604: Amazon In 2025: What It Takes To Sell At Scale (And How Ai Changes The Game) With Bernie Thompson

00:00
Welcome back to the podcast, the show where I cover all the latest strategies and current events related to e-commerce and online business. In this episode, we’re gonna get real about what it’s like selling on Amazon right now. Everyone loves to brag about screenshots and seven figure revenue numbers, but the truth is, selling at scale in 2025 is messy. Fees are higher, competition is tougher, and if you’re not careful, Amazon will eat your margins alive. That is why I brought on Bernie Thompson. He’s in the trenches, running a big Amazon business,

00:29
and instead of drowning in the chaos, he’s been using AI to take back control. We’ll talk about how he’s automating the grind, making smarter decisions, and actually staying profitable in a space where most people are just spinning their wheels. But before we begin, I want to let you know that tickets for Seller Summit 2026 are now on sale over at sellersummit.com. And if you sell physical products online, this is the event that you should be at. Unlike most e-commerce conferences that are filled with high-level fluff and inspirational stories,

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Seller Summit is all about tactical, step-by-step strategies you can actually use in your business right away. Every speaker I invite is in the trenches. People who are running their own e-commerce stores, managing inventory, dealing with suppliers, and scaling real businesses. No corporate execs, no consultants. Also, I hate big events, so I intentionally keep it small and intimate. We cap attendance at around 200 people so you can actually have real conversations and connect with everyone in the room.

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We’ve sold out every single year for the past nine years, and I expect this year to be no different. It’s happening April 21st to 23rd in Fort Lauderdale, Florida, and if you’re doing over 250K or $1 million in revenue, we also offer a private mastermind for higher level sellers. Right now, tickets are the cheapest they’re ever gonna be, so if you want in, go over to SellersSummit.com and grab your ticket. That’s SellersSummit.com. Now onto the show.

01:54
limited shelf space and you basically had to convince some gatekeepers, some uh basically buyers for the retailer that your product was worthy or you didn’t get any sales at all. uh so we’ve then been through this period here with Amazon’s somewhat infinite shelf, although the reality is you can bury a body on page three and no one will ever find it. So it’s not truly an infinite shelf if you’re trying to

02:24
sell stuff. But then, with AI, you know, it’s somewhat frightening in a way. I mean, you see today and you kind of expect this probably will continue that there’s, you have a conversation about what you’re looking for and you get back one, maybe three product recommendations. So it really kind of amps up the pressure of how do I become one of those three? It’s nice to be number three there on your search team. I’d like to be number one though.

02:53
um Yeah, and so I mean, I’ll be honest, first of all, we don’t know, we don’t know how to influence the LLMs. ah But then within that don’t know, we do know some things. mean, so one of the things that’s fortunate for us uh is, we’ve always had this mindset that uh part of our mission is, well, actually, our whole mission as a company, Plugable, is around compatibility. So

03:18
What is compatibility? Well, it is a bit about the products and how we design them. But a lot of it’s about information. Does this work with that? How does this work together? And so we’ve always been a content marketing company that’s put out a ton of content, tons of articles, tons of videos, tons of Q &As about how do our products work with other products? What are the quirks? What are the benefits? uh And so our strategy for winning at uh kind

03:47
uh AISCO or LLMCO is basically to put out more great content that connects things, that ties things together, that tells the whole story, that talks not just about the technology, but talks about use cases. It talks not just about use cases, but talks about the people and exactly how they’re using them. uh And I think we’re partially succeeding at that, but our kind of ambition is to put out just a lot more content than we even are today.

04:17
What is your medium of choice? it written or video or both? Yeah, it’s gotta be both. um you know, we actually just celebrated a huge milestone for the company. We crossed 50,000 YouTube subscribers. Wow. You’re probably way above that, Steve. That’s awesome. Yeah. But for us, we’re really excited about that. It’s a good threshold.

