This post is both a review of how the business went in 2019 and what I’m looking forward to working on in 2020.
I’m sharing all this for a few reasons.
First, I’m hoping that it will inspire you to take the time to think about your own business and maybe help you think of some things to work on. Reviewing past performance and setting new goals are important growth exercises, and the end of the year is a great time to do these activities.
Second, I want to do a better job at keeping you fully updated regarding what’s going on with my business. With that in mind, I will be publishing a Q&A post some time in the first 2 weeks of the year based on questions that are submitted in this post. So if there is something you want to know about me or my business, use the comments below to ask away.
Third, I’m looking forward to making 2020 the best year ever for Online Selling Experiment in terms of how many people we are able to help actually start and scale their online business.
This will be a year dedicated to ACTION and getting things done.
I have some exciting things in the works to that end like new Accelerator training programs, and I’ll share some details about them at the end.
2019 Year In Review
2019 was the year of wholesale.
We still did over $2 million in RA sales, but wholesale was where we saw our biggest growth. About 65% of our total sales for the year came from wholesale, and this was a pretty consistent ratio all year.
Here is our sales dashboard from April, right around $350k of this was from wholesale with the rest coming from RA.
We brought back merchant fulfilling more orders in December.
December is one of the best months of the year to consider merchant fulfilling, specifically because it allows you to get items to customers before Christmas that wouldn’t have made it if you chose to ship to FBA warehouses first. This is the situation in the final weeks leading up to Christmas.
In 2017 & 2018 we didn’t do as much of this, but we did it again this year and it went quite well.
In a roughly 2 week stretch of time in December, we were able to do over $50K in merchant fulfilled sales. Most of these items were bought and sold within a week, so there was a very fast turn-around on the items.
We built our own software.
In 2019, we built some in-house software to expedite various processes involved with wholesale sourcing and item processing. This has helped us to streamline things and become more efficient.
Normally you think of tools as third-party applications that you buy, but having something custom-built to meet your exact needs is also an option worth considering. It can involve a higher-upfront cost, but the long-term ROI is better if it is successful in solving your problems.
2 people left the business…
In 2019 we had 2 full time team members leave the company. 1 by their choice, 1 by mine.
This wasn’t something we’ve had to deal with in prior years, and it led to having to retool a couple areas. We were able to find some more efficient ways to get things done and have a leaner operation as a result.
So ultimately we were able to achieve the same level of sales we did with 2 more people but with lower expenses.
I successfully worked remotely for an extended period.
I spent 2 months in SE Asia with my girlfriend at the beginning of the year. I still worked some during this trip, but I wasn’t physically there to do any of it.
This was a great experience to have the business continue to run and grow while spending time on the other side of the world. From the beginning, having freedom was a big reason for starting my own business, and this was the first time that I was gone for more than a week or 2.
I look forward to doing more of this in the future.
2020 Business Goals
2019 was definitely a great year, but I’m looking forward to continuing our progress and making 2020 even better.
Below I’m going to share some of the goals I have for 2020 – I’m hoping that reading these will give you ideas and inspiration for your own goals. If they do, please share 1 or 2 in the comments below this post so I can read them.
1. Work to increase overall gross margin.
While I obviously want to work on increasing revenue and profits, I also want to focus on improving our gross margins. To keep the explanation simple here, the basic idea is that for every $1 of revenue we generate I’d like to work on improving the total profit we’re earning.
2. More focus on bringing new wholesale products to Amazon.
Thus far a lot of what we have done involves selling and optimizing existing listings on Amazon. In 2020, we’re going to test out creating more listings for products that are not yet on Amazon.
While this is a riskier strategy than selling products with proven demand, the potential profits are higher. Given our size and experience, it makes sense to start testing this.
3. Implement new retail arbitrage systems.
I’m not going to go into too much detail about this right now, but we’ve been testing some new retail arbitrage strategies that have worked out very nicely. We’ll be implementing some of these on a larger scale in 2020, and once we get out of the testing phase we’ll be sharing more details with you as well.
Since I know you are likely curious, I’ll let you know that this centers on better store-by-store data collection and usage. One way that it paid off in a big way recently was identifying merchant-fulfilled opportunities in December.
