FBA BET 10X Your Amazon Business In 2021 with Yoni Kozminski.mp4
Interview with Yoni Kozminski
Tomer [00:00:00] Welcome, guys, we have a very brilliant and important guest today.
Yoni Kozminski, the founder of MultiplyMii and Escala and today he’s going to talk about planning your FBA business, working on it, not in it and how to remove yourself from the business.
But before we jump into it, why don’t you share quickly a little about yourself background and what MultiplyMii and Escala are?
Yoni [00:00:30] For sure. Well, thank you so much for having me on. I really hope that I can add some value today and those listening and can really take something home.
It’s less about us, and I’ll tell you obviously about us because, you know, it helps to build a bit of credibility, but really the intent here is how do we help educate and you know, everyone going through this process of growing an FBA business in Amazon and Ecommerce, it’s a challenging road.
Related Reading: What is Amazon FBA: Complete Amazon FBA Guide in 2023
So, you know, for us, it’s how can we help first? And so the businesses that I have, it all started well before I got into these businesses. So I came from a creative advertising digital marketing background. I was doing digital strategy for the likes of Sony and MasterCard, Mercedes-Benz, Medtronic Enterprise businesses, but always from the eyes of a small business.
I was the tenth employee who grew to about 35 in Australia. That’s where the accents from. And you know, that was in the time where there was no social media. I was back in 2009, 2010, where I actually launched Mercedes-Benz Australia New Zealand social presence. So there was no Facebook or yeah, it was right at the start of all of that. So that was sort of the start of my career through sort of digital marketing.
And then I moved to L.A. and was in creative advertising, which did everything from TV commercials to the works, and that was doing strategy with MasterCard and with Sony. And I moved to Israel four years ago and before even that, I was already building e-commerce websites. But I’ve always had a real passion for ecommerce. For me, it’s the very finite understanding around the data points that you can understand how you’re impacting and how you’re working with finding your audience.
You know, when it was working with Mercedes-Benz, for example, you know how many billboards and TV commercials and newspaper and digital ads did they have to say before they had such a high purchase? You know, decision to make high value purchase decision. And so it is definitely just a more complex marketing equation but I really just had a pretense to the level of data rather than sort of the assumptions made. So I found my way into Amazon.
I met a couple of guys who had an Amazon business. They were doing $2 million when I met them in about 12 months helped scale that from two to five million. And the way that I went about it really was, I built an agency like everything that I’ve known historically. I mean, that’s really the, you know, a big part of the fundamental building blocks of what you’re doing inside of Amazon, you know, outside of obviously inventory and supply chain and logistics. And I got a really strong taste for it in that business, helping sort of build out all of the functions.
But I found the talent in the Philippines, so it was a big eye-opening experience. You know, I used to go down the path of hiring VAs and, you know, and it was good. It was helpful. But I always came from a very professional world. And so we never had generalists running around the businesses that I worked with, you know, with specialized media buyers or PPC specialists or both are in the same category of creative directors or art directors or designers or, you know, you are specialized in a role.
So the idea really was I helped professionalize that business and then created two businesses to help effectively recreate what we did for that business that was acquired by Thrasher. And what we did was we found a better way to find more high-quality specialized talent. And that’s what we do in MultiplyMii. We effectively do the end to end executive search and function in the Philippines for professional talent, you know ex-corporates, people who are doing things like, you know, operations, logistics, inventory management, you know, design, true creatives, not sort of the general virtual assistant, you know? And so, you know, that’s everything we’re trying to sort of professionalize the space and help people. Also with the onboarding and KPIs and managing expectations and performance management, it’s the whole sort of end to end.
And the other business Escala is where we are a process improvement consulting practice, where we specialize in e-commerce businesses, where we look at how systemized is your business based on people process and technology. And so the fundamentals of everything that I really want to sort of share today are born out of what we’ve created, you know, inside of that Amazon business, inside of the businesses where we’re here today.
And so. Today’s little chat is really just about how I can share just some of the bits of knowledge that I think were really helpful. Back then, you know, some of the documents that I’m going to share today we created years ago when we were assessing sort of the value and the viability into going into Amazon.
What products, you know, what’s the cost of the products? What’s the true operating costs and expenses attached to the business? What is my my game plan really look like? So I understood how much, we understood how much we needed to invest in the business and what our cash flow would look like and what would it what would a reasonable return look like? So I’ve gone on a little bit here, but that’s really that’s that’s the crux of it. That’s what I hope to share today.
Tomer [00:05:43] Yeah, yeah. And I’m also very curious to hear more about you and what you are working in your background. But I was a very limited time one jump right in, and this is a topic that I’m also very passionate about like you. So when you showed me the slides and some of the formulas and some of the data that you plug in, I was like, Wow, this is really cool.
