#314 – Printing $$$ By Sourcing In The USA And Selling In Mexico With Jesus Diaz
In episode 314 of the AM/PM Podcast, Kevin and Jesus discuss:
- 01:30 – Jesus’ Backstory And How He Got Started On Amazon
- 04:10 – Investing In A $5,000 Amazon-Selling Course
- 05:00 – What Is Jesus’ First Product? How Does Product Research Look Back Then?
- 06:30 – Getting A Bad Batch From His Factory Ended His First Product
- 09:30 – Moving Into The US And Build His Amazon Business
- 11:40 – Launching Successful Brands In Amazon Mexico
- 12:45 – Key Points When You’re Expanding To Sell In Amazon Mexico
- 17:30 – Product Opportunities For The Spanish-Speaking Market In The US
- 18:30 – Talking About Amazon Colombia And Selling On International Marketplaces
- 23:30 – Getting Great Ideas And Insight From A Non-Amazon Selling Conference
- 27:30 – Being An Entrepreneur Can Be Lonely Sometimes
- 28:30 – Helping 6-Figure Brands Reach 7-Figures
- 33:50 – Major Changes In Amazon Selling In 2014 And Now
- 36:20 – How Much Margins Should A Seller Aim For Today?
- 37:20 – Jesus’ Thoughts On The Aggregator Space And Exits
- 40:00 – Launching Tips And The Most Important Task For An Amazon Seller
- 41:00 – How To Get In Touch With Jesus Diaz
- 41:30 – Kevin’s Golden Nugget Tip Of The Week
Transcript
Kevin King:
This is episode 314 of the AM/PM podcast. In this episode, I’m speaking with Jesus Diaz. Jesus is originally from Mexico, started selling on Amazon about eight years ago, and is now living in the States. And he’s got some interesting perspectives on the differences between selling in Latin America and selling in the US, as well as some of the big mistakes that he’s seeing six and seven-figure sellers making. Enjoy this episode. Jesus Diaz. How are you doing, man? Happy to have you here on the AM/PM podcast. How’s it going?
Jesus:
Hey, Kevin, thank you so much for the invite. I’m so excited to be here on the show.
Kevin King:
I’m glad to have you here too. Originally, you are in Miami right now, correct?
Jesus:
Yes, I’ve been living here for the last five years, but I’m originally from Mexico.
Kevin King:
Oh, what part of Mexico?
Jesus:
I was born in Bera Cruz. But then I lived in Mexico City and many other cities in Mexico. The last place I was living was Mexico City.
Kevin King:
Oh, awesome. So what brought you to the US five years ago?
Jesus:
Amazon. Yeah. I started selling back in 2014, and I had my corporate job at the time, and that was like my dream job. I was very proud of that job, but also like I wanted to make money online. I was also always trying to find a way I was looking into CPA offers and I was selling eBooks back then on the Warrior Forum, all those things. And it was then that I found a person that posted something on Facebook that he was making like 55 grand selling on Amazon. So that was crazy to me. Like, it’s like crazy money. And, so I started chatting with him, like, how is it possible? And so he started explaining the FBA model, and the first thing that came to my mind was, Okay, this is not for me. Like, I’m in Mexico. I’m not in the US, I don’t know how to do it, but like, it’s impossible. So I started asking more questions and he told me, Yeah, I got into this big course, It was very popular at the moment. And that’s how I learn. And now I’m selling knives on Amazon. I’m making 55k. So that is how I started.
Kevin King:
That was 55k a month in gross sales or?
Jesus:
A month. Yeah, that’s what he told me. And he actually posted the screenshots. Back then, it was like everybody was posting like the sales.
