76. Maximize Your Profits: When & Why to Move Away from Amazon FBA with Brandon from Fulfillrite

76. Maximize Your Profits: When & Why to Move Away from Amazon FBA with Brandon from Fulfillrite Speaker 2: Hi, good afternoon, everyone, or good evening, good morning, wherever you are, whenever you're listening. I got Brandon here. And actually, it's really funny how Brandon reached out to us. I think he reached out to a colleague of mine and said, hey, we'd love to kind of partner up and see how we can kind of do something together. Right. And I get all these I get these emails all the time. And I did my due diligence on Fulfillrite. And I mean, they had just exceptional reviews. All over the place. And I was like, okay, let's have a chat. And then I think, Brandon, we jumped on a call and we just got on and we just spoke for ages. And I thought, how about let's just get Brandon on this podcast, because there's going to be areas that Brandon knows about I don't know about. And I think there's going to be a lot of people who are going to find this valuable, especially now with just the costs rising within Amazon from every area. It's becoming harder to make a profit and actually, this is a place where, you know, when we're dealing with PPC, there's only so much you can do with the advertising. I mean, there's, you know, there's going to be other places where you need to be leaner and cut back, not only with your ads. So, Brandon, thank you so much for joining us. Really appreciate having you here. Speaker 1: Absolutely. Speaker 2: Before we start talking about Fulfillrite and your role there, I want to kind of just rewind back in time and figure out where your passion and how you got introduced to this e-commerce space. Speaker 1: Yeah. Oh, goodness. How long you got? I'm going to try and give you the short version and we're going to see how this goes. So all the way back in, gosh, like 2015, I wanted to get a business out there. I wanted to give things a shot, see how it would go. And I decided to basically take a childhood idea that I had, turn that into a card game and run that to Kickstarter, which I did in 2016. And like squeaked over the goal like just got over like 10,000 by like some luck and ended up shipping that out. I started a blog as a result of that called Brandon in the Game Dev where I just kind of chronicled the things that I wish I knew when I was making games because that's really complicated stuff in terms of just marketing and supply chain and game development and everything. Ended up doing another game and another game from that. Relatively small. One's called Warco. Another one that got published, that we published was Tasty Humans. So like small obscure stuff. But along the way, turns out I was better at SEO and blogging than I was at game development and the stuff that came along with that. I ended up exchanging blog posts with Fulfillrite. They reached out to me out of the blue, just as like a co-marketing thing. And like things just kind of escalated from there. They ended up flying me up to New Jersey on a weekend, just to like meet each other. I picked up a little bit of part-time work from that. And then the part-time work kept coming in steady from there. And then eventually it turned into my full-time job as director of marketing a couple of years after doing the part-time work. It's a pretty unusual way to get a position with a company, that's for sure. Speaker 2: Yeah, that's amazing. And I think one of the big things that I've heard a lot of people talk about, especially in the last few months, is these extra costs storing your products on Amazon. It's been just a big blow to a lot of brands. And I mean, one of the questions I want to ask you, Brandon, is when should a brand start considering moving away from FBA or at least having products, you know, some fulfilled by merchants? Speaker 1: Yeah, that's an interesting question and a complicated one. But like first, just some useful context for folks listening in. Fulfillrite's an order fulfillment center, so what we do is we hold on to people's inventory and we ship it out, just like Amazon would do if you're using FBA. If you're using that service and there's different reasons why you might want to use FBA or you might want to use a different third-party order fulfillment company. But one thing that we hear people complain about when they're shopping around for different fulfillment centers, whether they work with us or with somebody else is basically they'll either not really understand how the pricing is working with FBA because it's fairly complex and others will complain that like They don't like the big corporation or they want to be able to get somebody they know on the phone and other stuff like that. Those are the two complaints that come up probably most often. Speaker 2: Okay. And also another question I have is like, how do you choose the right 3PL to work with? Speaker 1: That's, there's a lot of stuff that goes into that. And I've got, I actually have like a sheet where I just write down basic stuff, just basic criteria to look for, and five of them come to mind for me. The first is probably location. Whenever you work with a 3PL, the warehouse needs to be at least reasonably close to where a large amount of your customers are. And it doesn't have to be like 100 miles away or really close or something like that. If most of your customers are in the U.S., you probably need a U.S.-based fulfillment center. And if you occasionally have to ship one to Europe or something, but it's not a huge, steady volume out of the country, you just get one in the U.S. and you can feel pretty good about it. And like the closer the better. Like if you've got let's say thousands of orders in just the US alone, you might want one on the East Coast, on the West Coast and so on. You just want to make sure that whatever fulfillment center you choose is at least reasonably close to those folks because it cuts down on the postage costs, which is the primary thing. And it can help kind of reduce the shipping time, which a lot of people care about as well. Second thing is you just want to make sure they do everything that You want to make sure that the fulfillment center can do everything you need them to. Like, pretty much every fulfillment center under the sun can take inventory, hold on to it, and ship the orders out when they come in. And the vast majority