Pivot into Success - Amazon Seller Tips with Matt Shaw - Part 1

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Things we discussed in this session:

A. Part 1

B. Part 2

Things we mention in this session of Seller Round Table:

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Transcription in this episode:
[00:00:00] : Welcome to the seller roundtable e commerce coaching and business strategies with and er not and amy Wiis, Hey everyone what's going on? We are live right now with the seller roundtable podcast and I'm here with my friend Matt shaw and you guys, you're going to want to join us in the zoom for this or catch this live because I started talking to Matt a couple of weeks ago, he had this incredible story about, well first I thought I was just talking to this guy who was running a three pl and I'm like, oh man, another one, okay, you know, but matt has not only run a three pl, he has been a seller, he has done so many things and like a lot of us during this pandemic, he has had to completely pivot and he's done it with class and has really pulled it off. So I know that everyone is going to learn a lot from matt story today and I hope that you guys will join us here in the podcast because it's gonna be awesome. Welcome Mat, thank you amy. Thank you so much. This is exciting and I appreciate amazing at home and yourself for having us on uh looking to you know share our experiences. Um some of the things we've learned in my organization over the years and hopefully help others in their journey. Awesome. Well I'm going to hit the recording button for the show and we'll get right into it. Oh you know what, I have to check, I didn't even check what today's episode number was. So before I hit the recording button I'm going to pull it up and look at what our episode number is. We are episode # 113 today. Okay, got it. I can't believe we recorded 113 episodes. It's insane. So all right, here I go. I'm gonna hit the record button. All right. Hey, what's up Everyone? I am amy weeks and and er not is out today. We miss him. But we are here for episode number 113 of the seller roundtable podcast and we're here with special guest matt shaw. And you guys are just gonna love matt story today. Welcome Mat, thank you. Thank you and me so much. Well, you know, as I was talking about on the live before we hit the recording button, I talked to you, we had a meeting a few weeks ago and we were just talking about your three pl and you know, we got on a zoom call to kind of, I like to vet all of the providers that I recommend across the board. And so we get on this call and I started asking you about yourself and you tell me this just incredible story. And I was so impressed at all of the things that you have done and how you've actually pivoted into three pl out of kind of necessity during Covid and in order to serve others. And it's just such a cool story. So I mean we usually start a podcast just getting an understanding of your background and who you are and all of that. So why don't you tell us a little bit more about you? You, you can provide as much or as little information as you like, but give us a little background, Tell us a little bit more of your story. Great, well thank you. So it's a wild story because I really started out in marketing and sales and I was selling coupon books and I was working with you know, school systems and that would sell the books and then the restaurants were in those and I kind of parlayed that into starting to sell baby products for a company here in north Carolina. I'm in Raleigh by the way. And the interesting thing about that is I kind of got into this whole new industry um and it really expanded my sales territory at the time to covering the United States when I had been covering two or three counties before. So it was a big step, a learning opportunity. And kind of as I got into that road, I started learning a lot more about amazon and working with some different companies that were, you know, at the time very involved in the amazon and the FDA side of things and all of that was developing and growing and so um I kind of transition through a few companies and you know, I'm working as a sales rep one day and I'm, I'm sitting there and I'm, I'm thinking, you know, I want to, I want to be my own boss and my boss's, you know, making all this money and I'm over here working hard and it's like, how do I provide and create my own future? And uh the interesting thing is I was browsing on facebook and I said, I want to get paid to do this, right? So I kind of taught with a company that I knew who I had been selling products to that would sell them on amazon and I started bringing in some baby brands to be managed. So I kind of contracted into that company and that company was called jollity. Uh and I started, you know, repping these brands bringing them in and helping develop uh you know, their products and their presentation on amazon. And then, you know, we were doing some really exciting things because you know, the a plus descriptions all of that was not even existent yet, you know, videos on listings was not around. And so all these things we were learning how to do before they were even something that people are able to utilize within amazon. So I learned so much from this opportunity and kind of grew and grew and was there for a number of years and then kind of transitioned into doing some warehousing Kind of the three pl side of things and really managing amazon returns. But a lot of people here that are involved, no, especially yourself how complex and time consuming it can be dealing with those returns. So we were, I think we had a client that was a very large volume in the baby industry and we calculated if we got a warehouse, we could save so much funny by managing all the returns ourselves. And so it kind of, it went into that and then fast forward a few