Kevin King:
So in 2014, you’re sitting in Mexico doing your other job and thinking about, “Hey, I wanna be able to make some money while I sleep, do something online.” And you see this course too was a big course back that they’re the ones that actually kind of started this whole model of selling FBA. I mean, the company still exists, but they kind of pause for a little while. I think they’re maybe planning on doing something next year. But they really are the ones that said, “Hey, this is how you do this. Go to Alibaba, throw your label on it, and make sure it fits in a shoebox and weighs less than a pound. It’s not electronics. They had this whole list of rules and put it up on Amazon, then go to the beach and just listen to your phone. Ding, ding, ding, ding, ding every time you make a sale.” And that’s kind of the way it was in the very beginning. It was that easy. Now Amazon wasn’t nearly as big of a business as it is now. Amazon was still growing, but they’re the ones that started that. So someone like you saw that in Mexico City. Did you take the course or did you just watch their little series of videos and do it yourself?
Jesus:
No. I actually took the course, like it was an investment back then, and I used–
Kevin King:
Like five grand or something back then.
Jesus:
Like five grand. I remember. I was very nervous about it. I put my credit card in, I bought it, and I knew I still had to buy the inventory. So I was like, I think I was a person that making all the questions in the Facebook group, like, like, okay, how much I need to invest. And like, I was trying to minimize my risk. When I started the course, I was very nervous, very, very afraid, and also at the same time, very excited. And to me, that’s like a good combination when I feel that, like I feel afraid of something, but also I feel excited. That’s a good indication that I need to keep going there. So then I was like researching on Alibaba the first products, and I found something that looked interesting, and that’s how I bought my very, very first product with the same credit card.
Kevin King:
What product was that?
Jesus:
It was a mini pump for bikes.
Kevin King:
Like to blow up the tires and stuff on a bike?
Jesus:
Yeah, exactly. But very, very small. It was actually a very cool product. And the way I chose it back then, the method was very, very simple. It was just like, you look into page one and you see what’s, what’s there. So then you go to page two, and if on page two you see unrelated products, that means that the product is still not much rated and you can sell it. So that was pretty much all the product research back then. And that’s how I chose it. Like, I saw the different offers and nobody was offering anything crazy. It was like very simple packaging and everything. So I did something fancier back then, and with zero research, like I did not know anything, but I just like did something that I liked and it started to sell, it started to sell decently.
Jesus:
But then they have all this–, when I bought the course, I do it, I did it through like an affiliate and they had like a very I dunno, a very rudimentary tool where you can, you could like give away a lot of coupons, so, so you could rank for the product. So I started doing that stuff and soon enough I was selling like 20 grand a month with just this product. So I thought like, “okay, this is something like, I finally found something that works, so I’m just gonna keep learning and keep growing here.”
Kevin King:
Did you have any experience with e-commerce as a consumer? I mean, cuz it wasn’t that big in Mexico. Now it’s become bigger in Mexico, but in 2014, it wasn’t really huge in Mexico at that time, Was it?
Jesus:
Yeah. No, not at all. But yeah, of course. I have always liked buying things here and there. The biggest market down there is Mercado Libre, so yeah, I mean like buying and selling video games and stuff there for, for sure,
Kevin King:
So the bicycle pump you got it up to 20 grand a month. And how long were you able to run with that product before you kind of faded, faded it out?
Jesus:
It was a sad story because it was working really well at some point. I think I was like in my fourth or five or fifth shipment. And then the factory sent me a totally bad batch. Like it was breaking, like overnight. I had like 10 bad reviews, like overnight, like people were posting the pictures with the pump split in half. So I was like super angry about it. But that was probably the first lesson that I need to do some quality inspections.
Kevin King:
So you weren’t doing quality control at all?
Jesus:
No. That time no.
Kevin King:
So did you just launch that one product and just coast on it? Or did you launch a few more on its coattails?
Jesus:
No, well, with that one, that was the very first one, but then I immediately realized it, I need to keep launching products. So the whole Chinese method was too long. It was like, it took a while to get a product to Amazon. So I started researching companies in the US and I found one company that was importing a bunch of stuff from China, and then you could just buy the stuff here in the US. So I ordered some samples from that company, and I launched like three products from what they had, the things that I thought were the best. And I started getting more and more and more sales there. But then the quality was not that good because I also got a bunch of batch reviews, but at the time, that’s like six months in. So I knew already that this was working and I was gonna make it rain. So that’s what I did.
