I thought my wholesale business was unique. Turns out it’s really no different than any other and after teaching everything we know here at Vendrive, we realized there are some fairly common patterns – phases that each business must go through.

Going through these phases is a requirement and really doesn’t take any action from you. It’s just a natural progression of growth.

 

Phase One – Some capital, but not enough inventory

Every person I’ve come in contact with thus far has proven this to be true. Now, they can either have a lot of capital or very little. What makes them similar is the fact that they haven’t fully begun to source profitable inventory.

This isn’t a lack of knowledge (especially if you’re reading this blog!), but a lack of either action or commitment.

One of the biggest issues early on for sellers is not understanding HOW to source, but actually doing the work. It isn’t easy, although it’s simple and it’s quite boring, making you feel like you aren’t actually making any progress, although you are.

Once sellers break through this hurdle by committing to sourcing each and every day until they are increasingly good at it, they’re eventually moved into the next phase.

 

Phase Two – Maximizing capital

If you’ve made it this far, you’re kind of a pro. You’ve successfully implemented sourcing strategies and can consistently add new products/accounts to your business each and every month with relative ease.

Shifting from Phase One to Phase Two is the hardest, making finding success a very daunting task. Break into Phase Two, life seems to lighten a bit, streamlining takes hold and things seem to pull into organic momentum, although you’re making and have been making that momentum a reality.

Although this is a great place, we don’t want to stay here long and most won’t. Phase Two is the briefest phase as you quickly shift into Phase Three and are faced with your next hurdle to overcome – capital.

Note – Phase Two is a minor milestone that is a primer for the next phase. You probably will notice you’re in phase two for maybe a month at most.

 

Phase Three – Too much inventory not enough capital

An even better problem to have and one we all eventually end up facing. By successfully going through phases one and two, you’ve become incredibly good at adding profitable accounts, but at a rate that outpaces your spending abilities.

This is the exact opposite of the problem faced in Phase One – some capital but not enough inventory.

So by solving the problem in Phase One, you’ve essentially created the problem in Phase Three (you little devil you…). Depending on how much capital you were able to start with, this phase could come sooner or much later. The smaller amount of capital you have, the quicker you’ll hit this problem and vice-versa.

So how do we overcome Phase Three and break free from these phases all together? Two options – take less capital out of your business or add more in. Basically, do what I suggested here or find more money.

Finding more money is a different skill set and somewhat uncomfortable for many, but ultimately it’s an easy process and there are plenty of options.

Imagine having $50,000 worth of profitable inventory that you can’t purchase because you’re already spending all of the $30,000 a month you currently have available. By finding another $50,000 to bring into the business and assuming a 30% margin, that would mean another $15,000 a month for your business, or $30,000 if you read our 7-Figure Blueprint 😉

If this blog post has helped you in any way, would you mind sharing it for others to see as well? You can do so right below using the share buttons. It would greatly help us and we would think that you’re even more awesome than we already think you are!

 

One of the greatest things about running your wholesale Amazon business is that you can run it the way you want to run it. No one way is the right way.

With that said, here’s my way.

 

From Paris With Sales?

I woke up in our little Airbnb loft just a block away from the famous Louvre Museum. Still adjusting to the jet lag I rolled over to realize it was 10am. I think we just wasted a half the day in Paris… But, we were still in Paris!

It had been a few days since I even logged into my seller account. Comfortably Unaware, but it was Tuesday and I knew inventory had landed at my prep center the day before in New York and they would be waiting for me to email the shipping labels. No worries. I pulled out my $250 Chromebook, created the labels, sent the email and shut down the laptop.

Me slightly emotional at what I had accomplished sitting in Paris

As I sat back in the chair I took in what had just happened. In less than 15 minutes, I was able to process hundreds of units of inventory and continue growing my business.

The rest of the week would be filled with amazing food, Catacombs, Palaces and foreign language.

Here’s a video I made while in Paris! 

It wasn’t until we landed back in the US that I realized I had hit a new monthly sales goal.

 

The Simplicity of It All

I had experimented with this for a week in Oregon while relaxing in a cabin overlooking a flowing river, but I checked my email every few hours. Experiment failed. But in Paris, I didn’t have much of a choice with limited connectivity.

