AS 91: Expanding at 60 Million in combined sales with Jamie
21 Aug 2017
Today I’ve got Jamie Davison on on the show, Jamie and his co-founders Jason and Brad combine to sell over $60 million per year on Amazon. He is the co-founder of AMZ Insiders, a coaching program focused on helping new sellers create their own successful Amazon business and provide insights and tips to existing sellers.
- Selling on Amazon
- How to build an Amazon business
- How Jamie and his partners business scaled very fast
- Jamies path to getting where is today
- How he quit his job and why
- Amazon strategies and secrets
- How to scale an Amazon business
- How to grow an e-commerce business
- How they are divvying tasks and diversifying
- Important networking tips
- How they plan to double their business
And much more
Free Video Training: www.AMZInsiders.com
Free Facebook Group: Amazon Insiders – FBA Sellers https://www.facebook.com/groups/AMZInsiders/
DAVID ALADDIN: Great to have you on the show, Jamie.
JAMIE DAVIDSON: Hey, thanks David. Great to be on and I appreciate you having me on.
DAVID ALADDIN: Yeah. So can you take us to the beginning, before selling on Amazon? Where did your journey begin?
JAMIE DAVIDSON: Sure, yeah. My journey I guess, everyone has a different path, of course. On my end, I was, way back when actually a military officer, had attended WestPoint and so. In my 20s was kind of had the military background eventually jumped into the corporate word and probably like a lot of people’s careers kind of worked up the corporate ladder the best I could so I had a—I was in banking early on, I’d been recruited over to Home Depot, so I had some retail experience there for a few years running a Home Depot store and then, I kind of fell into the education space with a big test preparation company, Kaplan.
DAVID ALADDIN: Oh, yeah.
JAMIE DAVIDSON: Yeah, yeah. And so then which great education minds and could use some help on the business side so I kind of found that space and stayed in there for a good while. Had some success there and again, worked my way up through just kind of a Senior Executive there and then was part of some private equity deals. We brought in as a Chief Operating Officer and a CEO of another company where essentially, these private equity companies are buying the company. Basically about 50 million dollar businesses or so and they hope to flip them in about four to five years. So I was kind of the hired gun through that approach, so, yeah. So I was kind of—I felt like I had this big title but at the end of the day I was a hired employee, just a senior employee to help kind of lead businesses in these spaces here.
DAVID ALADDIN: I feel like when people amass so much money, they just create so much more money. I mean, 50 million, equity deals, and then they’re trying to flip it to 200? It’s pretty insane.
JAMIE DAVIDSON: Yeah, exactly. Exactly. They’re trying just to take it across the river and in four or five years, probably at least sell it for double, if not more.
DAVID ALADDIN: So, how long was this before you got into Amazon? What year, you think?
JAMIE DAVIDSON: Yeah. So I was in 2000, I mean, kind of the education run I think with Kaplan and a couple of these other companies was 2000’s, early 2000’s, up through 2013.
DAVID ALADDIN: Okay.
JAMIE DAVIDSON: And actually even through the last couple of years. Yeah, so for a while, I came down to—I’m in Atlanta here but I came down to Atlanta in 2011 and that’s where the kind of introduction to Amazon begun so to speak, yeah.
DAVID ALADDIN: Nice. You’d say like 2015?
JAMIE DAVIDSON: Yeah, I mean, actually I had full-time jobs up until this past year.
DAVID ALADDIN: That’s awesome.
JAMIE DAVIDSON: But my co-founder Jason, he jumped in 2011 is what I’m sure we’ll talk some more about that but so I kind of was following that path while he was in it full-time, I was still kind of on these…as you’d say I have these awesome big titles which he seemed to be impressed with but I was much more impressed what he was doing actually in eCommerce and Amazon versus what I was doing.
DAVID ALADDIN: So, I’m guessing Jason got you into it, right? How’d that go?
JAMIE DAVIDSON: Yeah. I mean Jason is a native Chinese. He’s been in the country for a long time, for about 20 years and he was a software consultant for companies like Coca-Cola and other major brands helping them with software and also kind of their back-end but I moved to Atlanta at 2011 to be the Chief Operating Officer of this tutoring company and he was literally my next door neighbor, a few feet apart from each other. At that point, he was selling cellphone accessories out of his garage at that point. So at that point, I really didn’t think too much of it.
It was—I have three sons and he has a daughter. My boys would come back over and they’d come back with an IPhone case and that kind of stuff and we’d…I’d say, “Hey where’d you get that?” and overtime it was like, “Oh, this is…” Yeah, I kind of learned this is what it does. Even then, we’d hang out a lot but it’s not like when you’re friends or neighbors, you’re not like diving into each others’ business so much in terms of what they’re doing. In some ways you’re trying to… you kind of get a feel for it but that was the beginning of it and because I think in 2011, it was still just a part-time thing for them and then in 2012 was when Jason quit his job and went all in. Well, again, I was still working through all this time but that’s when, that’s where he begun. I was kind of following the journey or kind of behind the scenes, helping sometimes, talking strategy and that kind of stuff but I was still working my full-time job.
DAVID ALADDIN: Interesting. I wish my neighbours were like huge entrepreneurs. I hope they’re not watching this but, man. They’re not like your type of neighbors.
JAMIE DAVIDSON: No, I mean, it was funny because he’s a very humble guy so usually what happened was in the house is a real nice neighborhood and everything, but the houses are really close and I would hear him out in his back deck and I’d stay up late working for my work but he was always out in his back deck speaking Mandarin or Chinese at one in the morning. And at the time, well I thought, oh, that’s interesting. That’s what he does. And I kind of thought that the reason he could do that was because he spoke Mandarin, and I thought that was like a barrier for me.
So at first, even though I was aware of how even early on, how well it was going. At first, at that point in time, I really thought that I didn’t fully recognize. Kind of what I recognized later that it’s an advantage to speak Mandarin, but it’s certainly not as I know you’re aware. It’s not a complete barrier but early on that’s what I thought so I kind of followed him along but I wasn’t thinking from day one. My wife was like, why don’t you jump in to that or at that time I was kind of looking at it like oh, that’s an interesting side gig, but as you know as I got more involved the further I realized the potential but earlier on I did not. I just kind of thought like, oh, it’s a side small little thing and it’s kind of funny, selling on Amazon, what is that?
