Planet Amazon Podcast

Amazon Wholesale: Todd Welch's Proven Methods to Boost Amazon Sales

• Adam Shaffer

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Unlock the secrets to thriving in the Amazon marketplace with insights from Todd Welsh, the visionary CEO and founder of Amazon Seller School. Discover Todd’s inspiring journey and the mission driving his educational platform, designed to guide sellers away from common mistakes and towards scalable success. Curious about the differences between Amazon wholesale and retail arbitrage? Todd breaks down these models, revealing why buying from brands and authorized distributors can offer a more sustainable and profitable business approach.

Managing suppliers and inventory is no walk in the park, but Todd Welsh has strategies to make it manageable. From coordinating complex shipments to the financial challenges of pre-paying for inventory, Todd shares invaluable tips for maintaining a competitive edge. Learn how to win the buy box with repricers like Seller Snap without succumbing to price wars, and understand the importance of specializing in product categories to forge stronger relationships with brands. Todd also highlights the game-changing potential of securing exclusive agreements to boost your business success.

Equip yourself with the essential tools and strategies for optimizing your Amazon listings and outmaneuvering the competition. Todd walks us through the benefits of using tools like Helium 10, Keepa, RevSeller, and more to enhance your performance on the platform. Gain insights into handling competitive ASINs, navigating the intricacies of private label products, and leveraging bundling strategies to create unique ASINs with minimal risk.

You can learn more about Todd and the Amazon Seller School here: https://amazonseller.school/  

Want to chat with us about this podcast? Send us a text message here

The Planet Amazon podcast, brought to you by Phelps United, addresses all things Amazon and other eCommerce marketplaces. In each episode, we talk with Brands, Agencies, and Sellers about Amazon news, new features, policies, brand policies, logistics, marketing, issues, and challenges, among other topics.

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Announcement:

Welcome to the Planet Amazon podcast with Adam Shaffer, where we explore the world of Amazon and other e-commerce marketplaces. Join us as we delve into the latest strategies and tactics for successful selling on the world's largest online marketplace.

Adam Shaffer:

Hello, I'm Adam Shaffer and welcome to Planet Amazon, where we talk about all things Amazon and e-commerce and we talk about strategies that drive success on America's largest online marketplace. Today, we have a special guest who is a true pioneer in the Amazon space. Todd Welch is not only the CEO and founder of Amazon Seller School, but also a seasoned expert in Amazon wholesale, which is a big topic that we're going to talk about today. With years of experience under his belt, Todd has helped countless entrepreneurs scale their Amazon business to new heights. Today, he's here to share his wealth of knowledge, offering invaluable tips and tricks on how to navigate the complex world of Amazon wholesale and to achieve sustainable success. Todd, welcome to Planet Amazon.

Todd Welch:

Yeah, I appreciate it, Adam. It's great to be here.

Adam Shaffer:

Great. Well, thanks for joining. And you know the topic is near and dear to my heart because you know we're all sellers and there's 2 million sellers on Amazon, believe it or not, some much bigger than others, but it's an important, important topic to talk about. But before we even get there, you know, I don't know if people, many people, really understand that there are ways to learn about Amazon outside of plugging away at it every single day. So why don't you tell us a little bit about the Amazon Seller School, what you guys do and how you actually got here?

Todd Welch:

Sure, so Amazon Seller School is basically my platform where I share any knowledge that I gain myself. Basically, I'm trying to help people avoid the mistakes that I have made in growing my Amazon business. When I got started in this, I followed people like Scott Volker and he helped me get going, and so I'm trying to do the same for other people. So I have a podcast on there. I create lots of educational videos. I do weekly Amazon news the top news of the week, anything that I think can help people. I've also got a monthly membership program that people can get in and get access to exclusive videos, direct access to me to get questions answered and all that good stuff. So whatever I can do to help people, I put it out there on amazonsellerschool.

Adam Shaffer:

I mean that's awesome and it's something that the industry needs. So we thank you for that. I mean for all the listeners. I mean everybody has questions, everybody runs into issues and also, whether you're new or you've been doing this for a while, there's always something you don't know, and it's almost impossible to know it all. So great to have a resource like URAM. So let's change the topic really to what I wanted to talk about today, and that was more of Amazon wholesale, and so there's multiple models that people could use on Amazon to sell and to market their wares. Can you just tell us really what is Amazon Wholesale?

