4 Ways Amazon Sellers Can Scale Their Businesses

Anybody who has run a successful business knows that the devil is in the details. Nowhere is this more true than in ecommerce. Here are four ways you can build an Amazon business that scales.

1) Begin with Process

So many sellers start their business as a side gig. Maybe they’re doing it on nights or weekends and trying to save up to quit their job. Or maybe they’re entirely devoted their time to building their business, but they’re spending every dime on inventory and have nothing left over to hire much needed help.

In either case, your Amazon business can quickly grow faster than you can possibly imagine, and a lack of systems can create unnecessary hardship on you without proper planning and thought.

Most people start their business wearing all the hats. Treat this as a benefit and use it to your advantage (even though I know you’re exhausted). Document all the tools you use, pay attention to every step of the process, and keep notes on what you think can be improved for the future.

As your business grows, you’ll find you’re even busier than you are now (I know, hard to believe), but that’s when all this information you’ve tracked along the way will pay off. If you’ve done a good job, you can pull yourself out and plug a new employee in without skipping a beat.

2) Implement Tools That Will Help

The absolute best way you can make your business scale is to implement tools that make your processes plug and play. If you’re using a cloud inventory system, for example, the tool provides the structure you need so that once you train your new employees on the system, you’ll get the same results as if you’re doing the work yourself. The same is probably not true if you’re using spreadsheets (or umm… sticky notes) as part of your process.

Let’s say you’re selling hats on Amazon, and someone comes along and starts to compete on  your listing (maybe even Amazon itself). A cloud inventory system can help you identify if  inventory velocity has slowed on that product so you have time to pull that inventory out of Amazon or sell it on a different channel instead of paying long-term storage fees at Amazon.

Or let’s say you are having a hard time getting the information you need from Amazon reports for recording income and fees in the right months. There is an amazing tool (A2X) that will take care of this for you with the push of a button. If you’re having a hard time figuring out sales tax collected, maybe take a look at TaxJar or Taxify.

There is an abundance of other tools available for Amazon that can help with functions like calculating and recording cost of goods sold, tracking your available inventory, filing your sales tax returns, automatically repricing your products for sale, and more. You just need to identify the gaps in your business and then fill them.

3) Define Clear Policies

So let’s say you’re just starting out and all your money is going into products and ads, and you don’t have any money left over for tools. That’s fine. Just start where you are and build from there.

Tools are not required to have a process… the process typically comes first. Figure out what needs to be done operationally and document that. Tools may help you cut out steps and speed things up, but you need a clear understanding of the complete process/problem before you know whether a tool can help.

One big issue that many Amazon sellers has revolves around returns. It’s the perfect example for a process you can and should define, even if it’s just on a Google sheet. Here’s the deal: some products get returned by the customer, and Amazon is waiting for you to decide what to do with them. They can just sit at Amazon as “Unsellable,”and they are happy to charge you storage fees for doing so. Alternatively, you can tell Amazon to destroy them or to ship them back to you.

So you need to build a policy that defines your operational process. If Amazon returns the products to you (which may take weeks), what are the costs of them shipping them back to you, refurbishing the products, and shipping them back to Amazon? What are the risks that the products will be obsolete by the time they are once again available for sale? Maybe it’s cheaper to just cut your losses and have Amazon destroy the products. Or maybe some SKUs should be destroyed and other SKUs returned.

Define your policies and then build your processes around them.

4) Do Your Homework

Not every business has the exact same workflow or challenges, but there are more commonalities between ecommerce businesses than not. This is even more true when you compare online retailers who sell on the same channels (Amazon, Shopify, eBay, etc.). Talk to your peers and many are willing to share tips (you can find some peers on our Facebook groups for Ecommerce Sellers and Accountants). Search online for cloud tools that will help fix your pain points. Even if you can’t yet afford them, pay attention to what they can do for you and include it in your future budget. You might find that “expensive” $1,500 per month price tag becomes a bargain when the next best alternative is hiring another full-time employee.

A good place to start is by watching our free webinar, Essential Tools for an Amazon Seller.

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