DAVID ALADDIN: Sounds like, yeah.
JAMIE DAVIDSON: Yeah.
DAVID ALADDIN: It’s surprising. You know how the saying goes, you’re the closest five people that you hang out with but you took it to the most literal sense with your neighbor.
JAMIE DAVIDSON: Yeah. I mean so as we get further into it. Jason, still has a house in that neighbourhood but he’s back in just last year to really grow the business and what we’re doing. He’s over in Shenzhen in China for most of the year and I have a team here but back then, literally, it was kind of humorous. I’d go over, bring over some ice and I’d joke about teaching how to drink a rum and coke or we’d have a glass of wine late into the night and everything but we were just talking and he’d share kind of war stories as this stuff was going on but it really wasn’t intentional. A few times he would joke, oh, I should hire you as a CEO but I probably couldn’t afford you. And I was thinking, yeah, this is kind of a small retail business and right, I’ve got a family and a good paying job, so it wasn’t really my mindset at that point but I guess I’m a slow learner from that perspective, eventually, I got pretty excited about it.
DAVID ALADDIN: What do you think pushed you passed the edge like where you’re like, okay, I want to get into this as well?
JAMIE DAVIDSON: Yeah, no, it’s funny and sometimes we’ll have Jason, he can join from China for example, but, get his perspective, too. But Jason for years would tell me and it wasn’t even just necessarily about Amazon, just as entrepreneurs, like you should totally do this, you should get into it. So we talked on his end too whether you want to do an education deal with me knowing my background on kind of for profit education. So, and I consider myself a risk taker but also I’m in my 40’s so with a family and everything else so it was hard because of the barrier on my case in terms of the corporate jobs and the pay was pretty high, so for me to kind of make that leap took, you know how to kind of be the right circumstance and the right situation, and even my wife thought it’d be a little bit crazy.
Unless you really—because at the end of the day it’s still entrepreneurship and you got to produce but for me, it just took a while to be honest for me to get to that point but the more I really got into eCommerce and started looking at it. For me it was also just a fit. It was something I’m kind of an analytical guy in a background and the more I saw it with Amazon and Jason would share this with me that early days, just around the tools and the reporting available, and all those stuff, you don’t have to build that. A lot of times, in other companies you have to build. The more I…I just thought it was fun looking at the information and it was just a goo fit for me. So in my case it was, you had to take a leap at some point but also, I thought it was the right opportunity.
DAVID ALADDIN: Did you take the full leap or are you still doing some part-time work on the side?
JAMIE DAVIDSON: Yeah, I took the full-leap.
DAVID ALADDIN: Awesome!
JAMIE DAVIDSON: Just this past year. The past year’s so…
DAVID ALADDIN: It’s good for you then.
JAMIE DAVIDSON: Yeah, so then again, it’s like…
DAVID ALADDIN: Scary at first.
JAMIE DAVIDSON: Yeah, exactly. You know, I mean it feels good and it’s scary and a lot of people think it’s awesome and so cool. I’m like, yeah, but it’s… again, it’s a good thing. You go to bed every night waking up going, I’ve got to do these 100 things because you kind of eat what you kill as an entrepreneur so to speak. Which is good but I think it definitely has like I said it’s a lot of work as…
DAVID ALADDIN: People, yeah, a lot of my friends think it’s easy. Like, oh, you just stay at home and do whatever you do.
JAMIE DAVIDSON: Yeah.
DAVID ALADDIN: But it’s not, it’s not easy at all, you know. I feel like there’s this constant stress always that if you’re not making money, you’re losing money and if you do that for a long enough time, you’re going to be broke technically.
JAMIE DAVIDSON: Yeah, you got a great perspective. I also joke with people that I’m in Atlanta here and I made part of Atlanta’s CEO council from my education roles and so I’ve been to a lot of these networking things in the past and in that space, when I mention what I do, people, people were polite but no one really cared because it’s not really that interesting even though it’s a huge industry of itself but the eCommerce space is like a lot of people are interested. It’s just it crosses over so many things so in that part I found interesting that whether it’s old high school friends or people I know here, people are definitely curious about what you’re going but at the same time they think, they say like, wow, that’s incredible luck or incredible this, but it’s exactly what you just said, it’s like, well, it looks good or sounds good but at the end of the day, it’s you know, you’ve got to grind and put in the work and make things happen.
DAVID ALADDIN: Yeah.
JAMIE DAVIDSON: And every day’s a new day.
DAVID ALADDIN: So, it took basically you guys seven years from a garage and then I saw a video with you guys in this huge warehouse, so.
JAMIE DAVIDSON: Oh, yeah. Yup, we’re here.
DAVID ALADDIN: Basically.
JAMIE DAVIDSON: I mean we’re like right outside the warehouse here. It’s attached here, yeah.
DAVID ALADDIN: Yeah. No, it’s massive! I mean, how high are those ceilings? For those listening.
JAMIE DAVIDSON: Yeah, I don’t know. Fifty… Let me see here.
DAVID ALADDIN: They’re huge! Yeah.
JAMIE DAVIDSON: Okay. It’s a 25,000 square foot warehouse, so it’s like a little mini home depot.
DAVID ALADDIN: Yeah.
JAMIE DAVIDSON: You know, with the racking and everything, so it’s like your typical warehouse with a loading dock.
DAVID ALADDIN: Do you guys own that or rent it?
JAMIE DAVIDSON: Yeah, we rent it. We’ve had a few locations we had to grow to this size and we’ll see in a year or two, we may have to switch again but yeah, we’ve got a lot of inventory here. I mean, even though we sell on Amazon FBA. And have our items at Amazon and other market; we also sell in a lot of other market places. And the other part is we have a lot of business at Amazon through Vendor Central so we just have really quick turn-around times. We have to get inventory turned over to whether it’s a customer or to Amazon so we have to stage a lot of it here versus sending it from China by boat, all that kind of stuff.
