Bob speaks from experience. Inventory buying is a thrill. Finding great deals is what we do. But if it sits in your warehouse and doesn’t get processed then it is wasted economic value. Value you might not get back. See if it forces you to borrow money or put off hiring key labor that would benefit the organization. Then you have a miss. Let’s talk about what you can make your Amazon business look like.
Bob’s previous episodes:
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Here is transcript- It is automated so it is not perfect but it does seem to get better over time.
Bob: 00:01 Who knew some computer stuff that were able to find me. Basically, you’re not unlimited lists of wholesale suppliers. I mean, of course they don’t all take Amazon, but I was able to use some portals and stuff to find more supplies than I could ever buy from, and I’ve just kind of taken the OAA that I did because I love the away. But the issue was I was getting too many IP complaints. I was afraid I was going to lose my account. I think I had maybe 12 in a year or something like that, so eight here in addition to wholesale, but I was kind of doing it the way I was doing away, always using the same tools I was using, tactical arbitrage, you know? Except that I was getting a program to a wholesale sites and basically that’s the same way I still do wholesale now. I either use tactile LABA charts to import a
Cool vice guy: 00:47 welcome to the e-commerce momentum podcast where we focus on the people, the products, and the process of eCommerce selling. Today, here’s your host, Steven Peterson.
Stephen: 01:01 Hey, it’s me. It’s Q4. Got to bring up my Amazon seller tribe. Um, this is probably, you know, one of the last chances you’re going to get to join this year. So I’ll run this for a couple of weeks. But, um, the, the good news is you could still get in, right? They are allowing people in, but at some point they’re going to cut it off. So I suggest you join today. Try it with 14 days for free, okay? So you don’t like it, you don’t get value drop. Um, however, don’t only measure on the value of what you’re buying, measure on the value of the impact it has on your business. And what I love about this group, the Amazon seller tribe is the amazing way they invest into your business. They will help you with all the questions. Go out and check out, uh, amazing freedom.com, forward slash momentum dash arbitrage.
Stephen: 01:44 Look at the testimonials. Those are real people. Reach out to them, right? You can kind of figure out who they are and go out and figure out, uh, and ask them, is it real? Are they really helpful? Will they help my business? And you will be blown away again. You get 14 days free if you joined through my link only and they do pay me. So I don’t want you to, I don’t mislead anybody. Um, but I believe in him. I’m in the groups, you’ll see me and you’ll get to talk with me too. So amazing. freedom.com, forward slash momentum, hyphen arbitrage. I know it’s a lot momentum, hyphen arbitrage. And you’re going to get 14 day free trial on the daily fine list. Make a purchase, get your money back and then say, huh, I can do this again. Wash, rinse, repeat, wash, rinse, repeat.
Stephen: 02:29 Amazing. freedom.com, forward slash momentum arbitrage. They are going to close it. Q four is here. It’s going to happen. Get ready. Welcome back to the e-commerce momentum podcast. This is episode four Oh eight Bob steel. Um, it is crazy how long it’s been since Bob and I talked on air, um, mind blowing and his business has completely evolved, um, with a lot of hard work. You know, his name is steel, he’s got steel in his resolve is persistence. I mean he is, it’s tough stuff and he’s pushed through it. Um, some really cool things about warehousing. Um, very interesting to listen to some of that conversation. Um, we both talk about our situations. Um, and I think there’s a value there. Um, I think his investing in real estate, uh, with warehousing is a very interesting concept that others might want to consider. And then we talk about lessons learned, things that are you should have done differently.
Stephen: 03:26 And you know, there’s a maturity you get to, I mean, you know, he’s very humble, um, and very quiet, but he’s matured. He’s recognized. I mean, that’s cool that a guy, uh, my age and his age, we’re pretty close, can still learn and is willing to learn and admit that he doesn’t know it all. That’s, Oh, I get the chills thinking about it because that, that’s why he’s such a great guy. He’s such a good friend. I just love him. Um, and I just think there’s some real value. And the one thing, and I, I kind of use it in the title here about chasing inventory. Don’t just keep chasing inventory. Make sure that it’s inventory you can process and prep. That’s a pro pro tip to pop gifts. Don’t forget that, you know, don’t just keep getting inventory to get inventory. Spend your money.
Stephen: 04:09 If you’re just going to sit, don’t do it. Get that stuff out. Spend your time there and you’re going to be better use. Let’s get into the podcast. Hey, welcome back to the eCommerce momentum podcast. Excited to have back my guest and we both are blown away to realize it’s been three plus years since we last talk. Bob Steele, welcome back. Bob Steele. Nice to be back. Steve. We’ve been well. I have been. Well, I know you have been. Well, um, you know, it’s funny. At our age were 50s, uh, we only not only have to do business well, we have to stay health well, right? I mean it’s an issue, you know, it happens. I mean, so we’re not going to turn this into a health, uh, conversation, but it’s definitely one of those things. How about mental health? That’s an interesting thing to talk about. How do you, because you used to have a big job, a lot of responsibility. Um, did you believe that when you got at your own business and you were gonna and you walked away from your corporate job, that the pressures were going to be less than the responsible cause you were going to have less responsibility?
Speaker 4: 05:15 Yeah, I believe that, but that’s certainly not the cases [inaudible] stress and pressure now than I’ve ever had. Yeah, that’s plenty a, I was just thinking the exact same thing, you know, and I had a big job and I had a lot of responsibility. Now when you have employees and you have other people relying on you bomb, that’s so lot isn’t it? [inaudible] and it’s just constant. It’s one battle after the other, after the other and it’s all, I can just pass it on to someone else. It’s all got to get done. Well, you know, how much help you have. It’s like ultimately you’re responsible for on an average on it and figure it out. Yeah. That’s it. The buck stops with you. Um, do you think you were meant to
Stephen: 05:57 be a leader in this role when you think back to your skillsets and your life and the things that you’ve done?
Bob: 06:04 No, I’m, when I first started selling on Amazon, my opinion was, you know, I never want to own a warehouse. I never want to have employees. I just want this a little bit on the side and you know, things evolved and that’s where I’m at now. When there’s some days I just want to give up and say I’m going to send it all to a prep center or I’m just going to do something else. Cause I’m, I was actually at our meeting with uh, Chris green and some other FBA sellers a few weeks ago and one of the things they talked about was Emma’s on fatigue where everyone’s starting to look to do other things because it’s, it’s a constant battle of finding inventory and turning inventory and prepping inventory. And it’s just a constant battle and to look to other avenues and it’s something I’ve considered, but right now I’m still fighting the Amazon battle.