can handle returns too. That's bread and butter stuff. But if you think that you'll need to like take different products and put them into a single box before shipping them out, like manually assemble that, you would want somebody with kitting and assembly service. If you've got electronics and you might need to touch them up, you might want one that offers refurbishment service. You just want to make sure that whoever you choose that they offer the service you need before you sign on. Other things that are really important are like Factors are important for any vendor you work with. One is communication. Like if you can get a hold of them, if you can have a conversation, feel like they're really communicating with you, like they understand your problems and you understand them, that's a good sign. If that's not there, especially not in the sales process, it's not going to get better later on. So you want to make sure you feel like there's good communication there. As well as like pricing, it needs to be something you understand. And somebody can explain it to you, but also competitive. It doesn't have to be the cheapest in town and that's probably, cheapest probably isn't the way to go necessarily, but it just needs to be competitive and understandable. Probably the last thing you want to look for is also just reviews and case studies. Make sure that other people say that the fulfillment center that you're looking to work with is able to do what they say they can. Like, are they shipping things on time? Are they arriving intact most of the time? Are customers happy? Does the pricing make sense? All that stuff. Speaker 2: Amazing. Okay, thank you, Brandon. And I think there's a follow up question to that, which is, we'd love to hear some examples of when you've seen a 3PL come in to help a business, and that's seen it flourish, like give me some examples of when it's really worked well. Speaker 1: So I'm trying to think of like a really clear example. I have Bear with me one moment. I know this is live, but like you also will know this is like the real deal too. So here's an example of where Fulfillment actually really helped out a specific client here. And maybe some folks who are running e-commerce companies, you know, in their basement or their home can relate to this. But take a look at this plate here. I don't know how well you can see that illustration. Anyway, it's got like, it's one of those fancy blue and white china plates, you know the type. But instead of having traditional designs on there, there's like a monster with like eyes on stalks on his head, like kind of like a snail and just a lot of these plates will have robots and black cats and volcanoes and all kinds of things that you wouldn't expect on that. That company is called Calamity Ware. Very good people that work there. I actually met some of them in person. And like all the way back in 2014, they were just kind of having these made locally in a warehouse and the warehouse was doing the shipping. And it worked like they had one when they had one or two or three types of items. But once they started to get beyond that, it was taking like a month to get out the door because the factory is not set up to fulfill. They're just set up to make the stuff. So that's when they found Fulfillrite through Shopify store, I think it was, just looking at the apps there. And just by merit of going with a fulfillment center in general, we're able to get the inventory out of that factory and start shipping it out, like the Shopify order would come in, the data would go where it needs to go, and then it starts shipping out. Now, these guys operate on crowdfunding. This comes from sketches that a guy had been posting on Flickr for a long time, like back when Flickr was like more of a thing, right? Speaker 2: Yeah. Speaker 1: And it's just like sketches and wild and crazy stuff. This started out with a couple of Kickstarter campaigns just to like see if they could make a physical product out of that. But once the actual fulfillment issues were solved, They were able to do another campaign and another and another and they've done, they have literally lost count of how many they have funded at this point. It is in the 70s now. Like we have like both we as the vendor have lost count of how many we've done and they as the client have lost count of how many they've funded because they've just done it one after the other after the other. And it was all because they got the supply chain problem fixed. Speaker 2: Wow. That's amazing. I always ask this question to everyone I speak to on calls now. Just from the lens of fulfillment, because you're just so in that world, and you see things that I don't see and what most people don't see, right, because you're seeing it day in, day out. What things about that space excites you for 2025? What can you see coming? Speaker 1: I'm trying to think about stuff that's going to be happening in 2025. This is going to be an interesting year no matter what. We know that for sure. It's going to be a very interesting year because we don't know exactly what's going to happen with customs and tariffs and all that kind of stuff. But what I think is particularly exciting actually has nothing to do with what makes the biggest headlines. It's these little tiny improvements that are getting made every single day in stuff that is called AI, but is actually just like I'm here to talk about tools to make sure things are packed properly. There are systems out there right now that are starting to pick up steam, and this is so neat to me, that will actually like, they'll use a camera, and while somebody's packing an item, it'll just like have a view from above, and they'll see and be able to confirm Whether it's packed properly, basically there isn't a computer system that can look while people are packing and make sure there's enough material in there to keep it from breaking in the mail, which sounds trivial, but it's like every time you get something broken in the mail, somebody's going to be upset about it. And then you got to have a return and you got it and you're out another product and something. And to think that there's some kind of system that can actually look and make sure it's packed correctly and save people a bucket of money, that is That's science fiction to me. That's like something out of like an Ursula K. Le Guin book or something like that's just