Kevin King:
And so how did it end up that you came, you said Amazon brought you to the US five years ago, so that would’ve been three years or so into your journey. What was it that you said, Hey, I need to actually move to the US I’m gonna keep doing this?
Jesus:
Well, I always had the idea of moving to the US since I was a kid, I wanted to live here, but now I had a good excuse, like, Okay, my business is there, my customers are there, I want to know how the consumer thinks there. I want to see how the consumer buys the stuff because it is different in Mexico. The lifestyle is just different. So I really wanted to do it. And after I started one year later, I was able to quit my job. And I remember my boss was like really crazy about it. Like, how is it possible that you have a really good salary and everything? But then I remember I show him my Amazon app, the Seller Central app, and it’s like, this is what I’m making, like, so it doesn’t make sense for me to just be here. So and like he was very impressed about it. I still talk to him sometimes. And then after I quit my job I kept working on Amazon and at the end of 2016, I was like, Yeah, this is time. This is the time to move to the US. So I started to apply for a business visa and all of that. And it was granted at the end of 2016 and 2017, I was moving here, I actually arrived in Fort Lauderdale.
Kevin King:
So you were able to use, able to get a business visa with an Amazon Business?
Jesus:
Yeah, that’s correct.
Kevin King:
Really. So you were able to actually get a visa. Did you have to show a certain amount of sales or show that you were hiring a certain number of people or something like that?
Jesus:
Yeah. They have some requirements. The main one is an investment. They say it’s a hundred grand, but at the time, by the way, in 2016, I had a bunch of inventory purchases. So I was using that as a backup and then I presented a very nice business plan with the people I was planning to hire and all that stuff. And that’s how they granted it for five years.
Kevin King:
Awesome. And so what do you have to do to actually be able to renew that?
Jesus:
I already renew it. At least hiring two people and just show that your business is working and you’re paying taxes.
Kevin King:
So how often do you get back to Mexico now?
Jesus:
Well, I try to go every three, or four months.
Kevin King:
Awesome. Are you, are you selling in Mexico or are you just selling in the US?
Jesus:
Yeah, of course. When Amazon launched I started selling there. I’ve been pretty successful there as well. I think I have right now, like 40 or 50 products down there in Mexico. It, to me, it was a bit easier because since I’m Mexican, I was able to work directly with them. I can import, I have a Mexican company there, so I can import things and I do all the accounting and everything completely separate from what I have in the US. And I know the market, so it’s much easier to know if a product’s gonna work down there, but still the volume, it’s nothing compared to what’s here.
Kevin King:
If someone is selling in the US now and they’re not Latino, or they’re not from Mexico and they don’t understand that culture and the differences, what are some key points that they need to keep in mind if they want to expand to Mexico? Cause you can have a unified account in the US where you have a US, Canadian, and Mexican. The Canadian marketplace is pretty much the same as the US. It’s a smaller market like you said. But the mentality and the culture is very, very, very similar. But at the higher level in Mexico, you know, the upper echelon, it’s, there’s a lot of similarities in some ways to the US but there are not nearly as many people at that middle and upper class that have those similarities to the US. So what are some things that people need to be aware of and the cultural differences and the selling differences and the type of things they’re looking for and what they expect?
Jesus:
Yeah. Well, when I started, like, this was all a test for me, the first thing I did, I took all the best sellers in the US and I launched them in Mexico. So the garlic press and the like oven meats and all that stuff, I launched all of that in Mexico. And so–
Kevin King:
Wait. You took these weren’t products you were already selling in the US These are just the traditional best-selling things in the states and just says, “What the heck? It’s saturated in the US but it’s not really in Mexico right now. Let me just take these over there.” That’s what you did?
Jesus:
Yeah. Because when I started with the, at the same time the markets opened, so there was nothing. So listings were there and they didn’t sell very well. Nobody’s buying garlic presses in Mexico, I guess.