Stephen: 06:49 Well, you, you are doing some other things with investing in real estate. We’ll talk about that in a minute. But let’s go back to that cause I think that’s interesting. Amazon fatigue. Do you think some of it, and this is, I have these thoughts, some of it is because the rules change. Like in your old business you guys had policies and procedures, right? They probably were the same for 20 or 30 years. Some of them, some of them should have changed, right? Of course they should have. Right. But lots of them didn’t need to, you know what I mean? Whatever it was. With Amazon it’s almost week to week that changes. So you can never like that one part of your world can’t settle. Is that fair?
Bob: 07:26 Yeah. So like every other week there’s something else coming on. You know, we’ve been fighting hazmat issues for weeks over the name brand on the MSDS. She doesn’t match the name brand of the product and it’s because it’s a PR, you know, it’s our own brand and it’s a bundle and it’s one component inside the bundle. It’s a highlighter. So I send them the MSDS for the highlighter. They don’t accept it because the brands don’t match is it’s a fighting battle and now we’re getting all types of trademark issues for certain wholesale is that we use in this anal, that brand name is the trademark problem. Like no, the brand says it’s fine. It’s the right brand is every time you turn around and they are doing something to change and always having to spend hours and hours figuring out what they want and still not getting them right.
Stephen: 08:11 Yeah. Unintended consequences. Right. So I’m sure they’re trying to address nobody sitting in her saying, Hmm, who am I going to mess with today? Right. Nobody’s doing right there. They’re fixing a problem for something else. Right. Whatever it is. However, there are consequences in a, and I, I’ve said this a lot, a, you and I both are old sellers, right? We’ve been zoned for a long time. The where we’re just doing the way we’ve been doing for years. So you can’t all of a sudden just say, Hey, you’re not doing it right. It’s like, wait, it was right. Okay. You want me to change? That’s a different conversation. Help me change that. And I think that’s always been a miss. Even with eBay, I think there’s always been a miss that they’re not helping. And maybe it’s because we’re smaller sellers or at least we were, we were right.
Speaker 4: 08:57 They’re not helping bring you through those transitions. Right. Is that, is that right? Yeah, and especially, I mean eBay I don’t really do a lot with, but Amazon, they don’t give you the time towards transition. It’s like, okay, this is happening tomorrow. You know? Like I know one of the bigger changes has been the way the small light programs changed where now it’s a $7 maximum and a seven ounce maximum for the weight. But so that they said, okay, this is not going to be any more small and light and your products had to be in by a couple months ago while they’re still having me send the products. I used to have enrolled in small light to small light warehouses. So they kind of said there was going to be a change, but really I guess they haven’t implemented it. And that’s probably very, very frustrating. Now, at least with eBay, and this has been my experience later.
Speaker 4: 09:47 It’ll be interesting to see if anybody else agrees. We have been able to call and get a U S rep almost every single time we have a problem. They are almost always from Utah for whatever reason, and it’s just been a wonderful experience. They’re like, Hey, you know, we can’t help you there with this because of this and it’ll give you an actual reason. That’s been wonderful. I’m great. That’s amiss with selling on Amazon, correct? Correct. Mm Hmm. How hard it is. Imagine having times just trying to escalate a case and ask for a us representative. Sometimes you get one and sometimes it’s just passed on and you know, you get the merge. What are the merge case email? This is working into it and you get them for months on end and they don’t even tell you what it is anymore after the first one. Yeah.
Speaker 4: 10:31 You have no clue. Is that, would it be hard for them to implement, do you think? I mean, I don’t know. I mean, I just wonder, um, I think that’d be a lot of costs involved in that probably turn to avoid that as much as they can. Yeah. And another thing I think is, I always remember when I read the book, the everything store that if, if you have to call Amazon, it’s a fail on the customer side, right? They always said that you should be able to answer and anticipate all the customers’ needs and wants and the entire mall. Maybe, maybe they feel the same way about us sellers that we shouldn’t have to be able to call them. If that’s true. And I know Jeff Bezos is listening. If that’s true, then guess what? You got a little bit of ways to go there to help fix it.
Speaker 4: 11:15 And you know, we love the platform from it. God, we’d love it. Sorry, 80 90% of the revenue. Love, hate relationship. Yeah. Yeah. I’m sure on their side too. I mean, I can’t imagine, you know, the employees must be very frustrated because you follow the rules and uh, Bob X doesn’t follow the rules. And so then I’ve heard being an Amazon employee is one of the hottest jobs on the planet. And I know you’re probably not local, but the last couple of nights on the news, they are actually finding 50 packages at a time of Amazon dumped in a couple of graveyards in a couple of different towns that would never deal with, Oh no.
Stephen: 11:54 Yes. So they are finding trash barrels full of undelivered Amazon packages that they’ve already located who the driver is and terminated them. But you know, I’ve heard that especially warehouse work is one of the most stressful jobs you’ve ever had. You know, we have five Amazon warehouses in our town, five big massive too. And they’re like a mile long. And it’s just, you know, when you can’t get by there when they’re going to work or when they’re changing shifts because you know, traffic stops because they actually bus them in because they don’t have enough parking. Oh, they have like satellite parking because it’s just so, well, I think this is growing pains, right? This, that’s why they’re working so hard on automation and you know, as good and bad. Right. I mean, the good would be is that, you know, let’s face it, less fatigue and, and things will probably work 24, seven.
Stephen: 12:44 The bad is you’re taking the human element out. So therefore it’s right or wrong every single time. There’s no gray area, right? There’s no, there’s no gray. I mean, it’s like they talk about, you know, trying to make the minimum wage in the country $15 an hour and now you see an, okay. A lot of corporations like, you know, the fast food restaurants, it’s like, Oh, we can’t pay our employees that much because of, you know, the mockup. It’s small and they’re just getting replaced with computers. Right? So you go in, you have to figure out how to order it yourself. You get frustrated. It takes twice as long. You know, I go to home Depot and it’s like, usually when I go, I have something that I can’t run across the cash register. And there’s usually one online open for people with a lumber and larger items, whereas, you know, you can go through the self checkout and this one person in watching six registers.
