Today, I'm excited to share a recent interview I did with Trent Dysrmid of BrightIdeas.co.
Now, Trent and I have know each other for many years since the early days of NichePursuits.com. Trent has gone from building niche sites, to running a marketing agency, to selling private label selling products on Amazon, to now wholesaling products on Amazon.
If you are not sure what wholesaling products on Amazon is, you are not alone. I honestly did not fully grasp what it was until I started chatting with Trent. In fact, during this podcast interview I had a couple of “aha” moments!
I can totally see how Amazon wholesale would be lower risk when compared to private labeling. In fact, let me give you my short explanation, but PLEASE listen to the full podcast episode because Trent does a much better job of explaining it than I do.
Amazon wholesale works similar to retail arbitrage in a way. With retail arbitrage, you might browse your local store until you find a deep discount or clearance sale on an item, then you buy as many as you can! (Once you've check that the selling price is higher on Amazon of course).
Then you just sell the items on Amazon for the higher price and you make a profit.
However, with Amazon Wholesale, you actually contact the company and make an agreement with them where they allow you to buy their products at the “wholesale” (discount) price directly from them. Then you just sell these products at the higher Amazon price and make a profit!
Bottom line is that Trent was able to take his business from 0 to $100k a month in revenue within 5 months. He expects that his Amazon wholesale business will do about $3 million in revenue this year.
If you would like to learn more about how Trent build his business so quickly, he's doing a live webinar on Wednesday right here.
Trent has put together a pretty impressive set of processes that he follows and then hands off to his employees or VA's where they can just follow his system and he doesn't have to do much of the work.
He was able to show me these processes and checklists that he has to build and grow his Amazon Wholesale business and it does appear that everything is laid out that anyone can follow.
If you would like to get access to these systems and processes to grow your own Amazon Wholesale business, please join Trent on the live training on Wednesday night.
Either way, enjoy the podcast!
Read Full Transcript:
Spencer: Hey everyone. Welcome back to the Niche Pursuits podcast. I’m your host, Spencer Haws from nichepursuits.com. I’ve got a guest with me today to talk about something a little bit different. Usually, we’re on here talking about building websites from scratch, SEO, and my guest has done a little bit of that but he’s doing something different now and I think it’s very interesting because I have a lot to learn about it. We’re going to talk about Amazon wholesaling and a whole other bunch of other things as well. I’ve got Trent Dyrsmid with me. Trent, welcome to the podcast.
Trent: Spencer, thank you very much for having me here. It’s a pleasure to be here. We’ve known each other for a really long time and thrilled to be on your show.
Spencer: Thanks for being here. We have known each other for a long time. We were just chatting briefly about that. I’m trying to figure out how long ago it was but I think it’s been seven or eight years back when you’re saying, just before maybe I created LongTailPro. We won’t dive into your entire story because we can’t talk about those seven or eight years. There’s lots of stories there but maybe you can just briefly, in one minute, tell us what were you doing seven or eight years ago and what are you doing now?
Trent: I built an offline business, an IT company, and I built that up to a few million dollars a year in revenue over—it took a long time—about seven or eight years. I sold that in 2008 and that’s when I moved to San Diego. That’s when I discovered Niche Sites and I think that’s roughly when you and I met because I was doing the niche site thing way back then. I started blogging about it and that just led me down a journey for the next four or five years.
We ended up creating a digital marketing agency because when you blog and when you do a podcast like we both do, you get people reaching out to you asking for help and eventually you just end up taking on clients. It was the pivotal thing for me was in the summer of 2016. We were running our agency, we’ve been running it for about four years and we had one really big client at that point in time. Life was pretty easy to be honest with you.
The client, shortly somewhere, in and around there, they gave notice that they were going to leave and I needed to find something new. I didn’t really want to keep going in the agency space. I interviewed this guy on my podcast by the name of Dan Meadors. At the time I interviewed Dan, I was struggling in private label because about three or four months before that, one of my other internet friends, he said, “Oh man, you got to get into this Amazon thing, it’s really awesome,” and I knew nothing about this Amazon thing. I didn’t know anything.
Spencer: We actually chatted. I remember briefly about it, about that time.
Trent: Yeah, we did. Actually, you’re right.
Spencer: I was doing some private labeling just via Skype. Here’s what I’m doing and you’re getting into it. I remember that well.
Trent: Yeah. I started in private labeling and I was in private labeling for about 4-5 months by the time I interviewed Dan. While my revenue was somewhere between $20,000 and $30,000 a month by then, I wasn’t making any money. I’ve chosen products that are too competitive and I was spending all sorts of money on pay-per-click advertising, trying to get these things to get traction, and it was really frustrating. I was really, really disheartened by it. Now this big client have given notice, it sound like, “Oh my gosh. What are we going to do? We got to figure something out.”
