In this article, let’s know who The Gravy Train is and his journey
I am super excited to bring you Chris Gunkel, also known as The Gravy Train on Twitter. He will share his Amazon online arbitrage journey in the UK. And I really love him because he is super transparent about his number and is also on the journey to £1.2M.
Topic Rundown:
Introduction
The Gravy Train talks about his targets and what he wants to achieve each month. His transparency is what I love about him. He shares not only his revenue figures but also talks about his profitability. Meaning, he not only talks about his achievements but also his downfalls; when he doesn’t achieve his goal. And this is the area that I think is really inspirational, for I also have to see what other sellers are doing; big sellers. Also, as an Amazon seller myself, we can all relate to his journey.
Who is The Gravy Train?
For those who don’t know, Chris is a seller on Amazon who’s moved from online arbitrage to wholesale in the last 18 months. He’s moved mainly over to wholesale for about 70% to 80% of his purchases through supplies directly through distributors. With that said, his business model gave him the ability to scale beyond £1M to £3M, and more. He also has a Discord group that helps other people.
Why he switched from online arbitrage to wholesale
He said that selling in online arbitrage has some great returns in ROI, especially if you’re not VAT registered, it’s fantastic.
But as a VAT-registered seller, you are competing with people that got a massive advantage over you. Also, you will find yourself against people that can accept a lot lower selling price. On the side of things, in order to hit a certain turnover level, is quite a concern for him. With the ability to scale because running on a virtual system requires a lot of people. There is a majority of people rely on Amazon Virtual Assistants to find them new deals all the time.
The limit you get from ordering through websites is a big problem for The Gravy Train in online arbitrage. Almost all websites are putting purchasing limitations on nearly all people that are buying from them. Ultimately, you want to be buying from suppliers that want to sell to you. In online arbitrage, suppliers want to sell to consumers and not retailers. He said that online arbitrage is scalable, but he doesn’t think it’s a long-term scalable business model like wholesale would be.
What’s going on in The Gravy Train’s journey
The Gravy Train must be on 972 for 12 months, and on 900 for the calendar year, which is very close to his goal of £1.2M. This year, he is only doing wholesale, mainly wholesale. His online arbitrage is about 20% now but it’s still decreasing.
The Gravy Train runs a lot of metrics on average profit per ASIN. It’s not huge, it’s something about £250, so it’s not massive at all.
His average selling price was a lot higher when he was doing £30,000 to £40,000 a month. You could buy 10 products that are selling at a high price and it would take up a big percentage of the monthly sales. So, the average selling price is probably around £30 to £40 per item, which is substantially higher than the majority of people doing wholesale. Mostly, people will like the lower cost of the item and presumably more people would buy that product.
With that, he had fewer ASINs because his average selling price was a lot higher than well. And that makes a difference. Also, it means less sourcing is required if your average selling price is also higher.
In Amazon online arbitrage
In terms of just the Amazon business, The Gravy Train got one sourcing Amazon virtual assistant who purely sources wholesale. So, Chris strikes up a relationship with a supplier, initially analyses what they’re selling, and hands them over. Basically, they have a number of suppliers that get the daily spreadsheets from; daily deals and daily offers. Next, they will look over them and they’ll make a decision on what they are going to purchase.
That person doesn’t actually make the bank transfers or spend the money on the cards; that’s still The Gravy Train’s job.
That person doesn’t actually make the bank transfers or spend the money on the cards; that’s still The Gravy Train’s job.
But the ones saying this is a good deal and how many they would want to purchase is the job of the purchasing manager but without them entering the bank details. His Amazon virtual assistant doesn’t have deal targets at the end of the day. It’s The Gravy Train’s connections that they’re working from so they can work off what he got.
He mentioned that they have a prep center that stores stock for him. As well as a focus on what needs to go straight out as soon as it comes in because their space is money. This prep center lets him store items on pallets and they charge him a monthly fee per unit, which is good. They also got an Amazon fulfillment FBM order for him, if he got some larger items that he doesn’t want to send to Amazon. Also, if he wants to move into a seller-fulfilled prime side of things and doesn’t want to get his own warehouse, they offer that service as well.
That is important as you scale your Amazon business. You need to have a really strong connection with any prep center.
Why is he using a warehouse and not a prep center?
Everyone who does wholesale needs a good warehouse because it’s more efficient. So why is The Gravy Train chooses a prep center over a warehouse?
Well, he did around the numbers and went to see a couple of units that were available for lease long term. Looked at the cost of business rate and loaded it all into a spreadsheet. And the benefit he found was quite minimal at his level. He thinks that when he’s pushing towards £2M to 3M, it might work out more beneficial.
For him, the employees' wages, that’s going to take up a big monthly cost. When he feels like he has enough units going out each day for one person to do full-time, it probably would make more sense.
Negatively, having his own warehouse facility is a liability for him; going to be present most days, and him worrying about security. The Gravy Train needs to be actually checking in and receiving all deliveries. And it is something he doesn’t really want right now. He wants the flexibility to go wherever he wants and just take his laptop and his business still continues working without him actually physically being in the UK.