Stephen: 13:28 Yeah. Yeah. And, uh, we, uh, we have a company called our hold in our town and they are the second or third largest grocer in the, in the world. I think they are right? They’re just a massive company. They have a U S in my town. And so our local store, they have robot that goes around and does inventory for them cause it’s mindless, right? So it’s forever just driving around this little thing, driving around these aisles, just counting stuff for them, you know, and you know, I understand that. Um, I understand being an old, ya know, CFO, you’ve gotta, you know, maximize. Um, but there’s a human element that gets lost. And, and I, I just, I went through it, uh, was it yesterday trying to get through somebody’s voicemail and they’re the companies and it was press one, press two, press three. I was seven questions deep pushing buttons, seven questions.
Stephen: 14:19 I’m like, all right, this is old enough. You got to give me a person at some point. And it was almost impossible. So I think there’s an extreme. I think that’s a risk. Well, let’s bring it back to our business. How about you? I mean, how have you embraced technology in your business? Um, you know, I was at, I think it was one of Sam Cohen’s conference and you were speaker and I think you mentioned when you brought up a bunch of names, I was on your list of being a data guy and I had never really thought of myself like that to the point. Now I’m embrace it.
Bob: 14:52 Like I go and talk to my reps and I’m like, yeah, just give me the data. I can do amazing things with data. I never really looked at that until you had pointed it out. So it’s a main data runs my business. It’s, you know, I always felt I was on the leading edge of software and stuff like that and trying to stay one step ahead of everybody else. But I mean, without data or this business, it’s, you know, from what I look at, it’s like I go in and say, you know, I’d buy this and this and this, and then I go and look and that’s not what the rest of the public wants. But if I have data to compare it to, it doesn’t matter what my opinion is, it’s data doesn’t lie.
Stephen: 15:30 And so in that example that you’re using, right, when you go back and you look at the data, the data says, well the market will want this. Um, how many times are you more right than wrong
Bob: 15:42 with date? If I have accurate data? Yeah, it’s probably 90% plus.
Stephen: 15:47 No kidding. Where in the past if or other people, you know, maybe Steve, you could, I can judge, uh, myself, um, I’m going by my gut help pop. I know that’s going to be hot. We did that with a pair of shoes the other day. I had one of the kids have convinced me, he’s like, Steve, these are going to be hot. These are just like, okay, you know what a year we’re young and I’m not, I’m old. Okay. They’re still sitting there.
Bob: 16:10 Yeah. Just cause like the first couple of times I met with reps, you know, they walk you through the product line and I’m like, Oh, this looks good, this looks good, this looks good. And that’s the stuff that’s either still shitting, sitting on the shelf, waiting for me to create a listing or sitting in an Amazon warehouse that isn’t moving. So now it’s like, I’ll go and I’ll talk to the reps, I’ll go to the trade shows and I’ll be okay. May go back to my whole talk rooms. And most of them times they have, you know, show specials and I’ll come back with the orders the next day.
Stephen: 16:38 [inaudible] Bob Willie. Oh, we said that exact same thing and it’s one of the smart guys. And he always said the same thing. He’s like, Steve, you know he’s, he’s an old long time, not an old guy, just says a long older seller, right. He’s been someone for a long time and he said, you know, at this point his life, he’ll take everything in, then go back, make a decision. If they’re pressuring him to buy right on the spot, he’s walking away because they got [inaudible].
Bob: 17:01 He’s actually one of the first, I want to say people that I follow, but one of the first people that I thought that knew they were what they were talking about that I met, it was back I think the first Scully show when they came to the East coast and he was part of the skin power crew. And I went and I was kind of a loner and spent the days I was there with the scam power crew. When I actually got to know Bob. And he’s, he’s
Stephen: 17:23 very smart, very smart. And, but he says, so he’s like, Hey, if they’re going to pressure me, I’m walking by, I’m going to walk away because that sales rep has to move that inventory. Somebody is pressuring him from behind. Right. Cause imagine that, that manufacturer saying, get this stuff out of the warehouse, guys, come on, let’s go, let’s go, let’s go. And so, uh, they, they figure they’ll sell it to you once. You’re just an Amazon guy who cares. Right. And then boom. Hmm. How different is it? You know, I was thinking about your, uh, a lot in the last few days. I knew we were going to talk. I mean, how different is your business today than it was three years ago when we talked?
Bob: 17:59 I think three years ago I was more, I was doing a lot more away and a lot more RA. I think [inaudible] at a time you were getting on whole sale you but you were getting started. Right, and I wasn’t really too familiar with wholesale and how it worked and then without giving away too much, I was able to talk to some friends who knew some computer stuff that were able to find me. Basically not unlimited list of wholesale suppliers. I mean, of course they don’t all take Amazon, but I was able to use some portals and stuff to find more supplies than I could ever buy from. And I’ve just kind of taken the OAA that I did because I loved away. But the issue was I was getting too many IP complaints. I was afraid I was going to lose my account. I think I had maybe 12 in a year or something like that.
Bob: 18:49 So here in addition to wholesale, but I was kind of doing it the way I was doing our way, always using the same tools. I was using tactical arbitrage, you know, except that I was getting them programmed to a wholesale sites and basically that’s the same way I still do wholesale now. I either use tactical Arbor charts to import a, a wholesale list or I have Javier with tactical bucket create me an X path to rip the wholesale sites like you would any other OAA site. So I kind of look at it as like non traditional wholesale I guess where I’m looking at it more as basically online wholesale compared to online arbitrage. Whereas a lot of traditional wholesales would go and meet the people in by from shows where yeah, I’m still using the data a lot to place my wholesale orders.
Stephen: 19:35 Are you then going to the shows, uh, still, but with arm data to sit back and say, okay, what can you do for me? Or, or
Bob: 19:44 yeah, cause most of the times the show specials, they have pay for the trips many times over. Right. You know, I’m at the point now where I’ve gotten in good with a couple of reps basically because I spend so much money with them that they’ll give me the show specials without going to the show. So say I don’t make it to Atlanta or AmericasMart, I’ll get an email from one of my reps and say, Hey, here’s all the show specials. As long as you open the order by Friday, you know, I’ll put it in as the show deal so I don’t have to go all the time. Most of the times I go to the shows now it’s not to meet new suppliers, even though occasionally I do. It’s more to reinforce the relationships with the supplies that I have that I don’t see all the time.