4. Work seller-fulfilled Prime into our rotation of strategies.
If you take my courses or follow the emails or blog posts I share, you probably know that we rely heavily on FBA through most of the year. One of the biggest benefits of this outside of decreased fulfillment time has always been the access to Prime shoppers. With seller-fulfilled Prime, you still get that benefit even when merchant fulfilling though.
We did quite well with merchant fulfilling in December, and I see a lot of potential to have select items sold via seller fulfilled prime year-round. I want to test this out in 2020 and see if the benefits of offering this outweigh the extra fulfillment costs.
5. Do $100k+ in sales on Walmart.com.
Walmart is aiming to compete with Amazon in a meaningful way, and out of all competitors, they have the resources and supply chains to do it. Up to this point we haven’t done much with Walmart, but we’re working on getting more items listed on the platform currently, and I’d like to have it contribute a meaningful amount of sales in 2020.
I would be happy with $100k, and I think this is very achievable given our size and the amount of inventory we control. If you aren’t selling on Walmart.com yet, it is definitely something I would recommend testing for 2020 given the possibilities.
6. Review and optimize all systems in Q1.
We aren’t having any problems that need immediate attention, but I still think going through with a fresh set of eyes to look for opportunities to be more efficient is a smart idea. Not taking the time to do this regularly is how you end up with things that are actually broken rather than just inefficient.
Doing this goes hand in hand with my goal to improve our margins too.
7. Launch a private label product line.
In terms of work, this is probably the biggest goal on this list. It has the potential to offer the greatest revenue and profit increases as well. My goal is to launch it both on Amazon & through our own site, and potentially on others as well.
More details on this will obviously be coming! If you have specific questions or things you’d like me to share about the process, please let me know.
2020 Online Selling Experiment Goals
1. Share more of what we are trying here on OSE.
We do a lot of testing, and I’d like to do a better job of sharing the details of those tests and the results with the readers of the blog here. This includes things we talked about above like selling on Walmart.com, launching private label brands, and trying seller-fulfilled Prime, as well as things we haven’t yet discussed.
If there is something in particular that you would like to hear about more often, let me know in the comments.
2. Help more people FOLLOW THROUGH.
In 2019, the team I have working on this site and I dedicated a lot of time to figuring out how we can do a better job helping people follow through with getting businesses started. We’ve overhauled the training programs being offered, are working on updating and adding lessons, and we’ve been working to improve the free content on the site as well.
In doing this, we’ve been leveraging a lot of external training ourselves – most of which have been traditional courses like we offer here.
The most recent program we’ve participated in had a very different format geared towards achieving a highly specific goal in a set period of time. This involved a combination of prerecorded material, live classes, and homework – all distributed on a schedule that the participants (including us) had to follow exactly to get credit.
There were real penalties for not completing the work too.
The results were clear and immediate, and I think the idea will translate extremely well to many aspects of building an online retail business. With that in mind, I’d like to introduce you to something new we’ll be doing in 2020:
Online Retail Accelerator Programs
Starting in February, I’ll be offering a brand new type of training program – “Accelerators” – to supplement the traditional courses I currently offer.
Each Accelerator will have a very specific goal – like “Get Your First $150 in Retail Arbitrage Sourced Products” or “Place Your First Wholesale Order”.
Each Accelerator will be broken up into a series of lessons and specific actions that take place over a roughly 4- to 8- week time frame with regular live interaction with my team and I. ALL students will be expected to follow along in real-time and complete tasks on time.
There will be deadlines to meet and penalties for missing them.
There will also be strong guarantees in place for those who complete all the steps – meaning if you sign up and are accepted into a program designed to get you your first wholesale order within 8 weeks, you’ll leave that program with your first wholesale order placed or with your money back in your bank account.
These Accelerators will not be replacing Online Retail Pro (this is the video-based, at-your-own-pace course I currently offer). My goal for them is to enhance the results students of Online Retail Pro experience, helping you see real, tangible outcomes after signing up for training.
With that being said, you will be welcome to sign up for Accelerators independent of Online Retail Pro as well.
We have one of these scheduled already and are working on picking topics for the rest of the year now.
That wraps up this post – don’t forget to submit your Q&A questions in the comments below. I’ll be answering as many as possible in detail in another post for the beginning of January!