And to those that are going to watch it, make sure that you actually take action. You actually use it. You, you check the files, see there will put a link in the description below so you can get a copy of it’s free of charge with your notes and thank you for sharing this with us and really take it, take it seriously and listen to it. Then just put it in the background because this is the things that actually change and help you grow the business. This is not maybe something that is sexy or shiny, but it’s what matters, you know? So that’s why I let you really show us, well, what you got?
Yoni [00:06:44] Yeah, I mean, tell you summed it up perfectly. It’s not. It’s not the sexiest stuff. It’s not new product development where we all wish we were just focused on new product development. But what I will tell you is if you pay attention to this stuff and you listen and take action on some of the steps that I want to share with you guys today, that’s how you can focus more on new product development because you really have to first understand where do you sit in your professional journey?
So if you let me share the screen, I will jump into the presentation. So I mean you. The first slide really just talks about who we are and what are we about, and I feel like I’ve really covered that. Our objective is how do we help professionalize Amazon and eCommerce sellers and really sort of have them be, you know, almost timeless and sort of continue to adapt so. Let me jump in to, guys. So when we talk about, I want to say a note to. Got to come. You’ve got to come more prepared.
Yoni [00:07:58] You know, there we go. All right. You say the right. You can see the right screen. Yeah. So I mean, I can’t see any hands or anything like that at this point but I’m sure if you’re listening and you’ve listened this far and you know, this wouldn’t be, this would be something that you would have experienced in your career instead of Amazon.
It’s that, you know, it doesn’t matter how much you’re working and how many hours you’re putting into the business, you know it’s on fire to flags up. You plan to do PPC before you know it. There’s stranded inventory and you know, everything sort of, you know, everything’s stand to it.
And so for a lot of us, you know, when you go through that the first time or you don’t understand how to get yourself out of it, you actually are unaware that what you are doing typically is you’re working in your business and very subtle adjustments to looking at what in versus on your business is. But they make a world of difference when it comes to truly scaling your business and removing yourself from the equation.
So you know, the first most important step for us today and for me to share is, you know. What does that even mean to work in your business? So, you know, when I look at it and I’ll try and make some examples here for you. But when you look at focus, you know, so you’re focused effectively on short term deliverables. So that might be like, you know, PPC ad spend, you know, going in, jumping in, doing it in that day. OK, right? I want to take that off day on Monday. They got done. I’ve done that bit of work. You know, I’m dealing with those urgent tasks I mentioned before, the flag going up. You know, you had a whole game plan.
You wanted to get to your listing optimization and do a bit of keyword research. And then you, you know, you had scheduled all these things. And before you know it, you’re fighting cases and your designs haven’t come back and you know you’re dealing with all these urgent tasks. And what ends up happening is if you’re large enough to have a team, you’re micromanaging the team or you’re the one, you know, if you’re not micromanaging your team, then you’re micromanaging yourself because you’re the one who’s effectively delivering everything. A lot. There is no trust that exists. So you’re the individual who’s making all the key decisions around the business or you’re the only one working in it. And that’s not scalable.
And when you look at your role specifically, you know, you getting like a lot of us go through with getting VAs where they do a little bit of everything. And you know, it’s just because I haven’t done enough planning to really define what the role and responsibilities and accountability look like. So, you know, you’re very central to the business, that individual, and it’s not sustainable. So at some point a system where you are bound to your business, you can only invest X number of hours a day, you know, into the business. And that’s, you know, that’s not scalable. Whereas when we talk about, you know, and jump in at any time tomorrow, if you’ve got if you got points
Tomer [00:10:57] I actually have something to add there is that I just about the roles. So I am a big believer that you can train anyone to do anything. But obviously, if you have to train and develop somebody, it’s a lot, a lot more work than just having a specialized, dedicated person that already have the knowledge that you’re looking for. But right now, I hire two more VAs and I’m in the process of defining the roles.
It’s really important of defining specific world to someone, and they are going to be expert in these instead of just any. As it comes, you just jump and then you just give them. So that’s something I’m changing of in my business instead of just everyone doing everything like more defining rules for each one. And I think that’s natural. When you grow, when you’re still small, it’s okay, you can manage it like that. But once you grow, you really have to define it like you show with your like, this is actually something I do right now.
Yoni [00:11:57] I mean, and it’s and such an important step to the whole process, like the I don’t know, I can’t remember who said the phrase, but you know, you never want to be the smartest person in the room. And so bringing in experts, you know, most of the I can honestly tell you, the consulting business, the consulting team are much smarter than I am. You know, these guys are all industrial engineers and CPA accountants and people who have, you know, degrees and experience and things that are well beyond my knowledge base.