So how was this all possible?

Simple; a prep warehouse so I would never touch my inventory or have to manage people and proper timing on placing restock orders. Suddenly I could maintain my business in under an hour a week and grow it in five…

I wanted my business set up so that “I” could process 1,000 units of inventory as easily as I could 100 and so far it was working flawlessly.

If you want to read more about the simple processes I used you can do so here.

 

Somehow Dates Can Get Better

Paris had been a while and so had that relationship. After a few months, I started dating again. While on a first date we decided to start walking around our historic downtown talking.

We eventually got on the topic of entrepreneurship and what I was doing with Amazon. As I pulled out my phone to show her how the seller app works and what it looks like I was struck with sheer amazement.

It was a Sunday and I hadn’t worked since Friday. As I looked at my phone I realized I had sold more on that day than any day before that.

A $3,000 day that I had been working towards for some time.

Even on a date during a weekend where I gave no effort to the business it grew. At this moment I realized what was possible with Amazon, the right systems, and an open mind.

Although this post isn’t as how-to as they typically are don’t underestimate the lesson shared from my experience thus far. You can build your business any way you want. To suit the life you’re working so hard to build.

 

Read almost any entrepreneurial based blog post or book and it bashes working for someone else left and right. Although we’re not exactly fond of having jobs ourselves, they provide a unique opportunity that going solo too soon can’t seem to offer; stability and massive early growth.

What’s wrong with stability? It gets a bad rap even though it’s a great thing in the early days of starting and growing your business.

When I really began to grow my business as a wholesale Amazon seller I got fired from my day job. Like pack your bags you’re done fired and it hurt. The good part, looking back, is how it forced me to grow the business in the short-term. I made different decisions without having that security or stability. I had bills to pay and responsibilities.

Although it worked out, if I could go back, I would have changed the situation entirely. I would rather have had the stability of income so that I didn’t need to take anything out of my business. Each time I paid myself I felt like I was robbing my business and stealing its potential growth, which was true. Sure I was able to pay my bills, but that was capital that would be consumed, rather than going into growth to compound many more times within the business.

It severely stunted my companies growth…

We’re often so focused on leaving that we sacrifice our businesses for our own selfish wants. Think of your business as a person. Let’s say that person is a farmer (it’s random, but keep reading). Each time your farmer friend produces a crop you take a portion. Doesn’t seem so bad and seems quite normal, but what if each new unit(?) of crop could yield 3-5 more the next time it’s planted (I’m clearly not a farmer….)?

Not too soon….

Keeping in mind the point of farming, in this context, is to have a farm (read: business) so large that even when you do take from it, it still grows larger.

It’s like families who have $500M in a trust fund and routinely spend $1M each year. Even though their spending is incredibly high, the earnings of the $500M grow at a faster rate than the $1M they spend each year. So even with that high spending, they continue to increase their wealth.

So when you steal from the crop (read: business/profits) too early, you severely stunt the business’ growth. At some point it makes sense as I described above, but too early and you’re left with a farm that never quite grows.

That’s what I was left with after being forced to take some of my profits too early. But the whole reason I started this business was to make more money Dillon! I hear you and I understand, but you’re thinking too small. When you take profits from your business, whatever is left over is actually your profits, not the total.

So if you had $2,000 in January in profits but paid yourself $1,500, you only have $500 in profits left over. Not bad, but if you reinvested the $2,000 in total and grew that business for another six months to a year before taking anything out, you could be in a much better position.

A position you wanted to be in in the first place.

Here are two options:

Situation 1 – $2,000 gross profits – $1,500 owners withdraw = $500 profit.

Situation 2 (let the business grow for a while) – $5,000 gross profits – $3,000 owners withdraw = $2,000 profit.

The only difference between the above situations is that you wanted and continued to grow the business without taking anything out as long as you could, not stealing from your crop…..

The big takeaway here is that if you have a negative view of your job, make a point to shift your perspective and use the stability to but both yourself and your business in a better financial situation in the near future.

After all, what’re another six months to a year if we’re all going to live to be 100+ years old?