I actually interviewed two people during wholesale in my podcast. The first guy was this student named Eddie and Eddie lived on airplanes and lived in hotels. He’s constantly going to trade shows to find his products using the wholesale model. I thought, I really don’t want to do that. I’ve got my wife, my very young kid, I don’t really like traveling that much. I think it was Eddie who introduced me to Dan. I interviewed Dan and he was doing, I think at the time about $6 million or $7 million. He only been doing it for two years. Everything was done on email. He barely traveled. I don’t think he traveled at all. I was blown away. I was like, “Man, this wholesale thing, I’m going to do this.”
We joke about it now because when I hung up the Skype from that interview, I literally said to my wife, “We’re going to do this starting today,” and we got pretty impressive results. Within five months, we were doing over $100,000 a month. We get over $1 million in our first year and it just continued to grow. It was a life-changing decision for me to embrace the Amazon wholesale business model.
Spencer: Wow. That’s impressive that you were able to grow it so quickly. We’re going to jump into how you did that. But before we do that, because I know people are probably asking, what in the world is Amazon wholesaling?
Trent: Yup because I didn’t know what a thing either.
Spencer: I kind of know what it is but other people I have no clue with this.
Trent: All right. Let me explain the difference between private label and wholesale. In private label, most people spend hours and hours and hours doing product research using tools like Jungle Scout, trying the find the magical combination of a product niche where there’s lots of demand but not too much competition, which is virtually impossible to do. I don’t consider myself skilled at finding because the tools are so powerful, all the niches get exploited so incredibly quickly.
In my case, I picked a dog collar, one of those shock collars where they bark too much it gives them a zap. I picked up a few other things but this was my main thing. So then, you get on to Alibaba and you’re looking for manufacturers that make this thing and then you got to order samples and you’re talking to China on the Skypes in early morning or late in the evening, which I wasn’t too super stoked about because it would cut into my family time. Ultimately, based on the sample you pick your supplier, you order a couple of thousand bucks worth of your product and they ship it over to you and it's got your sticker on it.
But you don’t really have anything unique, to be honest with you. I mean, this factory’s selling the same widget to somebody else. And then you got to create your listings from scratch, and then you got to get reviews. Back then it was a lot easier to get reviews but now it’s a lot harder. You hope that you get all your research right. The whole process can take months, literally months from the time that you start looking for a product to you are actually in stock. If you get it wrong, you literally can lose all of your money because if the thing never sells or in my case have to spend so much money in pay-per-click advertising that you don’t make any money, it’s pretty frustrating.
Wholesale is not like that at all. Wholesale, you are looking for products that are already on Amazon, from a US manufacturer, they already have a sales velocity, they already have reviews, there’s all the data there to show you how well the product sells, and then you contact that US manufacturer via the phone or email, or if they happen to be in your town, show up on their door, but that’s unlikely, and you basically say, “Look, I want to become one of your authorized sellers.” A lot of the time, there won’t be enough margin or maybe they don’t want anymore sellers. In my first five months, I only needed them to say yes 2% of the time. I built systems to send a lot of emails every single week.
We got all these systems to generate all these leads because it’s really easy to do that part if you have the systems. Then you basically put your little sales hat on and say, “Look, I’m a really great third party seller, I’ll help your brand, I’ll help you do this, I’ll help you solve this problem, I’ll help you optimize your listings, I’ll help you run pay-per-click campaigns. Some of them will say, “Yeah, okay, we’re going to authorize you to be one of our sellers on Amazon.” You place an order and unlike private label, I don’t need to go and get reviews, I don’t have to create a listing, I might want to improve it a bit, but I don’t even have to do that because the product is already selling.
That’s the big, big, difference because in wholesale, it’s virtual. Let’s say you start off with a $2500 order. It’s virtually impossible to lose all your money because again, you’re buying a proven product that already sells. The worst thing that can happen is, let’s say when you looked at the product, it was $19.99 on Amazon, and you were buying it for $10 and you figured you have then enough margin, I’m going to make money. The worst thing that happens is the product goes from $19.99 to maybe to $16.50, and now you’re just breaking even, or maybe you’re losing 50 cents a unit. But that’s the worst case scenario.
Spencer: Let’s back this up just a little bit or to clarify. You find a US manufacturer that already has an Amazon listing…
I've been selling products on Amazon since 2014.
Want to know the research tool I've been using since I've started (and still use today)? Get my latest tips and how to guide for using this tool.See the Full Jungle Scout Review
Trent: They might not have created it but the listing exists or somebody at some point created that listing.
Spencer: I can see that as well. It may or may not be a listing they’ve created. That makes sense. Then they say, “Yes, we approve you to be our seller of that.” Do you end up controlling the buy button? Do you show up in other sellers? Am I getting this all wrong?
