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Today, I'm excited to bring you and interview I did with Greg Mercer of JungleScout.com. Greg is someone that I have been following along with almost since I got started selling on Amazon myself just 1 short year ago.
When I first got started selling on Amazon, the way I learned was either by interviewing others on my podcast, or listening and reading interviews conducted by other podcasters. I don't remember the first place that I ran across Greg's interview, but as soon as I heard it, it was clear that Greg was a real expert in selling on Amazon.
How expert? Well, he regularly does over $400k per month in Amazon sales and did over $500k in December 2015!
In addition, Greg has taken those skills for finding great products to sell and leverage that into an AWESOME product finding tool called Jungle Scout. I personally use Jungle Scout all the time to analyze listings and find those hidden gems on Amazon. (See my Jungle Scout Review here).
Greg is offering a 10% discount on Jungle Scout to the Niche Pursuits audience right here.
So, in today's podcast, I'm excited to share the discussion that Greg and I have for how he built his Amazon business, as well as his software business.
A Brief Summary of the Podcast Interview
During the interview we cover lots of great tips; especially, for those who are looking to find and launch a product using Amazon FBA.
Here's a few of the questions that I asked Greg in the podcast:
- What were you doing before you ever started selling physical products on Amazon?
- When and Why did you start selling products on Amazon?
- What kind of success are you having right now with your Amazon business? (Sales, profits, anything you are willing to share).
- How Many Products total do you have?
- Do you sell any of your products outside of Amazon?
- Let’s talk briefly about your Jungle Stix case study. Can you tell everyone what that is all about?
- What is the revenue from that product last month?
- Okay, now is time for some of the golden questions that people want to hear. How do you go about picking a winning product?
- What metrics should we be looking at?
- Reviews, revenue, number of competitors?
- How do you promote your product once its live?
- I have a couple products that are not performing that well. How do you jumpstart sales for a product that isn’t doing that great?
- Now let’s talk about the Jungle Scout business. I personally use Jungle Scout a lot when I research for product ideas…Why did you start this business?
- Are you willing to share the success of the Jungle Scout business?
- I’m always blown away by the data that you guys are able to gather and display…such as the revenue numbers. Where are you getting the revenue numbers from?
- What time frame are the revenue numbers displaying? (Past month, week, etc).
- I have noticed a couple of times that one day the revenue will be one number and then the next it could be half that number…why does this happen?
- How can we avoid making a decision on these fluid numbers?
- How can people get a discount on Jungle Scout?
- Anything that we didn’t cover for building a business on Amazon that you feel like we should cover?
Wrapping Up
Overall, this is one interview that you do NOT want to miss if you are currently selling or looking to start selling on Amazon. Greg has been around the block and really knows what he is doing.
If you feel like this interview wasn't quite enough, I highly recommend that you check out the public case study that Greg has been conducting right here.
In addition, if you are looking for a great software tool to help you find products to sell through Amazon, I highly recommend that you check out Jungle Scout right here. That link will get you 10% off the regular price.
I hope you enjoy the interview!
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19 Comments
Conversation
Hi
Greg, amazing your result I hope can hit the same numbers…. I m new in amazon fba, and I selected a bad product for start…. bad because the competition is hard but not sure about if I must push it or select other product less competitive
The tops make biggers numbers : around 80k-100k and both have 1000 Reviews, my first goal is can hit some of smallers with 200-500 reviews (actually my product have 100 reviews and only 1 month and I hope can hit 300 for the next )
In some keywords I m on page one but stuck in the last position and I dont know how can improve it…. in ppc that keywords dont have much “volume of traffic”
So not sure … I have around 1300 units in inventory and 10k for invest any advice?
Hey Marc, this is tough. It sounds like you’ve already maxed out the PPC so about the only thing you could do here inside of Amazon is more giveaways. To be honest with you, if it was me and I was on the last spot of the first page with 100 reviews, I would probably start looking for another product instead of pumping money into this one. This time around, I would look for something with a lot less competition. Just my $0.02
Thanks Greg for your tips , I see others product in my niche and one that the top 1 with 100 reviews make around 10k-20k per month and the others only have 20 or 15 reviews…. So i think that is good idea ..
However what can i do with that product and the units ? Put a low price ? (and recover the cost and a little profit ? have patience and get more review with time and focus in that second that is more easy ?
Thanks again for your tips is good have help of a expert 🙂
Just to clarify, Amazon will allow you to have multiple seller central accounts but you absolutely must get permission beforehand. We got permission for our second one last year after a number of requests. There’s a few magic words you must use 🙂
Which are those magic words David? Surely not Abracadabra 🙂
Thanks for the clarification, David…good to know!
I have a question for you Greg 🙂
I just received your list of 400 product ideas. However i don´t quite understand the process yet.
For example, i discovered this product in the list: B0001XDU2Q
So now, i´ve found a product. Shall i then find a supplier, which sell that product. Then buy it and receive it. And then send it to Amazon FBA?
Greg & Spencer…fantastic interview. Thanks for sharing so much valuable info. I’ve been using Junglescout (extension) for a while now and LOVE it.
Question for you both: I’ve found a product that has strong demand, incredible depth, a long-term positive search trend, 3 of the top 10 sellers have under 200 reviews, and 4 of the top 10 have 3.5 stars or worse. The only “glitch” is that its about 2-3 feet long. (but only 2-3 lbs and not breakable). Would you do it?
