195: Ensuring Profitability on Shopify and Amazon

28-09-2023 • 17 mins

Tyler Jefcoat is the founder of Seller Accountant, which helps Amazon sellers achieve maximum profitability through bookkeeping and CFO services. He has been behind 9 figures in Amazon sales and 9 figures in exits, and that’s after he founded a company himself that grew to 120 employees before being acquired. Today, Tyler is going to share valuable knowledge for inventors, startups, and small manufacturers on what direct-to-consumer selling online is, the pros and cons of Shopify vs Amazon and eBay, and the keys to success when scaling sales through direct-to-consumer selling online.

Here are the key takeaways from the episode:

What is Direct to Consumer selling?
Funneling your customers from various platforms
Marketplace strategy to get customers to your shopping cart
Shopify vs Amazon/Ebay
Well designed, differentiated product sells very well on Shopify
A direct connection to many customers that have a number of problem solved.
Have your own website and drive Shopify to your website
Tips to Amazon profit
Staple products typically are better suited to Amazon
Product design strategy to ensure success of product sales
Which community is important for a customer buying something online.
It’s okay to be the type of product that fits your brand
Amazon fees are high, they take a lot of fees for each sale.
Amazon logistics (pick, pack, delivery), also have fees
Marketing on Amazon also has fees.
COGS is the leading indicator to how well you can market your product
The more margin, the more freedom you have to build an audience through advertising.
The less margin the more you have to be efficient for getting product to move.
20% to 25% net margin is a very viable product. 30% is big for scaling. 15% is dead.
Know that your accounting is giving you real-time information on profitability of your hardware product sales.
Each of your sales channels needs to be profitable
Each product you have needs to be profitable.