Todd Welch:

Sure, so Amazon Wholesale. I'm not 100% sure how it got the name Wholesale, Amazon Retail or something like that would be better, but usually we call Amazon Retail when Amazoncom is selling the product themselves. So Amazon wholesale is kind of what's been adopted for when you are selling other people's products and buying their products directly either from the brand or from an authorized distributor of the product, which makes it different than retail arbitrage where you're usually buying branded products from a retail store or a thrift store, garage sales, things like that where you don't have that direct connection back to the supplier.

Adam Shaffer:

Yeah, so I mean and that's a good point so Amazon retail in the biz we would call it 1P and that's when a brand sells directly to Amazon, amazon pays them for the products and Amazon sells it on the marketplace, on the platform. What we're talking about with wholesale is a version of 3P and it's where companies, you know 3P stores, are buying products, like you said, from the brand or from authorized distributors. But there's another version of selling on 3P and that is when you're buying from potentially unauthorized sellers or you're buying it from a retailer that's really supposed to be selling it to end users, but you get a good enough deal that you could probably resell it on Amazon and make a couple of bucks, which is kind of, to me, a little crazy, a little wild and sometimes pretty annoying when you're the legitimate seller of the product. So talk about the arbitrage for a little bit, because I think you used to do that, didn't you?

Todd Welch:

Yeah, that is more how I got started.

Todd Welch:

You know, I used to jump in the car, head to Walmart, head to Goodwill Savers, garage sales, all those different stores you know Home Depot, costco, sam's Club and you go into those stores and you've got the app on your phone whether you're using the Amazon Seller app or using something like inventory lab or something like that but you're scanning products, hundreds of products, looking at the prices they're selling for on Amazon and seeing if you can flip them.

Todd Welch:

So basically, you're trying to flip products and you're buying them at retail store of some kind and you typically do not have a way to consistently restock those products. So it's a constant hustle of trying to find new products, new products, new products to keep growing it. And I did pretty good. I got it to the point where I was selling about 90,000 per month month just doing retail arbitrage. But the problem is is it's hard to scale beyond that unless you start hiring people to do the shopping and things like that for you, which can get pretty tedious. It's not impossible, but it's more difficult to scale than doing Amazon wholesale, where you're just sending purchase orders to a distributor or directly to a brand and continually restocking products that are selling well for those that do buy arbitrage.

Adam Shaffer:

Sometimes they would make a buy, they'd buy a bunch of stuff and Amazon would maybe knock them off or a brand would have them taken off the platform. I mean that could sting a little bit if you own the products. I mean, has that happened to you?

Todd Welch:

It has. Yes, I've had products getting taken down all the time Retail arbitrage. The problem with retail arbitrage I get products taken down doing wholesale as well, but with wholesale I have the legitimate invoice from a distributor or the brand and you can typically present that to Amazon and get that result very quickly. But the problem with arbitrage is you don't always have a proper receipt. And I say proper receipt because Amazon is looking for the UPC or the SKU, the supplier SKU of that product, and while some places like Walmart they do put the UPC on there so you can use that to get those IP complaints cleared up, if you're buying from a thrift store or say you're buying from TJ Maxx or something like that, they do not put those numbers on there, they use internal numbers, and so Amazon will not accept those receipts, and so you're kind of walking that line and hoping that you don't get taken down if you're buying from those kind of stores.

Adam Shaffer:

Yeah. So what I find is a lot of people start that way because it's a way into the business without a huge investment and then they really learn the Amazon game. They learn how to manage the world on Amazon and I guess if you could be successful at arbitrage you usually could do well doing almost anything. So it's great training ground, I would say. But now you evolved and you made it to the wholesale side of the business. So explain more about that and how you got into it and how it all works.

Todd Welch:

Yeah, you're exactly right on that and shift. Starting in retail arbitrage is still good you can make some money in that but switching to wholesale or private label is kind of where you probably want to aim if you want to actually build a big business and a sustainable business. Getting into wholesale is a little bit different. Well, it's completely different, I should say, from retail arbitrage in terms of how you're sourcing your product. But starting with retail arbitrage is good because you can learn all the platforms right.

Todd Welch:

The platform is the same Seller central learning how to send in products.