Stephen: 20:24 Hmm. It trying like America’s Mart, that blew my mind. I only made it to one building, one building for a couple hours and we were supposed to meet for breakfast. You and I? That’s right. Yeah. I never did because I got lost on the trains. I literally on the train, I literally took, I don’t know, six or eight trains. I had no clue what I was doing. It’s, I’d get off of here and I’m dead. I literally kept going back and forth like a, a vacation, um, European vacation, big Ben tower, London thing. Um, and we never met, but I was blown away. I mean, it literally, I made it to, I found bunch of new wholesalers. It’s unusual that that still can be done, isn’t it? I mean, you wouldn’t think it could be, but
Bob: 21:06 we know there’s just so many of them. There’s so many new companies. Yeah. Yeah. So many co, I mean, we were the product when we had gone and I went with my friend Kyle. We do a lot of stuff together. Love Kai. And Kyle is a great guy. Smart, very smart. I use a third of our age and he’s smart. Yes. But, um, we were both buying from the same, from the same wholesaler and they had basically said, Hey, we got an Amazon exclusives with someone you guys can’t buy anymore and sell online. And we will do like trying to figure out who the exclusive was because a, they didn’t have depth of inventory. They didn’t represent, you know, 90% of the line. They just basically cherry picked what they want. So he went down there with a mission to talk to them and we actually got to go out to the company and meet them and sit down and we signed a Coke schools have with them. And I think the orders we’ve got in this month are probably close to a hundred thousand dollars that were splitting between us. And you know, he went with the mission and basically showed what he could do and came up this whole portfolio of things that he’s done to listings and things that he’s done to other Amazon accounts and things like that. And they were really impressed to the point where we went, went down and went to their headquarters and spent a couple days
Stephen: 22:19 there and you know, got the deal done. Um, the other, the person who did have the exclusive, are they still on the listings? Uh, no. Now think about that. So those of you listing right, who have exclusive and we have had exclusive and have lost our exclusive for exactly that same reason. We haven’t paid enough attention or like you’re saying, we didn’t cover enough of the brine or you know, somebody came along with the one more zero on their check and made a bigger purchase. And how could you fault a company for doing that? Painful. I like it.
Bob: 22:53 And one of the things we made sure we found out when we were there as you know, what happened to make this relationship shout sour so that we don’t make the same mistakes and basically its food items. So they were trying to back charged for expired stuff and stuff that’s in it. So it was just a crazy thing. Only some of the stuff they told me they were trying to do, I was like, that’s crazy. How can you do that? So they took all the risk out of their model and put it all back on the ground. What they agreed to. That’s what they tried to do. That fair act. That’s right. Fair. Right, right. Yeah. Not at all. Well it does it.
Stephen: 23:27 Is there a residual market for that stuff? When you, when you have, cause you must have the same thing with exploration or whatever the issue is, things just didn’t work. Um, is there a residual market for you to be able to get rid of that inventory or is it pitched? Donated,
Bob: 23:40 yeah. Pitch donated. I mean people have talked to me about wicked sedation and as much as I know about it, I know that I don’t have the channels to get rid of all this. Probably 75% of the stuff that you get that isn’t sellable on Amazon. I don’t have a flea market guy or you know, the guy that’s running a salvage store or the connections just to move inventory quick. And that’s one of the reasons I avoid, you know, liquidation, salvaged, stuff like that. I don’t have the channels to get rid of the stuff that I can’t deal with.
Stephen: 24:11 Yeah. I, I’m not interested in doing retail. I told the story a, there’s a wholesale auction near me not too far from here, less than an hour. And I bought, I um, meet clause. Remember the [inaudible] clause that everybody was doing private label. I was buying them for less than a dollar 50 cents. 30 cents. I don’t know. But the auctioneer gets 30%. So can you imagine that poor person, what they paid for those meet clause, you know, by the time they liquidated them down what I paid for them and what they got net was nothing. I mean it’s almost, they probably spent more in gas getting to them there, you know?
Bob: 24:45 Right. And in the auction it takes another 10 15% off the buyer too. Yeah. So I haven’t had the time. That’s actually how I started a lot of my Amazon business as I was going to local country auctions to buy inventory.
Stephen: 24:59 Uh, do you miss those days? I was thinking about that too. I remember
Bob: 25:02 where do you were, but you guys were sitting in your tipping white where yeah, got to the point where it was like, you know, Dahl was per hour. Like I would go for three hours and some days I’d come out and I’d be able to make you know, enough money to forward. And other days like, Oh, I bought two things and two of them were personal. So yeah, I kind of miss like the people and the stuff like that. But I think I can do more with my time than go into an auction every week. But I, I’ve been saying for six months now that I need to get to the auction that’s close to me now and talk to them about liquidating some of the stuff I have, you know, customer returns and just stuff that doesn’t sell. And I worked with, um, another seller who got a job promotion and she had a huge eBay store where I bought all of her inventory. I mean, we using on all the rolling racks and stuff like that, but there’s literally 5,000 pieces of brand new gap clothing and banana Republic and true religion and whatever doesn’t have listings. You know, we were just blowing it out as much as we can, but we have thousands of items that I don’t have the interest and put it on eBay. And I wish I had a channel to liquidate it. And I kept saying, I’ll go to the local auction and talk to them. Just one of those things on the, to do lists
Stephen: 26:16 on the list. Uh, you have a big list. Let’s talk about, I, I think it wrong. I think what you said about sellers are doing other things and you’re not interested in doing that. I think you are. I think you’ve done well. Um, and this was part of our pre-call. We were talking about warehousing. You know, I don’t think I’m speaking at a term when I can say that. You own your own warehouse. You have one of the coolest things and you’re not alone. I’ve heard this from a couple other people, but very few. A co
Speaker 4: 26:44 op warehouse where there’s a group of similar style warehouse units, right? And X number of square feet and you can get more than one. And then you guys shared the cost probably of snowplowing and right. Yeah. As a condo association. Right. Right. And so you share those, you know, if they want to fix the, I dunno, water runoff issues and stuff like that. Um, that’s an unusual thing. But you’ve invested in that and I don’t, I mean, I don’t know if I’m speaking in a turn and saying that you, you bought your place, right? You’re now not buying inventory with that money cause you bought real estate. When you think about from an investment point of view though, isn’t that diversifying your portfolio? Because you could’ve just taken all of it and spun it into Amazon, right? You could have, right. And Brian more water bottles.