But they’ve been brought in to look at the vision of what us is as a group of people are trying to solve for, and we work together to solve it. You know, I play my part, they play their part. And so I guess that’s, you know, and that’s the goal, really, when you talk about working on your business, you know, I’m sitting here today and we even move this session around, and I had that level of flexibility, not that I don’t work hard, that I could also move it around.
We’ve got 140 people on payroll today and you know, there’s lots of moving pieces, but I’m still removed from… I’m not dependent on any aspect of the operational effectivity of the business that lives well beyond me. And, you know, I don’t know if I’d be lost, but you know, it’s an orchestrated structure. So the way you get there is by actually starting to comprehend what does it actually mean to work on your business? And so what we’re doing and what I recommend everyone to do is to focus on that long term growth and that long term planning.
So when we talk about focus, we have a strategy planning at the start of at the end of every year where we effectively map out the business goals at a high level and we break it down into quarters. And then those quarters, we have what’s called rocks, and those rocks are the goals for individuals inside of specific business units. So everyone has anywhere between three to seven rocks, depending on your level of seniority every single month outside of your KPIs. And the idea is that we’re looking to build on everything we’re doing and we’re breaking everything down into its smallest possible common denominator. So it’s very bite size and easy chunks to achieve.
You know, you can achieve you achieve a lot in a year, but you know, it doesn’t feel like you’ve moved that far in a couple of weeks or a month. So that’s the idea of focus. You know, when we talk about dealing with priorities you can start to have like the Eisenhower Matrix, you know, you can start to work on the things that are important rather than urgent and plan out your day or your week in advance.
You know, your team has a system around, you know, not just reporting, regular reporting and getting that information, but you know, the incentive programs and the pay increases and everything is, you know, process driven. There’s no need for I mean, there’s a lot of trust for the trust is in the system. So you now have a team that are of leadership that delivering on their specific deliverables based on the high level from the business. Each person has very well-defined roles and accountabilities and responsibilities. And so, you know, nothing’s really falling through the cracks at that stage. And you know, it is scalable. And so I’m just going to outright say it. Even when I’m reading this out loud, it’s like, Wow, that sounds like way too good to be true. And that sounds like a lot of work. it definitely is a lot of work.
Tomer [00:15:23] But yeah, I agree.
Yoni [00:15:26] It’s a lot of work. But what you’re experiencing right now in your journey, wherever you are, even if I mean that probably people listening to this who are beyond where I am.
But the point is that, you know, you’ve all experienced it in some way, shape or form, and that is extremely common. And I’m going to sort of walk you through a little bit more as to what that looks like. So because I want to get to the I want to get to the meat of it. I want, you know, I want you guys to understand what it is to first what is working versus on. But I really want to share some value here.
So, you know, when we’re talking about working investors on what you don’t want is you don’t want your business to be on any one key player, cause if they leave, then that’s it and you’re sort of stuck back in it. When there isn’t sort of documentation, you are stuck by the influence of those that live inside of your business. And a lot of it comes down to perception. So there’s a lot of risk, a lot more things can go wrong.
But if you have standards where leadership are empowered, you can actually build the reality and have that sort of 360 visibility of what it is I’m working on and how do I achieve my goals and setting up that infrastructure so
Tomer [00:16:39] I have to add something. Some people are afraid or are scared of building is because it’s new skill that they have to develop outsourcing, hiring, its a lot of things involved here. And I think that because the scare stopped them, but it’s definitely a small step. You just in your mind, you have to decide that you want to get out of it. And actually it will help you grow the business more and just stick to it. It will take time. You will fail. You will learn new things for sure. But it’s if you want to grow, that’s the way.
Yoni [00:17:14] So I couldn’t agree more. I think like, like you’re saying, Tom, it’s like it’s an intentional decision. You know, for some people, they’re really happy that their business is a big part of their life and that they are happy to work know how many hours a week? I guess the question you probably want to ask yourself when you’re, you know, making these decisions is, you know, when I went and I decided to start my own FBA business was my objective to work 80 hours a week and have that level of, you know, I can’t switch off and have I become a slave to the business? Or did I build it to create more wealth, more freedom, more time or energy to focus on other things? So the only way to get out of that is to go through this.
And you know, and to this point, this is the common, most common thing that most businesses experience. This is a common growth trajectory. You know, you have an early concept, you bring a product to market, you build the framework, so you’ve got your supply chain sorted out.