Todd Welch:

Platforms right, the platform is the same Seller Central learning how to send in products, label products, get them into Amazon, sell them, market them. All that is the same. But in terms of finding products and getting products, it's different because you're not just going to a store and looking at what they have and scanning them and buying them. Instead, you are reaching out to either the brand direct or to a distributor, and an authorized distributor is essentially just someone, an intermediary company that might sell hundreds or thousands, possibly even tens of thousands of different brands that you can buy from, and what you do is try to open up an account with those brands or distributors and once you open up an account, you can get a list of the products that they carry and that you're able to sell, and you can then go through those lists and find products that are profitable. Instead of scanning products at a retail store now, you're scanning through, typically, some kind of spreadsheet or maybe a website to try to find profitable products that you can sell.

Adam Shaffer:

Yeah, so at the very bottom of the wholesale you're going through distribution. Maybe you could very bottom of the wholesale you're going through distribution. Maybe you could buy some of the stuff direct. But you don't necessarily have access to the brand registry unless you have a special relationship with the brand and you are probably not exclusive. So talk about that, because it's not super easy to always get that buy box. And then there's also the race to the bottom if there's other sellers on it. So how do you decide?

Todd Welch:

Yeah, that is one of the biggest difficulties doing wholesale is that if you can buy the product, probably other people can buy it. So you're typically going to be sharing the buy box. You're going to have a buy box rotation, right? So you might not always be the person that they're buying from when a customer visits that product on Amazon price and location of your inventory, things like that. So to handle that, essentially you are trying to negotiate with the brand or the distributor better pricing than other people, and that can be a game in and of itself, right, Because if you're brand new to a brand or distributor and you're like, hey, give me 20, 30 percent off of your normal price, they're probably going to look at you like you know who's this guy.

Todd Welch:

But with that said, discounting is typically the norm in a wholesale world, so distributors and brands are used to giving a discount off of their price.

Todd Welch:

So usually that first price you get is not going to be the best price that you can get. Now you have to give them a reason to give you a discount. So, for example, what I usually do is I go through their spreadsheet and I find all the products that I would like to sell at 0% profit or higher, and how many I think I can sell per month, Because then I can come back to them and say, hey, if you can give me this price, I think I can buy this many every month from you of all these different products. And now you're looking at, you know, maybe that's a $5,000 order or $10,000 order, or maybe even 20, 30, 40, $50,000 order. If you're getting into, you know the higher levels and now you're showing that supplier that you are legit and looking to make big purchases and they could potentially give you those bigger discounts on top of what they would normally give discounts for to someone who might make a $500 order or a $1,000 order.

Adam Shaffer:

Yeah, I mean so. So okay, so at the beginning you're doing your best to find products from distributors or from the brand and you're negotiating the best possible price. So now you found your products, maybe you have your price, and now you got to get going and actually buy the stuff and sell it on Amazon. So you still don't have their brand registry, so you're at the mercy of their ASINs or the creative that's on their ASINs for the moment. But how much inventory do you buy? How many weeks of that inventory do you need to risk and buy that inventory so you can have it in stock? And are you stocking it at your own warehouse or are you shipping it up to FBA to Amazon?

Todd Welch:

house or are you shipping it up to FBA, to Amazon? Sure? So very good question. When you're first ordering a product, I always try to do a test buy. So when I'm sending that big spreadsheet of products that I potentially want to buy from a brand or supplier, I am making sure they know up front that, hey, this is what I think I can buy every month or sell every month.

Todd Welch:

But I'm going to start with a test order. So if I think I can sell 500 units of this product every month, I'm not going to make an opening order of 500 units. I'm going to make an opening order of maybe 50 units or whatever a case pack is. You know, if a case pack is 50, I'm going to order 50. If a case pack is 12, I might order 24 or 36 or 48, something like that.

Todd Welch:

And that way I can send the products into Amazon and get some real world numbers of how many I'm going to be able to sell. If I send that 48 in or 50 in and it's like, boom, it's gone in five days, now I know, okay, I'm probably safe to order 500 or a thousand. So once I'm established, then I'm trying to order and keep about 45 days worth of stock in Amazon, about 20 to 30 days of stock in my warehouse and, by the way, I started in my basement and garage, so you don't need a warehouse to start out. But I'm keeping that 20 to 30 days of stock in my warehouse and then I give another about 15 to 20 days for transport between the warehouse and Amazon.

Adam Shaffer:

So you're getting the products at your place, you're packing them and shipping them up to Amazon. You keep an overstock at your place to make sure that you have inventory to keep on flowing up to Amazon, because once you get the show on the road, you don't want to be out of stock, sounds like and you think being at Amazon is the FBA is the way to go right.