DAVID ALADDIN: Let’s talk about that. Vendor Central, what’s the strategy there?
JAMIE DAVIDSON: Yeah, so originally, Jason’s approach was pure FBA, selling on Amazon. He did actually go to some other like Best Buy back in the day or Home Depot even before, some of the Vendor Central stuff, but, so one of the things because of the size of the business that you do get a little more interaction with Amazon directly and so the team’s always been invited up there a couple of times a year. We went up just two weeks ago, I was up there. You meet with them, and see how people there on Amazon’s side, they want to, just like any company kind of with their account execs, they’re looking at their bigger clients and saying, you know, and try to recommend or guide what they think you should do.
So a few years back, someone at Amazon in a meeting with Jason had that—Jason was really hesitant to do it because of concerns around the margins and less control over the product and everything. But someone at Amazon advised, basically got up and said that we’re leaving millions of dollars on the table by not doing Vendor Central and when you’re at Amazon, it’s almost kind of funny. You talk to people on both sides of the business. At Amazon there’s like a firewall between the Vendor’s Central side and the traditional Amazon.com side and so, basically the idea there now, too is we do almost half the business through Vendor Central.
These days so on that side of the thing, if you can establish the brand well and you can also…you have to have good logistics in terms of being able to provide the product when they need it because essentially they’re on control at that end. So if you don’t have the product for it, they’re not going to focus on you, they’ll focus on someone else. But if you can do those things, you can get the set-up going then it’s like you just provide them an inventory and then they do the rest and sell it so it can be pretty good but it’s you got to kind of find the right stage I think to do that because like I said, you got to have some of the logistics in place to be able to provide them because you know, you’re at their beck and call in terms of when they need the inventory and so forth.
DAVID ALADDIN: So, do you think like the biggest issue is just providing and having the inventory available for Vendor Central because with Seller Central it’s like—
JAMIE DAVIDSON: Yeah. Yeah.
DAVID ALADDIN: You’ve got all this worry about the little details with the customers and whatnot?
JAMIE DAVIDSON: Yeah! No… exactly right. There’s more to deal with in terms of the—on the Seller Central side. In terms of everything and if you’re whether FBA, if you’re not selling FBA, then we have customer service teams to support just because the scale, we actually have to have our own customer service team and everything but from a Vendor Central side, again, the inventory is big so if you’re your typical FBA seller on the smaller side who’s periodically shipping stuff over from China and either sending them directly to Amazon or directly to kind of a staging area, that’s going to be more difficult in a Vendor Central environment, right? Because they may say, on a whim they say, hey, we’re going to do this special promotion.
We need a bunch of your stuff immediately or we need it in a few weeks. And so it’s more of a traditional dynamic that if you were like a manufacturer of a product and you’re working with let’s say, Home Depot, right? You got to be able to kind of stay in the flow because again, there are a lot of other partners that you’re working with and so if you’re going to really kind of be at scale there and make that work, again you got to have the product. So I mean, I think that’s definitely the biggest dynamic. So in this case, where we have this warehouse here and all the stuff, we can make that work. Otherwise, you’re also paying a lot to fly product in and depending on the size and weight of your product, you know that’s going to be a possible hindrance.
DAVID ALADDIN: For sure.
JAMIE DAVIDSON: Yeah, in our case our product’s a little smaller so we can fly stuff, product around more often but again, for a lot of products it’s not. You don’t want to overspend on your logistics.
DAVID ALADDIN: Do you guys find that having your own fulfillment or your own warehouse versus a third party fulfillment center, what was the difference in there?
JAMIE DAVIDSON: Yeah. That makes a good question. I think if it may also have just been the timing of it at that point where it started off small, like this is our, this…
DAVID ALADDIN: I mean, I’m in that same—
JAMIE DAVIDSON: It’s—yeah.
DAVID ALADDIN: I’m in those same shoes where I’m trying to decide which way to go.
JAMIE DAVIDSON: Yeah, I mean, I think generally, it’s not the path we have right here. Generally I would, the first thing I would naturally think of is how can you outsource and not have to do that because when you do, it also depends kind of what your skill set is and your labor teams, and if you’re going to add management team because we have a warehouse here with right now, I’m on my computer screen. If I have to put on the laptop and walk you in there, there’s probably 10 employees out there working right now. I mean, it’s basically a warehouse team, right? And they’re slugging away and so you got to have a Warehouse Manager and so we have to have that. We have a head of HR and accounting here so it’s a little bit more of a traditional—
DAVID ALADDIN: Yeah.
JAMIE DAVIDSON: Operation, right? Because I mean, they’re employees, you got to make sure you take care of them and the conditions have to be right. So to do that is a bit of a commitment. I think in our case it was the business accelerated really fast early on. It got to 10 million and 20 million pretty quick. The first couple of years that we just kind of… we made that leap early on. If I was building it separately, again, like today, and Jason would also say, hey, there was a lot of good work being done. We also, in terms of market time and things that were in favor but if we’re doing it again, started from scratch, I’m not sure if we would build our own warehouse until we got—unless we really had the sales initially.
DAVID ALADDIN: I think the warehouse side is like a whole another strategic component of the business so I find it very interesting for your people to actually manage and own the warehouse’s component of it.
JAMIE DAVIDSON: Yeah, and actually again, you probably have a better perspective of who does what in terms of the different approaches out there, people will talk to you, so I don’t…I’m not sure how common people go with this approach first but it is like I said, you got to, it’s more like a traditional operation because we got forklifts flying around here.
DAVID ALADDIN: Yeah.
JAMIE DAVIDSON: And we got regulations and ordinances and safety, and all that important things
DAVID ALADDIN: What do you think are like some of the biggest business mistakes that you guys made so far?
JAMIE DAVIDSON: I think there are a couple of things; we’ve had Amazon accounts shut down so that’s certainly have happened before. We’ve been shut down during a key period of time, right during Black Friday for a few weeks. During the time when business was selling really well. There’s… one of the ones too is just around trademarks and brands too, so not with the core brands but a mistake of not really making sure that your brand is good to go before you sell it. We’ve had–been shut down not because, not intentional but just kind of being sloppy at times with in our case, we modified a brand name.