Trent: It depends. Those are great questions. Let’s just use an example. Let’s say, the Buy Box that’s currently $19.99. We assume that we need to be able to sell the product at $19.99 so that we’re going to be auto rotated for a proportionate share of the Buy Box because maybe there’s two other sellers or three other sellers and they’re all at $19.99.
If we would be the fourth seller, we look at the total sales volume, which Jungle Scout or Viral Launch will give you, and we say, “Well, we’ll get a quarter of that because there’s only four of us, we’d all have the Prime Badge, we’d all be at $19.99, so all thing being equal we’ll get roughly a quarter.” Then we just do our math calculations and is that enough? Does that make it worthwhile to carry that product or those products from that particular brand, which is just very, very simple math, and if it does, then we send them a purchase order, we place an order, and they ship it to us.
Spencer: Let’s say it is somebody that they created their listing and they are already selling on Amazon. Why would they want other people involved?
Trent: Some do and some don’t but there’s a very good reason to have more than one seller. Let’s say our largest account, when they weren’t yet doing business with us, they were the only seller of their products. But the problem is, the guy that was doing it didn’t really know what he was doing. He has a lot of other responsibilities in his job, and he had limited resources, those being expertise, time, whatever.
We come along and we say, “Look, if you will sell to us, we will take the burden of all, making sure negative product reviews are dealt with, the listings are optimized. We’ll invest some of our money in pay-per-click campaigns, we’ll just do it all. Unlike a marketing agency that would, say, “We’ll do it all and you can pay us thousands of dollars every month, we say, “We’ll do it all and we’ll make our money on selling the products. All you need to do is sell us products wholesale at a price where we can make a profit and we’ll just look after everything else.
For some brands, not for all of them, but for some brands, they think, “Hell yeah, that’s a great deal because that’s not our core business.” You got to remember, every brand is selling brick and mortar as well, and they’re selling brick and mortar a lot longer than they were selling on Amazon. Amazon might only be 10% of the brand’s total revenue, and they’ve built their company for years on expertise in manufacturing, in creating products, and finding retail distribution partners, and they’ve got that covered. But then, there’s this Amazon piece and only 10% of their sales, they don’t really know anything about it, and they don’t necessarily want to learn anything about it, and they’re like, “Yeah, maybe we can sell this stuff to you and you’ll be our partner and you’ll adhere to our map and you’ll help us. Sure. That’s a great deal.”
Spencer: This makes a lot of sense. From a company’s perspective, they’re getting somebody, ideally that is an expert at Amazon optimization, can run a pay-per-click campaign, take care of negative feedback, and optimize the listing in general that, maybe they don’t have the expertise themselves, and their only cost really isn’t a cost because they’re still probably making a profit when they sell you the product wholesale, right?
Trent: Almost definitely.
Spencer: They’re not losing money. They’re like, “Sure, you’re getting a better deal than our retail customers but we’re still making some money.”
Trent: And most manufacturers aren’t selling retail anyway, so they don’t even think in terms of retail dollars. They just think in terms of wholesale dollars. Again, case by case basis, some products we didn’t have to negotiate the price at all. Other products we did. It just depends upon how well their retail price is being maintained on Amazon because manufacturers have this thing called MAP, minimum advertised priced, and they hate it when their stuff is below MAP.
Let’s say that I make widgets. I’m ABC company and I make widgets and Walmart's one of my big accounts. Walmart is maybe 40% of my company’s total revenue so they’re a big deal. My MAP is $19.99 and Walmart has got it on the shelves for $19.99. Then because I don’t have control of Amazon, I didn’t have good policies, Amazon just kind of happened, it’s at $17.99 on Amazon or $17.50 or whatever.
That’s a big problem for me. Because Walmart is screaming at me to get Amazon under control or they’re going to stop buying from me. Now, 40% of my total company’s revenue is on the line because of the problems that are being caused by maybe 10% of my company’s revenue that is being sold on Amazon. Do you follow?
Spencer: Yeah. That makes a lot of sense.
Trent: And most brands have no idea how to identify unknown sellers and getting MAP under control and as a good third-party seller, you may have solutions to this stuff.
Spencer: You were starting to jump into how you got clients, you developed some systems to do a lot of prospecting. Can you touch on that a little bit more? That seems to be key to the whole thing. How in the world do you find manufacturers that will let you do this?
Trent: Correct. It is very key to the whole thing. When I started, I realized there are hundreds of thousands of manufacturers, maybe millions, on Amazon and I need a way to carpet-bomb because I need to generate the qualities and the quantity. I need to send out enough emails to the right companies to give myself the opportunity to get some yeses.
