Building Business Resilience through Financial Strategy

In this episode, Matt Putra, a seasoned fractional CFO whose expertise has transformed over 60 brands worldwide, shares secrets to e-commerce financial success. Matt masterfully navigates the financial labyrinth of Amazon and other e-commerce platforms, turning complex financial challenges into opportunities for growth and profitability. From his beginnings in corporate finance to co-owning Keep Nature Wild, Matt shares his personal journey and the strategies that have made him a sought-after advisor. He offers a blueprint for scaling and transforming businesses with revenues ranging from two to a hundred million dollars.

Join us as Matt reveals the critical importance of robust bookkeeping and financial planning to effectively manage inventory financing and margins. Learn about the indispensable tools like A2X and Soligo that streamline accounting processes and how scorecards can provide a clear financial roadmap for your business. If you've ever felt overwhelmed by the numbers game in e-commerce, this episode is your guide to mastering financial intricacies and ensuring your business thrives in the competitive e-commerce landscape.

Learn more about Matt:
linkedin.com/in/mattputra
https://eightx.co/ 

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.

To watch all Planet Amazon Podcast episodes, visit our YouTube channel.
To learn more about Phelps United, visit our website.

Transcript

Announcement: 0:00

Welcome to the Planet Amazon podcast with Adam Schafer, 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: 0:17

Hello, welcome to Planet Amazon. I'm Adam Schafer, and Planet Amazon is the place where we talk about all things Amazon and e-commerce related. Today, we have a truly special guest joining us, someone who has been instrumental in helping e-commerce businesses not just survive but thrive. Matt Putra is a seasoned fractional CFO with an incredible track record of scaling, transforming and financing small and medium-sized businesses. As a key financial strategist for e-commerce companies and agencies, he brings a wealth of expertise in financing, forecasting, cash flow management and profitability optimization. Currently serving as a fractional CFO at 8X, matt specializes in predicting business patterns, future outcomes and profitability across industries. He has worked with well-known brands like True Earth, the Tumeric and Lusum, ensuring their financial stability and growth. But that's not all. Matt is also a co-owner of, and CFO and COO of, keep Nature Wild, proving that he doesn't just advise businesses, he's actively doing it. Welcome to the show, matt Putra.

Matt Putra: 1:27

Thank you so much, Adam. It's so great to be here.

Adam Shaffer: 1:29

Okay. So first of all, before we get started into this, tell us a little bit about you and a little bit about 8X.

Matt Putra: 1:36

Sure. So I was a CFO of a private equity group a senior partner and CFO, and it was great and everything. But one day a friend and his wife called me to ask about their e-commerce business and could I help and figure some things out for them. So I worked with them for a year and I really enjoyed it. And then I worked for one of their friends and their friends and anyway that ended up being way more fun than working corporate. So I quit that, started my own agency and now I've been running ADEX for five years and since you know, at five years we've now worked with probably more than 60 brands with revenues from two to a hundred million in revenue US, uk, canada, australia, amazon, shopify, walmart, cpg, retail. So we work with a lot of people and we really drop into somebody's GPS system helping them navigate, growing, scaling, exiting, all that kind of stuff.

Adam Shaffer: 2:34

Yeah, I mean so it's awesome. So we've never really had a finance specialist on our show before. And again, I think people discount the importance of financial planning, accounting but Amazon is so, and in e-commerce, but so many transactions it's so complicated and Amazon doesn't always make it easy. There are certain platforms that try to help you with this, but there's always a charge for something. There's always things you need to be looking out for. So just the basic accounting and reconciliation side is complicated. But then the financial planning of buying inventory, how much inventory you're going to have, how do you finance that inventory and how do you ensure you're making the margins that you actually think you're making on Amazon. So, with that kind of intro into what I see people struggling with, talk to us about how you help Amazon sellers and brands navigate this and plan. You know there's a thing you call scorecards and maybe you could talk a little bit about that and then get maybe into more detail.

Matt Putra: 3:32

Sure. So I mean, I guess, if we're talking about the universe of helping an Amazon brand, you know I'm going to start at the foundation, which is good bookkeeping, and people do it a whole bunch of different ways. There's A2X. You can use Soligo to integrate with NetSuite, let's say, or A2X to QuickBooks. There's all kinds of things, but the foundational part that I believe of the Amazon bookkeeping process is there's a bi-weekly report that summarizes how much Amazon has sent you, how much they're withholding, what were the ad spend, what were the fees, what were the holdbacks. And then it's a PDF and I forget where the name is, but it's in the business reports or the transaction summary. That forms the foundation of your bookkeeping. That one thing. The reason why is this A2X will do its own thing, so legal will do its own thing, and they'll put transactions in all these different places. But that report is the is the truth, and so if you use that, you can check A2X, you can check any software and true, everything up once every two weeks, I believe they send it out. So from there, once you get your bookkeeping correct, the next thing that I think is really important is a financial plan. So again, we're building up foundation, next level, next level, so a financial plan, meaning that what do you think you're going to do in revenue this year? How much do you think you're going to spend on ads, what's your cost of goods going to be, what's your fixed cost? And then can you work all the way down to a net profit and maybe, even if you can't approximate a cash figure from there, you can go well, I'm going to invest in this part of the business or that part, but you can manage your cash flow. So that's step two, the Um, the.

Matt Putra: 5:05

The thing that I think is the cherry on top of all of this is scorecards. Um, I believe scorecards are probably one of the most important thing that people are not doing at scale today. People love dashboards, they love Looker Studio, they love Tableau, but they're not doing scorecards. And and here's what happens Dashboards are nice, they're pretty, they look great, but only the best people in your company can tell you what a dashboard is telling you about your business. So there's bar charts, there's line charts, there's all these things, but there's no flashing message saying do this or this is wrong. So only the owners and your literally best people can tell you what to do. A scorecard, for example, is going to flash two colors only red if it's okay, or green if it's okay. Sorry, red if it's not. So here's a really great example.

Matt Putra: 5:54

I work with a client and this was October last year their fulfillment center. There was a labor dispute, I believe, and so they stopped fulfilling orders. My client didn't notice for two weeks and then they noticed and they had to fly there and it took two weeks to fix it. In the meantime they short shipped Amazon and they lost $300,000 of revenue in October alone. If they'd had a scorecard and they managed fulfillment rates or shipping rates, even on-time shipping, let's say they would have seen on-time shipping drop off right in the one week that it first happened, cause it would have, you know, the target would have been 99% on-time ship.