Speaker 4: 27:34 Right. You could have done that. However you have a tangible asset of physical asset that nobody’s going to come in the market and replicate. It’s there. They can’t. I think one of the things we talked about in the pre show was access to financing because as much as you’ll hear Steve tell everyone, no, get numbers to get your finances together. I’m not one of the guys that does it. Yeah. But you know, you have other financing my properties at a lower interest rate then taking Amazon loans. And that’s one of the things we talked about that Amazon’s hassled me about getting another loan and where if I had had everything in order I would’ve been able to refinance the properties and buy inventory with that, you know, whether it be a line of credit or whether it be a, you know, a re refinance of the property itself.
Speaker 4: 28:23 Whereas since I don’t have all my records up to date, I’m not able to do that. But you’re on the path to get that resolved. I mean, how long do you think until you have that resolved? Hopefully the next four to six weeks. Cause I’m more sexual years. Nothing. Two years behind. Yeah. You know what? Bump six weeks is nothing at RH, man. That’s like nothing. I know, you know, it’s just like boom, wait, it’s already December. What? Well that’s what’s going to happen. [inaudible] well I love, uh, I love that you’d done it. I think it holds you back a little bit. But guess what? I think you’re busy enough, Bob. I think this is not unhealthy. It gives you a chance to breathe a little bit. Right. Sometimes you have to because otherwise it actually feels good to have an Amazon load paid off because I’ve been running on Amazon loans for two and a half, three years now and it actually, Oh, it was like a burden off my back to have it paid off and Oh zero. Yeah. Talk about that. Because what happens if your account gets shut down now you’ve got a whole bunch of people you disappoint, you got vendors issues. But outside of that, that’s it. Right? I mean I get me, I’m diversified. I do sell on Walmart, but in the big scheme of things, Walmart is 5% of my Amazon sales with probably 60% of my catalog loaded there. So without Amazon, you know, I basically had to turn off the lights and tell everyone
Bob: 29:42 to go home, but not not a position. I’d have a one. Yeah.
Stephen: 29:45 However, but you’re not going to go and Oh everybody has zillion dollars. And if that was the scenario. So you know, God forbid illness or whatever, it’s different cause that when you have that, there’s an old phrase about the sword of Damocles swinging over your head, you know, just one mistake and off with your head. Right. That’s, that’s the fear of that kind of thing. Did, did it keep you up at night? Sometimes? Be honest. No, I sleep pretty good. Okay. So that, did you, you felt comfortable enough in your business model that that wasn’t an issue?
Bob: 30:16 Yeah, cause I always knew that the value of my inventory far exceeded what I owed.
Stephen: 30:21 Yeah. And, and to be fair, you’re a wholesale model. You’re not, you’re not worried about, uh, as much about getting your Amazon account suspended because of him, uh, IP complaints and generally,
Bob: 30:33 no. Actually the funny part is I have more used as new complaints and in the, I’m an authentic appointed since I’ve been doing wholesale compared to when I did all away. But I’m always immediately unable to provide an invoice and access it and send it to Amazon who quiz it up. I mean it sits in my backend account health for six months, but every one that I’ve gotten has been clear.
Stephen: 30:55 What’s that attributed to do you think? Is it a buyer regret, buyer awareness, Reddit where they’re sharing, Hey, here’s how you get free stuff.
Bob: 31:04 Um, I think it’s a little bit of everything. Obviously some of it’s fraud. Some people probably believe they got an inauthentic prob, uh, item. Um, I had one complaint that I think it may actually have to do with some of Amazon’s keyword bots as I actually got to use soldier’s new complaint for a package of sticky notes. I know sticky notes, I didn’t, so I’ll use sticky notes. But when I was able to find the buyer feedback, it said that the packaging was dirty, which, okay, Amazon has a warehouse. It may have been in with something else, it may have fallen. Amazon picked it up. It didn’t really say that it was opened in use. So I think Amazon may be looking for some of those key terms and firing out the complaints.
Stephen: 31:49 Well, just like keywords are so critical to find your listing. Those key words are probably trigger words. Yeah, I was thinking about that cause I was out in the warehouse putting together an FBA shipment and Alexa, how does Alexa know? When I say Alexa and not say Bob now, I mean it knows, right? So who’s all the time, right? Somebody programmed in though or to say, Oh, if the name Alexa comes up, we’ve gotta do something. Right. And so I think it’s the same thing. I think you’re right that the bots catch that and just say, Oh, okay, dirty means, you know, used and therefore blah, blah, blah. There are humans that are programmed these things. All right, so co-op warehouse, what did do it again? You know, knowing what you know now, not the financing piece, but owning your own real estate as opposed to leasing it. Would you do it again? Yes, because
Bob: 32:40 I mean, I have friends that lease warehouses and I’m like, you know, you throw in 30 40 $50,000 a year and you have nothing in return. You’re helping someone else pay for their property. You know, even if you decide to sell in five or 10 years, you know you have the equity in the property. I mean, I wouldn’t suggest it the minute you decide you want to sell on Amazon, but once you know you’re going to be successful, when you get what you plan on doing for awhile, I would definitely say buy your own real estate if you can afford it. [inaudible]
Stephen: 33:12 but the trade off is it affects your ability to buy inventory, correct? Yeah. Yeah, we are. We’re in that same boat [inaudible]
Bob: 33:20 but I’ve always been opposed to, you know, renting or anything like that. If possible. I’m like, I don’t want to be paying, you know, I work with someone who is 30 years living in the same apartment. I’m like, you could have owned your own house if you put those mortgage payments in and now you know you’re moving and you still have like nothing because all the money you had went to pay your rent every month.
Stephen: 33:44 But I’m free Bob, if nothing’s holding me down right now. Yeah. Nick and I actually just had a friend buy a house and his mortgage is now less than 40% of what he was paying in rent. And the house is much nicer. Uh, I haven’t said this out on air yet, but we just bought a house and you and I were talking about in a precall and we, we, we’re calling it our permanent house. We downsized, um, that we did an apartment for almost two years, almost two years to the date. And then we bought a house and just about finished remodeling it. We’re living in it in a construction zone. Um, cause uh, which has not happened. My mind is not happy with that. I keep telling her it’s like camping that that works for a day or two. Anything. Yeah. It didn’t, it didn’t work long, you know.
