that will free up my time to ultimately create more value for my business. Currently I have hired a couple of individuals to do all of the prep and packaging work for my FBA shipments so that I don’t have to spend time on that. In addition I have a handful of individuals who help source products for me via retail & online arbitrage. I have systems in place that work to have other people source products which have been working very well for my business, my eBook Outsourcing Sourcing goes into the details of the strategies that I use for that. Outsourcing these aspects has been one of the real keys to growing my business, as there is no possible way I could source and process all of the inventory that my team is now able to handle.
Outsourcing is not limited to just hiring additional manpower. If there are services that will free your time, those count as outsourcing as well. I pay for quite a few services in my business, which can all be found on my resources page, as each one saves me more time than the amount that it costs. My overall philosophy related to outsourcing follows this line of thinking:
Anytime I find myself doing anywhere close to minimum wage level work, I will outsource that task for somewhere close to minimum wage to free my time for more valuable aspects of the business.
Tip #3 Take Calculated Risks
My third tip for today revolves around trusting your instincts and testing the limits of your comfort zone. This is going to mean different things to different individuals, but there will be opportunities in this business where you will have the ability to do something that makes you a little uncomfortable that has the ability for a large payoff. This could mean that you take an opportunity to purchase hundreds of a single item in a closeout buy when you know the item to be an exceptional candidate for resale, despite the fact that the most of single item you have ever purchased previously is 25 items. This could also mean using a credit card or some sort of small business loan to finance a larger purchase than you wouldn’t normally be able to handle when you think the potential payoff is larger than normal.
I have taken many risks over the past couple of years that have sparked the growth of my business. Not every risk you take is going to pay off, but the ones that do will likely make any failed risks worth it. That has been my experience, at least. My motto with risks is that I would rather make mistakes by taking action, than making the mistake of sitting idle. I would rather try and fail, then to never have tried at all. Do something that makes you a little uncomfortable in your business once in a while and the potential payoff can be very large.
I would rather make mistakes by taking action, than making the mistake of sitting idle.
Tip #4 Focus
My final tip for today is to keep your focus. There is so much information out there about selling on Amazon that it is easy to get information overload, and never take any action. There are individuals saying that retail arbitrage is the best current opportunity, others saying online arbitrage is the way to go, others saying if you aren’t private labeling you are completely missing the boat, and still others saying that if you aren’t doing wholesale sourcing you’re making a massive mistake. How is one supposed to decipher all of these conflicting views?
My answer to that question is to focus on one at a time. All of those sourcing methods have their merits, but if you try to do all of them at once, you will likely won’t get anywhere with any of them. My recommendation is to focus on a single business model and really master it before moving on to other sourcing methods. There have definitely been times in my business where I have been trying to work on building up multiple of these methods at the same time. I have found that to not be a very effective use of my time as I make little progress on each one. For about the past year I have been focused the majority of my attention on sourcing via retail & online arbitrage. My first step was to completely master my process, and document it in a manner that I could have others carry out pieces of the process for me. I then began building my team to make that a reality. There were some initial kinks to work out in the process, so next my time was spent primarily there. Now, I am to the point where I don’t have to do retail/online sourcing very often, and just have to do a little bit of managing of my team. What this has allowed is for this arm of my business to keep operating no matter how I spend my time. This now allows me to spend more time other sourcing methods as I see fit.
The intense focus on the retail & online arbitrage for about the past year has put my business in a very good position that allows me to spend time on other growth areas without any real impact to the retail/online sourcing methods that continue operating each day.
That’s about all I have for today. The above 4 tips have played a large role in my business growing to the level that it has today. Thanks again to the FBAMaster guys for having me do this guest post. Find me at Online Selling Experiment for more information.