If you don’t have the systems that I’m about to explain, being able to send like in our case, we started off sending a hundred emails a week so that means we identify 100 new products each and every week that met our criteria, and then we get a contact information for those companies we sent them an email. That would be a lot of labor, correct? It’s a lot of work.
Trent: I realized in order to make that happen, I was going to need to make use of virtual assistants. We typically hire out to the Philippines and those people you’re paying anywhere from $2, $3, $4 an hour so the cost of labor is much, much lower, and then maybe if I use some good software tools, I could semi-automate this and maybe try to get a lot of labor out of it. That’s exactly what I did. I set out to build because the guy who I interviewed on my show, he explained to me how to do it but he didn’t explain to me how to efficiently do it because his has a training program now and the how generally comes from the training program. My mind works so much in the way I break everything down into processes and then I document those processes, and then I delegate them.
I thought to myself, well, what’s the first step? Well, the first step is you need to find products. One way of doing that is you find other third-party sellers that have these products in their inventory and that are already selling them, and then you—we use the term extract—extract all of those products from every one of those sellers and you put it into a spreadsheet. So there’s a piece of software that does that called Price Checker 2, there’s another one called, I think Tactical Arbitrage can also do that. There’s not a lot of labor per se in that portion and it's’ really kind of check the box type work, so I thought, “I’m not going to do that myself. I’m going to document a system that explains step by step by step with screenshots and check boxes and all sorts of things exactly how it’s done, and I’m just going to give that system to a virtual assistant so they can do it over and over and over and over again.
That’s the first part. Now, I got all these products in a spreadsheet. I build this spreadsheet. It had these prepopulated formulas that would be able to do the math automatically. At the end of the day, all I wanted to know if a product is a row in the spreadsheet and let’s say there was 100 rows, 100 products from one extraction, how many of those have the right math that would make sense for us to start to sell them?
I created some formulas in the spreadsheet that would calculate that. It would look at the total sales volume as estimated by Jungle Scout or Viral Launch, either one, it would look at how many current sellers were in contention for the Buy Box. That means they would be the low-price sellers or the prime badge. Let’s say there was three, let’s say it was doing $10,000 a month in sales gross or $20,000 or whatever, we’ll just say $10,000. If there’s three current sellers and we assume that we would be the fourth, all things being equal, each of us four sellers will get about $2500 each because the Amazon algorithm will just rotate it around the four of us. Unless one of us has a really crappy seller rating or whatever, our price is out to lunch but we knew what our seller rating was and we assume that we be at the right price.
Then we would just assume that we’d make a 15% or 20% profit margin on our $2500. That equated to a product that would make us maybe $300-$400 a month. We’d like to carry that one because if you can have 10 of those, now you’re making $4000 a month. If you can have 20 of those, now you’re making $8000 a month in profit. The spreadsheet would then indicate which product we should go after and then I’d have another virtual assistant then for the products that we wanted to go after, they’d go onto LinkedIn and they’d find who should we talk to, who’s the correct person, and what’s the email address.
Once we did that, then we just start sending a whole bunch of emails and we’d have a couple of different tools that we used for that. In the beginning we would just use HubSpot because we could send them one at a time, a VA could go and click send, click send, click send, click send, which is a little bit laborious. Eventually, we discovered a tool called GMass, which allows you to pretty much send them all at one time right from your Gmail account.
With these systems and virtual assistants, it became pretty darn easy to be able to send 100 or 200 emails a week. My labor wasn’t involved in really that part of it because it’s now been delegated to virtual assistants. What I had to do is, let’s say on Monday or Tuesday, whatever the day of the week you like, we got a hundred emails going out, we’re going to get replies. Those will come into my inbox. Now the work for me will begin. Now I have to look at these replies or what did they say? Did they want me to fill out a wholesale account application before I could get a price list, which is pretty common. I would then get a price list and then I’ll have to look at the top selling products. I’d have to look at the wholesale price and then I’d look at the retail price on Amazon and could I make any money on it?
I would spend a fair amount of my time each week, the bulk of my time each week looking at all the replies and just dealing with them. Sometimes, I would try and negotiate for a better price. Other times, the pricing was good enough, although I always really would try to negotiate for a better price. At the end of the day, it’s like walking around, looking for little flakes of gold. You just pick them up and put them in your pocket.
Spencer: I love it. That makes sense. Tell me if this little light bulb that just went on for me makes sense or holds true, if I’m thinking about this properly. Essentially what you’re doing here with wholesaling on Amazon really is very similar to what a lot of people call retail arbitrage in a certain regard. With retail arbitrage, what that is, is people go to their local grocery store, whatever, outlet store, whatever. They buy things that maybe are on the clearance rack for really cheap, and then they go list that as a third-party seller on Amazon. They list a price at the right time, somebody’s going to buy that, they make $5 or $10 on the item, whatever it is. For lack of a better term, you’re essentially doing the same thing. You’re just sanctioned by the manufacturer and you have a guaranteed wholesale price that you can go back to time and time again.