DAVID ALADDIN: Yeah.
JAMIE DAVIDSON: And didn’t realize someone else was selling under that name. And so, a lot of people even through the training will ask me like, they’ll spend all this time in picking the brand name which I’m like it really doesn’t. You can come up with a really bad brand name and it still doesn’t matter but if you’re not really careful upfront, it can cost you a lot and so, something in this business, especially if you get big and successful to some extent, if you have a patent violation, what’s going to happen, typically is there not going to go after you when you’re small, they’ll wait till you… they’ll see how much money you make in a product, in a category and once you make the money, then they’re going to come back so you start getting into, it’s certainly beyond 10 million and so forth, you’re going to get into more legal side of things and so forth.
But certainly on, the basics would be on the trademark side. It’s being sloppy there at times. And the patent’s measured, it’s a mistake always but it’s just the reality of it that we have to spend money on some legal battles and that type of stuff which is just part of the business as you become bigger because people are going to want to… they’re going to want to, especially if you’re successful, they’re going to want to take a cut of that and they give you something… really, I mean, the patents are going to be something really, really minute and small, and again, depending on your product, that can get along.
If you’re smart, they’re probably not going to come up as much but yeah, no, a lot of the frontend things, I think certainly product side, too. I think the product selection, again, I know these are I want deals with this but you do have to do your homework in terms of not every product works or there’s not every product that you’re going to be good at. There are certain things that we’re good at. We’ve got into some products that have not worked and have failed because every niche is different and kind of how you add value is different, so.
DAVID ALADDIN: For sure.
JAMIE DAVIDSON: It’s not like we can just take anything and just replicate it and it’s like printing money for us, we’ve got to stay within our lanes still and then we’re trying to expand into new markets but—
DAVID ALADDIN: Yeah.
JAMIE DAVIDSON: We’ve got to be careful just like anyone else.
DAVID ALADDIN: I want to go deeper into the account shutdowns. Mainly because it’s my biggest fear with Amazon. The bigger I get, the more I fear it. It’s like a bad trend I have. It’s like a house of cards. The taller you build it, the greater the collapse. What happened and how’d you guys deal with it?
JAMIE DAVISON: Yeah, so a couple of the ones again there was the early days where it’s more like I was just at Jason’s house and having drinks with him and hearing their early days stories and then there’s today, I’m not going but I’m pretty familiar with it kind of from both ends of more of initially, it was…I kind of use the analogy sometimes of speeding. Speeding versus committing murder as a crime that they’re both technically against the law but one is more grievous than the other.
DAVID ALADDIN: Yeah.
JAMIE DAVIDSON: So there are a lot of things in Amazon that’s kind of speeding, right?
DAVID ALADDIN: Right.
JAMIE DAVIDSON: It’s kind of a grey area and you don’t really exactly know how far you can go. But if you think in one hand, like, hey, we’ve gotten pretty big and we interact with Amazon a lot, that we could still get shut down even though they know us and at Amazon, there’s account executives that look over every category in every account so you know what the products you sell, there are people that are looking specifically at your account and you’re just in a mix depending on how big you are or small but you fall under someone’s purview. In Amazon, there’s a lot of turnover too so they have people constantly coming and going.
DAVID ALADDIN: Yes.
JAMIE DAVIDSON: So it’s, which can create some challenges but certainly and again, things will rest around reviews of course, could get someone shut down. There’s manipulation around of how you’re ranking for your products. You could get shut down and again, there’s different levels of specification, kind of black cat stuff, I’m sure you’ve had discussions with people on this call and everything else but it’s interesting, it’s not something that, sometimes you read kind of horror stories you can just type on, look it up on Amazon, and these stories, like someone got shut down and it was final but it’s not really our experience really. There is a step, there’s a multi-step process in terms of appealing. I don’t know, I don’t consider myself an expert. There’s attorneys out there and everything else.
DAVID ALADDIN: There is huge industry, yeah.
JAMIE DAVIDSON: Yeah. They’re really good at it but typically there’s an action plan that you got to put in place and say, hey, if you just submit like, hey, why is my account shut down? Can you turn it back on? Or something, you’re not going to get a lot of progress. But with again, some of these attorneys, people out there, there’s usually a format of, hey, here’s our—we acknowledged this happened, or this was, we didn’t intend for this to happen and here’s our game plan going forward to make sure this does not happen again. A lot of it, sometimes, the shut downs are going to be flagged by automated tools and so they sound more harsh than they are but we’ve always been able to get our accounts back open and again, unless you’re really, really trying—
DAVID ALADDIN: Following—
JAMIE DAVIDSON: To do something wrong.
DAVID ALADDIN: How long were you guys down for? Do you remember? Or…
JAMIE DAVIDSON: We were down for about three weeks.
DAVID ALADDIN: Oh, yeah, that’s painful.
JAMIE DAVIDSON: I mean, we were just shut down in Canada just like two months ago so we’re in… we have a set of product line that we’re focused on but then we’re pretty global in terms of the different countries.
DAVID ALADDIN: Yeah.
JAMIE DAVIDSON: So you know, in Canada, and Mexico, and UK, and now we’re in India, we’re just starting off in India. But anyways, in Canada, I was in Seattle meeting with the Category Manager for us from Canada.
DAVID ALADDIN: Awesome.
JAMIE DAVIDSON: Yeah, and he didn’t really know us before, too, but now he knows us and probably next time as you get bigger you can get some relationships, they’ll probably be able to reach out to you but it can just be different mistakes you’re making that if they don’t like it, you can get shut down. But again, it wasn’t… it was more of annoyance because it causes business while we shut down. It’s not like there’s a fear that, hey, we’re going to be kicked off of Amazon so to speak, so yeah. I mean, but generally again even with new people and so forth, again, I guess that’s technically always a possibility but it’s not. I mean, a meeting with Amazon and everything else, it’s not like they’re out there to find people to shut down and they’re looking to…
DAVID ALADDIN: They want us, they’re going to kill us.
