Cant Fail Amazon FBA Business Month 2 Update – 117% ROI in 2 Months
It has been 2 months since I decided I was going into the FBA Business with my “Can’t Fail FBA Business Plan” and here is my update!
Todays post is a fun one… I share a LOT of data/graphs and details about my journey over the last 2 months to get this business moving.
If you like numbers, business plans, excel, assumptions and sensitivity analysis you probably have issues (like me) but will enjoy this post…
The short history is my wife left with the kids for a weekend and I had some extra time on my hands so I decided to throw myself at a new business… it took me 1 month to get setup to start selling and I have now been selling (with some inventory interruptions) for 1 month.
My wife is getting involved in this business and helping get all the items listed below completed. So the list of what has been accomplished is long but it has been completed by myself, my team and my wife.
Today’s post I am going to share….
- Our Day by Day FBA Business Timeline for 2 Months
- Key Failures I Experienced
- My Next Steps for Growth
- All the Resources I am Using
- Sales and Traffic Numbers
- How are My Assumptions Holding (lots of graphs and data J)
- Goals for This Business
Throughout this post you will see I have had one general philosophy with this business… SPEED over CONTROL
Timeline of my FBA Business
I am probably missing some steps but this should give you an idea of how I have attacked this business throwing as much at it as I can manage…
- Background – Grew an Amazon affiliate site ($1,500/month in one niche)
- Sep 11 – Decided to start an Amazon FBA business using the affiliate site mentioned above to drive traffic
- Sep 12 – Ordered 120 initial units
- Sep 12 – Started listening to all of Scotts podcasts at com
- Sep 12 – Contacted 20 similar websites to the one I had to see if anyone was interested in selling
- Sep 12 – Started building out a larger PBN for this niche
- Sep 13 – Setup and email opt-in bribe (discounted product) and retargeting pixel on affiliate site
- Sep 15 – Purchased website at Empire Flippers ($12k) selling a similar product
- Sep 16 – Ordered a crap ton of content for both the PBN, affiliate sites and soon to come Branded Site
- Sep 20 – Started building out my done for you Amazon Private Label branded site(hired someone to help)
- Sep 25 – Ordered multiple competitor products to research packaging and quality compared to mine
- Oct 1 – Product Received and Sent Onto Amazon (Labelled 120 units in a parking lot in the rain with a headache (lots of fun!))
- Oct 10 – Reordered another 500 units (before any were selling but with better packaging)
- Oct 15 – Finally resolved listing issues and was able to have product go live!
- Oct 17 – Sent email to my list to get some initial sales
- Oct 17 – Signed up for AMZTrackerand changed links over to SuperURLs on my 2 sites to help drive up rankings
- Oct 27 – Sold out of most of my popular inventory sizes
- Oct 30 – Ordered 300 units of Product #2
- Nov 3 – Second order of inventory received (500 units)
- Nov 4 – Ordered 3rdorder of inventory (500 units)
- Nov 7 – Using AMZTrackerexecuted first discount promotion
- Nov 8 – Our first hi-jacker on the listing (read My Wife Quite Her Job post) matched the price (so she didn’t get any data) and then sent a few emails asking her to get off the listing (success!)
- Nov 11 – Second product received at Amazon
- Nov 12 – Setup 2 unique arrangements(covering 4 sites) with affiliate site owners not interested in selling where I paid them $50 via PayPal for recommending my product as their #1 recommendation on their Amazon affiliate site
- Nov 14 – Using AMZTrackerexecuted the first promotion for product #2 and modified Affiliate sites to promote product #2
Total hours into this project are likely 5-10/week or 40-80hrs cumulative.
- Approval to “Gated” Category Was a Challenge and I lost 2 weeks with this!
- PPC Amazon – For some reason I haven’t got it working only a problem for the last week while I have had inventory to sell
- Leveraging My Affiliate Sites – Although I am driving solid traffic I have not done anything to use these sites to build my brand (to hit my goals I need to leverage everything to build a brand)
- Spending 2hrs in a shady parking lot at 9pm in the rain labelling and boxing my initial shipment was definitely painful! (didn’t get mugged so really this should be a success)
- I changed the title and it turns out I made it too long so the listing was disabled for 1.5 days without us realizing.