Trent: Yes and actually, there’s another really big difference. With retail arbitrage, which I never did, and answer is why I didn’t do it, you have to continually go to the store, scan products, buy more products, et cetera. It’s very, very laborious. Whereas, once an account says yes, it is a gravy train of cash because all I have to do every month is send them another purchase order for another order. Send me another pallet. Sold it all. Send me another pallet. I don’t have to go to the mall and wander around with my phone in my hand, thinking what deals might I find today. It’s massively different, that’s why I didn’t retail arbitrage.
Spencer: That’s why I never did retail arbitrage either. I hate shopping as it is. I’m not going to spend hours trying to make $20. It’s just not going to happen. I have a follow-up question to that. Is there a separate login for wholesaling? Or is that still literally your logging in through Amazon Seller Central and you doing that same process?
Trent: Yup. Same exact thing. And let me introduce one other idea as well. For people who are listening, to be successful in wholesale by the way we’ve explained it so far, you do need to have some money to be able to purchase the inventory. At some point, there’s a couple of really cool things that will happen. As you land more brands and get more products, you might run out of money. How do you solve that problem? This is another huge advantage of wholesale, although maybe this applies to Prime label as well. Once you’ve been selling for, I think it’s a year and you’ve been doing $10,000 a month for a year, you’ll start getting these magical little emails from Amazon lending saying, “We’d like to lend you some money.” Amazon will literally drown you in cash.
If you do it properly, every time you pay off a loan and they offer you another one, it will be bigger. The last email we got, Amazon’s like, “We’ll lend you $600,000.” You literally can’t run out of money. You pay 13.99% per year interest. For some people, they might think, “Oh my gosh, that’s so high,” but think about this. If I’m turning my inventory—right now I turn it about seven times a year—and our average ROI—I’m probably going to get a little too deep in the weed for some folks here—you make up roughly 30% ROI each time you turn your inventory, so I’m turning my inventory seven times per year, 7×30% is 210% return on my money, and I’ve only got to pay 14% for that money. How often would you like to do that?
Spencer: As many times as possible, right?
Trent: Correct. If I can give you a $1 bill and you’ll sell me a $2 bill for one dollar, how many do I want? All of them.
Spencer: Yeah, an infinite amount.
Trent: Correct and then there’s one other approach. Let’s say you find a brand. You don’t necessarily even have to buy from them. Once you got a track record, you could simply say, “You know what? I’ll run your seller central account,” if they have one and some brands do, “for a percentage of the gross sales.” Now you didn’t even have to buy the inventory but you still have all the upside.
Spencer: Wow. That’s interesting. Had you have any deals like that?
Trent: We did in the beginning and that was my very first account which I picked up at a trade show, oddly enough. And then we didn’t pursue anymore of those but now I’m actually thinking of doing that because it’s better than if the brand says, “No, we want to be the only seller on the account,” or, “We just don’t want to authorize you,” or whatever, it’s just another way of going at it, so we’re going to start putting that into our toolbox or our offering as it were.
Spencer: Yeah. That makes sense. I think we’ve given some really good examples. Maybe you can give one concrete example either of a product that you’re doing this for or a product that you know there are wholesalers doing this. Like you mentioned dog collars before. I don’t know if anybody’s doing dog collars but maybe you can walk through an example of, “Here’s the product, here’s the wholesale price, here’s what it’s selling for in Amazon,” that sort of thing.
Trent: I actually, earlier this morning, did an analysis of a really fast-growing competitor of ours. I look at all the brands that they have, and I looked at all the products. I’ll just give you an example of one of the brands. One of the brands that this company carries is Nature’s Sunshine. This company approached Nature’s Sunshine and they said the things that we’ve been talking about Nature’s Sunshine and then they worked. They don’t have an exclusive relationship, they’re not the only seller that sells Nature’s Sunshine.
Well, the brand Nature’s Sunshine sells on Amazon, according to Viral Launch, about $930,000 a month and they have many, many, many, many, many products. What do you think I’m going to do? I’m going to call Nature’s Sunshine and I’m going to say, “Hey, I want to be a seller too.” Again, most times people say no. You have to understand that. That’s why you need good systems. It’s like sales. You got to knock on enough doors, make enough phone calls, whatever. You only needed them to say yes 2%-3% of the time and you’re golden.
I did that. That’s what we do. We study our competitors and we just find brands that would appeal to us, so in the case of Nature’s Sunshine, they’ve got one product that’s called Nature’s Sunshine Nutri-Calm tablets 100 count and that sells for $28.55. According to Viral Launch, that particular bottle of pills sells $15,285 a month worth. If it’s selling for $28, I already know that I probably got to buy it for about $14, which is going to be pretty close to what the wholesale price is going to be, because usually wholesale prices are about a half of retail prices.
