E-comm Business Story: Hard Milestones, AMZ Suppliers & Manufacturers | David Applegate, ImportYeti

hello i am i'm so excited to share a little bit about something that you may or may not have seen um import yeti is a great site where you can pull down information about people where people are getting um their supplies from from china can be great for product sourcing it can be great for identifying counterfeit issues that you might be having and i want to introduce the founder david david thank you so much for coming on today oh i really appreciate it really appreciate it uh it's so cool to be here well can you tell me a little bit about uh about import yeti and how you kind of got started with it just so we can kind of give people the world of how you got here yeah yep so uh you know i've been econ my whole life uh you know eat green sleep the industry uh my main business wrestling mart we sell kind of high school wrestling goods you can imagine the pandemic is not you know uh super friendly to people in that that space right now um and we've been using this data um you know to find better pros you know products ourselves um pandemic hit and we you know went online and we essentially just said hey um would anybody else find these things useful um and from there we just kind of have been listening to you know people online you know non-stop and building something that uh you know makes sourcing a lot easier that's really great and you know how did you did you do where you did you start like as a what kind of seller did you start out on amazon because you know there's like the different paths that people come in are always kind of interesting yeah so i didn't start on amazon um i did uh you know if you want to go way back i did a lot of ebay and kind of other you know earlier marketplaces um and then uh we do 99 kind of we'll say just regular e-commerce um you know uh amazon's great love love love amazon um but uh you know ecom's been just an absolute blessing to us and we found that you know amazon could be kind of struck it could struggle sometimes with the categorization if you're trying to create more niche um categories um it tends to do extremely well when you're hitting more of those broad categories that people are searching large quantities for so you know what uh what would you say when you look kind of back at everything that you've done what was the one most like unexpected difficulty or a challenge or a hard milestone that it took to hit yeah um you know i think the biggest you know i'm not sure if this really answers your question but the biggest kind of impact we that i noticed was when i stopped selling things that were like commodities and started really trying to innovate on products that we'd sell and like to use a story like back in my ebay days what would happen is i started out selling cigar cutters in my early teens which my mother hated but you know it's cool and um you know i'm selling these things for like we'll say 10 um a cigar cutter and my cost from china would be like 50 cents or something like that we were charging three dollars in shipping so the profit margins were bananas you know and uh i was you know selling 10 or 20 things a day and i just thought i was you know had it made um and then you know a few people started competing in that space and that went down to like then i was selling for nine dollars and then eight dollars and then seven dollars and then six dollars and then five dollars and that's five dollars with free shipping it's like you know it kind of kept on dropping until you know it just was cutthroat and i was making 35 cents a cigar cutter um and i've seen the same thing happen on amazon you know where it's like in the beginning stages anybody could sell exercise rings and make a killing and now it's changing so that because everybody can has access to those suppliers everybody can bring you know these products in the question becomes how do you create a product that is truly unique in the marketplace and sells itself based off of its virtues more so than it does just you know uh kind of the standard you know you know template um and that when i started to kind of move into more of that mindset it really changed things because i was building products people would fall in love with and they'd want to order them they talk about it online and i get natural sources of traffic um you know the amazon became a method to distribute my products versus just you know the marketing platform i use to move widgets you know i've kind of seen that you know each as each uh platform kind of evolves you know there's a stage where it's kind of like a gold rush where you can put anything on it you know like i feel like for a degree like to a degree in walmart it's kind of like that you know people are taking their stuff on for that wouldn't sell on amazon and now they're moving it to walmart but as each platform evolves it's you it starts out as a gold rush and then it goes back to like okay this is what this is what it takes for something to be marketed successfully and you have to kind of grow up in if you if you came in on the gold rush you either feel like it doesn't work and somebody ruined it or you take a you take some time and you learn how to do kind of like the more strategic uh more thought through kind of marketing plans and product creation yeah and super well said i think too even as the market places is like new ones come out people are getting smarter and smarter so it's happening quicker like if you look at that ebay time frame like it took like you know we'll say years for that to happen amazon was shorter than that and things like walmart i think are going to be even shorter than that so you either have to have that timing and be like first to move or um you know uh you know find the better strategy so was there any like unpredictable success that you're like wow this is something where i never really thought i'd get to this point you know it was very incremental it wasn't like you know like even the things that where we had large pops um there was a lot a lot of incremental things that were kind of done you know up until then and you know really just kind of sticking to the fundamentals and just trying to create things that kill it and then just keep making trying to be like one percent better every day you know just like you know i'm not trying to promote import yeti but like if you listen to your customers and you just say hey can i get one percent better today and you know tweak a little thing here tweak a little thing there um you know ask them if they need other you know products or you know is there they neither let's say you're