Todd Welch:

Oh yeah, 100%. So if I'm able to ship directly from the brand to FBA into Amazon, I will do that. But a lot of companies will not do that. It's about, I would say, right now, maybe 30 to 40% of our suppliers ship directly for us, the rest ship to our warehouse for us, the rest ship to our warehouse, and partly that is because they don't want to be putting the Amazon labels on boxes shipping to a bunch of different locations, like Amazon especially makes you do. Now they break it up more than ever before. So you try to simplify it for those suppliers that don't want to do that and send directly to Amazon if you can. Otherwise you know coming to you.

Adam Shaffer:

So 45 plus maybe 15, and then you need to be able to reorder some stuff. So it's tough. You know, we found it's always tough with cash because a lot of these, these suppliers, you know you're lucky to get more than 30 days, if you can, of terms. So you're paying for the stuff many cases before it's sold and you're right, it could take a little bit of time before the stuff gets up to Amazon. So I wish it was a faster way to do it without the cost. But that's part of the game. You have to be willing to invest in inventory and understand you're definitely going to have a tail. It's not going to be almost always. It's not going to be sold before you have to pay. So you just have to be prepared for that. How do you deal with the competitors? So now you're selling stuff and a few other sellers are also selling it and maybe they're bringing the price down. So what's your strategy for that?

Todd Welch:

Sure. So discounting is one of the bigger strategies. If you can get it 5% cheaper than the other person. Even if they drive the price down, you can still go lower and be profitable. And now, eventually they're going to disappear because they're not making enough money. So that's one strategy.

Todd Welch:

Otherwise, you're going to have to have what's called a repricer, and I use a repricer called Seller Snap. When I started out I used one called Be Cool. There's another one called Go Aura. That's really good. There's lots of good ones out there. Sellersnap is really good for high level because it's like $500 a month. Be Cool and Aura and these other ones can start around $25 to $50 a month.

Todd Welch:

But you're going to need a repricer that is going to compete with the other people that are on there and try to win you the buy box, ideally without just tanking the price. But trying to actually increase the price is what the good ones will do. So instead of matching the other people, they might go like a penny or two above. So the other people don't drop drop, but also stealing some of the buy box, because Amazon will give you buy box and sales on lots of different metrics and you know price is one of the biggest, but it's not the only one. It could also be dependent upon where you have inventory. If a customer is shopping in Florida and I have inventory in Florida and the other people have inventory in New York, they're going to show my listing, even if I'm, you know, 5, 10, 15, 20 cents more expensive even more sometimes because shipping for Amazon will be cheaper and faster to get it to the customer.

Adam Shaffer:

That's interesting. So in your business and when you work with others, I mean, are you, are you focused on any categories or you don't care? It's a product, a product, a product, or does it matter to you? Sure.

Todd Welch:

So we try to focus in specific categories. Ideally. You know we have products all over the map because when you come across a good deal, you take it over the map, because when you come across a good deal, you can take it. But I always recommend and what we try to do is focus in a specific niche, especially starting out that you are familiar with and have some type of unfair advantage over someone else.

Todd Welch:

So, for example, I don't know anything about, let's see, crocheting. Let's say that's kind of a niche hobby, right, I don't know anything about it. So if I'm trying to sell products that someone into crocheting would have and I'm calling suppliers, especially brands direct, because when you're doing brand direct, a brand is typically more emotional about their products. Where a distributor is just transactional, they don't care, they want to make money, but the brand wants to sell to people that care about their product more often than not. So when I'm calling a brand that's selling crocheting equipment and I have no clue about crocheting equipment I don't have any connection to, perhaps I'm speaking to the owner of the brand or someone who's working in there versus.

Todd Welch:

You know, I really enjoy fishing, for example. So if I'm talking to someone on the other end of the line and I know they're in Idaho. I'm like, hey, you've been up in the mountains trout fishing lately Anything you know. How are the brown trout biting or the rainbow trout biting? Now I've got an immediate connection with that brand owner beyond being someone who wants to sell their products on Amazon, and it makes that relationship a lot better and a lot easier.

Todd Welch:

So that's why I usually recommend people start in a category that they know. You know it could be anything like one of the coaching. I had a coaching call with someone from New York. He's a retired police officer, so and he was trying to figure out what to sell and I'm like I don't know anything about tactical equipment. That might be a perfect place for you to go into, because you know all about tactical equipment for shooting and things like that and you could connect with the owners of those businesses in a way that I couldn't. So starting in a niche is definitely one of the better ways to do it.