That particular one, if I could get my share of the Buy Box and I could make 15%-20% gross profit margin on that, would I like to carry that product? You damn right I would. I want to carry that product all day long because it’s a proven seller. That’s just one product from this brand. This brand does $950,000 a month. I’m going to try and carry as many of their products as I can.
Spencer: Absolutely. I agree. I know earlier you shared roughly how much you guys are making? I think you said you hit a million dollars in your first year or just last year.
Trent: We did first year.
Spencer: Okay, what are you on track to do this year? Do you know?
Trent: Yup, I do. We will do probably $3 million-ish this year.
Spencer: And that’s in revenue right?
Spencer: 15%-20% of that will be your net.
Trent: Correct. Now I’ve got expenses because I’ve built a team and I have an office and these things but you don’t have to have all that stuff in the beginning. When I started, it took me five months to go from $0 to $100,000 a month. At that point in time, it was me, I wasn’t working out of my house but I could’ve. It was me and a part-time prep person so you would only use them when you needed them. It was three or four VAs, $2 or $3 an hour each, and a little bit of my wife’s time. That was it. Our margins weren’t as good back then as they are now because I wasn’t as good as picking brands, I wasn’t as good at negotiating, and we were running off of, I think about 12% or 13% margin, so that’s $12,000 or $13,000 a month of profit to pay me, to pay a little bit of my wife’s time, and to pay for some VAs and some software. It was more than enough.
One of the guys I’ve had on my show, he does about $200,000 a month, and he didn’t even quit his job, he works for the bank as well and probably the same bank you used to work at, actually. He’s built that business just part-time. Now I would say that his name is Josh. I would say he’s probably the exception, he’s a particularly driven individual, he’s particularly bright, and he’s using the systems that I’ve developed. I’ll take the smallest amount of credit in that equation. He’s particularly driven, and he’s particularly bright, and that’s why he’s been successful. But he’s built a multi-million dollar Amazon wholesale business without even quitting his job at the bank.
Spencer: Wow, that’s impressive, and I can see that because I know I am doing Amazon Private Label right now and there are a lot of ways it can be very hands-off. You can be as hands-on or as hands-off as you want to be because Amazon makes it so easy, don’t they?
Spencer: You ship in your product, they handle the rest, right?
Trent: That’s it.
Spencer: Once it’s there…
Trent: There’s no fulfillment, there’s no pick-pack-ship, you just send it to them. Put some stickers on it and send it to them. Hell, you don’t even have to put the stickers on. You can pay Amazon to put the stickers on if you want to.
Spencer: Exactly. There really are a lot of ways to make it really hands-off. You’ve talks a little bit about your processes and procedures and how that works so well for you. Do you just have those procedures set up for finding or prospecting? Or do you have processes for everything, beginning to end?
Trent: Everything. Absolutely everything. I’m just going to pull up my little table of contents on my processes here. Just give me a second. Product sourcing in the beginning is the most important part because if you don’t have products to sell, then nothing else matters. But as soon as you start to get products to sell, you’re going to have other things you need to have processes for. You’re going to need to have processes for your Amazon PPC campaigns. You’re going to need to have processes for inventory management. You’re going to need processes for product listing optimization. You’re going to need processes for product prep. You’re going to need processes for product pricing management, for purchasing, for handling reviews, for shipping, for supply or relations, for HR, for finance.
When you become successful at this, you end up having a business and you’re going to probably hire some people, and you can’t do it all yourself. It’s highly ineffective. You need to build business processes. That’s what we did and that’s why the other thing that was really cool with my Amazon wholesale businesses, I was actually able to delegate myself completely out of the job within the first year. I don’t even work there anymore. Now, I’m temporarily working there again now because one of my employees left and I’m filling in his role until I find another employee or two. Then I’m going to fire myself again and it goes back to it for me. I’m like, my wife works in it but for me, it’s purely passive income because I was just insanely obsessed with documenting everything.
Spencer: And I know that we chatted previously that you are making these processes, these procedures available to other people, if they want them, if they’re interested in doing Amazon wholesale. Maybe you can talk about that, how other people are able to use those and the platform that you built there.
Trent: That was a very happy accident. The back story in that is, I built all these processes because we simply needed them. You can’t do a million dollars a year without the whole thing going kablooey unless you have processes to keep the wheels on. The guy that I interviewed on my podcast, Dan Meadors, he does sell a training course. It’s called The Wholesale Formula and it gets launched, I think twice a year where he teaches people how to do this. Dan calls me up one day. He says, “Hey, we’re going to do a live event for our students so they can all get together, network and learn, do all the good things that you want to do.” He says, “You’ve been really crazy successful. Would you like to come and speak and explain to people what you did to be so successful so fast?” I said, “Yeah, that sounds fun. I’ll do that.”