years and I went out on my own and was doing my own amazon um F. B. A. Business. And then kind of at the same time still running the warehouse. And then Covid comes along and one of my largest customers at the time was wobble stool brand. And all the elementary schools stopped order it. So there we were um you know early I guess it was probably what's happening as early as february when everything was getting a little a little dicey. Um and you were selling you were selling millions of dollars in these wobble stools, right? And these elementary schools all shut down due to Covid. And so now your whole business besides the warehouse, your whole business was basically like, okay, what do I do now? You know, because it wasn't like you were going to sell a bunch of wobble stools on amazon, You know, that's not necessarily like people were looking for those outside of the elementary schools. Right? Well, a lot of the amazon business was was the elementary schools and they were the business fires. And so what was happening is that just stopped? So, you know, a large percentage of the business was those business fires and it just went away. Uh, it really slowed down and it kind of came back in a resurgence when the whole go back to school at home. Thing happened. But instead of it being large schools ordering, it was a whole bunch of small orders. And so there was this huge kind of transition period there that was happening. And, you know, that brand, you know, was was really affected by it and they had to kind of go off and start doing their own strategy and you know, we were kind of left, you know here at my company saying, okay, what is our next step? How are we going to keep the lights on? Right. So um I had another contact who interestingly enough sold a lot of consumable type products, think linen like napkins and straws and cleaners, degree Sirs, even toilet paper. And so all of a sudden we started selling all these items that were in high demand on amazon because a we were established, we knew how to how to make things work in the channel. Um We were perfectly positioned to uh you know, all of a sudden amazon said sorry, can't send any more inventory unless it's an essential item in the F. B. A. But we had a warehouse so we all of a sudden we're drop shipping like crazy. And it really was just a wild year because I would have months where we would do insane numbers selling a micro band, you know, aerosol um you know disinfected. So all of these wild things happened and we kind of got to today where we've transitioned more and more into doing a lot of the three pl side of the business for amazon dealers that since Covid have said, hey, I have to streamline my inventory flow, I can't hold as much stock at amazon. I have to be very careful with my shipment creation and amazon is constantly adjust, adjusting that metric so you have to stay on top of it. So we have, we have kind of switched gears and we we moved that direction and we have all kinds of wild things going on. It's been exciting. That's crazy. So you've always, you haven't been a private label seller per say, You've always kind of done sales for other major brands or for big companies, which allowed you to pivot into many different types of products to go from your wobble stools to toilet paper and anything else that that could could you could sell. But what was great was you having a warehouse allowed you to during the time when everybody else in private label was kind of frozen, you were able to fulfill whatever you needed to fulfill and faster than Amazon was able to fulfill it. We also took that opportunity during amazon because we, during the pandemic and when amazon was not delivering, because we had our own warehouse, we just swapped over to merchant fulfilled. And we had so many sales during that time, because people were just looking they didn't even care if it was a merchant fulfilled back then. They were just looking for something that was delivered on time that wasn't going to be delivered three months down the road. So you know it was crazy. Sorry It's very interesting you say that I've always from when I first started on amazon Ben, a fan of having a merchant listing and an F. B. A. Listing for a product in case you do have, you know you run low on inventory or um you know for the amazon all of a sudden takes you know three months to receive a palette that happens and you know having a contingency plan in place for that is that backstop of inventory somewhere and or the ability to get more shipments out. And when you when you run a large amount of inventory on L. T. L. On pallets sometimes a palette will get stuck somewhere and you're waiting and you look at your sellable inventory go down and all of a sudden you're like oh no what are we gonna do? And you also you can't send in more inventory either. That's what happened to us is you know somebody posted in our group the other day and talked about how Amazon lost an entire shipment like 30,000 products or something and then somebody else commented and said Oh you know Amazon lost my stuff too and I'm in the same situation and they can't send in more because they're they're brief stock limits are reached because that shipment still shows that it's being checked in or whatever it hasn't checked in yet. And so they get stuck and if they had a way to merchant fulfill they could continue selling. Even if that merchant fulfilled option is less numbers than your FDA numbers would be. It's still a really, really great option. So I'm also a big fan of merchant fulfilled. So you know, you have so much experience, I'm definitely, definitely going to pick your brain on the amazon side because I think there's so much that people want to know. And so tell me about amazon returns, You mentioned amazon returns and how you were processing amazon returns. We also do some processing of amazon