Adam Shaffer:

That makes sense. And then do you I mean people do, and we do we have exclusives with brands on either the brand or ASINs from the brand. I mean, is that? I mean, to me that's got to be pretty important. Is that something that, I guess, once you get, that's got to be pretty important. Is that something that I guess, once you get going, you need to be striving for?

Todd Welch:

A hundred percent. Yeah, we really focus on brand partnerships now, or exclusives with brands, and that, again, is where the niche really comes into play. Most of our exclusives are in categories that we know a lot about and most of the exclusives are with brands that if I said them on the air 95, maybe 99% of people would probably have no clue about the brand and have never heard of it. But we opened accounts with these brands. For the most part, we're opening accounts with them, reselling their products as one of many and building that relationship and working it into an exclusive, saying things like have you ever thought of taking control of your listings on Amazon? You know we're selling 500 units of these, or 100 units of these, every single month. If we optimize this listing, we could probably double, triple, quadruple that and really boost your sales on Amazon. And we can do all that for you if you are willing to give us the exclusive.

Adam Shaffer:

So offer them services if they give you an exclusive.

Todd Welch:

Correct, correct, and we a lot of times we'll do a lot of that for free. The optimization and things like that we usually try to negotiate some kind of ad share if they want us to run additional ads on the platform. But the optimization and cleaning up listings and things like that, that's kind of our carrot that we use to get the exclusive and then we're making our profit from selling the product, not having to compete against others, which means usually your profit margin can be a little bit higher. You got to find that balance of profit and units sold, because the brand wants you to sell more units, obviously, but typically your profit margin is going to be higher once you get that exclusive.

Adam Shaffer:

Yeah, for sure. And you don't have to worry about sharing that buy box, or you hope you don't. So then you are doing advertising.

Todd Welch:

I am. Yes, we do basic advertising on all of our products. So if you've been in the game for a while, you've probably heard of the 5 cent auto campaign. You can make it the 10 cent, 20 cent, 25 cent, whatever. But basically you make a campaign for 5 cents maximum bid and dump all your products in there To catch all Run and a lot of times you'll spend.

Todd Welch:

You know, if I look at my spend for a month I might spend a hundred dollars and sell like $50,000 worth of stuff or $20,000 worth of stuff, whatever the case may be. So at a minimum we do that. And then we play with some other ads. But we make sure we have a return on our ad spend of like nine, 10, 11 or more. So if we're spending a dollar, we want to be selling 10 or returning. I should say at least $10, $11, $12 on that dollar that we spend. But if we negotiate an ad share with an exclusive, then we're able to bring that down. So if a brand is giving us, say, $1,000 a month to spend on ads, then we might spend $1,500 or $2,000 a month in ads on that and we can have a thousand dollars a month in ads on that and we can have a, a ROAS of, say you know, five or six and still be profitable.

Adam Shaffer:

but regardless, we try to make sure we're profitable on any kind of ad spend that we're doing yeah, no, I mean, it's a big part of the game, and the problem with the wholesalers or the the sellers is when it's not your product, you're not a private label product, it's usually not that much margin, so you got to be really careful on the spend, and getting the brands to participate is a big deal. So that's a pretty good strategy.

Todd Welch:

That's why I say you want to figure out what your ROI is. So if your ROI, if your return on every dollar you spend, is, say, 30%, which our goal is 50%, but let's say it's 30%, you want to make sure, whatever ads you're running, that every ad sale has at least a break even with that 30%. You know, because running some ads can help boost the overall sales of the listing and boost your overall sales yourself. But you need to be tracking that and making sure those numbers make sense.

Adam Shaffer:

So your margin, you try to run a margin profile 50%. For ROI, so not profit margin but ROI, Because I was going to say I wish I had that.

Todd Welch:

Yeah, usually that profit margin is around maybe 22%, 23%, 24%, something like that. But I like to think in ROI, so that if I spend $1, I'm going to get $1.50 back. Is what I like to think, okay.

Adam Shaffer:

I want to tell people 50%, I will. I'm going to borrow that, so that's great. And then, with regard to Amazon, there's so many different parts of Amazon you have to be good at. How do you advise people to stay current and understand all these different disciplines and what's going on at Amazon and the policies that change and the policies that they don't talk about. Like, how do people keep up with all this stuff?

