DDP: Delivered Duty Paid! It sounds like a dream come true for so many Amazon sellers importing products from China! Isn’t it great that you can pay a slightly higher price for the product and get it delivered to you with all taxes already paid for? Perfect! Or… is it?
I’m afraid that when it comes to offers like these, we always come back to the age-old truth that if it looks too good to be true, it probably is. And DDP is no exception.
If you’re importing goods from China using Alibaba.com to sell on Amazon, eBay or anywhere else, you should read this article very carefully, because the chances are you’re currently breaching the law and could be facing severe problems due to tax evasion.
Sounds terrifying? I agree. So, let’s clear the air once and for all and learn about DDP Incoterms and how you CAN and CAN’T use it in your importing business.
It’s time for a money saving tip—who doesn’t like that, right?! 🙂 No, seriously, with the information I will share with you in this post, you can save hundreds or even thousands of pounds per month on your Amazon ad spend, depending on how big your business is.
I’m talking about AD SCHEDULING! So far, I have found this to be the most effective way to save on Amazon PPC costs. Previously, I was doing my ads manually, but now, with the help of Sellics’ new ad scheduling feature, I can fully automate the entire process.
Before we dive into the details of how it all works, we first need to understand what ad scheduling is and why it is important for your Amazon business. Without further ado, let’s get started!
Why should you schedule your Amazon ads?
For those of you who are new to selling on Amazon, this all might sound a bit strange, but for anyone who is already selling on Amazon AND spending money on ads, scheduling will make a lot of sense. And here’s why.
Let’s talk taxes. Yes, I know, I know! One of the most popular topics of all time, especially when it comes to Amazon and VAT. As much as I would like to not think about it and go into the head-in-sand mode, the reality is that we simply can’t avoid the issue of tax. Moreover, with the recent changes in how Germany handles VAT, we now have no choice but to face the issue head-on and find an effective solution.
I have already created a very detailed post about VAT for Amazon sellers, and it has quickly become one of the most popular posts on the blog. I have covered the basics of how VAT works in that post, so I won’t repeat that information here today.
This particular article is all about the newly created VAT situation in Germany, how it will affect Amazon sellers (especially those of us based on the UK), and what you need to do to stay compliant and not lose your seller account.
Just a quick disclaimer before we move forward:
I’m not a tax advisor, accountant or international law specialist. Everything I write in this post is purely my own observations and nothing more. DO NOT use this as legal advice under any circumstances! If you feel that you’re not comfortable with this information, seek legal advice.
In this blog post, I’m going to share exactly how I launched a brand-new product on Amazon UK and made more than £320,000 in sales in the first 18 months, which resulted in a NET profit of more than £85,000!
More importantly, I will show you HOW YOU can do the very same! Yes, you can start a successful, fully automated Amazon FBA business and make £2000, £3000 or more per month to replace your salary, finally quit your day job, and take back control of your life!
No, I’m not claiming to be making hundreds of thousands or millions of pounds, unlike so many self-proclaimed “gurus” on YouTube with their photoshopped screenshots! I’m talking about real money and real profit. In fact, to be completely transparent and open with you, I’m going to take you live into my account right now to show you the real numbers:
This is the Amazon account I created for this new product. As you can see, there are no sales for it prior to September 2017.
Over the last 18 months, I have sold more than 32,000 units of the product and made more than £320,000 in sales! This is from selling just one product in one niche with multiple variations.
Sure, those are only sales—what about expenses like Amazon fees, FBA fees and others?
February, the year’s shortest month, made record-low sales. Yes, in February, I “only” made £14k in sales on Amazon UK. Obviously, I’m not happy about that. Even though last year’s sales were only a tad higher, a drop of £1k this year is NOT a trend I would like to see continue.
Since I have set my Amazon sales target at £300k this year, compared to £240k in sales last year, I can’t really afford to have bad months like this if I want to reach my target. I do, however, have a plan of action for how to deal with this, but more on that later.
The competition in my niche has definitely increased over the last year, so that’s a big factor contributing to the decline in sales. Also, I am a little bit worried that, because I sell just one product with multiple variations, my current list of variations may have become overexposed, meaning that people who have bought the product from me already haven’t seen anything new. Perhaps they are now choosing different brands purely because of this factor (the product I sell is essentially a consumable that is purchased somewhat regularly).
I have already covered the competition part extensively in my January update post, so there’s not much I can do about that on Amazon alone—but just wait until I get started on Shopify! :).
The product range/variations part is something I can improve, and I’m already working on it! Two new SKUs are in production as we speak, and when I launch them on Amazon in April, it should help me “freshen up” my product offerings.
Another month has gone by, and it’s time to update you on my FBA business progress. In these monthly posts, I show you the real numbers behind one of my Amazon accounts. I’m talking about REAL sales and REAL costs, including a full breakdown of my product and advertising expenses!