JAMIE DAVIDSON: Yeah, no!
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JAMIE DAVIDSON: I mean most of the employees there is pretty cool. I mean, they really tend to be sharp, obviously really sharp people.
DAVID ALADDIN: Yeah.
JAMIE DAVIDSON: Those are from really good backgrounds and from Ivy League schools and all those stuff.
DAVID ALADDIN: Yeah.
JAMIE DAVIDSON: But most of them kind of, they do admire what we’re doing because they, they’re in these corporate jobs and they think, wow, it’s really cool. They kind of hope someday to be able to launch their own business, everything else, and they have their work cut out for them but they’re not, at least I haven’t come across—they’re trying to beat Walmart and beat their competitors, right? So they want to be the best platform.
DAVID ALADDIN: They’re beating Walmart for now.
JAMIE DAVIDSON: Yeah, definitely Walmart.com.
DAVID ALADDIN: Yeah.
JAMIE DAVIDSON: But they’re very focused on the competition so it’s not like they’re, the perception is they’re kind of working against us but when you meet with them, it’s not the perception I get along.
DAVID ALADDIN: What velocity or let’s say monetary volume were you guys at when you finally started to get account executives and such?
JAMIE DAVIDSON: Yeah, so it’s probably when we got to about the 10 million dollar mark.
DAVID ALADDIN: Okay, so I got to get there.
JAMIE DAVIDSON: Yeah. There’s still ways, David, you can…
DAVID ALADDIN: I get the global ones but like the global executives but I know they’re kind of like the fake ones, I want the US one.
JAMIE DAVIDSON: There’s still ways you can get kind of your foot in the door to get up to get a meeting with them and there was someone like, they don’t do a lot of events but they did like a boost event last year. I was out of town and when I was up in Seattle, they had sent us an invite to this event in New York.
DAVID ALADDIN: yeah. I saw that, yeah.
JAMIE DAVIDSON: I didn’t really think it was even Amazon at first.
DAVID ALADDIN: No.
JAMIE DAVIDSON: I was like, this probably someone like us doing a training or whatever.
DAVID ALADDIN: I thought it was fake.
JAMIE DAVIDSON: Yeah, yeah. So I met the girl who runs that, she was like, no, it’s real, you should come. You definitely got to come. I was like, yeah. It’s like an invite only, right? So I was like, oh, yeah, next year. So on one hand they’re pretty protective. When you’re up there, they’re like, they’ve got to escort you around and they’re cautious of what they say and don’t say with you but they want to find a way to connect with sellers and help seller communities, it’s just…
DAVID ALADDIN: Corporate.
JAMIE DAVIDSON: Yeah, yeah. They’re trying to think and they’re like, yeah, I think I could tell you. Yeah, this was in a press release so I can definitely tell you this. They don’t want to give you an unfair inside edge.
DAVID ALADDIN: Yeah.
JAMIE DAVIDSON: Violate their own rules but at the same time, they want to… so some of these things they said, hey, like the one gal I meet with who ran this boost event she said, oh yeah, we’re going to—they want to have more trainings and have their, they want to have some control over the training going out there and do more so they were talking about with coming out with some pilot for that stuff—
DAVID ALADDIN: Very cool.
JAMIE DAVIDSON: And so I said, oh, yeah, I’d love to help or you know be part of that. And so, yeah there are ways to connect with them and eventually probably get into you know, you get a direct wrap in that kind of stuff.
DAVID ALADDIN: Hm. I saw a vid—go ahead.
JAMIE DAVIDSON: It’s may also differ by markets. Sorry, it may differ by markets, like Canada, you may be able to kind of achieve that quicker, get help quicker in a smaller market place where less people are focused on and there’s just so many different angles within Amazon and things that’s working on that but yeah, sorry, I interrupted you there.
DAVID ALADDIN: No, no. You’re my guest. So I saw a video with you discussing some of the myths that Amazon sellers have about Amazon. I actually liked it a lot. Can you go into detail about what kind of myths they are?
JAMIE DAVIDSON: Yeah, I think some of the stuff, we were kind of just talking about a little bit which was one of them again was this perception that Amazon is looking to shut you down or to work against you, or that they have kind of, it almost feels like a negative connotation at times verse sellers and again, I consider that one of the myths because that was, when you go to meet them, they’re in these silos where they have these big jobs and I can relate to it from my own corporate jobs. Like when I was like in the exact same thing so but it was just a different type of space where they have all this responsibility but they’re only in one silo of the business.
So if they’re on Vendor Central or this, within these things, they don’t know. They don’t know a lot of things. Each individual doesn’t have kind of the whole picture. Like as a seller, you know more about the platform than they do.
And they’ll say that because for example I have a friend of mine who heads up Amazon Prime Day. He’s another former military guy. He’s a former aviator pilot, but so he is super focused all day long year on just to the Amazon Prime Day and he’s trying to learn all the other aspects you know. So he’s… he doesn’t know how to, he doesn’t know everything about it because he’s so focused on how to execute a really big day and they’re really good at that, but how it relates to things that I’m talking about or focused on.
He doesn’t know but so again, that was that one comment you had before that they are trying to work with us and understand it doesn’t always feel like it that when you’re away from Amazon because it feels harsh and threatening and so forth. And in some hand, they do need to have I guess in my opinion, some fear factor because they want to, they want people to try to play within the rules and have some…
DAVID ALADDIN: It’s working.
JAMIE DAVIDSON: Probably. It’s like the IRS with your taxes, some level of fear that’s, enough of that. Oo, that was probably honestly the biggest one going up there and the other one too is again around things like training programs and things they have on. They don’t do a really great job of selling themselves in that way of kind of letting you know what they’re trying to do and so again, I think there’s ways to see more from them and connect more with them to help FBA sellers and so forth. So those are probably the biggest ones that stuck out to me being up there but it’s just a really impressive… you know they have to compete with Google in terms of employees, like our Google less type companies I compare it to. So they’ve got, everything’s super nice there, everyone’s like tons of people are walking in with their dogs.
DAVID ALADDIN: What?