You’ve got your products rolled into fulfillment by Amazon. They’re in the warehouse, listings are up, you’re starting to sell. And then, you know, I’ll use the term again, but the flag comes up and you keep sort of going through it. So that’s very common. And that is what you know, I’d be lying if I didn’t go through that at periods of life in, you know, it’s been a learning curve and I still do it today. You know, it’s one of those forever battling things like I could just do this, you know, I could just jump in and could download that report. But you just you start to have to become more protective of your time because you’re not getting
Tomer [00:18:56] I’m sorry to interrupt you. I also find it that it’s just like sometimes five minutes where the boss is just small video. Just give it to someone, and that’s it, it’s off your plate, so you just really those realization that you okay, it’s one take me a lot of time for some task before sometimes the more complicated you have to be like a more like strong, robust system or process. But a lot of that I do, it takes me just a couple of minutes to make a video and give it to someone. And if you have an organization for them and for me, I use Trello, I can keep the progress.
So even if I give to one of the VAs, just simple explanation. Just start with it. The next day, I give him another feedback and then another day, another feedback. And then we refine the system to a point where I don’t need to do anything and I can just tick reports. So that’s how I look at things and approach things.
Yoni [00:19:52] And that’s perfect, that’s the best ways that incremental training, giving time for feedback, and, you know, you’re sort of smoothing out that process until it gets to perfection. So yeah, I couldn’t have put it better myself.
Tomer [00:20:06] You guys just took it to the next level, I think.
Yoni [00:20:09] Well, that’s what we’re trying to do, what we’re trying to sort of show people what the next level can look like. And so the great Segway, I mean, this is really what you want your graphs to look like, you know, you want to prepare for scale and then scale. And so I want to jump into what that actually means.
But the last thing that I’ll share with you really is that so that no one’s freaking out, it’s very common. I’ve said it a few times before. It’s always going to be built by humans. In the start, you have to figure this stuff out. We’re not in an age where A.I. is driving everything. So, you know, if you’re sitting at this point, you’re saying, Jesus, you know, I wish I was like this already. It’s you’re exactly where you need to be at this moment in time. And you know, we’re all wiser as we learn.
And so hopefully, you know what I’m going to share today is tips on how you can approach it will help get you there so you want to build systems inside your business and a systemized business creates a real harmony between the people, the process and the technology, which is effectively how we define a system in a business.
Tomer [00:21:11] Couldn’t agree more than that at the beginning obviously when you don’t have systems, that’s when confusions and tension and things when everyone knows what they’re doing, it’s very smooth knowing everyone coming without stress or pressure because they know what they have to do. Like, when I love the way that you laid it out and you look at things that, you know.
Yoni [00:21:35] Yeah, thank you. Well, you know that really is is the goal is to create that time and freedom for everyone to enjoy. And that’s not to say that, you know, you don’t end up working hard, you work just as hard, but you’re working and investing your time into things that are going to have more and more impact. And hopefully more important than any of that is that feel more meaningful to you. And so again, this isn’t life.
So maybe I’ll just ask you to admit that if you had to abruptly stop working in your business, how long would it function normally without you sort of coming back to work, if you decided, you know, I can’t be bothered today or for the next week, you know, how are you going to go?
Tomer [00:22:24] Yeah, it’s a good question. I’ll be very open and honest. So if I’m not involved in business at all, maybe a couple of weeks, but if I would like an hour a day, I can operate it so.
Yoni [00:22:38] So I’ll be honest with you and say that two weeks is great. So if you’re saying that you could walk away for a two week period, you’re a strong position. If you abruptly you have the level of processes and systems in place that if you decided for two weeks not to come in and then things would fall down, you’re in a really good place.
Tomer [00:23:01] I go through a month and a half and so I had to build these systems.
Yoni [00:23:05] Well, well, that’s perfect. I mean, that’s like through necessity you’ve come up with a system and that’s…
Tomer [00:23:11] Not really because of the trip, but in general, I do have systems because I like to work in the different like I have so many, many things in the middle of the day. So when you have systems, you can choose when to work. No one is really depend on you. Yes, I am by the end of the day, just to monitor a drill and allocate tasks will give me the back, but that they can do it like until just before I go to sleep. So it’s not because of necessity…
Yoni [00:23:44] It was intentional. It was intentional. I mean, that’s how you wire them. And honestly, it’s one of the fundamentals to building a successful business is being able to build those systems so that you can continue to expand your horizons and, you know, and stay motivated and happy and have a work life balance. So it’s really about having the most important people working on the most important tasks, not the most urgent. And that’s what we’re going to talk about today.
So how do you do all of this? You know, it sounds great on paper, and everyone’s probably buying it at this point, but it sounds too hard. Well, I’ll tell you, the way we look at it is really in a few steps. So when we talk about how to scale, the first stage for us is defining and documenting.