selling pet leashes the pet leashes be longer is it colors they're looking for is it a pattern they're looking for is it they need them to be stronger you know is it a different type of braiding material um and really really staying close to people and understanding i think is is you know it's all those dinky little things that kind of amount to something that's amazing you know what i'm really hearing is and i don't i don't know maybe this is because i've just been too steeped in amazon culture for too long um is the 14 principles right uh are do you feel like customer obsession is as a principle that you have kind of integrated into your own business or yeah like freaky customer obsession like yeah you know like i email every single person like they have access to me so that i can get that unadultered fill you know feedback and really try to grasp um you know what needs to happen to um to make those things awesome well let's let's talk oh go ahead go ahead see i like to think of like amazon is like like a like what the app store was to apps you know like it made it so that you can sell software at a rate that nobody ever could in the past in a fraction of the cost you know and so people spend things as amazon as a business which it technically is but i like to think of it as a distribution platform it allows you to sell e-commerce goods at a fraction of the headache you ever have and i have a physical warehouse you know warehouse team and like like you deal with hr issues and you know netsuite is my erp and it's like that stuff is just complicated it takes an insane amount of time with you know amazon you can do that and you know uh you know ten percent of the effort five percent of the effort you can scale so much faster but you still have to have an actual product in the business um you can't just say you're going to try to exploit um you know two seconds of uh you know of timing with a widget well yeah i was able to do like a million dollars in sales like out of my living room with like one person helping me pack boxes occasionally like that you know and you can't do that kind of volume with that so there's a huge opportunity but you have to kind of be watching the marketplace and identifying where the gaps are and where the market trends are going for sure it's so cool that you can do that kind of volume with you know out of your living room like that's just physically not possible yeah yeah so yeah it does have this you know it can be a a big task mask or what what would you say like some of the biggest changes that you've seen since you started to sell online um because i know i mean i i've been selling online for about a little like 11 12 years and it's changed a lot uh what are some of the biggest changes that you've seen biggest changes you know i think that uh the expectation that amazon has set in terms of like customer service shipping logistics like is super intense you know like it used to be in the you know just like with you know ebay you could open up a store on you know whatever your platform was back then um you know asp.net storefront or whatever and uh you could have you know take ten days to ship and people be cool with that now it's like they expect the stuff instantly like you need to you know your phone lines need to be open i mean you're competing against the big dogs uh it's it's much more you know rigorous than it used to be well and you know i think that you know for some people somebody's going to probably be watching this on youtube and there's a lot of there's a wide varied information group of information um i think one of the things that especially for people starting out it's how do you discern what youtube's are still relevant because it has changed so much um so you know i think it is about looking at kind of how making sure that the information that you're gathering how how recent was it uh you know is that person still practitioning um yeah i think that's a huge one yeah are they still selling and do they sell lots because we when i what i feel like happens is especially when you get to the timing thing you get these people that will exploit the timing in the beginning they'll then see the writing on the wall and they'll be like i can no longer sell these widgets on amazon it nearly the same profit i can but if i leverage this into selling courses i can make even more money selling courses and i know enough to sound dangerous you know but they really aren't you know all that good or they're selling they are selling that volume but they're doing it at a loss so that they can show the screenshot yeah yeah if they're even not faking the screenshots you know yeah yeah yeah it's so it is it is important and you can kind of pick it up if in the language so if you're in groups where you're watching the language of other sellers you'll hear them refer to programs look with uh like they'll refer to using a program that's been defunct for two years or you know they'll be like this is a great program like well early reviewer program has been dead for a year so you know that hasn't it couldn't have been working for you recently you know yeah yeah yeah so uh what you so let's talk a little bit about import yeti and like how did you were you just like you know what the world needs they need this like how did you get to to to get to this to this point yeah well i think that at a high level um you know i really struggle with alibaba like you know what happens is if people are aware of it but you know like just like how you have amazon gurus who are like make a bunch of money on amazon in china there's all the baba gurus that are like do you want to you know make a bunch of money open up a factory on alibaba and these people don't actually have factories it's just like you know somebody who knows someone who has a factory and they say they're selling products um and it's a very very inefficient method like my favorite analogy is if you type in like barbell it'll be like there is 6000 manufacturers of barbell or whatever the crazy numbers there is not 6 000 factories in the world that make barbells there's maybe like 30. you know so you you if you look at those numbers you go out of the 6 000 options they have why is it that you know 30 only make it and how do you find one of those 30 and if there even are those 30 probably 10 of which aren't the best or maybe specialize in what you do and 10 of which are mediocre maybe 10 or stellar um and uh you know alibaba is incentivized to really provide that data or kind of walk through that stuff and the you know the way what import yeti does is we essentially pull in all of the shipping data when you ship a product from the