returns. It's a very concierge service, but tell me why people should process their own returns or if they can or hire someone to process the returns and what kind of things you discovered in processing returns, wow! So I have, I've been involved in returns from times where they show up in my apartment at the time and I have a stack of boxes to go through. and then, you know as we got into having a warehouse, we had a little bit more of a streamlined organizational process in place. But you see so many things from amazon sending back a totally different product, you know and and this guy that I worked for always joke that I'm waiting for the diamond ring to show up, you know because you know amazon will scan something with a bar code and it can be blue bar code says red does not matter. And so the trick is, how do you work through that and understand that you're going to get inventory returns, there's going to be damaged packaging and you need a process for it. You need to be able to quarantine Ebay for used items, some categories you can be used on amazon most that I've sold in didn't even have the ability. So you know, I haven't been as involved with that, but I think, you know minimizing the loss of the wholesale dollars from whatever that batch of inventory is. Um And then seeing if you can work out credits with manufacturers or return rates, um You know, some clients will have a return rate built in and then if they kind of are able to reuse some of the returned inventory and get it sellable again, then they win. And so there's a sweet spot for the price point. So if it's very cheap items, sometimes it's not even worth it. Um And I tend to say that things over $20 make more sense. Um And then of course if it's you know, 50 $100 high value item like that, you don't want to just lose all this wholesale dollars in that inventory, whether it's disposed or, I mean even if you're donating it, some companies can't even write off donations based on their tax status. So it's like, what are they supposed to do? So um they say it takes a village because you need a team to, you know, go through those items and open up the boxes and determine what the issue was. And then there's companies you can bring in as well that will help you when amazon makes a mistake And sends back three items when they were supposed to send four. Um You can have someone do the case and the creation and all that and they take a small percentage, but you get most of that money back when amazon makes the mistake. So yeah, I mean since we started, we've always processed our own returns and that I tell people the same thing basically I had a client called this morning and I was explaining, they said well you know should we process returns? Like what should we do with our returns? Can we trust amazon? The first question was can we trust amazon to take that return and put it back into the sellable pile if it's truly sellable or put it in the damaged and get rid of pile if it's truly damaged. And I said absolutely not, you cannot trust amazon because we get all of our returns back and we've gotten them back for years. And like you said matt, sometimes you get a completely different product. They're not checking this at all. The tag inside of that return says that it's damaged or whatever. And it's not it's either never been opened at the percentage of Customer damaged or damaged marked products that have never been opened. That our return is incredibly high. I would say like 90% of the stuff that we get back says it's damaged, but it's never been opened and you can get reimbursed for that. So if you like you mentioned if it's over $20 product and you could get reimbursed for that and that's a 90% ratio of, you know of what is marked damage, but there's really nothing wrong with it. And Amazon is not taking the time to actually open it and look at it. They say that they do, but they don't and there's just no way. I mean, I do agree with me there. There's just no way they're actually opening them because of when you process your own returns, you see that, you know it's completely wrong. Right, yep. It's funny you say that there is a amazon fulfillment center near where we're, where we're located here in Raleigh and I have literally considered going to get a job there just to get on the floor just to be like, all right, this is what it's like, okay, now I know now I, now I see it and um but the problem is they'll probably want to have any managing a bunch of people and then it'll, the cat will be out of the bag and so yeah, I know, I've also just thought, you know, I would love to hear, you know, whether or not I would love to see that, you know, whether or not amazon is actually doing anything with these things, you know, that would be so helpful to know. So, yeah, okay, so returns along the line of returns, you guys, if you have a way to process your returns or you can find a three pl or someone to process your returns for you at a minimum, Do that in the beginning when you're first selling a product. Because you will learn so much about the way that your products are handled, the way that they're marked and a lot of customers, I don't know. There's a lot of sellers that don't even shop on amazon or they don't shop on amazon us. And so they don't realize that the reason that customers market product damage so that they don't have to pay a return fee so they want to return a product. They'll just market damage because you get these options of different radio icons that you can select when you go to return a product. And if you select that you know it's damaged then amazon is like oh it's good no return fee for you, Go ahead and send it back. And that's why there's such a high percentage. But if you do have a product that you know like that where you're getting a lot of returns, you definitely want to check them out or or do that right. Um Did I miss