04:40
And so that’s a nice, you know, kind of baked in audience. You know, as long as we’re putting out content that is interesting and informative and we can, you know, kind of keep winning back that audience. That gives us a base of awareness and traffic. but obviously written is important too. I mean, kind of the cool thing about, you know, multimodal LLMs is it truly is both. I mean, if, if we, you know, say something in a video that used to be kind of buried content as far as search engines go.

05:10
But for the LLMs, they’re gonna unearth that. They’re gonna break that video into tokens. Not only will they have the words, but they’ll have the context of that I’m there plugging something in when I’m saying the words and the LLM will actually extract that context. So yeah, it’s really everything. Nice. And so that explains it actually. Yeah. I’ve been doing a lot of AI optimization lately with my site.

05:40
So one of the things is just citing facts about your sales and whatnot and so we’ve sold over a million handkerchiefs So I put that on the site and instantly it got picked up by AI and now I’m known as like the highest volume handkerchief seller on the internet. Yes, and then recently I also uh scanned all my product descriptions into a Date of place database a face database and now my search is so much better. Awesome. That has improved sales dramatically anyway

06:10
My question for you is I just was on your site and I noticed all your links go to Amazon still for purchase. But you do still take sales on your own website. I was just curious, how come you’re not using buy with prime so that you actually get their emails? Yeah, no, that’s a that’s a great question. So so first off, we we do have the Amazon buy box often prominently, but we can control that skew by skew. So we actually have have our line segmented by

06:40
what uh target sales channel we expect that product to succeed in. So we actually have a whole bunch of products that we are not targeting Amazon on. That are more business focused, that we sell through the IT channel. So when you go to those products on our site, we’re capable of shifting, you’ll kind of, like we have this complex buy box that uh can direct you to Amazon, it can direct you to, uh you know, B &H photo, it can direct you to

07:09
our distributors, or it can direct you to Shopify, and we can control that. Okay. I would expect no less. Yeah. It’s a spreadsheet-based configuration of it, and then we’ve got some Python code that pushes metadata up to Shopify, and then some liquid markup on Shopify that then uses that metadata to do the rendering.

07:34
oh Just curious and I don’t want to talk too much about this but like what is your criteria for what gets pushed to Shopify versus one of your partners like Amazon or B &H? Yeah, so, you know at launch, so generally at launch we’re shooting for Amazon success, although not always like today if we’re launching a USB cable We’re not shooting for Amazon success. There’s a thousand Chinese brands You know doing a USB cable and and we’re not gonna beat them unless it’s something

08:02
really magically unique, it’s certification, something like that. But otherwise, if it’s one of our core products, like a higher ASP type product, we’ll shoot for Amazon success and we’ll send it to Amazon. But then after that, it’s pretty much how the product behaves. If we’re able to achieve some search running for some significant keywords on Amazon and a significant BSR,

08:30
ah We will then say that it’s an Amazon-focused product and make sure that we’re monitoring and maintaining those ranks or building on them. Other products do not succeed on Amazon. They get swamped by all the Chinese brand competition, ah and then we’ll actually officially designate those as not Amazon-focused. uh That’s often when the buy box will be shifted to one of our other partners or just generally the distribution because we want to be

09:00
I mean, Amazon has to be a special case because of their high market share. But really what we’d like to have is a mindset of, you know, equally sending traffic to all of our partners. And so we generally, you know, try to shift to that mindset once we let go of, you know, Amazon. So is this change the result of? Well, let me ask you this. What is the Amazon landscape like right now for large sellers? uh

09:28
I read a report recently that said that it’s less competitive on Amazon than ever before because a lot of sellers are dropping out and you’re obviously one of the survivors. Has it gotten easier for you then? No. So what’s happened is actually there’s been a consolidation among the Chinese brands. So in our particular space, you’ve had a few Chinese brands break away from the larger pack, basically anchor you green uh basis.

09:54
are the big three in the USB space, cables, chargers, adapters, and then to some degree, docs, although that’s where we’ve maintained our leadership. uh so what’s happened is you have less of a… Five years ago, a lot of the searches on Amazon looked like this rotating set of five-character brands, just constantly changing all five-character, all from China. uh That has shifted.

