How Jenny profited 180% more by focusing on slow sellers and launching new products.
Anyone who’s been selling on Amazon for more than a few months has likely experienced the “80/20 rule”. The 80/20 rule states that 80% of outcomes (or outputs) result from 20% of all causes (or inputs) for any given event. This rule is seen in eCommerce when 80% of sellers’ income comes from 20% of their products. The top sellers.
In our own Amazon business, we started with one high-selling product in 2014. After two years and ten products launched, we found that 80% of our sales came from two products. We spent 80% of our time milking, babysitting, and pushing two products instead of pushing the other eight.
We have found this to be true for many private label sellers. But it doesn’t have to be that way.
When we dug into this 80/20 rule and surveyed hundreds of Amazon sellers, we discovered a common denominator. They focused on the products that brought them the most sales—investing 80% of their time and energy on 20% of their products—negating 80% of their products that only brought in 20% of their income. Thus, focusing on one tree while ignoring the forest. But why?
In this Slow Sellers Inventory Strategy guide, we’ll take a look at:
Why Most People Fail on Amazon
Overwhelm & Mismanagement
Put simply, overwhelm is the key reason for the lack of growth. The common denominator of overwhelm, poor management, and going in too many directions at once is the lack of a proper system. Without a system in place, your attention is spread too thin across many products, projects, deadlines, emergencies, etc., and the result is stagnation, or worse, regression.
Every successful business in history has had a system.
They all have these systems in place to allow them to manage the 20% of their products making 80% of the income, without losing sight of growth and expansion. As an Amazon seller, your #1 job is to build systems that run 80% of your business, so you can focus on the 20% outcomes that grow the company.
180% Growth In One Year
Our “InvenStory” today is about a SoStocked customer who we’ll call Jenny. Before Jenny ever found SoStocked, she was that typical Amazon seller described above. Jenny spent 80% of her time babysitting and nurturing 20% of her products (the top sellers). She spent most of her days massaging her sponsored ads campaigns, researching new keywords, creating social media posts, funnels, and promotions for these products, thus negating 80% of her business.
Jenny’s initial excitement for starting her business had long worn off, and she had become somewhat jaded. She felt stuck. Her overwhelm, and overwork kept her in the mindset of stagnation, where she was scared to launch new products.
It’s the all-too-common catch-22: “If I spend my time researching and launching new products, then I won’t spend enough time pushing the products that pay the bills and keep my business afloat. But my existing products don’t make me enough money to hire people who I can train to help me launch new products, so I’ll keep doing the same thing over and over while expecting a different result.” A vicious cycle.
That “strategy” of panic-management does not work. Never has, never will. Jenny was stuck and frustrated.
All Is Not Lost
Jenny felt overwhelmed and stuck, although not defeated. She heard about SoStocked through a popular Amazon mastermind group. Jenny decided to attend one of our free online webinars where she learned about proper inventory management and, more importantly, time management.
After the webinar, Jenny reached out to the SoStocked team and signed up. Jenny had a pretty good idea that if she could free up some time and attention, she could focus on the more neglected 80% holding her back from achieving her goals.
It didn’t happen overnight, but it did happen! Jenny followed the step-by-step onboarding videos provided by SoStocked–she imported all of her Amazon listings through the API, and she synced up her Seller Central account to SoStocked–within a couple of days, she was up and running.
Jenny even got to do a personal onboarding call with a SoStocked team member to help her with any questions after the initial onboarding. After she learned the SoStocked system, Jenny trained her virtual assistant (VA) on how to use the software. It took about two weeks, but the VA took over the inventory management.
Slow Sellers Inventory Strategy
With most of her time freed up, Jenny was now finally able to focus more attention on the 40% of slow sellers that had not been producing. And with the reporting features in SoStocked, she was able to quickly identify problem products and develop a plan for how to handle them.
These low performers were so neglected that many of them were just accumulating fees and tying up capital. Getting those products selling profitably or getting that money back and reinvesting it in viable products were key strategies she implemented.
She immediately started seeing more income and, more importantly, PROFITS from these low performers. This small win revitalized her and put the wind back in her sails, giving her the energy she needed to keep going.
Within short order, Jenny was able to scale up and launch 30 new products (SKUs)! That was HUGE growth in a short time. With her newly reinvigorated, refueled relentless commitment to success, Jenny was able to properly launch these new products, hire more staff and keep everything in stock.
Jenny is now so thrilled with the results and the dramatic growth and change in her business. She told us she’s on track for a 180% increase in sales in 2021!
To put that into perspective, let’s say your business was doing 1,000,000 in sales per year. Just by freeing up time and launching new products, and keeping them in stock, that would mean an additional $1,800,000 in sales!
Freeing Up Time
Look, there is no such thing as a one-size-fits-all solution. No magic pill or wand that will make all of our problems go away. But there are a couple of takeaways from this story that every business owner should learn:
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