JAMIE DAVIDSON: They got doggy snacks in the front counter to take in for your dogs. I haven’t worked in that type of corporate environment so that was kind of humorous for me but I did ask them when I was there, I asked them at dinner, I said, what’s the culture like to work here? It wasn’t so much a direct question for me as a seller but I was just curious. In one hand in Amazon, I hear about Jeff Bezos and the intensity of that, about how intense the environment can be and so it sounded like they have a healthy balance that they have all this autonomy like there not, no one really watches what hours they work but they’ve got to get their work done and they do work pretty long hours and everything but it’s just kind of a little bit different type of corporate environment than I’ve worked at in the past, so.
But you know, my biggest thing was I came away feeling like beyond the big… we have our big operation, we have contacts, but I do feel like for mid-sized sellers and smaller sellers, you can find ways to connect with Amazon. It could be, you know you don’t want it, it could be a way like the Boost Event or if they’re going to run a pilot in trainings or try to find ways just like anything else to add value to them in some way.
If you can be part of a pilot or that kind of stuff. Then, I think that can potentially help get you in before you’re one of their top ten sellers in a category for example.
DAVID ALADDIN: Very interesting. Yeah, I got to start networking harder.
JAMIE DAVIDSON: That’s good. It’s always good so that’s why it’s great to meet you, too. I mean, the one thing in the Amazon community with Jason, Jason’s kind of a more behind the scenes type of guy and so I’ve taken to a networking environment he’s really humble but you kind of recognize that it’s not necessarily his strength but for me, there’s so much, we all can learn from each other and get out there then, a little connection here through. Again, we have some connections in Amazon but even separately like my buddy who’s up there. He’s got to be careful if he wants to make sure that I don’t ask him for any special favors or anything but the more you can just get to know people and they can trust you, whether it’s at Amazon or whether it’s kind of people within the Amazon ecosystem, I think the more all of us can benefit.
DAVID ALADDIN: Behind businesses are the people and that’s what makes everything happen so it’s just something I got to work on harder. What it—
JAMIE DAVIDSON: I’m not yet through with the podcast and everything else to me, I’m sure you may have seen you’ve got a lot of great guests and everything and so I think, yeah, to me that’s part of the reason I was in the podcast too and see what people are up to because it’s pretty inspiring what I see different people doing and learning from it and so whether it’s at Amazon or just, again, that network of other people doing the same thing we’re doing, I think that can [Crosstalk]
DAVID ALADDIN: For me, yeah, for me podcasting is like, it’s like my neighbors. It’s the five closest people I have.
JAMIE DAVIDSON: That’s great.
DAVID ALADDIN: But so, for you, what struggles do you face? Because you guys are at the eight-figure mark, what kind of problems do you guys deal with?
JAMIE DAVIDSON: Yeah. I mean, one of my test pun early is you tend to be, you know, just the legal aspects is one that’s more interesting, that’s not very fun to talk about but then.
DAVID ALADDIN: Super dry.
JAMIE DAVIDSON: Yeah, maybe if we’ll talk with Jason on it, have him over, it become a big part of his time and he’ll fly back to the U.S. to deal with lawsuits, I mean, we’re talking about a lot of money, right?
DAVID ALADDIN: Jeez.
JAMIE DAVIDSON: And there’s, I don’t have, you know, get another boring topic, why don’t we talk about the tax issue again we’ve sold saw like we’re dealing with stuff with California now, and different states, and I don’t, I’m not an expert even to deal through that but the rally is a bigger company. We have to make sure that those things are in order and there’s a lot of, you know, by state, different things coming out that, you know, when you’re small it doesn’t necessarily isn’t super important but even if you’re small but you want to sell the business in a few years and so forth, those are the type of things that you’ve got to make sure your house is in order so kind of non-sexy things, yeah, like taxes, lawsuits, who we pay.
If you can’t afford to pay you have to hire like a good attorney to deal with stuff but, again, those are some of the things that are, you know, again, most people hopefully aren’t going to have to deal with it for a while, but there are other things too like for us to, you know, 60 million, our name is on let’s say closer to almost 100 million including all the other platforms, but, so, we’ve got a lot of people. We just hired 50 new people in China.
We run a lot of operations out of China as well too, so for us to scale to get to 200 million it sounds like, again we’re talking about individual sellers, it sounds like big. But when you’re talking to somebody with a business, you’re pushing hard to really grow. One of the challenges we had early was just to find new categories and products and for us not to fail on those categories. Two years ago, we sold the electric scooters.
DAVID ALADDIN: Oh yeah. It was you?
JAMIE DAVIDSON: Yeah.
DAVID ALADDIN: You’re that guy? What happened?
JAMIE DAVIDSON: Jason and I were on a deck a few years back and I—this is how some of the products have happened. I was on the deck having some wine it was late at night and I sit with my son in our neighborhood, there was a boy who had the product and I said I think this is going to be a popular item this year. At this point, this was like the year, almost a year before that Christmas and so Jason looked at it and did a ton of research and he went over to China, he sent me photos like to all the best warehouses. He was trying to find the one with the best batteries and so he came back and we had about like a million dollars of the inventory, and the product we had was pretty good but because of a lot of crap that came out, a lot of those—
DAVID ALADDIN: For sure.
JAMIE DAVIDSON: Going out catching on fire and so we had about a million dollars of products sitting at a port and…
DAVID ALADDIN: Was that Miami?
JAMIE DAVIDSON: This was in Los Angeles, are there in Los Angeles, so, but it was a loss, right. It was a big loss and we sold some of them through eBay and we have some around the office here.
DAVID ALADDIN: I feel like, I…
JAMIE DAVIDSON: There’s lots of stuff in the office here. But those are things that, you know, we make those mistakes, you know, whether they’re mistakes or bad guesses, it stuff that happens.
DAVID ALADDIN: At least you guys have transportation for the warehouse.
JAMIE DAVIDSON: That’s right. I think, you know, Jason was, yeah, those people are… Actually on one of our videos we have Jason is cruising around on, on one of these.
DAVID ALADDIN: Okay. Maybe Christmas gifts for the employees’ kids or whatnot.
