We had started our Amazon business earlier that year (which at the time was just a side hustle), so I went to our little 250 square foot office and cried for hours. I was absolutely devastated. I didn’t know what to do… Our fledgling wholesale business couldn’t support me, let alone my wife and newborn daughter.
I grew up in the very poor community of Williamsburg, Kentucky where nothing is given and everything must be earned. After my parents divorced when I was five, it was up to my mom to raise me and my two brothers. Even in the bleakest of moments, my mom never gave up. She was a fighter and a warrior, and that’s a temperament she instilled in me.
Day to day work on an Amazon wholesale business
Dan has no day to day role in Amazon.
He hasn’t opened an Amazon account for 2 years!
They have 2 domestic employees (in the USA) and 2 in the Philippines that handle all operations.
Dan DOES have input in agreements with manufacturers.
An employee asked Dan to review – what do we want from a relationship as well as what they can offer.
It’s not passive but more passive than most business models.
Also, it delivers a sizeable profit!
The average margin for Wholesale on Amazon is 20-25% net for Dan and Eric. As a cashflow business, that’s great.
1-3 hours obligated to the business – 35-40% ROI month to month.
With Private Label, there are a lot more decisions to be made eg designing product, sourcing etc.
Improving easier than creating
Making something better that is already good is also much easier than creating or finding a new product.
And you get predictable income when you buy wholesale to sell on Amazon.
That’s why Amazon wholesale has advantages over the private label as a model.
Goal – more time and freedom
Spend more time with kids and provide with experiences Dan didn’t get.
Dan asked them before school started, what do you want to do?
Daughter (9) – I’d love to go to LA and see Santa Monica pier.
That day Dan called into office – off rest of week – booked ticket for rest of week
Position kids to have the mindset for freedom.
Another example – employee vacation
One rule – no talking shop about business.
Over the 2 weeks, never talked about business.
Dan Meadors – The Amazon Wholesale Formula 2019
Dan worked for a retail company selling eg Pokemon cards.
Saw amazing growth – Dan played a fair role in that.
Saw how to see how to grow a business.
Was there after college 5 years – $1.5M/yr sales up to $25M
Went from 13th employee to 200 people.
Starting on Amazon – the impulse
One of the employees came in and gave notice. Making more money on Amazon part-time than in day job.
Started company back in December 2011.
Dan was actually let go from the job which was traumatic.
He enjoyed his job and in theory enjoyed his job.
But was afraid of debt because it ravaged his mum.
He bought a house outright, paid off wife’s student loans.
Replaced a roof which was very expensive.
When got terminated – had only $3000 in the account and lots of bills and a 1-year-old baby.
Told wife -“I quit my job today to do my Amazon business”.
He was actually fired! So he just faked bravado.
Starting the business
Couldn’t use money out of the account.
Got credit card for $600.
Did RA – grew it organically.
Working very hard. The budget grew fast.
$850,000 in sales, maybe $250K in profit!
The 2nd year, worked even harder – 70 hour weeks.
But ended up $950K sales end of the year.
That Thanksgiving – Black Friday is the biggest shopping day of the year.
For RA if you’re not shopping, you’re missing an opportunity.
In the USA, you have to be out on Thursday – meant missing out on Thanksgiving!
Dan and his partner talked about – what happens if we can’t work 70 hours/week
Other businesses didn’t work
Dan tried a Retail store but shut it down.
Get: Dan Meadors – The Amazon Wholesale Formula 2019