Building your brand in new frontiers with Amy Wees

All right, guys, I have a very special episode for you all today. Scott Needham and I from the Smartest Amazon Seller podcast have partnered together, where he interviewed Amy Wees, and she delivered some amazing, actionable strategies as to how you can grow your brand off of Amazon. I feel like this message is super timely for what a lot of us are experiencing massive amounts of overseas competition, a lot of margin reduction, an increase in FBA fees, etc. the list continues to go on and on, and while many people look for what's going to be the next best sales channel for me to get into, Amy shares some actionable tips and strategies, and I think you can experience a mindset shift in terms of understanding that getting into retail can open up some massive doors, an opportunity even bigger than what you're experiencing on Amazon. So go ahead, sit back, listen to this episode, take down some notes, and then when you're done, go ahead and follow the smartest Amazon seller podcast by Scott Needham.

Intro (00:01:09) - One, two, three.

Scott (00:01:12) - Welcome to the Smartest Amazon Seller podcast. I am your host, Scott Needham, an Amazon seller. And I have with me Amy Wees from Amazing At Home. She has been giving such amazing advice. I was at a conference with her 2 or 3 weeks ago in Boston, and when I heard her talk, I was like, all right, I've got to get her on the podcast to talk about this subject. I've never talked about it, and I know there's a few people that are probably at this threshold of how to take some of their products, some of their brands, to the next level, understand, what it can mean to branch outside of Amazon and perhaps even into retail stores. Amy, welcome to the podcast.

Amy (00:01:57) - Thank you for having me, Scott. It's great to be here.

Scott (00:01:59) - So, you know, I like to think that I'm, pretty good at selling on Amazon, but, the more I've been doing this podcast, the more that I like, I'm like, there's just way more things to consider.

Scott (00:02:14) - in how to, you know, grow a brand and actually maybe turn a product into a brand. And, one of the first things that you think of in, in answering that question is like, well, are you just on Amazon? You know, have you if you expanded and like, have you found the best fits off of Amazon? So, let's just do a thought experiment where, you know, I have grown to, say $500,000 a year in sales, and it's all just on Amazon doing, you know, private label. What would you think be, you know, the next step.

Amy (00:03:00) - Well, I think always you have to look at your customer base, right? who is your customer and where do they shop? What are their brands? Do they follow, you know, where do they expect to find you? and of course, we all love Amazon. I love Amazon too. I'm an Amazon seller as well. but when it comes to expansion, we really have to think and remember that e-commerce is 10% of all of retail.

Amy (00:03:31) - E-commerce is 10% of all retail. So it's like, whoa, you know, and then Amazon is a little over half of the e-commerce chunk, but there's still so many cool places that we can sell our products both online and offline, in brick and mortar channels as well. So when you're thinking about, okay, you know, could I do something off Amazon? I know a lot of people too. They don't want to keep all of their eggs in the Amazon basket right now because it's just been yeah really crazy. Amazon's changed a lot right.

Scott (00:04:03) - That's not a yeah it's not a great idea. now so expanding off Amazon and you know figuring out where your customers are or how to get to them, you know, the most natural might be, you know, Walmart Shopify but like and then the rest of, you know, brick and mortar you could set up wholesale. So say you're approaching you're approaching that question right there. what are some factors that you should be considering?

Amy (00:04:34) - Yeah. So I mean, the first thing that you should consider is your margin.

Amy (00:04:39) - So if you're on Amazon and you have just A3X, so you're sourcing it for $5, you're selling it for 15. If your margins are really narrow, you might not have enough margin to actually expand into retail and sell your products at wholesale prices. So when you're selling your products wholesale, in general, the general rule and of course, there's exceptions to this rule. But the general rule is you're selling that product for 50% of the retail price, and the retail price is whatever you're selling it for on Amazon. So it's not like you can say, oh, well, my MSRP is $40, but I sell it on Amazon for $20 on average because yeah.

Scott (00:05:23) - That won't that won't fly.

Amy (00:05:25) - No. Yeah exactly. And we know that Amazon's already doing you know comparison pricing across major retail channels. So the first thing that you should think about if you're going to start selling your products wholesale is do I have the margin to sell this product for 50% of that retail price? And, and still make a profit there? So that's, that's the.

Scott (00:05:52) - Well, even take your, take your scenario of a $15, retail, and your, your, cost of goods is $5 per unit. if you were to sell it to a brick and mortar store for 750, is that worthwhile or is that good enough?

Amy (00:06:12) - I don't. It wouldn't be for me. No. You know, that's the good thing about selling wholesale is that, that usually those brick and mortar stores pay shipping. So you're not paying for shipping, right? Okay. that's helpful, but, you know, that's a very narrow margin, right? I like to have enough profit to at least buy one more unit even on Amazon. Right. So, you generally want to be able to cut it in half from your retail price and then cut it in half again. to be able to, you know, make a, make a profit there. So, that's just a general rule. So pricing is your first. Yeah. Sorry. Go ahead.

Scott (00:06:57) - So what you're saying is if, say, your cost is $5, if it was wholesaling for $20, you're like, okay.

Scott (00:07:04) - That starts to make sense.

Amy (00:07:05) - Yes. Exactly. Well no. If your cost is if your cost is $5, you want it to wholesale for ten, right? So you want to be able to double that, right. So if let's say I'm selling a product for $40 retail, the wholesale price is $20, I should source that for ten okay.

Scott (00:07:27) - Yes. Right. Yes. Yeah. Yeah. I, I think, we're just dancing around. Yeah, yeah, I understood you. and. Yeah. So, you know.

Amy (00:07:40) - That's the, the first consideration is that you want to think about your margin and you know, whether you have enough margin there. and then the second thing is think about how your customers shop. So, you know, where do they shop? Do they mostly shop online for your type of product? And if so, what are the other, types of online channels that might be beneficial for you? So maybe you're selling a home decor item, right? Home decor.

Amy (00:08:10) - And even on Amazon, home decor isn't really the best product. Those aren't the best products to sell on Amazon, because American consumers usually go on websites like Overstock and Wayfair to buy home decor type of goods. And if you'll notice, if you go to those online websites and you check out the prices of home decor compared to those prices for very similar products like I did an example of a gold vase. it was a, you know, on Amazon, these types of gold vases were like $19, right? Very cheap. You find the same thing on Wayfair and it's like 73 to $100. so if you are selling a home decor item, you might be surprised Amazon might not be the best place for you to sell your products, and you might discover that there are other really, really great places to sell. yeah. And then same thing. There's brick and mortar opportunities as well. little chain stores like Tuesday morning, for examp...