Stephen: 34:24 But anyway, um, with the goal being is to be in that position where you have no more expense and you have no more responsibility that the ability to get rid of that because when you don’t have control, you know one thing about our warehouse, we do lease our warehouse but we have a contract and we have, you know, we know what our rent is going to be next year when it goes up. I know all those things, however they sell, you know that that lease is assignable. But there are, that opens up different issues and our plans are planned but we’re not in control. So and your scenario, you and I both, you know me and my house, you and your business are in control, right? If you decide that you want to get in the lawn mowing business pop cause you know you need more sun, right?
Stephen: 35:09 You could, right. I mean you could do more exercise. Yeah. Well that’s another issue. All right, let’s do this because I just want to make sure people go back and listen to episode 60 because when you hear Bob talk so confidently, you’re not going to hear it as well. Back in episode 60. Cause he didn’t know how much he knew until he came out of the closet and all of a sudden everyone was like, Oh my God, this guy’s one of the smartest guys in the room. And he didn’t realize it. It’s fair. And that’s not a, that’s not, that’s a very humble, it’s humble. [inaudible] and tribute a lot of that to you because I would be the type to go to a conference and sit in the corner and not talk to anybody. And you had me on your podcast way back when and then people started coming up to me.
Stephen: 35:51 And I think it, it helped me personally build the confidence in myself to be able to approach somebody and talk to them. Now episode 60, that’s how long, I mean, think about that. Episode 60 and you’re now in the 400 400 something now, 400 and something. Um, but you go back and listen to Bob’s experience as a purchasing agent and purchasing department. But really that depth of experience, and I tell people this all the time, I’m sure you’re the same way. Whatever you’ve done in your life has prepared you in ways that others don’t have that advantage. You just have to realize and what you learned is a skill. And then if you can apply it to your Amazon or eBay or Etsy or whatever other business, you have, your own Shopify, if you apply that, you have a big advantage over other people. Is that fair?
Stephen: 36:36 That’s very fair. I mean, I think back then I talked about the things I was learning in my Amazon business I was using at my full time job things I was learning at my full time job. I was using my Amazon business. So they kind of helped each other. It’s fascinating. I mean it’s just, it’s really is applicable across all different methods if you recognize it. And then if you sit back and take stock of yourself and in a humble way and not be an ego and say, Oh, I’m the smart guy. No, you know, there are a lot of, I mean you and I both know a lot of smarter people than us. All, lots of people. Yup. All right, let’s do this. Um, because I think somebody can go back and get a lot of depth on that. And I think what you’ve already talked about is really helped a lot of people. I’d like to go to lessons learned and I was thinking about where you are now and you will honestly say that you stumbled, right? Nobody wasn’t a straight path to success. You’ve had to stumble, you’ve had to zigzag, you probably had to retreat a few different times. Right. Can you talk about some of the lessons that you’ve learned, maybe stuff that you would do different, knowing what you know?
Bob: 37:42 Um, the main thing I would do is just because I have basically access to more inventory or new account is not just to go ahead and bring it in. Cause one of the issues we ran into was sorta financial, but we had so much inventory that sat because we didn’t have enough room or enough personnel to prep it and send it in. So I think if I had been more steady about how things were brought in and probably a little more organized. Um, and I have someone funny story, but it was actually a virtual assistant I used back in the days of EPS years ago and her and her husband worked for us doing merge stuff. Uh, they were in Bosnia and they actually one, I guess they call it like the Bazi and the lottery to come to the U S so my friend Kyle sponsored them. They lived with them for a few months.
Bob: 38:41 She’s expecting now and not able to be on her feet. She had, we run Kyle’s warehouse, so she’s actually working on the back end for me doing my reimbursement stuff, my shipping consolidation. But one of the things that’s really helping is she’s, I’m able to forward her an invoice of something that’s coming in and when it gets here, the shipping plan is ready to be imported into scan power and sent back out. So getting stuff like that done is really helping us be more efficient. And now, you know, we’re scheduling the stuff that comes in. Oh I better, instead of just saying, okay, I can get this, let me get as much as I can and get it in here. It’s kind of like a discipline not to just get it, cause you can get it. And then what it sit here is some of it related to capital again though too, because you’re pausing loan borrowing money is some of that related to that too and it kind of forced you out of it?
Bob: 39:39 I mean, actually the biggest thing I did when we, when we didn’t have the extra capital to spend was spend literally two to three months doing returns. And they just said we’ve got pallets and pallets and pallets of returns. And we did it, I want to say probably February, March, April timeframe, and we found that a lot of the holiday inventory that came back was now out of stock where it actually sold for a premium off season while nobody had stock. Chris, I was actually a good thing to do. I mean of course sales suffered a little bit but it was good to get a lot of that cleaned up. And you know, some of the, we got like toy sets at Costco last year. Those are like little figurine sets or whatever and we’ve got a couple back there in perfect condition and now they just continue to price had basically gone from 35 a $40 to $100 that’s awesome.
Bob: 40:33 Because they weren’t available anymore. But just to take the time to do that. And you know, Rhonda has helped a lot where we get in returns and now that we don’t just put them in a pile and we’ll get to them when we get to them, they come in, right? They come in and he looks at it and figures out, okay, this is junk and gets thrown away. Or you know, this is a pair of shoes that’s in perfect condition, then we’ll reprep it and send it back in. Or you know, this is IP crap. What are, what do I do with it? Am I, yeah, stick it in a pile. But she’s, it’s coming in, she’s looking at it right away and we’re determining where it goes. Whereas before it was just like, yeah, those are returns yet back room somewhere until we get to them.
Bob: 41:12 So you’re describing two bottlenecks in your business that you’ve put two key people, it sounds like, into those roles. Right? Right. When, when you’re looking at, if you had to set up again, would those be the positions you would start with? Because most people think, I think it’s something that needs to be done. I mean now obviously as you grow and sell more, the more stuff you get back. So I knew that, you know, returns were becoming more of a, more of an issue, not only for space because even though we have warehouses, they’re not huge and we have walls in the way and stuff like that.