Todd Welch:

It's like it never stops people keep up with all this stuff. It's like it never stops. Yeah, so, following the news you know amazonsellerschool we've got the news and stuff on there and I have a lot of fun putting that together. That's how I actually stay up to date, because I'm scouring the web and LinkedIn and every place for news and then I put it all together and send it out to people so that helps me stay up to date. But other than that, you know, linkedin is a great resource.

Todd Welch:

Twitter or X, I guess now we call it is pretty good as well if you're following the right people. But you got to make sure you're following the right people on there to get good content. Youtube is good. Amazon News is good. Signing up for different people's newsletters you know, even though I put out my own newsletter, I'm signed up for like 10 other ones getting information and stuff like that. So it's a fire hose out there, for sure.

Todd Welch:

But essentially you just got to do this and take it step by step. You know a lot of people get overwhelmed and try to take in too much and they're worried about ads that they're going to run and they haven't even found a supplier for products yet. So you got to start at number one. You know, open up your Amazon seller account if you haven't done that, and then look and see what step two is and then step three, and not get overwhelmed. Just start. You're going to make mistakes. Hopefully you can learn from my mistakes and avoid some of the ones that I've done. But you're going to screw up, you're going to lose money sometimes and you just got to learn from it and do it. Every business is like that. You know, whether it's on Amazon or you're opening a gym in your local city or a hair salon or something. You're going to mess up. Make mistakes and you just learn as you go along.

Adam Shaffer:

You mentioned repricers before. What are the best tools that new people coming into the business should be maybe looking at? I think I know of a few, but like SmartScout and others.

Todd Welch:

What do you think? Yeah, so Repricer is definitely needed, but other tools that I use on a daily basis analyzertools I like a lot for automatically processing spreadsheets, so you can upload spreadsheets that you get from these suppliers, match them to Amazon listings and then work all the data in their filters and things like that to find ones that are profitable and the price is really good on analyzer tools. So I like that a lot. Rev Seller is another plugin that I really like. Last I looked, it's $100 a year and it puts this box at the top of every Amazon page so you can see what your profit is on all the products and things like that.

Todd Welch:

Keepa is also one that is 100% required to do this, because Keepa allows you to look at the historical sales price, the historical sales rank, the number of reviews, the breakdown on variations. You know which variations are getting the most sales and things like that as well sales and things like that as well. So those are probably my like mandatory tools. And then, once after you start growing more getting. Helium 10 can be helpful if you're optimizing listings. Data Dive is helpful if you're optimizing listings as well, and lots of other tools that you can get into and if you go over to our website, amazonsellerschool and click on the resources link, you can see a list of all the different softwares that I have used and my thoughts on them and stuff as well. In the beginning, keepa, revseller, analyzer Tools and Repricer are going to be some of your required tools.

Adam Shaffer:

That's super helpful. I didn't know about analyzer tools, so, thanks, I'm going to check that out. We definitely have that as an issue, that maybe that'll solve it. So that's great, thanks. So now, thanks for the tool information. I haven't done RevSeller either, but I'm going to check this all out. Moving on, we talked a little bit about competition, but if there's too much competition, do you wind up saying I just don't want to spend my time on this anymore? I mean, do you wind up just backing away from certain ASINs and sometimes.

Todd Welch:

Sometimes it will happen that you know you get on a listing and maybe when you first started selling there wasn't very many people and then more and more and more and there ends up like being 15 to 20 people on there. Everybody's driving the sales down. I will a lot of times sell out of that product and not reorder it then, but I'll keep it in my software to check it every now and again, because sometimes what will happen is a supplier will open up and flood the market and a bunch of people will jump in and a lot of those people will eventually disappear over the next three to six months or a year, whatever the case may be. And then you look back at the listing six months later and there's like no FBA sellers on it and just one FBM, because everybody was like you and just cut and run on it right, and now you can reorder that product and start selling it again. And sometimes you'll have that rinse and repeat kind of thing. It's a game that you're going to have happen. That's why you want to track your profit on products over time and see what's beneficial to reorder and not just blindly reorder things all the time. Only order things that have been profitable for you, you know, in the last 30 days and projecting forward are probably going to be profitable for you, you know.

Todd Welch:

And then also you're going to run into situations where it's quite obvious that whoever you're coming up against is getting a better price than you. So if that's happening, then you can go back to the brand or the distributor and try to negotiate a better price. If you can get a better price, awesome. Now you can compete with that person. If you can't, then unfortunately you're going to have to sell through and not reorder it and check back in six months or three months, because sometimes these sellers will, especially the bigger sellers. You know, if you run into these sellers that have like 100,000 seller reviews or seller feedback, they will be okay with getting 5% profit or maybe even 0% or at a loss in the attempt to push everyone out of the market.

