You sell physical products, but are you an entrepreneur or a sales channel manager? Building a brand and growing a business is different than simply selling products on Amazon.
In this episode, I’m talking you through the difference between being a true physical product entrepreneur and being a sales channel manager on Amazon. Owning a business requires a big picture vision, with three essential parts of the picture. Sales channels (like Amazon) are only one third of the equation.
Three Parts of the Physical Product Sales Equation
Managing a sales channel (like Amazon) is only one part of the equation. In order to own a scalable brand and business, you have to focus not only on the income stream, but also on the specific product you sell, and a specific audience.
- Sales channels. Amazon, Shopify, your own business website; these are all possible sales channels. Being fluent in one is a job and an income stream, but not a business.
- Product. Knowing your specific product and how your customer relates to it, rather than responding to an algorithm to know what to sell, is a crucial part of the physical product business.
- Audience. As a business owner, you get to know your audience, who they are and what they want.
“People who focus on re-selling other brands’ goods don’t have a business, rather, they have a cash flow stream.”
Look at Your Business Like an Investor
What are some things that make a business more sellable and more attractive to investors? These are the things that are important to focus on as a true business owner.
- Targeting the right audience. When you know what your audience truly wants, you can charge more for the product, which increases your profit margin.
- Diversifying your markets where appropriate. More markets = more buyers.
- A team in place. You have to be able to walk away from your business for a vacation or a few days without it crumbling.
“As an owner, you want to think about things like an investor does.”
Transitioning from Income Stream to Business
So if you are an Amazon sales channel manager and you are happy with that income stream, great. If you want to move away from being at the whims of the Amazon trends and regulations and own your own business, you need to take steps to move toward that.
- Start thinking like an owner, and like an investor. What is your strategy, your long term vision?
- Pivot away from selling only to an algorithm and toward understanding your specific customer, who they are, what they want, and offer them things that are related to those.
- Think about what you would need to do to be able to walk away from your business. Replace yourself as sales channel manager with someone who does it even better than you. Start learning how to hire and manage, accepting that you may not do it well at first, but like with anything else, you will improve.
“Use Amazon as a tool for your business, but don’t get stuck on it, and don’t be beholden to it.”