united from china or anywhere else in the united states via c you have to fill this document called the build relating we then take 90 million of these things compile them so then what you can do is you can either search the supplier or you can search the um the company in the us and then we'll show you where they actually import from so like to use the barbell example let's say your favorite barbell company happened to be like you know john's barbell company you would then plug them into import you had to even say they import their barbells from you know uh bill's barbell factory in in ridge uh and you could see who that you know bill's factory's customers were what kind of volume they move and then you could reach out to them and uh and um you know touch base well because i and i do think that you're correct like but i have the same experience people like i'm just going to buy some i'm going to buy some coach purses on alibaba and i'm like well those aren't coach perches anything with a brand name isn't real uh and then uh there's there's so many people who have had money taken and being able to do some more research and being able to identify what are the factories that are providing great things especially if you're just getting started and you're like i have an idea for a product but i don't know what factories would make this then it's a great way to to reach out and you know we've even had uh we had a brand recently that was having issues with uh somebody who's using their same mold uh for a product and so we looked up those products those brands um we you know we kind of had to do a little digging a little bit and we found that there was you know that their factory was selling their mold to somebody else uh so you can't if you have a competitor is that do you do you feel like a lot of people are using import yeti for more for primarily for single kind of like tracking down counterfeits yeah i think sourcing is 95 of it you know uh for you know it's kind of a sad reality that china you know has loose standards with some of that stuff and my mindset's always been you know if you're creating the best product and you're choosing the right partners generally speaking those problems don't present themselves um you know when you really run into troubles when you're choosing those kind of you know less than top-tier suppliers and those people that aren't really partners with you if i'm a good client and they understand and value my business and we're you know have a strong connection i don't run into the problem of them sharing their molds with you know other people yeah i even had somebody that was uh he might have been a little paranoid but he was having different factories make different parts and mislabeling them and assembling in the us so that you know like so you know the the degree to which people will go to kind of mask that uh do you uh if if some and if there's an established brand that is listening um maybe they don't want their factories revealed is there a way to block your information from being on import yay yep you go to the customs and border and i believe it's called a confidentiality manifest request or manifest confidentiality request or something like that and uh you fill out this little form um you send them a letter and then yeah takes the data off because there's a hundred sites like emporia it's not just just me um and then it takes the data out of all of those um off all those sites so i would say that would be most important if you have something that is uh like if you had a product that maybe doesn't have a lot of intellectual property would be hard to defend here would it be extra important to do that or i mean yes the way i worded is that like you know generally speaking if you are importing something that's a commodity you know uh people even if they they're not going to have a hard time finding a supplier of that commodity no matter what and really like i mean there probably are some rare use cases but you know i don't see a ton of value in it really where the emphasis needs to be honest is how can you create products that you know are unique and you're you know there's there's something behind them like a brand name you know the customer you know like nike doesn't care about me knowing his factories you know they just they just don't care uh because i can't create an interesting affinity yeah yeah well and i think this kind of goes back to what we talked about earlier like as the marketplace has evolved uh you know you know five years ago on emma's son you just needed a garlic press and you could make a million dollars yeah yeah you know like the garlic presses if you're new to the amazon community the garlic press is like the joke of example product right but so i think that there is a need for an emphasis on exactly what you said uh you know developing a product that solves a problem or feels a need that's not already there and then that eliminates a lot of the there's you still have the issue of how to market that product to make sure customers are aware of it but you have a lot less of that raised to the bottom like as soon as i get the item in now i can't sell it for a profit that i see a lot of new sellers struggling against yeah and it's and if you're battling for those razor thin profit margins man you're gonna have a hard time you know it's just you know there's there's too much that can happen that just really destroy your business like you know you want to build something where the profit margins can sustain you know a little hiccup here and there i have a friend that makes people really upset she's a e-commerce bookkeeper and she tells all our clients that she recommends at least a 30 gross margin people like lose their mind like that's not possible it is possible it's just harder uh but you know i saw a lot of people who came to me uh in the last year for coaching or help with profitability uh because they were on those razor thin margins and then it the cost for a container quintupled and you know yeah they had no room right yep so they went you know they had a successful profitable business they were you know jet setting and you know having fun adventures and then now they're in a really bad place um because they had no room to really uh to move and our bus and physical products is a very cash intensive uh thing so having so having enough margin to build up that reserve i think is really important yeah for sure yeah there's a lot of things you can do to try to increase margins you know like one of the things i always that drives me crazy is people like intentionally beat up the manufacturers to like try to you know squeeze an extra penny