Todd Welch:

And then when you come back in six months, maybe they're the only ones on there and the price is higher, and now you can test the waters again and see if they are still trying to push people out of the market and go from there.

Todd Welch:

But that's another opportunity too, if you see this happen and you come back and now there's just this one seller on there and the listing is garbage and you can reach out to the brand and be like, hey, I see this seller. He jacked up the price or drove down the price to get everybody off the listing, then jacked it up and they're selling it really high. The listing is garbage it up and they're selling it really high. The listing is garbage. Have you ever thought about taking control of this listing and making sure you know undercutting your price and all your retail partners and then jacking up the price? That kind of thing's not happening, manipulating the market, and it could give you an in to take that brand in as an exclusive or maybe steal that exclusive from someone else who's not doing a very good job.

Adam Shaffer:

That's great. And one other kind of thing it's like and I don't know if you've done it, but I have and you get good at arbitrage, you get good at wholesale, you get good at exclusive brands, but then you get this feeling like there's never enough margin. So I want to do what these other guys do and have a private label product. And you start creating your private label products and you realize it's not so easy. I mean, have you fallen for that? Do you do private label?

Todd Welch:

I have. That was one of my first big failures was in private label. I've had a couple of those that didn't go well. I've got one that does go well for us and is doing good. It's in the fishing niche, which I'm really good at and I know that market and that is going well for us. But one of the ways that I do kind of private label but also make it a lot easier is do bundles and creating bundles. So essentially you're taking maybe three, four, five different products and putting them together and creating a bundle, usually under your own name. But if you have a partnership with a brand, I will sometimes create the bundle under their name. But you can make it a lot easier because you can see the products that are obviously selling. You know what's selling well together. Using keepa you can look at the variations of a product and see which variations are selling best and then create a bundle of.

Adam Shaffer:

You know these are the best selling uh crochet, uh threads or whatever right well, I guess in that, in that scenario, you're not going out and placing huge orders in china to bring in containers where the stuff you're buying existing product and you're creating a unique ASIN.

Todd Welch:

Exactly In private label. You're typically ordering maybe four to six months worth of stock at a time probably, and with bundles it's just like any other product you're stocking. You're probably carrying 60 to 90 days worth of stock and it's typically a lot more foolproof, and if it doesn't go good, well, you're liquidating that inventory or maybe you're pulling out the bundles and selling them individually on the original thing. So you have a much lower threshold of getting into doing bundles.

Adam Shaffer:

Yeah, that's a great idea and you could be creative with the bundles and you could vary them, so that's awesome and so and then one tough kind of dirty part of the business is how do you deal with returns from? You know they just come. Amazon makes it super easy. Is that something that your vendor partners help you with, or are you having to liquidate that?

Todd Welch:

Yeah, it's definitely can be a struggle, but real quick before we switch into that. On the bundles, if anybody's interested, we actually have a wholesale bundle course inside of our membership program, so that might be something to check out.

Adam Shaffer:

I might join for that. That's good.

Todd Welch:

Yeah, it's definitely very nice. A lot of people have liked it. So if they're interested in that, check it out. But for returns, it's kind of just the nature of e-commerce. Whether you're selling on Amazon, on eBay, your own website, whatever, you're going to get returns and if you don't make returns easy, you're going to have less customers and you're going to unfortunately also have people taking advantage of returns. So we typically will get the returns back to our warehouse.

Todd Welch:

Well, first, you know, for the wholesale products, amazon has that option for grading and reselling. Grading and reselling so we will. On most products we will allow Amazon to do that, unless we find that they mess it up or if it's a specific type of product that it doesn't make sense for, like if it's a food product or a health product or something that you know that you're not going to want them an untrained person to look at it and resell it, we won't do those ones. But otherwise we'll let Amazon grade and resell it for us if it's possible. Otherwise, the rest we'll get back to our warehouse, open them up, see if they're resellable. If they are, we'll put them back in the inventory and resell them. You know, either as new, if they've never been opened or like new, used very good. I usually recommend used very good because always go a level below where you think it should be so that, uh, you don't get a return again.

Todd Welch:

Their expectations of like new. It might be different than your expectations of like new Uh. So always grade down uh, but then we resell it and things that we can't resell. You know, it's just kind of part of the game. Some suppliers will have an option to return it back to them and get a credit. But that can be difficult as well because that's a whole nother level of management that you have to do. But if you can get set up to return those ones back to distributors and brands that allow that, you can get a little bit money back there.