He paid for my plane ticket to get there and I was on the panel on the first day. His audience, they kind of had gotten to know me because I produce a lot of videos for free and I got my podcast that was free, so people kind of knew me and once I was on this panel, I answered a lot of questions from the audience and there was a lot of interest for the talk that I was going to give the next day. My talk was—I took an hour—I explained how I used all these systems to grow this million dollar Amazon business in the first year, with the particular focus on how we sourced products. At the beginning of it, I said, “Hey, everybody, I got nothing for sale, take good notes.” It’s a relatively complex process to build all this. If your brain works like mine does, you’ll figure it out but it’s a lot to take in in an hour. I think if I was sitting in the audience and I’ve never done it before, there’s no way I could have take that in within an hour. There’s just too much detail and as the speaker I can only go so deep into the wheat.
At the end of that talk, you got the microphones in the aisles, people are coming up the microphones and more or less, everybody’s asking me the same thing, “Hey Trent, would you sell me a copy of your standard operating procedures s what we call them, and I was like, “Um, I don’t know. I guess I’ll have to think about that.” I went back to the office and I got home from the trip and talked to my wife about it, and then I talked to Dan about it, and I said, “Yeah, I guess we could see if this work. I mean, really just because some people came up to the microphone doesn’t mean it’s going to sell very well.
So I came up with a name called Wholesale eCommerce Business Systems, WEBS is the acronym, and we just basically took all of our systems that we built, and back then—this was about a year ago—I think we had about 55 or 56 standard operating procedures in all the categories that we talked about a few minutes ago. We just made a copy of them and found somebody else’s software application, and we put all of our content, all of our standard operating procedures into this other software application which was designed for that purpose, and we offered it for sale. And holy cow, we sold a million dollars worth in the first six months. I was blown away. Absolutely blow away.
Spencer: That’s huge.
Trent: Yeah. It was another life-changing moment.
Spencer: I’m sure it was.
Trent: We’ve continued to evolve it now the number of SOPs, I don’t know, maybe it’s 70 or 80. I don’t know what it is. Now, it’s a product other people use. We’ve worked really, really hard on making it as straightforward as we can, have as much detail as we can, instructions and so forth, and there’s people who’ve given us testimonials that literally changed their lives. A perfect example is, I mentioned Josh earlier, the banker guy. He uses it. There’s another guy, Nate. He was in my podcast. He was struggling and then he bought it and he doubled his business in three months. And then there was this other couple, Kit and April, who were doing retail arbitrage and they didn’t see a great future for that, so they wanted to succeed in wholesale but they weren’t succeeding until they bought WEBS, and then it was just a game changer for them.
The thing for people to understand is the WEBS isn’t a training course per se. Most times when you buy a training course, you get access to the members’ area and there’s all these videos that you watch, and then you have to take a bunch of notes or maybe you get your VA to watch a video or whatever, but it’s just videos. This is not that. This is actual software that has standard operating procedures in the software so that for a given task that needs to be done over and over and over again, you simply take that particular SOP and you assign it to one of your VAs. It’s so detailed that you don’t need to make a training video on how to do the thing because the thing is explained in excruciating detail, step by step by step with words and check boxes and pictures and so forth, right within the standard operating procedure.
With the training course, I’ve watched 10 hours of video but now what do I do? With this, it’s like a menu. You go into a restaurant. You say, “Well, I feel like having a hamburger,” so you go to the hamburger section and you order a hamburger. It arrives at your table and there’s your hamburger. In this regard, if you’re sourcing products, you go to the products sourcing folder. The first step of sourcing products is product extractions so you look at the products extractions checklist. You can do it yourself but why would you when you can hire a VA for $2 an hour and they can do it?
Spencer: So all of the how tos are already directly in the platform itself. It’s just a matter of assigning that procedure.
Spencer: Whether you send it to yourself or a VA or other employees. You don’t have to teach them how. They will know how by following the steps.
Trent: Correct. Think of it in another way. You can start your burger joint from scratch or you can buy from McDonald’s. What do you get when you buy at McDonald’s? You get all sorts of marketing support, blah, blah, blah, but the main thing you get is standard operating procedures for how to do everything in that restaurant. McDonald’s don’t want their franchisees reinventing the wheel on anything, or Subway, or whoever. They say, “This is the way that we figured out that it works.” That is exactly what WEBS is. This is the way that we figured out how it works. Just do it this way. Now if you want to edit it? Click the edit button. If you want to make changes, totally you can do that but you don’t need to.
Spencer: Right. So it’s almost like they’re getting a franchise from Trent here in a way, right?
Spencer: Except they don’t pay you any royalties.
