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Since Amazon launched Fulfillment by Amazon (FBA) a decade ago, countless third-party resellers have used the platform’s customer service and fulfillment tools to launch small businesses of their own.
Jessica Larrew and her husband Cliff are among those Amazon resellers, and they’ve launched The Selling Family to share their strategies with others. Larrew chatted with StartupNation about how she got started, mistakes to avoid and more. The following excerpts have been edited for space.
StartupNation: What’s the first thing you sold on Amazon?
Larrew: The first items I sold on Amazon were used textbooks. I had read that selling used books was really profitable, so I ordered a book scanner and headed out to a thrift store.
I made between $5 and $50 a book but didn’t enjoy it at all and soon realized that the real profit for me would be in retail arbitrage. I sold toys on Amazon during our first fourth quarter; I sold some Bounceback RC Racer cars that I found at Big Lots and would fill my cart to the top with those things! I’ve since had luck with books, but it wouldn’t have worked as my only source of inventory.
What was the hardest part about getting started? Do you think that’s changed for sellers getting started now?
The hardest part about getting started with Amazon FBA is weeding through all of the information to decide which model is best for you and how to piece all of the steps together. I don’t think it’s changed at all for sellers just getting started. In fact, I think it’s even harder now because there’s way more information than when I was new!
That’s actually why we created our courses at The Selling Family. We realized there was nothing out there that took people from point A (starting) to point B (selling items for profit)!
How long did it take you to ramp up to a full-time income?
It took me a few months to replace my $1,500/month income, and then it was less than two years to make enough to also retire my husband from his full-time job, which was another $5,000/month.
What are the most common mistakes you see other Amazon sellers making?
I think a lot of people jump the gun and start buying way too much inventory at once, without understanding how to evaluate the sales potential and profit. They’ll decide to buy 50 of something or they’ll open up a wholesale account and buy a couple hundred of one item, then be stuck with it.
We always advise new sellers to test the waters and send in just three to five of a product and watch what happens. If it sells quickly, buy some more. If it’s a product that was on sale or clearance and you can’t find more of it, that’s still OK. You learned something about evaluation that you can bring to the next product you find.
I saw on your website that every trip is a game to see if you can pay for it using things purchased along the way. Tell us more about that.
I think my favorite story is about our $12,000 date night. That doesn’t mean we spent $12,000 on a night out! We were looking for something to do and decided to go sourcing, or out looking for product to sell.
This is really fun to us! Some people go to the theater; we went to one of our favorite liquidation stores. These are stores that buy “pulled” inventory from manufacturers and retail stores like Costco and CVS. Then they get sold in discount stores for a fraction of what they cost originally (often 50 percent or more off). If you’ve been to a Grocery Outlet or Big Lots, this is very similar to what we visited.
So Cliff and I headed to a mom and pop liquidation store. Long story short, we spent $1,684 on product with a profit potential worth $12,283. That’s a great date night in my book!
Related: StartupNation Business Services
Do you have a daily routine for managing your business? What does a typical day look like?
One of my biggest goals was to create a life where I have a lot of flexibility and time to do exactly what we want to do as a family. So honestly… I don’t stick to a hard and fast routine.
I did start homeschooling my son, Aiden, this year, so that has forced us to change up how we go about things a little bit. I homeschool him for the first part of the day and then work on my business later.
We try to go shopping for inventory once a week and get out one shipment a week to Amazon. Our schedule when we first started included shopping three times a week and shipping once a week.
When someone is first getting started, they will spend a lot more time getting settled into the business and spend more regular hours than we do at this point in our business.