I do these posts mostly for myself. It’s basically a diary of my journey into building a brand-new company and turning it into a £1M+ a year business. That’s the plan, and I know exactly how to achieve it, which is why I like to do these monthly posts to keep myself ACCOUNTABLE!
It’s so easy to get sidetracked with the other projects and businesses I have, so it’s a great strategy to keep all my goals and tasks written down in such a public way! It would make me look really bad if I didn’t act on these, right?
I highly recommend that you do the same. Write a journal or keep your tasks and plans written down on paper so you can regularly check on them and see where you stand with your journey towards the goals you have previously set.
I have made a decision. I’m going to cut my losses and close down the US expansion for my Amazon business. After careful analysis of January’s results, it’s obvious that there’s no point in continuing. I will go into more details and explain the reasoning behind this decision in my January income update post next week.
A sad day? Not at all! Actually, I’m very relieved that it has ended. I’m not happy about the fact, BUT my excitement for the future is much greater than my disappointment in the failure of this US expansion experiment.
Today, I want to talk about “letting go” and how I believe it has helped me tremendously over the years to grow as a person and business owner. Here’s why.
I have always been full of ideas, especially business ideas. Since a very early age, I was thinking of ways to make money—don’t ask me why, I don’t know! It’s just how I’m wired. You know, the typical “born an entrepreneur” type of person. That’s me.
The first business I can remember starting was at around the age of 6 or 7, where I was simply baking chips and selling them to family members (mostly mom and dad as they had the money). Those sales were probably “forced” on them but, hey, whatever works, right?
At that age, I actually dreamed about owning my own restaurants or pizzerias. I was very much food-business-orientated then. In fact, I recently found some floor plans that I drew when I was a kid for a two-storey pizzeria! It was very detailed and had with equipment, tables in place, etc.
Good question! And it’s a common one that many newbie sellers ask me when they start getting into the product research process. Should you simply pick random products OR look for niches with multiple products? Let’s find out in today’s blog post!
First of all, let’s just quickly set the definition of what RANDOM and NICHE products are and then we can get into differences between them.
A random product is usually something that doesn’t provide many opportunities for horizontal expansion.
For example, a computer desk is plus/minus a random product. Yes, furniture is a niche, and yes, office products are a niche, BUT in relation to Amazon FBA businesses, these would not be classified as such because they’re simply too generic or too wide a category.
It is almost impossible for a small seller to get a furniture store/business off the ground. It is important, when starting an Amazon FBA business, to make decisions with your business growth plans in mind, which we’ll cover in a minute.
Another classic example of a random product is the famous garlic press. You might think it’s a niche product (kitchen niche) but it’s actually not. It is a random, one-off product purchase.
Yes, people who buy garlic presses would most likely be interested in other kitchen products, but that’s typically at some unknown time in the future! Usually, when someone goes on Amazon to look for a garlic press, they just want to buy that garlic press.
Amazon product launches—the hottest topic of 2019?! Yes! Everyone wants to know the MAGIC formula to launch a product on Amazon and gain sales, reviews and organic rankings as quickly as possible.
BUT does a magic formula like this even exist in the first place?
I’m afraid not…. let me explain why.
Up until a few years ago, the whole “ranking” thing did work very well for sellers. You know the drill: launch a product, do high discount giveaways, which instantly boosts your sales velocity and automatically increases your organic rankings. Just two years ago, all you had to do was create a spike in sales velocity for just 7 or 10 days and it would basically “stick” and transfer to organic rankings.
Many smart people became millionaires because of this trick. I don’t know why Amazon let it go on for that long but, unfortunately, by the time I got involved with selling on Amazon, it was already too late. Amazon had fixed this “hole” in the system and created a much more complex ranking algorithm, making discounted giveaways pretty useless.
Fast forward to 2019 and you’ll need a lot more than a few clever tricks to successfully launch a product on Amazon and achieve good organic rankings. A LOT MORE work needs to be put in! Sales velocity is still a super important ranking factor BUT only if you sell the product at full price. No more heavy discounts to try to trick the system.
You should see my face as I’m writing this blog post at 5 a.m. on the 1st of January. I am SO excited for the new year ahead! I can’t even remember the last time I felt as energised and POWERFUL as I am today. This year will be the year of BIG changes and BIG achievements – and I can’t wait to share it all with you!
If you’re wondering WHY I am writing this post at such an early hour –and on a day when almost everyone else is lying in bed fighting a hangover – check out my 4 a.m. wake-up routine post!
This will be a long post as we have so much to cover! As usual, I will start off by sharing all the sales data, costs and NET profit numbers for both the Amazon UK and Amazon USA platforms. Then I want to quickly cover the whole year of 2018 so you can see the progress I have made.
Lastly, we’ll finish up with an IMPORTANT update on the next steps I will be taking—and already have taken—to move my business to an entirely new level in 2019! This includes expansion to eCommerce, wholesale AND other Amazon regional websites. As it’s January, it’s the perfect time to put some time stamps on all the goals I have set out to achieve in this year, so we’ll also be doing that at the end of this post.