Jesus:
So then I started to analyze what’s there, and I looked at Mercado Libre, which is this huge platform person uses down there. And I saw there was a bunch of textiles like clothing and things like that that were selling very well in Mercado Libre. So I started launching those types of products. And I’m still selling some of those in, in a very good volume. So yeah, I would say like, try to do some research in some of the other markets. Mercado Libre is probably one of the biggest right now. Amazon is big enough that you can do your own research on Amazon as well, so you can see what’s selling already. And the other thing that it’s important to know is that Chinese sellers are dominating the marketplace down there, probably here too, but you will see products super cheap like they’re offering like really, really cheap.
Jesus:
The key to me, and the same thing applies to the US. The thing is not to try to compete with them. It’s like you can actually sell the same thing for much more if you know how to market it, how to create the listing, how to differentiate the product, and if you know how to present it and try to find the opportunity, like if you see a gap like they’re selling product A and product C, but product B which is similar, it’s still not there, maybe try to launch that. If the demand is there it’s very likely that it can work for you.
Kevin King:
What are some big things, like you said if you know how to create the listing, a lot of people in the US may not know how to really do that properly in Spanish, and there are some idiosyncracies and some little things that you have gotta make sure you do, right. What are some tips that you might have around that?
Jesus:
E-Commerce and Amazon, the main thing is the images. So I don’t even worry about the copy is like I know I can write copy in Spanish, but I don’t think that’s the decisive factor. It’s really the images. So it applies the same things that apply to the US apply in Mexico, just to it in Spanish. Whatever you are putting your images, make sure that you’re answering questions to the most common questions that your audience will have. And make sure to present the product, like it’s something really, really valuable. Everything is about the perceived value.
Kevin King:
So a lot of people may not know this, but Mexico is the largest Spanish-speaking country in the world, and the United States is the second largest Spanish-speaking country in the world. There are over 60 million people in the US that speak Spanish at home or as their native language. You’re living in the capital of Latin America. Miami is basically–, you go to Miami. If you’ve never been to Miami, you go to Miami, it’s Spanish first in a lot of places there even if I as a gringo walk into the supermarket, they’re gonna speak to me in Spanish first. That’s just Miami’s big cultural melting pot of all these Spanish cultures. What are some things that people may be overlooked here in the States, Forget about the Spanish speakers in Mexico or Latin America, but what are some opportunities that you see from that side that people are missing that are selling on Amazon in the US that they could be doing that product tailored towards that Spanish speaking market here in the US?
Jesus:
Well, there are a few I’m here. I participate in a large group of sellers here in Miami. Most of them are Latin. So some of them come with ideas like, yeah, in my country, like we use this tool to like a barbecue for something special for a barbecue they do there. So like, they were showing in this Chinese barbecue box, which is very different from what’s here in the US. So those types of products, I guess there is a market for that. But to be honest, I haven’t really tapped into that. I’m not really saying anything regarding that stuff.
Kevin King:
Columbia is supposed to be the next big market, that Spanish-speaking market that opens up for Amazon. Is that something that you might be interested in moving over to that as well?
Jesus:
Not really. My mindset right now is like, there is so much opportunity in the US that it’s not even worth it, at least for me to look into other markets until I’m at the level I want to be here. Because I made a lot of mistakes during my career in Amazon. It’s like I opened Seller Central in Europe. I was selling in all countries in Europe back in 2016 and 2017. And it became a nightmare with Brexit and with all the taxes and all that stuff. So I realize that if I just focus on what works, I will just be more successful. And so right now my focus is like keep growing here in the US and also I prefer to build something here in the US that doesn’t rely only on Amazon. Like, like taking my brands out to Shopify, something like that. The amount of money I can get in Colombia is nothing compared to what I can get with just one product here in the US
Kevin King:
That’s true. That’s a mistake that I see a lot of people making is that they think they need to expand or they get these emails from Amazon saying, “Hey, we’ll help you expand to Europe or to Australia to wherever” and they go for it. But what they don’t realize is that’s basically like starting a new business. Yes, it’s the same system and you understand the Amazon selling process, and that’s a major advantage that you have, but it’s like setting up a whole new business, new tax regulations, new setups, new additional round of inventory that you gotta finance cash flow logistics. It can be a pain. That’s why I tell a lot of people to go with what you know. If you’re in the US selling in the US or if you’re living in Germany, go with Germany, or maybe don’t go to the US.