So, you know, I have a lot of conversations with people and they all say, Yeah, I know exactly what’s happening in my business. It’s all in my head. And, you know, I’m sure for some people out there, they’re probably experiencing the same thing. But our asset, our core, is a business. And what we’re trying to share with people is this quote. It exists on many of our presentations. And what it says is “if I had six hours to chop down a tree I’d spent the first four sharpening my ax,” and you know, what we take from that is that it’s all about the preparation and the planning. And if you can build a plan and adjust as opposed to sort of make decisions on the fly and you know go after this new product category, I don’t think the sales are good enough and starting from scratch.
You want to make incremental improvements and decisions knock all over the place. So defining and documenting. So first things first is you have to understand what’s happening in your business. And so as a high level and I apologize. I mean, it’s not going to be super interesting for you guys, but the creative team have sort of overindexed on the sensitivity and couldn’t really care if people see that some of the functions inside of the high level process of a historic version of our business. But this really was an example.
At a high level, we have our core functions, from business development to client onboarding, I guess recruitment and sourcing and then and then human resources, for example. So we document at a high level what’s happening, and even when we talk about this was when we moved from HubSpot, we moved to HubSpot from a different from Zoho, which I won’t spend too much time talking about Zoho with guys.
But the idea is that everything that we’re doing in the business and everything that you should be looking to do is your documenting out everything that’s happening at. So that’s at a high level. What’s happening is a function and then you’re documenting and you’re defining really what’s going on from a step by step perspective.
Tomer [00:26:44] Which is like SOPs, right?
Yoni [00:26:46] Exactly. So this is like the this is the start, this is the building blocks of an SOP. So the way we sort of our methodology and side of a scale is we take a almost like a five layer top down approach to building up processes.
So the first layer is the high level business overview of what’s happening from a function level. And then you have inside of each of these would be considered a sub process. And so once you get to the next stage where you’re designing and you’re improving, then you’re actually stepping it down to, well, what does each individual inside of each of those specific sub processes? What are they delivering on?
So again, a little bit of over indexing here with sensitivity. I’ll fix it the next time. But all this is showing me is who inside of the active pool management, which is like people that we’ve found and identified, what happens? What is the active pool manager doing? What is the recruitment manager doing so in this instance, you know, without saying it, I imagine that the recruitment manager is effectively managing the active pool managers.
So they’re doing all the hard yards here, and this is likely a balances in checks or they’re actually assigning it to that specific recruiter. So we’re defining it the next layer, like all the workflows inside of the business. And again, now if you think about what have I what I have you, I know at high level all the different functions in my business. I know what is performed inside of each of those, and then I now understand who is performing them and what technology is used and what sort of task that I delivering on. So this is again, all this stuff is the building blocks, and this is the HubSpot example
Tomer [00:28:28] This looks overwhelmed to me. Even as with those that are watching this, you can just watch it again if it’s not clear. That’s my tip. I’m going to watch this again, for sure.
Yoni [00:28:38] Yeah. So so I like I was saying to me that we’re going to build a whole bunch of sort of tools. And the idea is so to give a lot of this stuff away for free so that people can build them inside of their businesses because it’s a process, right?
Like where we’re really working with. I would say sort of some of the medium to larger e-commerce businesses in the space. And it’s an education process. It’s an evolution. It’s a growth process from moving, from working with, you know, VAs and, you know, really being stretched to starting to understand, Okay, this is my commitment. It’s not my side hustle.
I am building an FBA business and I am going to remove myself from it. So, you know, the idea is, how do we help everyone get to a point where they can operate? Like, you know, I mean, maybe not the thoracios of the world, because that you have literally billions of dollars of VC backed investment, but you can at least perform like a very serious and professionally run company that would effectively compete with any business on the planet.
Tomer [00:29:43] Yeah, and it could give you time to actually do strategy. And that’s what I think that the entrepreneur that the guy on the top should really work on everything else should be outsourced.
Yoni [00:29:54] Yeah, I’ll tell you. I’ll tell you one thing that typically hits for people to understand what why is this all this important? And I’ll still step you through the other aspects of it. I’m going to show you a few more things today.
But if I asked the question if you could give the same level of attention to your top three products as you could your entire SKU set of 35 know what would you tell me? You know, you’d probably tell me that it’s too hard, that you know, it’s impossible. Or, you know, if you build the system and it functions correctly, then there’s no reason why one product should get more attention than another. It doesn’t matter if it’s making more money.
Really, you should be focusing your attention on the ones that aren’t. And so this is a sure fire way to be able to define the process, understand who’s doing what, how it’s happening, and then make sure that you allocate time and resources to each of them. So it equates to the full piece of the pie.