Speaker 4: 41:44 But um, you know, just the bottleneck of it and the cashflow that’s tied up in it. Yeah. Does it, does it pay your position? I mean that’s what I was trying to get to. Does that position pay for itself now because you have such, you’re at a scale, you have volume and she’s moving it right. I think she’s taken it upon her self to have the responsibility. I mean yo shoes
Bob: 42:09 was doing all the RA shop and for us. So we’ve cut back on the IRA a little bit. Um, just found that some of it was our sole moving inventory and stuff. So she’s kind of taken that upon herself to help get organized. Cause that’s one of my, I guess, bad characters is I’m not very organized and she’s forcing me to like, okay, get the work laid out for everybody, get the labels done, put it in this area. So we’re spending the time the day before to get the next mornings work ready. Whereas I would just say, yep, I’ll do it in the morning. And then, okay, now the first hour I’m here, I’m running around in circles. People sitting here with nothing to do where she’s pushing me to get ready and get it organized
Speaker 4: 42:49 and it has been helping and love it. Love it, love it, love it. So realigning responsibilities and, and you’re taking something that probably is waning. Maybe she was getting a that Amazon fatigue a little bit and this allows her to do something different and probably have a better impact on the business. Right. And she’s much more organized than I am. I love it. See, this is, this is the way a business is supposed to evolve, Bob, isn’t it? I mean, it really is. You know, you couldn’t do all this stuff right from the beginning. Right now, I just don’t know. You have to learn by,
Bob: 43:25 by making mistakes. I mean, that’s one. We want the names. I said learn from your mistakes and you know, everyone’s going to make them. I’ve made tons of them, but just learn from them and don’t beat yourself up over it. Okay, I made a mistake. Fix it and move on.
Speaker 4: 43:36 Well, how do you invest in yourself and your team? I mean, how do you guys, I mean, are you still developing relationships? So you taking part in conferences at all or doing anything? Like you just said, you’ve been through so many conferences, but yeah, Chris green had a juice, like a local meetup. You wanted to get some people together. He’s always been one to help other people. 100% yep, definitely.
Bob: 43:57 And you know, he helped me, this where I started was meeting Chris green and we’ve, we’ve developed a friendship. We don’t get to go get together as much as we’d like to, but there’s somebody that is local to him that I’ve worked with before and he’s looking to the next phase beyond the Amazon. And I think Chris really believes in them and it’s a great idea and I think he wants to be there to help them along the way. And I think that was part of the reason to get together. And you know, I had met another guy who came and they weren’t all Amazon sellers. A wasn’t an Amazon get together, but he was running, um, cell phone were like fix
Speaker 4: 44:32 it, cell phone stores or something like that. Fixture electronics and great guy. You know, when we were able to see that people were doing different things and being successful and that’s like one of the things I said about selling on Amazon is you could do all way. You could do merge, you could do IRA, you could do private label and you could do what you loved and still be successful. And I think that’s what I had seen when I went and met the other guys was like, Hey, you know, I’m doing this and I’m successful. You know, I met someone else that was, there was actually a print on demand printer. Hm. You know, he had set up a website and you know, we had asked some of the guys in the group to help them test it. But you know, people are using, I’m not that familiar with print on demand, but like red bubble and stuff.
Speaker 4: 45:15 He was actually one of the people that made the shirts and did the shipping and all that, had his own machines and just upgraded it. So you know, he was there as well. So, you know, it was great to see that other people were doing things that were kind of Amazon related but not 100%, you know, just selling inventory. Well they’re finding their lien right there. The thing that they connect with, right. As we were talking in our pre-call, you know, there are people that are running brands for brands, right? They’re not, they’re doing the backroom stuff. They’re answering customer service. We do customer service for a company and I’m not speaking and of turn, they’re a large company. Um, and when you do those things, it’s, it’s a different kind of business. I mean it really is, but that doesn’t make it less, it just makes it part of Arlene maybe.
Speaker 4: 46:00 Right. Maybe something we’re good at. It’s very enjoy. It’s very cool. I mean back to your old corporate world that didn’t exist in it. You were put in a box. The box was, you’re going this way, Bob. This is what we need you to do. Here you go, boom. That’s it. Right. Usually, I mean, I was one that, I don’t want to say one of the reasons I’m not there anymore is I spoke up for the way I wanted things done, even though it wasn’t always the way the boss wanted it done. And there was other guys that worked. They were like, yup, that’s absolutely the way we’re going to do what I 100% agree with you. And I wasn’t that guy. As much as I was quiet and shy, I said, no, I don’t think we should do that. And I’d cause friction sometimes.
Speaker 4: 46:43 Yeah. Well, but now, now others are doing it to you. How do, how does that work when, when employees or staff come to you and say, you know, Bob, I wanted to try it this way. You know, is it the older you get, the more willing you are to bend or are you being more rigid? Uh, I’m kind of like, you know, uh, so we’re wrapping, you know, something to, and I’m like, I really don’t care how you wrap it. As long as it’s protected and the labels were Amazon can scan it, do what you think is best. I may, there’ll be times where I overrule them, but for most of the times I’m like, as long as it’s protected and it’s done to this standard, do whatever way you want. So I’m really not too up in, it has to be wrapped this way and done that way.
Speaker 4: 47:27 And we have two college graduates that work for us. My son and his friend and these guys are fresh and they still have stars in their eyes, you know, remember what will we go to school right the way back. They, uh, come in and they’re like, Hey, can we try this? And I’m like, sure you got, yes, the rules are the rules. I mean, I don’t get to set the rules. Amazon sets the rules or eBay or whatever it is, but sure, as long as it’s legal, you want to try it. Maybe I’m wrong. Maybe, maybe I’m just, maybe it’s changed and I can’t see it. And that’s probably true in a lot of cases. Um, that’s, uh, that’s new for me. That’s not my way cause I’ve been a controller my whole life. That’s what I was trained to be. Right. So it’s healthy.
Speaker 4: 48:09 Freeing almost, isn’t it? Yeah, very well one of the things I found is the best employees, I don’t want to say we have a bunch of older people working him, but I think six of the seven people retired. They don’t have to go out and work. They enjoy coming in. It’s awesome. And being able to get out of the house. So it kind of works. They don’t really have to have a job, but they enjoy it. So they happy to be here. They happen to be out of the house and it’s just kind of working first right now. Whereas, you know, one of the problems we had growing is employee turnover. Yeah. You spend months training somebody, you know when they’re doing okay and they’re doing great. And then I like, okay, I just got a job as we had some are working for us last summer and he was doing great.