anything there on returns? Thanks. So okay, so my next question for you, you mentioned that a huge amount of your buyers when you were selling wobble stools were business buyers. So tell me about your business buyers set up on amazon. What is what are the ways that people should set up for business buyers? And and what are the benefits to using? Were you discounting for business buyers? Were you discounting in bulk quantities? Give us some tips about using the business by our option. So with with the business buyers there's a whole another extra set of metrics you can look at within your account. That will help you kind of see how much your business is going to the business fires and anyone that is looking at their order history, there's a little icon or tag that shows up and says it's a business fire. Uh, and I love to look at those and say, who's the business? Like if it's a paper towel dispenser something, who's buying this or if it's one of my private labels products, I'm interested to know what category it is. And sometimes you'll see that it's a car dealership and you're like, oh I don't even think about that. And so you see angles there. So just decide to, but for the business buyers you kind of have to prices, right? So you have your sales price and you have your business fire price. And this can be the same. But if someone has a business account when they're logging in, they're going to see the business price. So the everyday buy on amazon isn't going to see that unless they're logged into that account, unless that's changed. My understanding is that and then you also have the ability to do the quantity discounts as well as you can set up the percentages or a flat dollar amount off, you know, five units, 10 units, 100 units. And there are, I think there's one new category option where it's like bulk, where you can literally set up pallet quantities of stuff. So I think paper towels on large, large quantities like that you can set up. And the benefit is amazon is going after the business by our big time. And what's happening is they're saying, hey, we want to compete with these other big box stores that are doing tons of B two B. Business. And in that you're able to capture a new kind of demographic of buyers um that are out there, logging into their business account and they're looking for lots of consumable items. So if you're thinking we sell um I don't know, paperclips, we'll use that as an example. You know, offices are going through those like crazy. Well if you have a really cool paperclip and you want to get it out there, having a business price point in a quantity price within the business buying side is going to give you an advantage because you're going to show up, you're going to be more competitive. Uh And I think it is definitely something that every listing on amazon should have. I don't sell any products that don't have a business price. Um And if I'm doing any discounting or uh you know, quantity price breaks, all of that is run through the business buying side. So that's a really smart thing that people can do is just check their metrics number one and number two, make sure that they have some kind of business by or discount set up because what do you have to lose? Exactly, yeah, there's no additional costs. You're simply reaching out to a whole new group of IRS. I love that. And if you're offering a business by or discount people see that and they go, oh well, you know, if I can log in with my business account and get a slight discount on this, it's the same thing we all do, you know when we go to buy something, if we can use it for our business, we go and look and see, oh well can I get this wholesale or can I, you know, save money on this. Um So what a wonderful opportunity. I love that you have experience with that because that's something that people ask about. You know, what is, what is this business buyer thing and how do I work it? Right. Something I love about it is we buy a whole lot of four by six labels for the thermal printing for all the shipments and I buy those on amazon. So I go in and I look at, you know what brands that I like the best as we've got three or four and then it's where's the quantity break? And how do I want to cash flow and I want to buy a whole lot of them Or I'm going to try out this new brand. They have a really good price for, you know, for 4000 versus 1000. So maybe I'll do that and it just helps and the, you know, as the seller in that side, you're probably going to have a much better margin positioning with that higher volume. Yeah, I think it's, it's super smart to do that and you really, you can't lose at all. That's very, it's a smart way to do it. I love it. And you know I also when I was a reseller, I bought so many supplies on amazon because you could really get better discounts and I think the more that people aren't going out to Costco and Sam's Club, you even see nowadays you can't get a lot of the supplies when you go to Costco and SAM's Club in such, you can't get a lot of those supplies even in store anymore, you have to get them online. So if you can buy them on amazon in bulk for cheaper or with a better selection, you're going to make those decisions every time. So it's it's really awesome. It's an awesome opportunity. And even if you don't think that your product would be used by business buyers, like I have clients that sell gift products and stuff like that and businesses by them. So you wouldn't, you be surprised even if you don't think that your product will be sold to a business um that it will be right. Very true. Thanks for tuning in to part one of this episode, join us every Tuesday at one PM pacific standard time for live Q. And A. And bonus content after the recording at cellar Roundtable dot com, sponsored by the ultimate software tool for amazon sales and growth seller S C. O dot com and amazing at home dot com.