In this article, we’re going to be talking about the different revenue avenues that can be explored using Amazon UK wholesale.
Here I have with me today to discuss all this is my good friend, Jonny Smith. He is going to share his insights about the platform and the lessons he can impart to help individuals who want to follow the same career path.
I’m really interested to talk about the intricacies of creating a brand out of your company, gaining a reputation, and branching out into other marketplaces, all in the name of developing your company.
Who is Jonny Smith?
He is a UK national currently residing in Cape Town, South Africa, a multi-channel, multi-country, nomadic entrepreneur earning 7 figures. He has been in the e-commerce industry for 15 years and full-time on Amazon UK for 4 years, achieving his own warehouse a year and a half ago, and in the past six months has achieved to travel the world.
What has his journey been like?
He started his own Shopify store, and due to having his own warehouse he has his own distribution and is very focused on a certain niche, which they find comfortable. Finding that he does £30,000 to 40,000 a month, close to half a million in Shopify a year. Allowing his company to explore other opportunities such as software B2B, and wholesale. Granting them a name for themselves which gives them the traction they need and the credibility that makes wholesalers and brands make offers to them rather than them having to reach out.
Jonny Smith also has a German Amazon business which he started last year, which he found a bit more difficult. But due to having their niche of exporting to Germany and selling on the German marketplace. Finding still that his main drive and volume still come from Amazon UK specializing in fulfillment from their warehouse selling Fulfilled Prime, they also do Leverage FBA, which frees up space in their warehouse, because it’s such a good model.
Jonny Smith’s experience in Amazon UK?
He said that he is gaining profit in Amazon UK and states that he feels that it won’t change for a very long time. He recommended Amazon UK for beginners to focus on Amazon first, get their systems in place, and get a good team. He is profiting £1.6 million in a year, with their margins steadily getting better due to selling Fulfilled Prime and improving their skills.
What is the most important lesson he has learned throughout his process?
Jonny Smith started out the warehouse by micro-managing every staff worker and individual by himself which caused him to split his working hours between micro-managing and creating a back-end staff, which he says was good but he had never been great at micro-managing. He continues by saying that he accepted that he needed a professional inside the warehouse rather than himself, which ultimately allowed him a greater profit, a better team, and more time to focus on other projects to further the company.
Most beginner entrepreneurs were too focused on doing everything on their own – but allowing a professional into the workplace; who knows what they’re doing can and has the skills to manage a warehouse, is the best decision anyone can make. When comparing the cost of a warehouse manager and noticing the increased output and efficiency of the staff on-site, it allows you to have your own work hours while giving you greater returns.
Is it better to hire people to work on sourcing rather than sourcing yourself?
If you have enough revenue to allow yourself to hire people for sourcing, creating software that allows your employees to have greater returns in terms of sourcing will gain you a greater profit, while allowing you time to work on other projects to enhance the company. His time is too expensive to be used in sourcing items himself when he can pay other people to do the task for him using software that he developed which will allow him to do more with his time. You definitely need to build a team that operates the business for you, while you build the business.
8 Things I learned about Reselling from Amazon from Jonny Smith
I interviewed multichannel, multi-country, and nomadic online seller Jonny Smith to talk about his impressive businesses grown out of the UK. We talk about his experience owning and managing a warehouse while traveling the world, as well as his software that helped him diversify and build his businesses.
Why did Jonny Smith dive into Shopify?
He says that he does find importance in building his own brand. Due to being in wholesale and creating a name and reputation for his company as a top competitor in their specific niche. Now brands approach his company for deals rather than the other way around. Venturing outside of Amazon and opening new doors and opportunities allowed his company to diversify a lot, allowing his company to expand into the B2B market.
Allowing his company to branch out into different marketplaces has allowed him to build his brand with reputable reviews from a substantial customer base, brands and sellers are more inclined to talk and communicate with a store that has made a name for itself within a specific niche as being a legitimate brand, a legitimate source for distribution. Though it may seem like more work, due to him having an Amazon UK store, adding Shopify doesn’t add too much overhead, it’s already integrated into their system with just a few adjustments. It runs like clockwork he says, the rewards have really started to pay off for him, further saying that he’s really glad he branched out into Shopify.
What opportunities have come from him branching out from his success in Amazon?
Wholesalers, and exporters, his company deals with numerous amounts of clients all over the world, it has opened opportunities in America trying to gain contact with him, brands reaching out and offering that their brand could really work inside his store. All sorts within their niche, exactly refined to what he’s selling in his store, which usually works out.
Why did he create a warehouse while traveling around the world?
He had traveled a lot before the warehouse, he’s in the UK market which has minimum order quantity, which took a massive hit on the category that he is in. He further states that it’s better to have a warehouse in the UK rather than in the USA and sell it for Fulfilled Prime because it reaches the whole entirety of the UK. When compared to America, the UK has a greater reach, due to having Amazon FBA. He also receives cheaper prices, and cheaper fulfillment costs, and sells it for Fulfilled Prime.
While also wanting to venture out into Shopify and E-bay having a better lead time, and better control, he ultimately decided that it was better to have a warehouse. He says that, if one is debating on whether to get a warehouse, he says that they should be prepared for a huge amount of overhead and that costs will be great, he says that one should venture out, and diversify, because the costs of the warehouse, the payroll, utilities, is not worth it if it’s not diversified.
He says that finding the warehouse manager that he has today, the skillset that this certain employee has, and the hierarchy that Jonny has built has enabled him to allow the warehouse to operate itself without him needing to micromanage it. He said that if the warehouse manager was to send in his notice for 3 months, there would already be someone who will fill in for them because of the natural hierarchy that he put in place.
Why does he still travel even with a warehouse?
He says that to understand the mentality of not always being in the warehouse is to look at the other giants in the industry like Jeff Bezos, asking “Do they stay inside their warehouses all day?”. He further explains that one has to understand that if one wants to grow something bigger, one eventually has to let people who are professionals and know more about certain aspects of the warehouse, operate it for you. If you are comfortable enough with the systems and software that you put in place within the warehouse, and trust in the hierarchy of workers you put into the said warehouse, it can ultimately run itself without having the owner around it.
What advice would he give to people who want to follow in his footsteps?
Even if he didn’t enjoy warehousing a lot, he says that it has helped him learn a lot about running a business, managing people, and real-life interactions, and the learning curve he says was very good for him. But going into warehousing one has to have the mindset of diversifying their options, getting outside of the FBA, creating a brand for the company, and creating a name for themselves in their niche. He further emphasizes that if you’re only in the FBA, don’t create a warehouse, if you’re in America he can’t really speak out of his experience. In the UK he says that his decisions have netted him good margins. If you like micro-managing, if you have any prior experience with managing, then go for it. You get to build something yourself, if you do want to go down the nomad life, you have to prepare for at least a year of hard work.
Are you planning to follow the journey of Jonny Smith?
If you do want to reach him, you can contact him at Ecom Inner Circle (Build a Business Using Amazon FBA, eBay, Etsy, Shopify). You can also join this Facebook page to learn more.