I can’t speak for Greg, but for me personally…I’m totally fine selling oversized items. It comes down to whether it’s still profitable in terms of Amazon fees, shipping fees, etc. If the money is still there and you feel like you can compete, go for it.
Best of both worlds having Greg and Spencer together in a call! JS user since mid 2015 here 🙂
Couple of questions guys if you don’t mind me asking:
1 – Do you recommend getting an LLC even if you’re not a US resident? What about the liability insurance?
I’ve just started with 2 products in FBA as a sole propietor and I am not from USA…What’d you recommend? Are there any companies you would recommend for getting the liability insurance and which are the related costs? I am planning to expand and have at least 5 products by mid 2016.
Could you expand a bit more on how the LLC works if someone sues you. Is there a way to avoid being sued by customers? I mean…I guess that if you are creating products that are not dangerous it wouldn’t really make sense to a judge…like you mentioned “she got hit in the eye with the marshmallow stick”…not your fault mate…you’re not selling knives and guns…
2 – Do you know how a non-US resident is supposed to handle tax? Amazon requires you to send your W8 when you sign-up which basically means that you don’t have to pay taxes in USA for each of your sales but each time I asked about these issues to Amazon staff I get pretty vague answers and nothing substantial. I guess this very same question would also apply if you are planning to sell in Amazon UK, Amazon Japan, etc. How are we supposed to handle taxes if we are not residents of each of those countries?
I think this whole liability, insurance/coverage & taxation part of the business is really on a gray area and it makes me feel a bit nervous not to know EXACTLY how to protect my brand and myself. Advice is really appreciated since I am not even a US resident.
3 – I didn’t really understand the part Greg where you mention that you don’t need to give your account if you sell your brand to a third party. How would that work? I always thought that if someone wants to buy your brand you need to basically “give them” your account details and that’s it.
4 – Do you recommend analyzing the products sales history before deciding to jump in? I mean…JS chrome extension is really good to get a first impression of volume and sales but it’s about averages as you mentioned in the podcast. When I find something that makes sense with the JS chrome extension, then I use your JS web interface to insert the ASINs of all competing listings in page one and see what data it gathers for a couple of days. If I see some consistent sales in let’s say a week at least, I’d think that would help me decide to finally move on manufacturing a product. Does this make sense? Do you use a similar process or how would you recommend “validating” your product idea before actually deciding to move on?
5 – Do you pay attention to BSRs or do you just rely on sales volume and number of reviews?
BTW, I am planning to move by the end of this year or next to Barcelona as well Greg…we may be neighbours lol. Good choice…great food, best football in the world (u guys in US call it soccer) and lovely mediterranean sea.
Thanks in advanced!
$400k is a wonderful headline figure. But as anyone in business will know, the turnover is pure vanity. What is the bottom line net profit? These are the real figures I am interested in.
That’s in the interview. Its over $100k net profit. Hope that helps.
I wonder if Greg Mercer realizes that answering every single question with “Soooooo…” doesn’t make him sound any more intelligent?
Excellent interview and insights! Looking at FBA for some time now and just getting my mental processes down now.
With that said, I hear a lot of folks talk about ROI, “I’m making 30% or 40%”, but it doesn’t equate to any take home profits, “because in this business you need to reinvest”. So a couple of questions.
1) If you are earning $400k and your ROI is 30% are you saying you will earn $520k… Wouldn’t that make the ROI 130% and not 30%?
2) When do you stop reinvesting and start taking a cut?
3) Spencer in your last update you mentioned you earned $60,000 and “my net margin is right around 40%” = $24,000… If you only earned $24,000 from spending $60,000, how is that a winning proposition?
4) Maybe a better question would be, what did you spend in order to generate $60,000 in revenue?
Thanks ahead of time for clarifying the numbers and for being so open and transparent about these things.
Let me try to clarify…you appear to be looking at the numbers all wrong.
1. Greg explained that his NET profit was around $100k per month. Meaning AFTER all expenses/costs he in pocket net earnings was $100k. Again, your numbers are wrong here. ROI calculation is (Gross Revenue – Gross Costs) / Gross Costs. Greg is saying his Gross Revenue is $400k. He didn’t say what his gross costs are, but we can caluculate that because he gave us a 30% ROI number. With simple algebra we get that his gross costs are roughly $300k per month. This leaves him $100k Net Profit.
2. That depends on your business and personal preference.
3. I’m not sure why the numbers are mixed up for you. Just take $60,000 (total revenue) minus $24,000 (my net profit) to get total costs – $36,000. So, I spent $36,000 and got $60,000 deposited into my bank account. That’s a winning proposition all day long for me…not sure about you.
Hope that helps!
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4.
Awesome interview and a great insight to a thriving business model. Really interesting and helpful – thanks to both of you!
Hi Spencer
In the process of finding a niche look: long tail keywords that have low competition and possibly high search volume, but generally long tail keywords have a smaller search volume compared to shorter keywords. (Generally speaking, because I know that the process is much more complex).
Questions: For Amazon FBA theme, I do the opposite? Find Keywords wiht high volumen search for better position my product in Amazon?
or should I do it with the same parameters search of a niche?
You have mastered the two topics, how to use keywords to position a product on Amazon. How you work this?
Best regards.
Hi, interesting interview! I would like to know how to search the number of sales per month for the product on Amazon. Greg said that he would look for products with 3000+ sales per month. How do I go about finding that data?
Thanks,
Matt
Hi, thanks for the interview. How do I go about looking for the number of sales/month?
Thanks,
Matt