Tomer [00:30:53] For sure.
Yoni [00:30:54] So after you’ve defined your designs, you’ve gotten to that stage now you want to start leveraging technology. So you said you use Trello?
Tomer [00:31:06] I use Trello.
Yoni [00:31:09] Great product Trello, Asana, Monday, Click up. We love you. You know, Slack. You know having the right Google Drive, you know all leverage of the pieces of technology because the reality is having the right tech stack is going to make you be more efficient with everything that you do.
Tomer [00:31:31] And even if it’s the same cost for the tool like a VA doing it manually, you want to have a tool, you know, because tools don’t do mistakes. Tools don’t have emotions. You don’t have to manage them. And you know, it’s a great to really leverage technology. You’re just starting to discover yesterday, text expander to phrases.
Yoni [00:31:54] Yep.
Tomer [00:31:56] I use like a different tool, like using it for years, AutoHotKey, which is more robust. But this is something I’m trying to have with the team so we can save a lot of time repeating phrases and things that we use daily.
Yoni [00:32:11] It’s yeah, it’s critical. I mean, if you can always leverage technology, we’re at a point now where we’re building technology because we see gaps in the market and we can’t actually find what we need. So we’re building our own technology to make our clients lives easier, like a client portal so that they can manage the performance management reviews of their employees on this dashboard and a whole lot of other things.
But technology is definitely, it removes margin for error. And so, like you said, you know, I am most passionate about creating jobs. But if you are literally looking at a piece of technology or a person, take a second and just think, what is that person’s life going to look like? If a, you know, a piece of technology can do that job, it’s not going to be the most engaging stuff.
And you know, how long are you going to retain someone who’s literally emulating Slack? like sending emails out to everyone or whatever it is. So, yeah, I’m with you on that. So another sort of interesting thing that we talk about is prices law. So valuable output inside of a business is asymmetrical, so typically a small number of your team will actually contribute the majority of the work produced.
So if you had 25 employees in your sales team, five of them would generate 50 percent of the sales. So what this for us says is that if you can understand what’s happening in the business, you can better solve this equation. I mean, there’s a few ways you could cut this, but one for me would be that maybe you don’t need to hire all 25 because we figured out the most effective route on how we can achieve that and we can be more efficient and that’s what scale is.
Scale isn’t just hiring more and more people, and I’ve got five million employees and I’m doing 10 billion dollars in revenue. Where’s the profit? What’s the profit margin? You know what I mean? I mean, like, just because you’re bigger doesn’t mean you’re better. And for a lot of Amazon sellers in particular, the places where they’re most profitable are between one and one point from zero to 1.5 million. And then once you get to sort of that four or five million dollar range going from that one point five to four million, it’s a very different changing game for Amazon sellers, and a lot of companies struggle to get out of that gate because that’s when scale is required. So just a way to think about it.
So the last stage, the last stage when we talk about sort of building this scaling plan is onboarding and removing yourself. So the reality is, and you know, four ways you can go about this at home. A few of the things that I love to do is when we build on onboarding and training automation, building out the process maps like I was showing you before is great and then starting to actually build out the SOPs, the standard operating procedures of how to perform those tasks and then committing them to things like Loom is a great tool for video recording.
So how I would recommend it is that when you start to bring people on, if you haven’t built out those recipes because you haven’t got around to it, don’t sit and go back into your business. Every single time you hire someone, you have them create the SOP as you on board and have them record the videos. It’s going to do two things. One, it’s going to build in SOP if you have a framework of how you like it to be laid out and you know, I just showed you one today on how you can build the high level and to the sub process, and then those sub processes is connected to SOP.
Each person has their SOPs attached to those things, but having them sort of write it in that format, like who’s the step by? What’s the next step? And then cutting those videos up into short bite sized pieces. So two to five minutes, you don’t have someone sit for two hours watching a video where they needed all of three minutes of it of you know its a waste of time
Tomer [00:36:09] For the two hours uploaded to YouTube and YouTube allows you to do the sections. So, I mean, yeah.
Yoni [00:36:14] Perfect. Oh, cut it up.
Tomer [00:36:17] Its faster that way
Yoni [00:36:20] Yeah, and I think that’s really the point I’m making here is that at least if you’re going to record two hours, make sure that the key insights are easily accessible. So I think that’s a great, a great use to be able to have the little the tagged markers. Yeah.
So, so that’s so if you look at what we’ve talked about today, what we’ve talked about is defining and documenting, designing and organizing and constantly improving and then on boarding and removing yourself. And so if you understand what’s happening in your business at a high level, then you go to the sub processes and you know what functions are played with inside and who is performing them and how they are performed. You’ve effectively committed your business to, you know, an operating system that is going to help you if you have a look to sell your business, people love to see that level of documentation so that you understand exactly.
