Kev's Honest Thoughts On Amazon FBA in 2021

In this blog post, I am going to share with you Kev's honest thoughts on Amazon FBA in 2021. This will be applicable to you, if you are in phase 1 of your journey, where you are just getting started, or you have only just got started, and you are looking at really taking this opportunity and taking your life and business to the next level, where you are able to quit your job. Or, you are in phase 2 of your journey, which means that you are more of a seasoned seller - you have maybe been selling for many months, or even years at this point, and you have got team members, or you are looking at adding team members - you are looking at structuring your business systemising your business, putting management processes in place - this blog post will just share with you Kev's general thoughts.

Expect the Unexpected 

Kev has experienced quite a lot over the past few years, since 2015, every year there has been many changes, there has been many different policies, there has been a lot of different things occurring, but this year, is in many ways, more unique. 

We are experiencing something we have never experienced before, with Brexit, with COVID-19, and the pandemic, all the different changes that are occurring, which feels like it is more on a regular basis, than maybe it did a few years ago. Amazon are putting much more structured policies, and lots of hurdles in place, to navigate, resolve, problem solve, and to adapt to the different things that are occurring. This is definitely one of the things which you need to be aware of and accept, going into 2021 - that at any moment, something is going to be different. Expect the unexpected, there are always things changing, and there are always things that are occurring. One minute the government may say something else with COVID-19, there may be something which comes out with Brexit; there is always going to be something. So, you as an entrepreneur, you as a business owner, you need to have that ability to accept the fact that something is going to happen, then have the flexibility to problem solve, to adapt, to pivot where you need to. Whatever happens, you face it head on, and then you resolve the situation and find the solutions to those problems. This is one of the biggest takeaways Kev has learnt over the past few years.  

Beginner 

Now, let us focus from a beginner point of view. If you are just getting started, or you have recently just got started, then it is a fantastic and an amazing time that we are living in, in terms of eCommerce. Over the last few years, every year, Amazon has been growing and expanding more, and there are millions upon millions of people who are Prime members, and who are shopping on Amazon. eCommerce is 100% the future, the pandemic has compressed 5 years of growth into a matter of 9 months. So, if you are just getting started, then this is an amazing time to start selling on Amazon. 

So for you, you need to is think about what business model that you are actually focused on, whether this is retail arbitrage, online arbitrage, or you are going straight into wholesale, or even private label.

Arbitrage models, when you think of retail arbitrage and online arbitrage, there is no denying that over the past 5 years, there have been a lot of changes. Things in 2015 and 2016, were very different to what they are like now. 

Back in 2015, from an ungating process for example, Kev was able to just give a receipt and they would just accept it ungated. However, now, they have put out a lot more stricter criteria and policies in place. This means, if you are a beginner, you don't know any different, so this is your advantage. You are going into your business, where all of these hurdles you have to overcome - the verification of your account, maybe you have to transfer from soul trader to limited. These are all experiences you are having to take, but you know what the opportunity is, because there are more and more customers on Amazon, and it has really blown up. It is a really exciting time for you. What Kev would recommend, if you are getting started or you recently just got started, if you are in an arbitrage model, for Kev, 100%, he would recommend anybody to now have an eye on wholesale. There is no denying that the future is looking towards from a wholesale point of view. So, you need to have an eye on that. That's not to say retail arbitrage can't be done, or online arbitrage can't be done - it can. There are many sellers that are still selling, through those models, and are very successful. This is just one of things Kev has done over the past 5 years, and continue to do, because it is still an amazing opportunity. But having said that, there is no doubt about it, the future, you can potentially start to open up a wholesale account, you start to work with wholesalers, it is going to make the sustainability of your business long term much more structured and safe.