Kevin King:
But I agree with you, the US market is so huge that most people, expand too quickly or, try to expand too quickly when they haven’t even maximized what the opportunity is here. And the same thing goes for like Shopify and for other things. A lot of people will say, “Well, I gotta have a Shopify store, I gotta be on Walmart, I gotta be on all these other platforms.” Those are great, and it’s great to get that leverage, but a lot of times people do that and they take their eye off the ball on Amazon and that, that extra five or 10% of your time that you’re trying to devote to building a Shopify store if you just spent that same five or 10% of your efforts on Amazon, you would have way more sales. And that, I think that’s a mistake a lot of people tend to make. Do you, do you agree with that?
Jesus:
Yeah, a hundred percent. I did that mistake.
Kevin King:
I mean, it’s good to have a Shopify store just for credibility, you know, set something up cuz there will be people that go and look at it or if you need it for brand registry or, or something like that. But I would not put a lot of time and effort into it. Now I noticed you’ve been to a funnel hacking live, Russell Brunson’s show, so you must have been at one point like, “Hey, I need to like get off of this Amazon and figure out how to do some funnels and some other type of marketing.” Is that why you went to his events?
Jesus:
Yeah, well that, that’s been one of the reasons, like, I just like that community, like the launch of entrepreneurs there and the mindset is really cool and you meet a lot of nice people there. But just like like in Amazon events too, you meet really, really cool people. So I like that stuff. And definitely, I’ve been trying many, many things. So Shopify funnels like email market marketing, like a lot of stuff, but to be honest, it really boils down to what’s working. Keep doing that because Shopify, you can make a large business there as well, but it’s a completely different set of skills that you need to master to be successful there. And like, just to be good at Facebook ads and then Google ads and TikTok ads or maybe work with influencers and all of that stuff is completely different from what the average Amazon seller does. So I would say like, yeah, if Amazon is working for you, keep doing that, but also like try to like have it in your mind. Like you need to have something that will protect you in case everything goes to hell with Amazon.
Kevin King:
Yeah, I always tell people if you’re gonna, if you want to expand, if you get an itch in your pants and you just, Hey, I just want to expand, go expand to Amazon Canada. If you’re selling in the US expand Amazon Canada first. Cuz it’s, it’s an easy transition. You don’t have to worry about the language differences, very little cultural differences, and just add five or 10% to your bottom line there. And that’s an easy, easy one to do if you’re just having that itch. But I agree with you on what you just said about funnel hacking lives, Russell Brunson’s show, I’ve been to like four or five of those and there are not very many Amazon sellers there when you go to that show. I mean, there’s a handful, but what I like about his shows is that it’s a combination.
Kevin King:
You got a bunch of social media people, you got a bunch of funnel people, you got a bunch of just pure entrepreneur type of people. And I think that’s something that’s important for Amazon sellers, that they get caught up in this world and this Amazon world and that’s all they know. But you can get some great ideas and some great insight by going to other shows, whether it be traffic and conversion for example, or the social media expo or Russell Brunson’s shows Funnel Hacking Live is what they’re called. One just happened in just recently. And those are great places to go to be around other entrepreneurs and just to kind of get more well rounded and some of that stuff you can bring back to your Amazon business. Is that what you’ve found as well?
Jesus:
Yeah, yeah, of course. You’re right most of them are people doing heavy stuff on social media and a bunch of coaches and different strategies. And like if you’ve been in the industry for a while, you can use some of that stuff to your own business or like, if you want to do some coaching or things like that all that information is gonna be relevant, but the networking you can do there, you’re very right. It is a different kinds of people from the Amazon events. And so it, yeah, the event is really good. Like if you have the opportunity to go, I totally recommend doing that.
Kevin King:
So are there any other conventions that you go to or any other events that you’ve been to that you found really good and valuable? Just as an entrepreneur or just for mindset or anything like that?
