I’m still not 100% sure if it was a good idea or not. We had sales and they were ultimately higher than expected. I’ll summarise the idea, the results and the learning.
Sharing the risk
Launching a European business on Amazon from scratch has a real cost. Setting up not only the logistics but also the tax structure to be able to act with Pan-Eu and have the products in all of Amazon’s European warehouses is a significant risk if you don’t yet have sales data for your products.
So the proposal to one of our clients was this
We sell your products through our accounts. You can use our infrastructure. We charge you for the agency services for this. In exchange email data we buy your product from you, even with a profit margin for you. It wasn’t too difficult to convince. We are a partner in this case who, looking back, assumes almost more risk than the client.
Learning achieved
This exchange of service and product is not quite turning out as we had imagined. Yes, sales are emerging but they are at a price.
We invested in new packaging help your business reach customers effectively ourselves because the old one was substandard.
Vine’s average reviews have revealed a few more product shortcomings that we hadn’t paid attention to.
It’s difficult to have a good margin since we bought the product at too high a price.
Bottom line: We didn’t invest enough time to build the partnership properly. We should have been more demanding on the product level. Still, I think this model with this client may have a future. It will depend on the upcoming negotiations for the second batch of products.
Seller Tool
The seller tool will allow us to operate with fans data Amazon at another level. With the new inverter, the tool will not only be on par with other offerings on the market, but even far above.
This is what I think about 2024. Everything is still to be defined. What is already clear to me is that it will be a year without comparison.