Adam Shaffer:

But it's kind of just something you got to build into, build into your business and try to maximize and, wherever you can, you have to have a process for it. Like you said, going through and finding the new, putting it back and regrading it and selling it.

Todd Welch:

So yeah, no, not with high returns. And if it makes sense, you might have to just cut those ones.

Adam Shaffer:

Yep for sure. So track your returns. Yeah, I mean, sometimes we'll get an allowance from the brand, sometimes they'll take back defective, sometimes they'll take and do stock rotation. So I think it starts with trying to negotiate with the brand partners, but sometimes not so easy and you got to have a process for it. So good stuff.

Todd Welch:

It really depends on the price of the product, right? Because if you're selling a $10 product, by the time you get the product back to your warehouse have someone open up the box, look at it, figure out what they should do with it and then have someone contact the brand and send it back to the brand. You know you're using a dollar or two at least of labor, so is it worth even doing it for low-priced products? But for higher-priced products, definitely. You want to see those avenues of getting some kind of reimbursement on those.

Adam Shaffer:

Cool. So with that I think we had a bunch of pretty interesting topics, but would love to hear from you Basically. First start with what's your advice to people that are getting into it. I know there's a ton of people in the biz, but there's still people that want to leverage the platform to start a new life, start a new business, and it's a lot easier than opening a retail store or doing something else. So what's your advice for somebody just getting in the game?

Todd Welch:

Sure. So my advice would be to treat it like a real business and don't trust anyone who's telling you that you know Amazon is passive income or you can make a million dollars this year selling on Amazon. Most likely those people are just trying to sell you a course and not necessarily doing it themselves. So anything automated if it says automated Amazon sales, run away as fast as you can. So treat it like a real business. Act as if you were going to open up a gym in your local town or whatever beauty salon, or whatever the case may be. Treat it like a real business and do everything necessary to set it up and get started Now with that. As I said, take things step by step right. So just because you're treating it like a real business doesn't mean you have to understand everything before you get started. But when I say that is, don't have unreal expectations. You know you're not going to be a millionaire next year.

Todd Welch:

If you start selling on Amazon right now. It's possible, anything's possible. Your private label could explode. Your wholesale business could explode. If you're putting in 100 hours a week, you could definitely do it, but you're going to have to put in the time to do it and start with one product you know.

Todd Welch:

Go to Goodwill, go to a thrift store, go to Garage Sale, find something that's unopened and that you can sell on Amazon and learn that process to sending it in and selling it, and get started there and then take step by step from there, learn from other people. Watch some of my videos, look at the courses, membership program, things like that. Shoot me a message and ask me questions. I always am happy to reply to emails and stuff like that, but the number one thing is to treat it like a real business and don't expect to get rich overnight. It's not a get rich quick scheme or anything like that. There's still a lot of money to be made. Amazon's definitely harder than it used to be, but there's still a lot of money to be made if you're willing to put in the work.

Adam Shaffer:

That is awesome advice and I do believe that people think they could come in and make a killing overnight. So thanks for that sound advice. So, with that, how do people get in touch with you? You were mentioning a couple of things, but why don't you just repeat ways to connect with you and your company?

Todd Welch:

Sure. So amazonsellerschool is one of the best ways I've got all my information on there. You can contact me on there. You can click over to my Instagram, my X, my LinkedIn, youtube, all of that from there. But otherwise, you know, whatever platform you're on, if you search for Amazon seller school, I'll probably come up on there and you'll be able to follow me on any of those platforms and especially get on the email list. That's one of the still one of the best ways to communicate with people and most effective ways. You know because you control that platform and you know you're going to get my emails once you're on there. Where with Facebook, linkedin, all that, it's all up to the algorithms whether they show you anything that I post or not.

Adam Shaffer:

Well, that's great. Well, thank you very much for spending the time with us. I definitely learned a lot and I think you know you touched on a lot of pretty hot topics for the folks that are listening. So thanks again and look forward to spending more time with you in the future and have you back on the show.

Todd Welch:

Absolutely, adam. It's been great, thank you.

Announcement:

Thank you for watching another episode of the Planet Amazon podcast, where we talk all things Amazon. If you want to learn about how to accelerate your sales on Amazon, visit Phelps United's website at phelpsunitedcom.

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