Jesus:
Well, I try to go to whatever is available. Like, at the beginning I was going to everything then from 17 to, well after the pandemic, I’m just resuming to start going to events again. But I recently been to a search conference. It was, it was good. Yeah, there is a bunch of things that people can use, like pretty much go to everything and trying to network. When you go to this event, the key is to just be open. Like there’s gonna be a bunch of stuff that maybe doesn’t apply to you and what you’re doing. Just be open to what they’re saying, what they’re doing, and talk to other people and you will find somebody that’s doing something completely different from what you’re doing and maybe try some of that or adjust something and see how it works. It’s like that’s the way to, to grow. That’s where I found find most of my value from those conferences.
Kevin King:
So it’s not so much the presentations as it is just the networking of being around other like-minded people.
Jesus:
Yeah, that’s the most valuable for me. And of course, sometimes you get inspired by what you see on stage. Like you see somebody talking about, like recently I saw somebody talking about adding, the inserts in your products and then collecting the emails, all that stuff that is like older than hell like everybody knows about that stuff. But the way he presented it, he made it sound like it’s new, so it’s like, okay, maybe I need to look into that again. And because he’s, he’s doing really cool inserts. Like when you touch it’s amazing. And some like foldable stuff that just jumps and stuff like that grabs people’s attention and you offer something like he said, like the mafia offer and people cannot refuse, so they just go and just sign up, and then that’s how you get the email. So there are so many things like that that you, you hear at the conference, and then if something clicks, we’ll try to apply it.
Kevin King:
That sounds like Sean Hart’s presentation.
Jesus:
Yeah, exactly. That’s right.
Kevin King:
That’s what that sounds like right there. He’s a smart guy. He’s an old-school marketer and has been doing this for a while, so he’s a smart guy. So, So this can be like a kind of like a little–, it can be lonely at times being an entrepreneur, selling online, can it?
Jesus:
Of course, yes. Then when I started it was kind of my dream. Like, okay, I’m gonna work from home and I don’t have to meet anybody. Like, I’m gonna be behind my monitor. I’m gonna make a ton of money. And that was my mindset when I started. But then I quickly noticed that my life quality was going down because I was not interacting with so many other people. So I was like, okay, I need to start connecting with more people going to this event. That’s another reason for the events. And yeah, chatting with people and getting into the groups, so you can network and keep your life balanced in any other area.
Kevin King:
And one of the things you’re doing too now, besides I see a playing the guitar. I see a guitar behind you. Besides playing the guitar, is you’re helping brands grow. One of the things that you’ve started is something to actually what I think what’s your slogan and we take six-figure brands to seven-figures or something like
Jesus:
That? Yes. I just started with that and I believe this is part of my evolution, like professional, also personal evolution. Like I want to start working with other sellers in a more professional way, not just, over a Facebook chat but really like commit to somebody that’s ready to grow. Like when I was starting, if I had somebody that I could work one with one and ask all those questions, and if he had all the experience and he could help me, pretty sure I wouldn’t have made so many mistakes as I did. So that’s, that’s what I’m offering right now. And then the game for me is that I’m gonna get to network and to know other people and to help other people and start to experience that part in my journey because pretty much all I’ve done so far and all these eight years I’ve been selling, and I’m very confident of my experience and of my results, but I’ve never really worked directly with people and that’s the next thing I’m doing.
Kevin King:
So what do you see is the problem? There are a lot of courses out there, a lot of YouTube videos, a lot of courses, how to start selling on Amazon. Here are the basics, but there’s not very much there, there’s a very small amount of stuff where someone’s already doing 50 K or a hundred k or six figures a year, and there’s not a lot that’s really aimed at those people. I mean, we have Helium 10 Elite and there are a couple of others, but there’s not a lot that’s aimed at that, especially like you said on the one-on-one. So what are some of the pain points you think you can help address with these sellers when they contact you to say, “Hey I’m doing a 200 k a year and I really wanna grow my business to a million.” What are some things you can specifically help them with, do you think?
Jesus:
The very first thing is a mindset. Like when I started, the reason I did not grow as fast as I would like was my mindset. Like it was a lot of money that I was making back then for my reality. So to me, like if I was able to think like, Okay, I can actually make more than this, and what are the actions that I need to take in order to get there, nobody really taught me that. So I was like, just experimenting with everything.