off of the thing when there's you know i deal with a lot of suppliers like they are already typically selling you things they're pretty rock bottom they're not making 100 markup on their stuff um you know but putting those strategies in place like you know choosing the right freight forwarder is really trying to drive down this freight forwarding cost huge another thing i've had some success with is really understanding the cost structures of the products you're trying to make break them out into different categories so you can like like as an example let's say i'm importing you know like mugs right what'll happen a lot of times is they'll say okay this is five dollars but really it's a thousand dollars in mold costs um that they're distributing across the test units i'm buying there's artwork fees there's photography fees there's r d fees and you can take that and then change your unit you know restructure the pricing so the unit cost becomes 250 you're paying them a grand in uh mold costs and then the research and development costs which drastically decrease your tariffs um and you know these are cutting the um essentially the what's being put on the commercial invoice by half legally too it's not like there's anything wrong with that because they're just you're changing the way that the costing is um and you know like that's a stellar strategy working through packaging is a huge one with so many goods it's shocking the packaging costs like shocking and a lot of the factories because nobody has in-house packaging they outsource that almost 100 of the time they won't shop packaging as aggressively as you can um and really saying like hey what are the different packaging options what are the cost differences between these packaging options you know um you know what is the spacing of the packaging so you can fit more things per container you know i've seen people make just like they'll import a walk as an example and they'll put the walk in a giant box you know versus stacking the walks like into in the assembling of the united states which seems like it would take more labor but if you can fit literally 40 or 50 times as many walks in a container because they're stacked you know just on top of each other hurts my head doesn't hear about that much money being set on fire yeah it's crazy yeah um you know and really getting creative like understanding what the cost structures are really scientifically and then saying what are the methodologies you can use to try to manipulate those things even like what are your warehousing costs in the united states the shipping to you know from the port to the you know fba warehouse if you're shipping straight to the fba warehouse or if you're re-tagging you know all that stuff uh you know can you could really make some big differences there you know another thing on margin is you know just as we're talking about sizing is making sure that you have the size tiers for fba if you're going to use fba kind of tape to the side of your computer because sometimes a half inch can be the difference in like three dollars a fee per unit yeah you know so sometimes it just means folding that rug one more time and you could you know and so but but it's also you so we gotta balance that and the logistics to get it from china here i think like you said um for sure and then you know the other thing about the packaging is if you're going with the manufacturer they might only have limited options and sometimes packaging can be a big point of perceived value and help help make your product stand out so if you're putting it in a plastic bag because that's all that they had you could really be hurting your marketing long term yeah for sure well and i know that's several companies that uh that we work with they buy their their packaging separately they package it in the u.s because the ammo users are so different um the mmoq is minimum order quantity um so they can get it much less expensively if they order it and put it together even with the increased cost of labor in the u.s it's still cheaper

yeah that's interesting we do all of our almost all of our packaging overseas um central assembly in the us but we still find it to be drastically cheaper to get packaging done overseas although most stuff is poly mailered it might be different if you're dealing with cardboard um yeah yeah these are the ones i'm thinking of are cardboard so maybe that's that's probably why maybe it's that walk thing yeah yeah yeah um so can you tell me um if you were going to start if you know somebody's new and they wanted to source something from china or from some other country what would be the the most important things that you think that they would need to know yeah i think the the first thing i see the biggest people make mistakes in is really think about how you portray yourself to those vendors and let me use like like a really concrete example what most people would preach in the intro emails they would say ask for the moq and price right out the gate but when you're saying that what that win with the vendor here is you're extremely price conscious and you're a small order you know because they're saying what's the smallest amount i can order and what's the price i can order for you know versus if you were to think of like how would walmart send that email and i'm not saying you want to act like your walmart but the way their email goes is it goes like hey my name is you know robin i'm a purchasing manager at walmart we're interested in bringing in ceramic mugs we'd like to learn more about your company can we set up a call to introduce you know each other and then they would have this call and they'd talk a lot about you know what the factory's good at the factory's bad at and build a relationship you know and they you know hopefully through that good relationship then you can start to work out some of the harder details but that relationship is what's going to enable those harder details to be worked out they're not going to want to share their hard cost structures with you if your first email says hey um you know uh what is the emo q and price because they're going to be like hey this person's gonna yeah and is another side note i would never say i'm an amazon seller there's a lot of great amazon sellers out there but there are also a lot of really horrible ones and you know you peg yourself into that market when you say i sell on amazon um you know it's better to just say hey retail or e-commerce or whatever um and then i think you know if you can really set up a really strong relationship with those vendors and they perceive you as somebody that's going to be a long-term business partner