Next Steps to Grow…
- Brand Registry on Amazon
- Start my retargeting PPC more aggressively (ordering graphics now & will test direct link to amazon, link to a review post or squeeze page with email opt-in magnet)
- Improve branded site– currently just enough for a brand registry but need to build it up
- Improve email follow up sequence and build list
- Build out product line (6 additional products I have my eyes on and geting pricing for – focusing on products in the same market until I have grown as much as I efficiently can then plan to try and sell with a central product theme)
- Start social presence for my brand (hiring an expert for this!)
- Inventory strategy – I would like to come up with a better strategy but for now as soon as one item hits the 30days of remaining inventory status it will trigger us to reset all inventory with less than 60 days left back to 60 days.
- Improve shipping logistics (currently still receiving at a warehouse and then having them forward on using DHL) – This shouldn’t be hard to sort out but it is just one more thing to resolve
- Continue content and SEO efforts on affiliate sites to continue to grow them (content & niche specific PBN growth)
All the Resources I am Using
- TheAmazingSeller(free training)
- AMZTracker(used for all rank tracking and promotions)
- JungleScout(awesome for researching how products are selling)
- Done For You Amazon Branded Site (person I had build out my site is now offering to build out others Amazon Websites)
- NOTE – Special soft-launch pricing being offered on this service. If you are interested in a done for you Amazon Private Label or Affiliate Money site have a look!
- Done for You PBN Service
- Empire Flippers– Purchased one website from Empire Flippers
- Have a look at listing – https://empireflippers.com/listing/40319/
- PayPal (One unique thing I am doing which is risky but fast is to establish a relationship and send incrementally larger orders as “gift” payments to save on PayPal fees, you will get no buyer protection but you don’t really get it with a wire transfer anyway!)
Sales & Traffic Numbers
The first couple days of November we were short on inventory for the popular sizes but including those days here is how we are doing…
November Stats so Far:
- Average Traffic = 289/day
- Units Per Day Ordered = 12
- Average Profit Per Unit = $10
Since I Started Selling Oct 15 here are The Traffic and Sales Graphs
How are My Assumptions Holding
To give you a better idea of how all the pieces off Amazon work to build into Amazon here is a graphical representation of how my FBA web properties are setup…
The basic cost/FBA fee/profit breakdown for my products are as follows…
This is the table I built 2 months ago to analyze the potential for this business and now with 2 weeks of data here is where the numbers sit…
On track for a 117% return on my $53,147 investment after 2 months (with lots of opportunity to still improve)
With only 2 weeks of solid data I am likely underestimating where we will actually end up!
From my initial post I made many assumptions about how the business was going to be able to perform and as I stated at the time I thought many assumptions were going to be off (and I was correct).
One important number was very close to my assumed ROI (117% vs 138%).
Again I have to hesitate to draw too many conclusions from this since I am extrapolating a lot of data from 14 days in November (I was out of many sizes for 3 days and the xmas rush may have started??).
But the good news is that I believe many of the numbers should only improve over the coming months.
The 3 assumptions that I was furthest off were…
- Conversion to Buy My Product – Only 26% of people who purchased through my affiliate link purchased my product vs the planned 50%. However, I am hopeful that as my review count increases and I continue to improve my sales page my conversions will increase.
- Sales Driven by Amazon – Amount of sales driven by Amazon resulted in only a 58% increase vs my expected 100%. However, again with only 12 days of solid sales I expect this number to increase as my seller rank increases.
- Costs – I thought other expenses were going to be higher. Although Amazon continuously requires funds to be reinvested in inventory/additional products to grow it can all snow-ball from that initial investment. Especially when inventory order time is under 2 weeks my ability to recycle funds within the Amazon business has been better than expected.
- AMZTracker(used for all rank tracking and promotions)
- JungleScout(awesome for researching how products are selling)
- Done For You Amazon Branded Site(Premium Branded website service)
- Done for You PBN Service
- ExtremeRebate, RebateKey, Samurai.Social
- Snagshout vs Vipon
Public Goals for the Business
- Short Term– Sell 50 units/day on Amazon at an average $10 profit by the end of the year
- Longer Term– Build this brand into a $50k/month net profit business and sell for a 30x multiple within 24 months of starting = $1,500,000 sale J
Obviously massive stretch goals but I believe both are possible given competitors I plan to outwork sales numbers!
I enjoyed creating this post with all the number crunching and graphs and hope you like it as well. If you have any thoughts on the approach I am taking and how it could be improved I and many other readers would be interested in hearing!
Jon, this is fantastic. You have certainly built a solid FBA business here very very quickly. The combination of your off page affiliate sites and PBN is unique.