You know, you don’t want to have dependency on an individual in a business, especially if it’s being sold or acquired. So just things to think of is a sellable asset. Doesn’t mean that you can try to sell your business. A sellable asset in my mind just means something where I’m not dependent. I’m not a slave to my business and I can effectively, you know, jump in and out as I see fit.
So yes, a few other areas to look at, and then I’m going to jump into this Amazon doc that we’ve talked about a few times. But, you know, designing your org chart and your org strategy so who you need and when you need them as you get bigger plan itout based on the financials, you know, cash is king, unfortunately so, you know, there’s absolutely no point in jumping into any business without understanding what’s in it for me.
Realistically, am I going to actually make any money here? You know, am I going to act? Is it going to be successful? So this is how I used to present it. But now, and you guys, this is the link that we’re going to share is going to be this link and you just chuck it in and you’ll get you get the email to duplicate this.
Tomer [00:38:30] So we’ll put this in the description section.
Yoni [00:38:33] Yeah, perfect. So I’ll share this with you after and you can check it in the description and the effectively what we’ve created here is a two year financial plan for your Amazon business. This isn’t to replace the zero and your ERP and your inventory planning tools and anything like that. This is more so something that we could easily because we’d put it together historically bring from a planning, and you can even use it to update and track.
But the idea, simply put, is to give away things that people can easily leverage so if we went to the complexities of, you know, recommending an ERP and it’s, you know, it becomes expensive. So we’ve built a tool, it’s baseline to help you so I’m going to walk you through what that tool looks like and you can have a play around with it at home.
But if you take a look here, so the standard landed cost calculator that everyone’s seen before, where you can play around with the unit values and the prices, et cetera. The idea is obviously, you know, we now understand what our order, what our cost drivers are, what our inventory is going to look like before we, we step into it. But what we also want to look at and some of the things that are less talked about, I would say when we talk about planning an Amazon business are things like payroll breakdown.
So all the numbers here are arbitrary, you know, and the way this works is you select, you know, where the employees from and what the salary is. And we’ve even given you again, these are very dated and, you know, just arbitrary insights. You might learn a few things.
I mean, there’s a few different examples of project managers and designers and things like that, but you can play around with it and you set the month that that individual is hired in that year. And you know, and you add in the different individuals, you can add new rows or change the names, and this is all feeding into the entire operation here. So we also have the opexes, which is the operating expenses. So that’s everything that is used outside of the acquisition of inventory. In this case, you’ve got here from
Tomer [00:40:31] Its gonna take like time to plug it but I think it’s really, really important to take the time to really understand and plug the numbers. It’s really important. Like people, sometimes they don’t understand the importance of those things and they think, Oh, I’m going to do it at a later stage or when it’s the time, but there is no better time than now to do it.
Really, it’s going to change your future because once you see those numbers, you’re going to realize and things that, oh, wow, that’s that. These are the actual numbers that people don’t do it like enough.
Yoni [00:41:03] Spot on. I mean, that’s so like, why did I even invest today in talking about working in what is working in your business versus on a business got to do with an Amazon plan right now? And so to sort of to your point, you need to understand where you sit in a scale. So like, how can you measure something that isn’t tracked, that isn’t planned out, that isn’t projected, it’s an impossibility.
So, you know, you know, there’s I can throw so many cliches at you like, you know, fail to plan, plan to fail. I mean, the fundamental, you know, the quote that I gave before, if I had six hours, jumped down the tree
Tomer [00:41:39] 100% I agree with you
Yoni [00:41:41] It’s it’s 100 percent in that and so agreed it will take time. It took a lot more time to build this than it will to plug in the hours. I’ll tell you that much. So, you know, probably worth your while in having a shot at it or even just taking aspects of it that you like. Because the really impressive aspect of this is the side of the tab that I haven’t shown you guys yet, and that is your two year cash flow projection on the basis of you having to play with just three numbers he wants.
You filled in the rest of them, but you effectively could just play with this tab for a long time in terms of your projections and your estimations. But to keep it short in here is so let’s say it takes you to two months to bring a product to market. Let’s just assume so you’re not spending anything there, potentially, but you’ve ordered your inventory, which is connected to the other tab.
You’ll define how much you expect your daily PPC spend to be at the start. And we all, at least for me from experience, I won’t speak for everyone, but in my experience, typically speaking, we’ve always put a higher investment on media spend when Amazon wasn’t sure where to sort of place our products. So, you know, the way we’ve built it is typically we’ll try with high numbers. These are just again arbitrary numbers but the other things, too, is that we’ve found that, you know, your ACoS are typically higher.