you know you're going to get a much much much better price a much better outcome you know you're getting better quality they're going to pay more attention to the order because they're like hey we want to make sure that you know we could keep david because if this is butchered you know he's not coming back to us for round two and we think he's gonna come back to us for round two uh you know from there i think the next mistake i see a lot of people make is they still pay with chase wire transfers that's just atrocious especially if you're dealing with countries outside of china because forex conversion can just really really kill you to put things in perspective like let's say that they're quoting things in usd they're saying like ten dollars you know is what the unit cost is and you're in a currency that fluctuates a lot that ten dollars might be eleven dollars you know next month and then nine dollars a month after that so they have to break you know those cost differences out into the price they quote you because it's you know they don't like having to come back every month and re-quote you prices whereas if you work in their local currency really understand those cost structures and pay in the local currency so then say five ten percent depending on what the country is china as mentioned it's less of an issue because they pegged the rmp of the us dollar um but uh still you know forex fees could be two three percent sometimes that can make a big difference in your overall margin for sure yeah um so what else what are your expectations what do you see coming uh for this next year in terms of this next year you know i think shipping prices are going to drop something good um you know uh they're still holding pretty high but they will come down i think especially as the back lock starts to alleviate um you know companies are at least i feel factories are opening and you know doing a much much better job of um of you know producing high throughput um you know 2021 was still pretty shaky um so i'm excited for that a lot um i think that there's going to be just a bloodbath in the amazon space with small sellers getting just you know i i hate to say it but it's just going to get ugly and you know i think some of that's the you know addition of things like thoracio into the marketplace where they're buying up these companies and then truly putting best practice into place um you know so you're no longer competing against you know joe yeah yeah joe it's like you know a bunch of phds out at mit um you know it's it's a different caliber of person um you know so i still see so much opportunity i don't sound pessimistic at all i'm just like the opportunity to create you know one of the cool things about the internet is that all these really cool communities pop up you know like as an example i'm a huge fountain pen lover and everyone creates these cool ink colors and they're so neat and i'll see people that will be like hey i'm a fountain pen addict and they'll create an awesome color you know out of their house and then they'll sell out you know thousands of bottles um you know and that's like an example of like something that you know someone who's passionate who actually knows their stuff is creating something that adds value um you know so those kind of people i think are just going to destroy it yeah i agree with you i think that the me too products are going to be harder and harder and then there's going to be even more opportunity for people who are really developing products that make a difference in the marketplace and really know their audience and connect with their audience uh you know i've been so if if people want to find out more about about you or import yeti what's the best way for them to connect with you import yeti.com you know i have all my contact information on there you know if people use the site i really am trying to build something people love and please give me any and all feedback even like really small things if you're like dude this button drives me crazy where it's placed just you know me and me like i hate this uh you know i'll take any format any feedback in any format you want um you know yeah so that's probably the easiest way i mean i'm always happy to help you know so if you're if you're stuck with you know how to import a product or you're not really you know grasping something always feel free to send me an email i'm always happy to kind of say hey here's what best practices looks like in this area that's i really appreciate you and i appreciate you coming on and and sharing uh i feel like there's a lot of people that talk about like make a million dollars but not a lot of people are like this is how you avoid like don't like you should stack the walks like don't put them in the like there's there's i think there's a lot of like little things that make a huge difference and uh just the stuff you shared today i think will be really valuable for those listening it was so ironic is that is how you make the million dollars is by figuring out how you should knock the walks like you need to take the emphasis away from quote unquote billion dollars and focus on the process which is like it's boring and it's not as glamorous you know and i get it it doesn't sell there's a reason why i'm not on youtube creating videos about you know make 10 million dollars tomorrow on amazon because this message isn't as sexy as that is um but uh it's what really moves the needle that's real and it goes back to what you said like five percent better for your customers same thing five percent better for your profit margins and having those yeah and nothing focused on what quick get rich quick but really like this is how you make a business run yeah yeah yeah and i think that's the exact mindset it's like how do you create something that like if you think like i want us to be alive in 10 years or five years you know like and if you're looking at your own this is not going to work at least acknowledge that and just make the hustle for what it is and then you know collect the profit margin and get out the game as quick as you can um but uh you know if you're trying to create that lasting value that really is going to last you know five or ten years and you have to create something that is um the product will last that long and differentiates itself that's great and so i want to thank you for sharing and you've given us a lot to think about and i hope people kind of follow up with you more i want to talk with you more because you obviously have a lot to share so thank you very much for your time today i appreciate it

2022-02-13 14:45

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