Systems

If right now, you are looking at online arbitrage for example, you want to have a thought on how you will have a systematic approach to this. Kev really believes in building systems, and having the systems mindset on how you are systematically building the business, from sourcing, to purchasing, to shipping - if you think about the growth and maintenance side of things of your business too. So, you want to start developing a plan for this. If you are working full time simultaneously to your business, then this becomes even more important, because time is very scarce for you. There is not enough time, so you are going to want a systematic approach and have a strategy in place of the major systems, sourcing, purchasing and shipping, what are your goals going forward? Are you going to look at the different sourcing strategies there are - hiring virtual assistants, looking from a purchasing systems, are you looking at hiring a senior assistant or admin assistants, which can help you get all those tasks done? From a shipping point of view, have you got your spouse involved? Are you shipping from your living room? Or are you looking at outsourcing to a warehouse? What is your goal and steppingstone, to get there? Do you maybe have to go to a prep service first, to get some time back and build to that warehouse?

If you are interested in a fully established prep service, consider using ours: https://www.systemisefulfilment.co.uk/ 

And if you are interested, book a consultation call with our business development manager Lucy, so she can guide you through the process: https://www.systemisefulfilment.co.uk/free-consultation

Advanced Sellers / Long Term

What is very important, is from a growth and maintenance point of view, knowing what is happening across your entire business. There are many parts of this business, where you could leak money - whether that is stock going missing, or you don't have systems in place to reconcile shipments, or you have got unfulfillable products, you have got stranded items, it is really important to have systems in place, so that you know where every single penny is going. And then, having systems in place from an infantry health point of view, so every bit of money that you are spending, you have got a strategy in place, where you know you want to sell something for the next 60 to 90 days, or however long it is, depending on your capital and resources. You have got actual systems in place for this, that is going to be super important.     

For you right now it is very exciting. For you right now, you should be focusing on how you can increase the amount of leads you are getting in for your business, you should focus on how you can start opening up wholesale accounts, and start getting through some stock lists and try finding those winners. Then, you can start to systematically set up your days - when are you sourcing, or your team are sourcing, when are you reviewing? When are you purchasing? When are you shipping? And really putting in some structure from day 1 into your business.

From an advanced point of view, right now you may be more serious. You are an Amazon seller and you have quit your job, and you are reliant on Amazon. Maybe you have been doing online arbitrage for some time, and you have started to do a bit of wholesale, now is the time to do everything that you can to evolve your business. There is no doubt about it, that with online arbitrage, you still have the ability to build big businesses. You can still build 5-6 figures a month in your business. But, for you as an advanced seller, you have got to think long term. How do you build relationships with more suppliers? How can you potentially get some brand deals, or exclusive wholesalers that are going to be working for you? Which means you are going to start building more of a relationship with potential brands. 

This from a more advanced point of view, long term stability, structure, security, is much more stable when you are working closely with a brand, company, or a wholesaler, that you have an actual relationship with, and you have invested in the products and the brand. At the same time, from a private label point of view. Private label has changed so much over the last few years, but it is still an amazing opportunity. 

Be more focused on building your website, building your social media channels, starting to build an email list and building relationships with customers around your brand. 

This is going to be something which is important long term as an advanced seller, because if you think about it, if right now, you are very subjective based on competition, your ability to source, your ability to use online arbitrage or retail arbitrage, it is really important that you evolve your business. Your business doesn't just max out in maturity, there is always that next level of maturity, which is then the meeting with wholesalers, phone calls with wholesalers, negotiation skills, being able to negotiate discounts, being able to give value to brand, where you can develop a report for them, showing them what you can do for them on Amazon.

Skills

Amazon FBA in 2021 absolutely has to be a part of your business. From an eCommerce point of view, there still is and will continue to be for a long period of time, a very significant marketplace which we can take opportunity in. That's not going to go. But for now, for us, it's the case of, if you are a beginner, it is the case of resolving the problems, going through verification, transferring of accounts, and really developing those skills, from the accounting point of view, team building point of view, systemising point of view, building structures and KPI's point of view, focusing your attention in the right places, and having those processes in place. Those are some amazing skills you will learn as a beginner. Or, if you are advanced, these are imperative skills. These skills are so important, because as you get bigger, there is more potential in for you to lose money, to leak money and to leak products. This is why it is so important to have those managers in place, those systems in place, those KPI's in place, and so on. 

Further reading:

How To Outsource Purchasing In Your Online Arbitrage Business

How to Outsource Your Purchasing In Online Arbitrage

How To Build Systems In Your Business