crazy to me. Speaker 2: And I'm going to flip this question and ask you, what are the biggest disruptors that you're seeing in this space? What is this coming within the fulfillment space over the next year? Speaker 1: I'm trying to think about how to put this delicately. Basically, the biggest disruptor is not necessarily going to be a company. It's going to be what happens in terms of trade policy. And what I mean by that is, depending on what happens with tariffs, which could differ depending on when somebody were to watch this, we're going to see whether people want to make more stuff in the U.S. or not. We're going to see whether people import more items at a time instead of drop shipping from China or wherever else. We're going to see what people do with that. And the way that people react to whatever new incentives are put out there with whatever trade policy ends up sticking is going to change How much inventory people keep on hand, it's going to change where they put it. It's going to change how much it costs to manufacture as well as the services that people are going to need because all of a sudden people might have more need of like freight brokerage and stuff like that instead of trying to like coordinate it on their own. And what happens around all that is just going to have all these downstream impacts at fulfillment centers, any kind of import-export firm of any sort is just going to have to respond to. That's by far the biggest disruption I see coming anyway. Okay. Speaker 2: And I want to also ask you this question, which is, is there any question that I should have asked that I didn't ask that you think is really important for people to know about fulfillment centers? Speaker 1: Yeah, I'll give you one. And this is, I think this is kind of a sleeper question, but it's an important one, which is knowing when you need a fulfillment center in the first place. Sometimes it actually makes sense to ship on your own, which sounds like kind of a strange thing for somebody representing a fulfillment center to say, but it's true. If you're shipping a relatively small amount of orders, you can pack your own boxes and get those in the mail without too much trouble. What in fact will happen is a lot of order fulfillment centers, it varies from place to place, but a lot of them will have minimums around like 100 per month. And if you don't, if you're not steadily doing that, they'll be a little bit shy about taking you on as a client because they know they won't be able to do it as cost-efficiently as you might like. So you can actually ship on your own at first. That's the interesting thing. And to me, like the important question is like, how do you know when you need help? So to me, the real answer to how you know when you need help is basically one of two things is going to start happening or you think it's going to start happening soon. It's either going to take forever to get packages in the mail, which is not great because customers don't like that. Or it's just going to cost too much because postage costs a small fortune and fulfillment centers and FBA and all of that gets a discount on the postage. It's when one of those two things sneaks up on you that you want to actually get some help with fulfillment, either taking forever to get shipments in the mail or the postage is just really starting to add up. And other things you might want to look out for, it's like, if you feel like orders are piling up, that's definitely a sign to get help. If you feel like you're moving so fast that you're making mistakes, it's another sign you might want help. And if you just generally feel like all you do is pack boxes and drive to the post office, then you probably want help because you're not, you know, running advertising and doing A-B testing and doing product development and the cool stuff. that you probably wanted to do when you started up with e-commerce in the first place. Speaker 2: Amazing. This is all very, very helpful. Thank you so much, Brandon. And I wanted to also ask you, like, if people wanted to know a bit more about FulfillRite and just ask you some more questions, more personal to their brand, how would, what would be the best way to reach out to you? Speaker 1: So if you want to get a hold of somebody at Fulfillrite quickly, the fastest way is to send an email to support at Fulfillrite.com. And if you're specifically looking for pricing information, Fulfillrite.com slash open. That's the fastest way. If you happen to be on our YouTube channel, I do personally respond to the comments as well on any videos that you happen to stumble across. Speaker 2: Okay, perfect. And if there was one thing that you would want to leave those selling products on Amazon, or just in general on e-commerce, what would be the one advice or point you would want to leave people with? Speaker 1: One advice to leave for people who are selling on Amazon Pay really close attention to your customer retention. I think that for sure. And part of that is delighting your customers, you know, nice packaging, making excellent products, stuff like that. But the other part is just not messing up the supply chain part, just being able to get those packages out on time and intact. You know, you do the things right, great packaging, great product, you retain people that way. You do the fulfillment right, you don't sabotage those efforts by not getting it to people on time. Speaker 2: No, that's brilliant. And actually, this all sounds so, so simple, but actually it's the things that people miss, right? And actually, if you can reduce that, those issues, it's just one step closer to just growing the business further and just doing right by the customers, which then leads to them potentially buying again later and increasing that trust that they have in you. Brandon, this has been incredibly insightful. I really appreciate the time you've taken to join us on this podcast webinar. I wish you all the best. If you have any questions for Brandon, every time I've emailed him, he's been incredibly responsive. Feel free to either go onto the Fulfillrite YouTube channel or reach out through, did you say it was support at Fulfillrite.com? Speaker 1: That's right. Speaker 2: Perfect. Okay, well, thank you so much and I hope you have a great day and for those listening, see you in the next one. Speaker 1: Thank you for having me on and thank you all for watching.