Thanks for sharing so much data, it is very much appreciated.
I am starting my own FBA business and have $75k ready to deploy if the right opportunity comes up. Will checkout EmpireFlippers and the Done For You Amazon site services.
Thanks again for sharing so much information!
Thanks Francis, this was a fun post to put together. Good luck with your business, you are in a fortunate place to have funds to start investing!
To: Jon Gillham
I am so pleased and so upset.
Pleased for you and your wife..
– yep, upset w/ myself.
To see you take on so much,
so incredibly smoothly and
successfully, it truly fascinates
me. I’m hoping you write an e-book
someday so I can read it over & over.
action Action ACTION !!!
This is now my mantra.
This wonderfully helpful post
will be a guidepost and a beacon
signaling to me and getting me
back on track if I should wander
or get lost. I am grateful to you
for this and for the values you
have held for so very long.
well done indeed.
Time for me now to take action.
Respect & Gratitude,
Thanks John, I have built up a team to do a lot of the work…don’t get me wrong everyone including me works very hard on this business.
Good luck with FBA business and thank you for the details.
How do you create graph like that?
Thanks, which graph are you referring to? All graphs were made in Excel. The image with the truck was made in Canva.
This is freaking awesome Jon!
I’m a bit slower than you but I’m going to order the first batch of products for FBA soon.
My site is slowly growing and producing affiliate sales so I hope to get similar results 🙂
Thats awesome Tung, I know how much effort you are putting into your site so I am sure you will have success!
This is fantastic. I have an affiliate site on track to hit 5k this month. I have been toying with the idea of doing exactly what you did but haven’t sat down yet to figure out a plan. Thanks for sharing
With a site doing $5k per month if there is a good product fit than I am sure you will find success with this model.
John! Even with the team you’ve built up – I have no idea how you keep so many things straight within your own head. This is unbelievable how quickly you’ve been able to implement all of this! I’m sure it doesn’t hurt that you have all kinds of money to invest. But still…
Are you having your units air shipped over from China? I know it costs more – but I think that’s the way I would go in order to not have to deal with waiting for boats. What kind of warehouse are you having them shipped to? Did you rent or lease some space? Or just borrowing from somebody you know? Will you eventually just have your supplier properly label the products and ship directly to Amazon?
One genius takeaway that I got out of this post (that I never thought of before) is how you email other affiliate sites and offer to pay them to promote your product. Awesome strategy!! Great job with everything! I’ve been second guessing myself as to whether or not I should private label a product. This post has re-motivated me. Thanks!
Don’t worry Matt they are not all straight! Yes definitely shipped air… although yes it is more expensive the capital turnover rate is one of the most important numbers I believe in this business. The faster the turnover of the capital the faster it can multiply and I can stop putting money in and start pulling money out. Even if I save $1,000 on a $10,000 order if it ties up the money for 1.5 months vs 2 weeks I need to invest 30k instead of 10k and it actually hurts my ROI.
The spot is a warehouse that receives packages (not the most professional operation – a guy with an address and a receiving dock).
The affiliate arrangement I thought was pretty clever…was a no brainer for everyone I have been able to contact!
Don’t second guess yourself… I liked you post on singular focus!
Oh – I’m staying focused either way… One of the long term plans for my ONE site was to possibly create and sell a private label product through FBA – one of the products that I am promoting on the site anyway. So it would be part of the focus strategy. I was just second guessing whether or not I want to deal with sourcing and inventory and back end FBA stuff… Doesn’t seem very passive. But might be too lucrative to ignore.
Could you add my email to your list if you have an auto tutorial program, I seem to loose direction after reading tons of blogs for newbie; Still I am not confident to start, thank you so much!
Man, what a cool post and congrats with the success of this project. I clearly have issues too cause I’m loving how you’re geeking out on the spreadsheets.
The outreach to other affiliate sites also struck me as a cool idea. I wonder if there are other similar opportunities like paying owners of social communities to mention your product….
Looking forward to future updates.
To your success,
Glad you enjoy the graphs… these are fun posts to put together!
John, you are a rockstar buddy! You laid out a great path for people to follow. I really like your approach with the affiliate site. I picked up Amasuite instead of Junglescout though. Figured it was a better product to use in this style of affiliate site-to-fba.
Thanks again and congrats on going full time with this stuff.
Very well don Jon!
I have an affiliate site for weight loss pills that is making some alright passive income.
Any thoughts on private labelling it or selling it? This site is for the Scandinavian market.