JAMIE DAVIDSON: Yeah. They didn’t last too long. It like right now the people are, with the eclipse going on here, right, everyone’s, people began to shut, some sellers have been able to sell those and make a lot of money and some people have been shut down for safety reasons so, there’s always a risk, right? Whenever you place, whatever the product may be, there are so many different points that you could, you know, you could fail. Hopefully with enough experience and time, that we, again, I’m sure, you’re on the same thing. You kind of reduce your risk and then take advantage of the opportunities where you do, we are doing well, you know, we kind of double down and try to make money, make margin where we can, but there are always setbacks and things that you have to deal with.
DAVID ALADDIN: Let’s talk about outside of Amazon, how you guys branched out, what’s the strategy?
JAMIE DAVIDSON: Yeah, sure. So it’s a . . . we have a guy here that’s dedicated to specifically those relationships in that business so it’s an interesting one too because I always think about, what’s the correct order so to speak. If you’re selling at amazon.com, do you go on Seller Central, do you go to Vendor side, do you go to other countries with an Amazon or do you go to other platforms? And so, we’ve got, we sell on walmart.com, we do a good amount there. Again, just outside of, within Amazon we do other countries, right? Like I told you Canada, Mexico, towards India was kind of a pain to get up and running. Australia is coming soon. We do some of Japan, but off of Amazon, we do Walmart, we do Home Depot, we’ve got Overstock, Wish, we do AliExpress, we’ve got Mckay Calibre. So we’ve got a handful of different ones, and again I’m not, I don’t consider myself an expert those but again we have a basically dedicated guy that handles those relationships for us and goes out and he had a kind of a background on dealing with how traditional retail like that before and so he manages that day-to-day and builds those relationships. And then again we have the warehouse so we get products to those things but…
DAVID ALADDIN: No, it’s awesome.
JAMIE DAVIDSON: Yeah. Yup, so…
DAVID ALADDIN: That’s what I got to do.
JAMIE DAVIDSON: Yeah. I’m sorry.
DAVID ALADDIN: I’m trying to diversity my operations and so I’m not leaning on Amazon too much. It’s been going pretty good, it’s just, it’s a lot more heavy lifting I guess.
JAMIE DAVIDSON: Yeah, yeah. You don’t know like what’s going to take off, like jet for example. Like how’s that going to play out? Is that going to—
DAVID ALADDIN: Yeah.
JAMIE DAVIDSON: Grow big and then die or is it going to be sustainable. But, yeah man, I think on one hand it’s helpful that we’re not, you know, we’re somewhat focused in terms of our category, so I think all these things, if you’re going to look at a lot of different categories and kind of go all over on Amazon, it’s hard to move all these things to concentrate, so you kind of have to pick your strategy to some extent, whether you’re going to kind of stay within a category. You know, if you stay within a certain category so to speak, it’s a little bit easier to try to focus to take these things to other countries or focus to take these things to other platforms just because, you know, you can be a little more focused on your products whereas if you’re spread out more, you know, you may have to stay more on kind of on Amazon or stay, you know, a little bit more limited at least until you grow to enough size. Yeah.
DAVID ALADDIN: Hm. Where do you guys see yourself in 5 years?
JAMIE DAVIDSON: That’s a good question too, so Jason, it’s funny. Things grew really quick and again if Jason, let’s say this. I always feel like Jason almost got bored with the business. It grew so fast and he is definitely really interested and we’ve experimented with some other businesses outside of Amazon and learned how hard other businesses can be like things in Biotech or whatever else, and so…
DAVID ALADDIN: Very cool.
JAMIE DAVISON: The real focus now is to really, really focus on doubling this business. Again, we’re doing a lot on the China side so, you know, there is a market here in the U.S. to buy Amazon businesses and also a market in China that is devaluations can be really big in China.
DAVID ALADDIN: What?!
JAMIE DAVIDSON: So yes there is an aspect of potentially. It’s not an immediate plan so I won’t say, but the possibility exists to have a really big exit potentially on that side, but again, there’s a lot of, a lot to be done there and yet we’re worth, we’re a good sized business but there’s obviously, you know, there’s people there doing certainly more than us and bigger than us and moving really fast and so we’re trying to really—
DAVID ALADDIN: Yeah.
JAMIE DAVIDSON: Focus on doubling the business in the next couple of years and probably in the next three years I’d say and see where that takes us there too. So the other part now is again some of the stuff with Jason and I which is, you know, we’re doing some more training to help people. One of my thoughts is that, hey, we’ve got to decide there are probably things that we can help other people do and help sell. You know, the beginners, I know, you kind of, your podcast help the kind of people that are little more advanced beyond the beginning stage so we thought—
DAVID ALADDIN: Yeah.
JAMIE DAVIDSON: There’s more we can do to help people get to a certain point. I mean, none of it is a magic bullet, none of it is easy but you got to kind of understand the right process and how to, there’s a lot of mistakes you can make if you don’t know what you’re doing so we’re also looking to help focus and help people along the way. We haven’t completely nailed down on it, maybe potentially with some of the higher-level sellers and helping, some of the 10 million to get to 50 million type stuff but yeah that’s definitely on to that, we’re focused on and I’m focused on helping other with as well.
DAVID ALADDIN: I agree, well, you see I would do that but it’s like I feel like if I kept on talking about the same thing, you know, I’ve been there and I’ve done that and I do, actually I’m kind of selfish. Like I do it for myself, like I’m trying to always push myself to get to the double or the triple or quadruple like my sales and revenue, so. But I get.
JAMIE DAVIDSON: Yeah.
DAVID ALADDIN: Yeah, there’s definitely a passion around teaching other people how to do stuff.
JAMIE DAVIDSON: Your podcast serves that purpose. Naturally, right? So you’re…I know myself, there’s just so much of these businesses that you kind of, sometimes you forget what you do know, what you remember before, you don’t realize, oh, yeah, I forgot about that aspect. You’re not focusing on it so even when people that do know some of this stuff. That when they listen through podcast and I’m sure different guests you have. It’s like, it’s just motivating, too or it reminds you, oh, I really need to focus on this area again because there are so many possibilities and so many different things you can focus on. There are so many people interested in it too because while it is a lot of hard work. It is, there’s a really fulfilling feeling to kind of drive something that is your own and build something that you’re proud of yourself. So there are a lot of people that have a desire to get into that, so it’s a matter of how you do it. But there are also a lot of people out there that are teaching things that maybe aren’t in it for the right reasons or they’re not, so the quality is low so—
DAVID ALADDIN: Yeah.