At the moment, he is not looking to outsource that and says if he has huge savings right now, he would.
Your job is to make this business as simple as possible. The more elements you have managing staff prep center, warehouse, or utility rates.
8 Things I Learnt About Reselling On Amazon from The Gravy Train
Making the difficult transition from online arbitrage to wholesale, Gravy is well on his way to reaching the 1 million mark. He built a successful retail business on his own terms and is helping others do it too. Follow his journey here and his active Twitter community.
Inspiration of The Gravy Train
He is reading a book titled The 4-Hour Work Week by Timothy Ferris – New York Times bestseller. And there are things in the book that struck him and one is about what happiness is.
It may sound deep, but what it asks is what is happiness. Tim Ferris believes happiness is excitement and about having lots of excitement in life, whether that’s with family or with friends. Whatever it is, always create excitement for yourself. The idea of where you can go and have excitement for yourself in a week’s time. Don’t just spend weekends having but remember that there are 7 days in a week to do that. Remember, enjoyment isn’t only allowed at the weekends.
It doesn’t need to be one big holiday a year or two big holidays; doesn’t need to be a big thing about working towards your retirement. Making yourself happy multiple times throughout the year is what it is all about. You can work when you’re in your 30 until 60. Then, enjoy yourself and have happiness in retirement.
Agree that you can have happiness and excitement now! Create memories and build a flexible work-life balance. Having a work-life balance is crucial in enabling you to do that. And that’s why The Gravy Train tries to outsource as much as he can at the moment, but it might change in a year’s time.
Why is The Gravy Train so transparent?
Being transparent about his results on social media can be difficult. If you feel like you’re underachieving, it gets to you. Being transparent gives you the option to actually share with everybody. When you’re sharing it with everybody, you then open yourself up to more criticism. So, if you do that, always be prepared to take it. You can’t only share the good things but you also need to share the bad times.
The Gravy Train is running a reselling group, and he offers wholesale mentorship services that help other people do these things. And to be able to do that, he must be transparent and show everyone what he’s doing at all times. If people buy the services he offers, they need to understand what he’s actually doing, otherwise, people will think he’s a fraud.
Two things The Gravy Train picked up from being transparent
One, the actual time. The physically needed to spend working on this business every single day is decreasing every single week, as he outsources tasks. The Gravy Train said that the sourcing virtual assistant looks after most of the suppliers. Recently brought in an Admin VA who helps the other businesses that he runs, but they also help out with a lot of tasks for the Amazon business. In this kind of business, a lot of things just take time to make money. You could go two days without doing anything on the Amazon business and then the next day, you might spend 9 or 10 hours on it. Always remember, the figures on the screen do not always give you the full story.
And second, 16% ROI isn’t bad for a business that he doesn’t have to focus on, mostly. Sometimes what you don’t see from low sales is actually just releasing cash all the time. And The Gravy Train wants cash, cash, and cash. Cash is king, as they say. As we are approaching deep into the month, he needs cash in order to buy more stocks for the next month.
He said he got lots of items that were bad online arbitrage buys back in the day that he finally bit the bullet and cashed in. That is a reflection of a 31-day period where you’ve taken huge losses and some huge wins and it’s balanced out around 16%, so in his eyes, it’s been a wonderful month. And when that happens, he puts a big red cross saying he did not hit his target. But he released a lot of stock that could sit around for another year and he got money to buy better deals with, so that’s good enough for him.
Just take everything with a pinch so he says that everything you see on Twitter when something looks bad. You might be really good to them, but something that looks really good to you might not be so good to them. Just be open-minded about things, which is the best way to be.
What’s next for The Gravy Train
Looking at the wholesale model which The Gravy Train does is the big thing called wholesale, but let’s be honest if you’re just becoming a retailer; is actually getting yourself a professional mindset. Chris is a retailer now and not just someone who’s flipping on Amazon. Look beyond that and start thinking about how do you actually build a future for retail business. If you’re going to do a physical store, is probably not the most attractive thing to do in this day and age. What you’ll need is an online presence; getting a website is actually functioning and getting traffic to it. It is crucial to build yourself as a retailer.
Next year, The Gravy Train is planning to build his website running and functional. He has his own website that has made a few sales, but he is still building a website where it could be his own marketing. A platform that doesn’t have the high fees that Amazon has but will work alongside the Amazon platform. Using market channel fulfillment, where Amazon’s stock will be shipped to customers if they order through the website.
His long-term plan will be to just have that website working with his own set of suppliers who maybe don’t want you to sell on Amazon and actually fulfilling them through the website and not on Amazon.
Time to get your happiness!
If you want to contact The Gravy Train, you can contact him mainly on his Twitter account and that’s @GravyFi. He also runs a reselling group called Gravy Train so you can also check that out. He now has 150 to 200 members that he helps progress through online arbitrage to wholesale or if they want to go into private label.
Want to learn more from different people doing Amazon online arbitrage? You can check out our previous articles featuring Raiken Profit and Romer the Roamer to know more about their Amazon journies.