Kevin King:
What are some of those actions that are stumbling blocks for a lot of people?
Jesus:
Well, the main thing I would say is product development. I see so many mistakes on the product development side. People still launching me-too products, just changing the packaging and something like that. I mean, that can make you some money for a few months, maybe, maybe one year, but you will be strolling fighting with all the Chinese companies and like raise to the bottom with the price and all that stuff. The way I do it right now is I differentiate my products in a way that it doesn’t have to be something crazy that’s super expensive, no, but in a way that’s I’m hitting a space in the market that nobody’s there or like fewer sellers are there. And I present my product in a way that will talk exactly to the audience that I want to reach.
Jesus:
So this way I’m seeing so much success that me-too products and I’m able to price my products sometimes even like twice the price that everybody’s selling. If everybody’s selling for $30, I have one product that sells for $60, so that’s twice the price and my product sells really, really well. So things like that are very, very important. When you’re trying to launch a product, you need to know where you’re getting, you need to know the industry that you’re getting at and how will you make your money there.
Kevin King:
So when people are growing, they’re at this level too that say the two, 300,000 and they’re trying to get to seven figures, where does the money come into all this financing and, and making this work? What would be some of your advice on that?
Jesus:
Well, you have to work your way up. I mean, if you’re selling 200, 300 you probably have some cash flow going to your bank account, so you would be able to keep launching products. So maybe you focus first on those products that will at least make you $10,000 a month. And you don’t require a lot of capital for that. You can launch one to three of those and maybe out of those, you will find one that’s, jumped to 20-30k. So you can start expanding on that. Maybe you launch the premium version of that or you keep expanding on that and you take that money that you’re generating already. So that’s why I liked working with people that are already selling because it’s very different when you’re just starting. You have a bunch of things that you need to work on. If you’re already selling, you’re almost there. Like one product can take you to seven figures really quickly.
Kevin King:
What do you think are some of the big differences? You started eight years ago selling, so you’re an OG on this. What are some of the major changes or big differences between 2014 and now? I mean, you talked about one of ’em earlier where you’ve just looked at page one to see what was selling and go to page two, see and just find a bike pump and just throw it up there. Besides those little basic things, what are some big differences that you’re seeing now for someone that’s approaching this as a true business and not just as some good kind of get-rich-quick scheme?
Jesus:
This has had to be there, like from the beginning, but back then the mentality was like, I’m just gonna make money. I’m gonna launch cash flow products. So if I see an opportunity, I’m just gonna launch this and make my money there. I mean, as long as it doesn’t break, that’s all right. Like that doesn’t work anymore. And so right now it’s like you have to design something. You have to offer something that is really, really good. And one thing I like to do is I like to test it myself. I like to really touch the product, feel it, and think if it’s something I would be using myself or I would be proud of selling. So that’s very, very different. Now, probably it was back then, but it was not in my mindset like building your own brand and when you build it, you’re able to take it somewhere else.
Jesus:
You can take it to Shopify, you can even well now you can, you can exit the business. Like many, many people are exiting businesses now. And back then, I did not hear anything about that back then. Another big, big thing of course, and this is more recent, is PPC is like Amazon has a big focus now on making more money. And so the way the marketplace looks now, you just see sponsored products everywhere. So this has become like a pay-to-sell type of game. So that the main difference right now is that you need to have enough margins to be able to endure that, to be able to pay 20% to Amazon for PPC and still make money. So that’s pretty much the biggest change around for me is like, I’m looking for a product that has at least a 40% margin, so I can give 20% to Amazon back and keep 20%. And back then the rule of thumb was very simple, was like one-third goes to the supplier, one-third goes to Amazon, and you keep one-third, but that doesn’t apply anymore.
Kevin King:
What’s the lowest margin? Someone bottom line on pay-per-margin, someone should be looking for, not, not just landed cost margin, but like bottom line profit margin. Do you think is, is reasonable for an FBA business?