JAMIE DAVIDSON: Careful too who you kind of who you’re working with.
DAVID ALADDIN: You’re coming in from the Kaplan scene so we know the quality, you guys have, I’ve done your books or your company’s books.
JAMIE DAVIDSON: Oh, okay.
DAVID ALADDIN: They did a lot of engineering books and even up to high school and SAT stuff, so, definitely high level.
JAMIE DAVIDSON: That’s why I kind of thought with Jason’s side and my background, and our story together, every story gets a little bit unique but it’s… we’re still formulating an app but we think it’s a pretty good combination, it’s a good team, and it’s also, you got to work with people you like. I mean, one thing with Jason and myself, and there’s also Brad and the team here is like, I was in China with Jason last year and again, he did some other ventures, too and he said, for now, I only want to do deals that are with people that are good people and I want to have fun with the business because you can make… if you do a business deal with the wrong person or the value’s going to lie, it can go really…
DAVID ALADDIN: South.
JAMIE DAVIDSON: Yeah, it can go really south.
DAVID ALADDIN: I feel like that point you just said has to be emphasized so much more because you don’t find out until it’s too late.
JAMIE DAVIDSON: Yeah, people think we just, they’re looking for a deal or it sounds exciting or sexy, like, oh, we’re going to do that and partner with this guy, but yeah, you got to find the right fit absolutely because it’s a big commitment.
DAVID ALADDIN: Well, some people, I feel like in business, some people are just completely different creatures. They’re hard to work with, they’re hard to talk to, they’re just very machine-like, it’s hard to explain but they’re not people-people.
JAMIE DAVIDSON: So, that’s a great point. Yeah, the first—you got to be careful. I even think about well u have friends, right? And friends that want to, and I have a lot of good friends in here in Atlanta, really successful people, different spaces that want to get involved, they want to do something which is great but you got to keep that in mind, too, especially if they’re your good friends. You don’t want to jeopardize—
DAVID ALADDIN: The friendship.
JAMIE DAVIDSON: The friendship but at the same time that’s not a reason not to do something if it’s the right fit, it can be really, really good but like to your point, it’s not always the same. That dynamic can be different when you’re working than when you just have been socializing with someone.
DAVID ALADDIN: Before we end, I want to touch base on how your partnership with Jason like kind of occurred. What, how do you think it formulated and became what it is today?
JAMIE DAVIDSON: Yes. So when I came early on I talked about that. We had this friendship and this dynamic. I think we have mutual respect for each other in terms of—he was launching this business I kind of joked that which is true, I came home one day, my wife said she sold like, I had a desk and this really nice conference table that she sold to Jason for 100 bucks to start his business and at the time I was like, whatever. A hundred bucks, and later on I joke to him, hey, I should’ve traded that for equity for him in the early days.
DAVID ALADDIN: Right.
JAMIE DAVIDSON: With the business, but you know, one we had mutual respect for each other. We had… he could see that kind of my background could add value in terms of what I did.
DAVID ALADDIN: Yeah.
JAMIE DAVIDSON: And again, we had a lot of discussions on our case. A lot of people were like, oh, it’s really lucky that you guys were neighbours, but I said, well, actually we went through it for like several years of different deals, we had it. And he’s the type that said, hey, I’m not, I don’t want a big business plan. I want it over a drink. I came to it with a few business plans in the education space and he had an offer to me a few times and I turned it down one time. Then, he came back with another offer so it wasn’t that easy. When you really get into really doing a deal, things could not work out even though we were in… we were both coming out from a good place? Sometimes, it’s not easy, it doesn’t just magically happen but I finally kind of a line on this deal because I was really passionate about Amazon.
And eCommerce space and obviously, he’d been successful with it and then on the training side we could fit. So, like I said, I guess my biggest point here was it just took a little while it wasn’t easy even though when people are like, sounds like we were neighbours and friends so it happened but that’s really not the case. Still, because it probably took ton of a commitment on my part to be willing to leave a good paying job and so forth.
So it’s one thing to do a part time and you can do that which is great, you can start that way, but when you’re really going to do, you know, go in it every day, everything else, you just have to get it, like I said, the stars have to align. If they don’t, you know, and probably when the deal’s going to work before, part of the deal was it didn’t upset either of us. We weren’t, we kind of understood where each other were coming from and that’s why I’ve allowed potentially to have another deal and look at it down the road where it did make sense and so, and now that the stars are aligning, we’re off and running.
DAVID ALADDIN: No, it’s awesome. How can people contact you and find out more about you?
JAMIE DAVIDSON: Sure, yeah. So you can the Amazon Insiders, we’ve got basically two things we’ve been working progress. We’ve got amzinsiders.net as our blog, we’ve got a few things up there. The amzinsiders.com is our free video training report where I’ve got that and then, I’m also on Facebook, we’ve got a Facebook group. Again, if you look at the Amazon Insiders you can find this but feel free to reach out or private message around like that so I’m happy to connect and again, I love networking with people like yourself and everyone else in the community since we’re all working together so to speak to hopefully, I love seeing people be successful and doing my part to try to add value and at the same time, learn from people like you and others.
DAVID ALADDIN: We’re all against each other on Amazon.com but on the outside, we’re having drinks.
JAMIE DAVIDSON: That’s right. Yeah, you can’t see, I mean, within it each other it’s like me, we’re not competing day to day within our category but you’re right, but at the end of the day, really, West Point would say, cooperate and graduate so to speak.
DAVID ALADDIN: For sure. No, I believe that, too and everyone that I meet with, I find them as allies, I don’t see them as enemies actually, so, but very cool, awesome. Thank you for coming on the show, David Aladdin, Jamie Davidson, out.
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