This was my attempt at an amazon product store. It started by following Seth Kniep on youtube. I eventually purchased his course for $997 and got started. The course was actually quite good and while a bit long winded I was able to follow it, find a product, setup my Amazon store and get started. It also helped me with Amazon keywords and how to utilize Amazon PPC to get sales started.
The product I chose was a microfiber (plush) bath towel. Think the super thin beach towels that dry quickly, don’t collect sand and absorb alot of water. But these were “fluffy”! I was trying to sell them as bath towel replacements, specifically for the avid gym goers as they would dry well and could be left at the gym for a while before getting “funky”
I was able to source the towels from a supplier in Chicago. They clearly weren’t the manufacturer but for $5 a towel, it seemed like a great price and I could say they were “sourced” in the USA. https://maximmart.com/54×27-luxury-drying-towel-microfiber-long-pile-premium-380-400gsm.html
Things were going slowly but started to get consistent with getting close to breakeven on the cost of PPC and the profit from the towels. Selling about 1-2 towels a week, but then one day…. I got an order for 10 towels… at $24.99/ea that was a great order and a elated day! Until, the next day when the order got returned. And you know Amazon’s no quesiton return policy. So there I am super pissed becuase not only did I not sell the towels, but now they were going to cost me because since they were pulled from the Amazon rack, they could not just be put back, they would have to be sent back to me for inspection before reselling. All of the shipping being charged to me of course.
I decided to have all the inventory shipped to me instead and just donated the remaining inventory to a local animal shelter and wrote off the loss. It was only about 20 towels left, but I was done. I will admit that in hindsight I sort of through a hissy fit by closing down the business. However, I learned that I don’t think I like the inventory style of a product business. I ran the numbers and even if the business started to do well, I constantly be reinvesting the profits back into more inventory. Sure maybe when I make $5-10k in profit I could scrape off $500-1000 for myself to spend or save. But what is that really.. another $500 a month after having sold 1300+ towels (30% profit margin @ $24.99/ea) didn’t seem like it was worth it. And god forbid I buy more and more inventory each month as my company grows and then the market shifts and I’m left with 5000 towels trying to sell them for atleast cost to break even… and losing all the profit I kept snowballing down the line.
Be careful out there, plenty of gurus and such out there saying they made $100k on Amazon last month when in reality it was the Revenue, not profit. And maybe they made $30k in profit or more but they probably couldn’t (or shouldn’t) have spent that and and had to reinvest. Or maybe they didn’t make any money as they spent all the profit already in PPC trying to make the profit. Or perhaps I’m just bad at this or too lazy.. Idk. I would revisit this if I could think of a better product that was more “evergreen” and could sell all year long and to a wider market. But I’d also probably try to find some drop shipper to work with instead. Amazon has soo many fees…. yes its convenient and quite easy but going from 50-60% profit margins to 15-30% after there fees… no wonder the stock is doing so well.
Final notes, Seth’s course was worth the money as well as Matt Clark’s “Amazing.com”. I spent ~$1600 on Amazing course and inventory, account setups, website, marketing and photos and then another $1000 on courses in 2018 with Seth Knieps. Was able to write most of this off and learned alot about the inner workings of a store that will hopefully help me in the future with a store or shop of my own.