Also at the start, while Amazon is learning where your product fits in market. And so you can say here, you know, I might even chuck it to one hundred and twenty percent all I’m at that point trying to do is sell products. Get to my first 50 reviews. You get to get to that stage where things are actually balancing out. I understand where I said in the last estimation you make based on your historic data or, you know, wherever you want to sort of plug it is what percentage of orders will come from PPC spend versus organic and again, typically it starts PPC is going to drive a lot of those.
So once you go through all of this and you’ve inputted all this information, you’ll get the totals so you’ll understand what your cashflow looks like at a high level around your business. And it just helps you understand things like, you know, how much total investment do I need to start this? You know, am I going to have cashflow issues if my product is very Q4 heavy? You know what? It’s going to help me plan.
So if I need things like support from funding, you know, whether it’s one of the funding providers, growth funding providers or, you know, whether it’s about inventory planning and making sure that you’re not going to be stranded with, you know, out of stock inventory, things like that super valuable to the plan out. But yeah, I’m not going to actually jump into too many more things here because I think that, yeah, I think that that’s a pretty good sort of summation.
The last slide I had for you guys was, you know, I would. And we’re still working on this. But I would call this almost like Jedi Level is when you have business analytics in place and you’re effectively tracking your operation on live dashboards based off of all this information. And so this is what you call the North Star metric where, you know, we were in a growth state. So it’s about the efficiency and growth. And if those numbers are in the right place based on all the data points that are getting pulled in, then we’re in a good place. If they’re not, then one of the other lights in these boxes will light up and we’ll know what to change.
Tomer [00:45:09] Is it like a dashboard that you will see everything like in one place?
Yoni [00:45:13] Yeah, yeah, we’ve got we’ve got analytics dashboards for the business that helps us see all this information in one place. But that’s but like I was saying, that’s that’s really sort of the Jedi level, and we’ve got a whole department now built out on creating this and the idea ultimately how we operate is we build the solutions for us internally. We stress test them.
We say, like, is this something that is viable? You know, people are going to want dashboards to manage their business. And then, yeah, and so if they are, then we’ll start to produce this for external sources. But it very hard for us to charge someone before we’ve tested it and said, yeah
Tomer [00:45:53] Because instead of me connecting the dots, if you can see everything in one dashboard like builds up in real time tools for Amazon seller like shopkeeper, shopkeeper I think is this the best one that I tried many tools and it gives them, like in 10 seconds a picture of what’s going on like real time. So.
Yoni [00:46:12] Which is key? It’s critical.
[00:46:14] Its 100% the key and you know, you can still do it. But when you have to connect the dots, first of all, you will sometimes be lazy to do it and you will not do it this as frequently as you want. Second, it saves you a lot of time seeing like this right away and getting this week and in business, it’s all about speed of execution and seeing things and just running with this drive. Keeping you on track.
Yoni [00:46:40] Yeah, you need to be aware to make those changes at the time, not wait three-six months before you know, to sort of steady the ship or change course. So, yeah, planning is everything.
Tomer [00:46:53] This is like a real value that we got here, and sometimes it’s hard to see when you like, encounter these kind of videos that provide like real value and change that you put in your business. So again, for those that watching it, I definitely just to watch a couple of times and really take something from. Don’t just watch it because by watching, you’re not going to get anywhere. Yeah, maybe it will. You know, you absorb. Always we absorb. But at the end of the day, it’s those that actually move and take action, right?
Yoni [00:47:25] Absolutely.
Tomer [00:47:27] So Yoni, thank you so much for sharing this with us. I know it’s things that you use in your businesses so we can trust using them as well in our ours. For those that want to get hopefully you. How can they reach you?
Yoni [00:47:42] Yeah. So feel free to check out either of our websites. MultiplyMii, M-I-I dort com or we are escala? If you want to get in touch with me directly, then you feel free to email me to. If you listen to me this going on for this long, then you almost deserve a direct line to me. So this yani o and I at multiplymii dot com.
Tomer [00:48:05] You’re amazing journey, and I hope that we can meet very soon when I come to Israel to.
Yoni [00:48:14] Absolutely I’d love to host you.
Tomer [00:48:15] Thank you so much again for being a guest here. I hope we can bring you again in the future. I’m sure we have many more topics we can talk about and all the best
Yoni [00:48:24] With pleasure. Would love to to help support and as we bring out more content, would love to share it with you with you guys.
Tomer [00:48:32] Thank you very much. Take care.
Don’t forget to check out my Amazon FBA course and avoid the same mistakes that most Amazon sellers make!