Speaker 4: 48:54 And he’s like, Oh, I just got a job as a flagman directing traffic for, you know, 75% more than you paying me. I’m like, okay, what am I supposed to do? You know, we’re paying you, you know what we can pay and now he’s got at this job and he’s got benefits and salary and sick time and vacation time and you know, a small company, most of us can offer that type of stuff. You gotta respect them leaving you. You got to understand, I mean that’s fair. [inaudible] but it was a, it was an employee turnover. Things like as soon as we get someone and they were doing decent ope off to, you know, another thing, and I always said, Hey, if you came here and you learned how to sell on Amazon, you started your own Amazon business, I’d be more than happy to help you out.
Speaker 4: 49:32 But it’s like, okay, they were doing, you know, one was going into the construction business and one was going into, he was going to be a flag man. It’s just, it’s frustrating and it’s very exhausting to like, okay, I just spent all this time and he’s finally got it and now it’s okay off to find someone else. But you figured a way around it by finding people who stuff. I tell this story a lot too, is that we used to sponsor a baseball team, a triple a baseball team, and they were terrible. And the coach, new general manager came in or whatever. And what they figured out was that there were star players that were on their way out of their career, meaning, you know, they were really great player at one time and in the old days they just cut them loose and that was it. They started bringing them back down through the minor leagues and they still had a following. So all of a sudden the crowds got bigger. They still had value to offer. And when recognize that
Stephen: 50:28 just because somebody is old, then they still have value. Right. When you recognize that, and it sounds like you figured that out, that’s pretty awesome. Yeah. Um, has there been any of these people that have surprised you that you were like, Oh, these guys, you know, he’s going to be set in his way. He’s not going to come up with anything innovated? Have you been surprised?
Bob: 50:50 Yeah, I mean, bill kind of runs the in and out. He’s, you know, he builds the pallets and gets all the receiving and stuff like that. And he’s very
Speaker 5: 51:00 [inaudible]
Bob: 51:01 I don’t want, he’s organized, but he, he thinks it’s like, it just doesn’t move things for the sake of moving things to get it out of the way. He’s like, Oh, there’s an unintended consequence. Right, right. That okay, we got, we have to unload this pallet because we need the space. But he keeps everything together if like, you know, if returns come in and they’re all from a certain vendor, he keeps it all together. He’s very good at separating things. So when I go to look for it, it’s much easier for me.
Stephen: 51:30 Hmm. I think there’s again, another lesson. All right. All right. So I want people to go back and listen to episode 60 go back and get some perspective. And then come in, listen to this again and sit back and say, wow, I mean, it’s amazing how far you’ve come pop steel. I mean, just amazing. Uh, it’s been a lot of hard work. I know. I mean, I know, I know the work. Um, so the goal of the podcast, Oh, if somebody wants, I can, can I, I can put your Facebook contact out there. Somebody who’s a pause. Okay. All right. I’ll do that. Um, and I, I love this. Don’t chase inventory just to get it right. Don’t chase inventory. Be sure you’re ready for that inventory because if it could, and it’s such a, I, you know how much I have shelves you spend in my warehouse. I have shows of inventory. It’s very nice to look at. It’s organized, right? Yes. But it’s, uh, not doing anything, so that’s not good. All right. So the goal of the podcast is to help people get past point. A stuck stuck today for you is way different than it was when you were part time seller and just pushing, you know, buy an RA and prep it and sending it out. How do you get past stuck now? Uh, what, what’s your advice for a baby? A little more scaled of an operation to get past stuck?
Speaker 5: 52:45 He,
Bob: 52:46 I think it’s probably the same as most people learn how to delegate responsibility. And Rhonda has helped me come a long way with that because I mean I was, a lot of the arguments we had was you got to do everything. And I’m like, yeah, I do everything. And that was the problem. And now that she’s been helping more, it’s helped our relationship and it’s helped the business become more organized and more, one of the, um, comments before was they come in and it’s chaos. I can’t work in chaos cause I’d have so much stuff lined up for everyone to do. And now it’s, it’s more piecemeal and organized. But learn how to delegate and play on other people’s strengths to let them help you grow
Stephen: 53:27 so hard. I mean it’s so,
Bob: 53:29 it is, cause I’m a, I didn’t want to let go and now it’s like I finally learned to let go
Stephen: 53:36 and you’re going to get disappointed from time to time. But then again, and I always say this, Steve’s not perfect. I know I make mistakes, right? I just, I made a mistake this past week with your client stuff. We make mistakes. I mean, it’s not good. I beat myself. You don’t have to beat me up any more than I will, but so if it’s okay for me to make a mistake, why is it not okay for Bob to make a mistake? Right. That’s going to make them, that’s right, dude. It is. It’s just so good to talk with you. I mean, I’m blown away. Uh, I love, I love what you’re doing. I reached out to Bob for different thing because we were having a vendor, a growth issue, and he is such a resource. He has so many contacts. He was able to put me in touch with the right person. Um, and I thank you for that. I thank you so much. I wish you guys nothing but success. Thank you so much. Take care.
Bob: 54:21 Thank you Steve. I really appreciate what you do for myself and for everyone that you’ve had on your podcast over the years. I mean just to be able to come up to you at a conference like, Hey, you know, this guy will help you out with this problem and you get the people together and you know, you’ve done a lot for myself. And if I think for the whole community I can speak for, and I think a lot of us do appreciate that. Whether it’s
Stephen: 54:41 [inaudible]
Bob: 54:42 not said enough, but it’s great to have someone like you
Stephen: 54:46 to vouch for everybody. You’re very kind. Thank you. Take care man. Such a great guy. Such a real guy. He’s 100% real. So, you know, if you’re having challenges, you want some more information, reach out to him because he will help you. He is just so knowledgeable, honest as the day is long and he’s going to punch you in the nose if you need it. You know, I’m, you’re going to hear, Hey, you know, suck it up, do the work. Um, and then you can earn the right to, uh, complain about outside of that and not going to complain. He’s going to get the work done. So terrific guy. Um, and go back and listen to the episode 60, because you’ll see how it kind of began and look at what it’s become. It could happen to you too, but it comes with a lot of hard work, a lot of blood, sweat and tears, e-commerce, momentum.com e-commerce, momentum.com take care.
Cool vice guy: 55:34 Thanks for listening to the e-commerce momentum podcast. All the links mentioned today can be found at e-commerce momentum.com under base episode number, please remember to subscribe and like us on [inaudible].
Stephen: 55:47 Okay.