Jesus:
Well, the lowest I wouldn’t take is anything below 15%. Like that’s, that’s like the lowest I would take. But I wouldn’t plan to do that because there are things that can go wrong and then you can go lower than that. So usually my target is to be at a 20% margin after everything. Yeah,
Kevin King:
That’s 20% after everything after, that’s after ad spends, after, after everything. That’s the bottom line margin. Yeah. Yeah, I would agree with that. 20% should be the baseline minimum that you’re shooting for. If you can get it above that great. Now that’s FBA. Now if you’re doing wholesale, that’s gonna be a little bit harder to do if those are you listening, doing wholesale or some sort of drop shipping or something. But on FBAthat’s def definitely where you wanna be. What do you think about what all this was happening out there right now in the aggregator space where there was a big boom and now it’s kind of a bust and they’ve pulled back a little bit a lot. What do you think about the opportunities for actually selling your businesses going forward?
Jesus:
Well, I think this is, this is like the main goal for many sellers like this is when you get your big paycheck when you exit the business and you get like a bunch of money at once. But if you have a business that’s working and you enjoy working on it and it’s providing the cash flow and you’re confident that you keep expanding, I don’t see a reason to sell. You can keep doing that. Like, unless you seem like a major change coming on Amazon that you’re not gonna be able to keep selling or something like that, I wouldn’t sell. So sorry, I would sell in that case, but otherwise, I prefer to grow, grow my business. Of course, like now I’m planning like I have two accounts, I’m, I’m preparing, so I’m preparing to exit that in the future.
Jesus:
But now I’m doing everything right from the beginning because now I understand how to do it. But yeah, like I was in contact with one of these aggregators last year and I have one account that has only few products that are successful. So I was trying to sell that. And they were willing to pay something for it, but it was not what I wanted. So I did not sell. But I think they’re really, right now for them it’s, they’re in a bad place because they bought a bunch of these businesses that right now with all the PPC changes, it’s like they’re not even that profitable anymore. And they gave away like, a lot of cash. So yeah, it’s very interesting what’s happening, I guess if you plan for selling, do everything you can to have like a very lean structure and very lean numbers. So you might be able to sell for a good multiplier in one or two years.
Kevin King:
So with all the changes, as you said, that’s happening out there, what is your latest strategy for actually launching products?
Jesus:
Well, I’m using some tools. The main one of course is Helium 10, but I mainly use PPC to launch. Like, I’m just willing to spend a bunch of money at the very beginning to rank for the product, but I don’t really worry that much about all that process because that’s just a process that you follow. The most important part for me, again, is product development. I know that if my product is really good and I validated it somehow the whole process is gonna be so much easier. And sometimes even if your PPC is not top-notch, you still are gonna be successful. So I would say like pro product development is the most important task for an Amazon seller.
Kevin King:
Awesome. Well, Jesus, I really appreciate you coming on today and sharing with us. If, if people want to find out more about you or reach out or how would they do that?
Jesus:
Well, I just like started with this SellersMastery thing where I plan to offer some of these one-on-one coachings to some people. Not everybody, I just wanna work with a few people that I feel comfortable with. And I’ve just launched a website for that. It’s sellersmastery.com. So feel free to check that.
Kevin King:
Awesome muchas gracias for coming on today. I appreciate your time. So I hope you enjoyed my conversation with Jesus. We’ll be back again next week with another awesome episode of the AM/PM Podcast. And before I let you go today, I just wanna share these words of wisdom with you. You know, a lot of people in the Amazon space are afraid to share their product idea. They keep it really close to their chest, and I just find that kind of humorous because sometimes people will say, “Hey, I got this idea, but I need you to sign a nondisclosure agreement before I talk to you about it, or I can’t tell you what I’m selling because I don’t wanna tell everybody what I’m selling.” Those kinds of things, just gimme a little laugh sometimes, because, ideas are worth nothing unless executed. They’re just a multiplier. Execution is worth the millions. Just remember that ideas are worth nothing unless executed. They’re just a multiplier. Execution is where it’s at. Execution is where you make your millions go out there and execute, and we’ll see you again next week.
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