Trent: No royalties. They just buy it for a one-time fee.
Spencer: One-time fee upfront and then they use it.
Trent: I should quantify. They do have to pay user fees for the software but that’s not a percentage of their sales. It’s like $10 or $15 a month per user.
Spencer: Very cool. That makes a lot of sense, actually, the way you describe that. You could take a training course and get all the how to videos but then you would have to write your own standard operating procedures if you don’t want to do it yourself. Or you could just get the WEBS platform. It’s already got everything built in and you’re ready to go.
Trent: That is precisely correct. When we hire a new VA, we don’t go through a training and orientation period. As a matter of fact, it even affects the way we hire. We don’t even do interviews. When we need a new VA, we simply put a posting on onlinejobs.ph or Upwork or whatever and we literally will take five of them who look the best on paper and we’ll just assign them one of our standard operating procedures. They’re going to do the thing that we’re hiring them for, and then out of those five, whoever did the thing that most accurately in the shortest amount of time, that’s who we just hire.
Spencer: That’s cool.
Trent: It makes hiring VAs a whole lot easier as well. And if you have turnover, no problem. If you have great systems, your business is not going to be singularly dependent upon a particular individual because you’re not relying on their memory. You’re not relying on their experience. Sure that’s an added bonus and they’ll accumulate experience over time but ideally, what they are doing with that experience is they’re using it to improve the checklist, to improve the standard operating procedure, which is what we do on our own business. We continually are iterating and improving when we change a piece of software. We make the changes and then we push those changes out to our customers.
Spencer: If people want to get access to WEBS, I know you actually don’t have this open all the time. You just do certain times of the year, you open it. I guess you tell me how often do you open the doors for this?
Trent: So far, it’s only been for sale twice per year. It’s generally the spring and the fall. And because WEBS now consists of some 70 odd checklists, there’s lots of ways I guess we could slice it up in the future but the current plan is to continue with what we’ve been doing and only make it available twice per year, once in the spring and once in the fall.
Spencer: That makes sense. That is of course coming up here. You’re going to be opening the doors here real quick and you’re going to be doing, I believe you said some light training as part of that?
Trent: Yeah. We do a webinar at the very beginning because a webinar is visual, this is just audio. I go into my products sourcing formula in even more detail and with the ability to show screen shots and so forth in a webinar, people have found that quite helpful. Once you register for the webinar, you’ll get the emails afterwards that show more pieces of free content and so forth. And at some point in time, I think it’s about a week after the webinar, the card opens and then for people who’ve seen enough and decided, “Hey this is for me,” they can go ahead and buy it.
After they buy it, there’s even more training that we put. There’s more training videos, there’s webinars that we do, take to answer questions, we have a Facebook, and we try and do as the best we can to make sure that people get all their questions answered after they purchase so that they understand how to use it and so forth. Being this is our third product launch, we’ve had the benefit of having the feedback from customers from the first two, to refine WEBS and so forth. I think this is going to be our best one yet.
Spencer: Awesome. We’ll set up a page where people can go to. If you’re listening in on the podcast here, you can go to nichepursuits.com/webs and after the fact here I’ll make sure that goes to that live training so you can watch the webinar or get more information about what WEBS is all about. If you want to check that out and get started doing Amazon wholesaling.
Trent, it’s been great having you on the podcast. Is there anything else that I’ve missed that you’d like to discuss or bring up?
Trent: No. I think we covered it. We covered the difference in wholesaling and private label and my story and so forth. The only thing I would say is, like every business on planet earth, being successful at this business requires that you work, you have to put in the time, and requires that you develop skills, communication skills are the most important thing, because at the end of the day, your success will be the by-product of your ability to effectively build relationships with these brands so you can buy their products. If you’re someone who doesn’t like talking to people, this probably isn’t for you.
Spencer: It’s good to know. I think Amazon wholesaling is pretty cool. I think I had a couple of lightbulb moments here just discussing it with you. I kind of understood what it was but I think it’s crystal clear now, at least for me. Hopefully, people listening in understand what Amazon wholesaling is all about. There’s still a lot of opportunity here in 2018. I’m sure 2019 and beyond, there’s still plenty of opportunity. If people want to follow along with you in particular, where is the best place that they should go?
Trent: Just go to my blog, brightideas.co or they can google my name. I’m the only Trent Dyrsmid on planet earth so it’s pretty easy to find me on the googles.
Spencer: It’s hard for you to hide.
Spencer: Very good. brightideas.co if you want to follow along with Trent and what he’s doing, his podcast and blog there or if you want to learn more about his standard operating procedures for Amazon wholesaling, you go to nichepursuits.com/webs. Thanks a lot, Trent, it’s been a pleasure.
Trent: Thank you very much for having me on the show, Spencer.
Spencer: All right. Thanks a lot.