Webinar: Scaling Your Amazon Business

Scaling Your Amazon
Business: Expert Insights
WITH EXPERT GUEST SPEAKER
KEITH SMITH, FOUNDER & CEO, PAYABILITY

SCALING YOUR AMAZON BUSINESS
WELCOME,
AMAZON SELLERS
We’ll be getting started momentarily…

MEET THE EXPERT
§ KEITH SMITH, CEO OF PAYABILITY
§ STARTED CAREER IN FINANCIAL SERVICES AT COUNTRYWIDE AND
INDYMAC
§ FOUNDED CYBERMORTGAGE, ZANGO & BIGDOOR
§ TECHSTARS MENTOR

HOW TO SCALE YOUR AMAZON BUSINESS
§ THE CORNERSTONES OF SCALE
§ HOW TO DETERMINE YOUR SCALABLE GROWTH STRATEGIES
§ WHY PROFIT IS MORE IMPORTANT THAN MARGIN
§ HOW TO MAINTAIN A POSITIVE CASH FLOW AND KEEP INVENTORY STOCKED
§ TOP TIPS FOR REPLICATING GROWTH AT SCALE
WHAT YOU’LL LEARN TODAY

WHAT IS SCALE?
§ EXPONENTIAL REVENUE GROWTH DUE TO INCREMENTAL
INVESTMENT
§ ACTIVITY THAT SPURS GROWTH NEEDS TO BE REPEATABLE

ADVERTISINGINVENTORY NEGOTIATE WITH SUPPLIERSOPTIMIZE PRICE
SCALABLE GROWTH STRATEGIES
EXPAND

§ INVENTORY MANAGEMENT: Monitor your low-stock notifications before they
become out-of-stock
§ SELLING COACH: Use Amazon’s tools to better understand your inventory
opportunities
§ INCREMENTAL RESTOCKING: If possible, buy in small batches regularly in order to
increase inventory turns and optimize your cash flow
SCALABLE GROWTH STRATEGIES:
Inventory

§ PRICE AGGRESSIVELY: When launching a product you should start at a price that
is less than your final price. During this launch period, you may sacrifice some profit
to win sales in the long run.
§ OPTIMIZE FOR PROFIT NOT MARGIN: Reducing price will impact your margin, but
the goal is to maximize absolute profit not margin on individual items.
§ WIN THE BUY BOX: Volume and velocity will increase significantly when you are
winning the Buy Box.
Optimize Price

§ PAY PER CLICK: Only pay when customers click
§ Payment can go on a credit card or be deducted from your Amazon
disbursement
§ You’ll get $50 in free clicks to start!
§ PLACEMENT: First page of search results or product detail page
§ BENEFITS: Maximize sales, and boost sales rank as you’re reaching new customers
Advertising with Amazon Sponsored Products

§ MORE SALES = MORE BUYING POWER: As you sell more, you will likely be able
to get a better deal on your inventory.
§ NEGOTIATE: Many suppliers will provide terms based on volume and/or better
pricing if you can pay them faster.
Negotiate Better Inventory Costs or Terms from Suppliers

§ LAUNCH NEW PRODUCTS: Create a product launch plan that is formulaic and
repeatable for each new product you launch.
§ TEST AND LEARN: Proactively test and learn and make changes from test results.
You should be running one test each month.
Expand

They require cash flow.
What do all of these strategies have in common?
INVENTORY
NEGOTIATE
WITH
SUPPLIERSOPTIMIZE PRICE
ADVERTISING
EXPAND

WHAT IS CASH FLOW?
§ Noun:
The amount of money being transferred into and out of a business, especially as affecting liquidity
§ Cash flow is a vital component to any business’ growth strategy
§ As an Amazon seller, cash flow is especially difficult to maintain given Amazon’s two week payout

HOW CASH FLOW HELPS SCALE YOUR BUSINESS
§ KEEP INVENTORY LEVELS HIGH
§ INCREASE SPONSORED PRODUCTS SPEND
§ OPTIMIZE PRICING
§ REDUCE PRICES FROM SUPPLIERS
§ TAKE CONTROL OF YOUR BUSINESS
§ ABILITY TO CAPITALIZE ON BUYING OPPORTUNITIES
§ MAINTAIN SALES RANK = MORE SALES

HOW TO GET CASH FLOW
AMAZON LENDING CREDIT CARDS LOANS PAYABILITY

HOW TO GET CASH FLOW:
Amazon Lending
§ DETAILS
§ Variable amounts and terms offered
§ Amazon will reach out to you via Amazon Seller Central if you’re eligible for an
Amazon loan
§ IMPACT ON CASH FLOW
§ Bumpy: You receive one lump sum of cash (the loan principal) along with your Amazon
Payout
§ Repayment: Functions like a merchant cash advance that you pay back (with interest)
from your Amazon income

Credit Cards
§ DETAILS
§ Pay expenses on a business credit card and owe interest if you carry a balance
§ Low Amount: Business credit cards tend to have low credit limits
§ Limited in Use: This “cash” is only useful where you can pay via credit card
§ Expensive: Interest rates and fees are very high
§ Revenue Stream: Earn rewards and cash back as you use (and pay off) your card

Loans
§ DETAILS
§ Bank loans – require stable business history
§ Online small business loans – easier application processes, faster decisions,
typically higher rates than banks
§ If you do qualify for a bank loan, the interest is relatively low
§ IDEAL FOR
§ Your suppliers require you to make large, one-time inventory purchases

Payability
§ DETAILS
§ Next day access to your Amazon earnings
§ IDEAL FOR
§ Sellers that are growing
§ Sellers that can grow faster with faster payments
§ QUALIFICATIONS
§ 90 days of selling history
§ In good standing with Amazon
§ Over $2k/month in sales

§ AMAZON HANDLES THE DEMAND, WHICH MEANS SELLERS CAN FOCUS ON SUPPLY /
INVENTORY – BUT KEEPING INVENTORY STOCKED REQUIRES CASH FLOW
§ OPTIMIZE FOR PROFIT NOT FOR MARGIN
§ THE KEY TO SCALING IS TO FIND GROWTH STRATEGIES THAT WORK AND ARE REPEATABLE
§ FIND A FINANCING SOLUTION THAT IS AS SCALEABLE AND REPEATABLE AS YOUR GROWTH
STRATEGIES
IN CONCLUSION

QUESTIONS?
Interested in getting a handle on your business finances?
Have questions about the health of your business?
Visit www.fetcher.com to learn more.
Want to take control of your cash flow and start
scaling your business?
Visit www.payability.com to get started.

Webinar: Scaling Your Amazon Business

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