E156: Diversifying Ecommerce Businesses Beyond Amazon USJune 21, 2018 in Ecom-Crew-Podcast
“…I think under a million dollars, personally. I don’t think that you should be trying to ‘squeeze that lemon’ much harder until you’ve re ally optimized Amazon. I think once you get beyond a million dollars, give or take, in sales that’s when you really need to start looking at other sales channels, whether its outside of Amazon.com and other marketplaces within Amazon or other sales channels totally outside of Amazon.”- Dave Bryant on evaluating when an ecommerce business should diversify and get sales off of Amazon US
Amazon US is widely regarded as the ecommerce platform to be in for sellers online. However, an ecommerce business that’s growing at a steady pace will eventually be confronted with the need to expand and diversify outside of Amazon US.
Dave and I both agree that ecommerce businesses below the million dollar mark should not jump into diversification too quickly. “I think under a million dollars, personally. I don’t think that you should be trying to ‘squeeze that lemon’ much harder until you’ve really optimized Amazon. I think once you get beyond a million dollars, give or take, in sales that’s when you really need to start looking at other sales channels, whether its outside of Amazon.com and other marketplaces within Amazon, or other sales channels totally outside of Amazon.,” Dave says.
However, that’s not to say that online entrepreneurs earning below seven figures should not do anything to boost their Amazon profile. List building off of Amazon and having an intuitive and user-friendly website can go a long way in increasing sales.
If you have reached that threshold, however; then it’s time to rethink your strategy. Having all your eggs in the Amazon.com basket can be risky, especially since your account can easily be suspended for one reason or the other. If this happens, you will need to have another way to liquidate inventory.
On that note, ecommerce businesses may also do well to explore one or two of the following verticals:
The platforms above have been ranked according to a number of factors — dealing with taxes, ability to do Fulfillment by Amazon, cost of shipping.
Other resources mentioned:
How to Lose Money Chasing Champagne Dreams of Retail Distribution
Thanks for listening to this episode! If you have any questions or comments, feel free to leave them below. Happy selling!
Michael started his first business when he was 18 and is a serial entrepreneur. He got his start in the online world way back in 2004 as an affiliate marketer. From there he grew as an SEO expert and has transitioned into ecommerce, running several sites that bring in a total of 7-figures of revenue each year.