10:24
in the last few years. It is now more consistently Anchor or You Green or somebody else. I think what you and I, I’ve actually been curious if that is something like that is not just the strength of those Chinese brands, but actually something where, know, once a champion has been crowned, whether there’s a little bit less. uh I mean, it’s

10:50
As you know, investment in China is directed but not in a uh purely top-down or kind of singular kind of way. It’s more that at the federal level, there’s the five-year kind of goals and then each of the local jurisdictions encourage companies in their area. There’s a little bit of like

11:15
I don’t know whether it’s explicit or implicit specialization. Areas tend to specialize in types of products. then at the company level, they have to be very scrappy. They have to win incentives from the local government, but they also have to win in the market. And they’ve got this hyper-competitive Chinese marketplace internally to the country that they’ve got to compete in that’s just brutal. And the survivors of that tend to be very strong companies that can succeed globally.

11:45
And uh so actually one of the interesting things about Anchor is I don’t think they’ve ever been very successful inside China. They were early enough that they succeeded outside China first, whereas a lot of these other Chinese brands, actually succeeded inside China first and then became tough and fast and great at what they do and then they succeeded externally.

12:11
So I don’t know all the dynamics. It definitely feels like I’m looking in a window into something that I don’t quite understand. But there’s definitely been a winnowing of the Chinese brands in our space to the strong leaders. just because an article says that there’s less sellers doesn’t mean like the competition’s less. You’re saying it’s because of consolidation among the brands. I feel like the fees and whatnot keeps going up.

12:40
How are you coping with that? And are you coping with that primarily with AI systems and making everything more streamlined? What have you done? Yeah, mean, the tariffs are a much larger potential effect than the Amazon fees on a percentage basis. uh You know, at our levels of markup in electronics, is, you know, we probably electronics already had kind of compressed uh margins relative to some categories. And then that means that the tariffs have a disproportionate effect.

13:11
And also for us, we’re at higher ASPs. So some of those things where somebody’s fulfillment costs went up by 50 cents, that’s the whole game on a $10 product. But on a $100 product, it’s something that’s a little bump. ah So frankly, I don’t know that I’ve felt the fee increases that much. The biggest fee increase for us actually occurred uh a few years ago. It was a category specific thing where

13:39
within electronics, the stuff we were mostly successful in moved from 8 % to 15 % sales commission. And that was brutal. was a $1.5 million shift from our profits to Amazon. uh But that occurred, gosh, back in like 2018 or 2019. These later fulfillment changes and some of the, a lot of the kind of punitive fees, the overstock, understock,

14:09
you know, long-term storage kind of stuff. uh You know, they’re guiding you to have a hyper-efficient business that’s well-run, which is actually hard to do, but we’ve had to be there already. I we have amazing systems, so, like, especially some of that stocking stuff, it really hasn’t bothered us because we were already there in terms of our…

14:32
Inventory levels and stuff. I that makes sense I mean electronics is so cutthroat and the margins are lower You you have to have those systems in place to begin with to even compete is what it’s yes. That’s right. Okay Well, let’s talk about the tariffs We had a short conversation before I hit the record button You have been largely free of tariffs thus far whereas I just placed a large shipment and our tariffs are at 55 % right? Yeah

14:57
No, it’s crazy. It’s one of the things that is tough about the tariffs is, and this includes the first set that were done in 2018, you have these wildly different rates depending on the category, is HS code. Well, these HS codes, they were set up decades ago. I I think most of our products, like the parent category of our electronics products are like nuclear materials or something.

15:26
You actually look up the chain of HS codes. It’s something ridiculous. these categorizations are not something that are clear and brilliant and match the modern world. And so then that contributes to one of these problems that if you have wildly different rates between different types of products, there’s a lot of room for gamesmanship. But basically, in our case, what’s happened here in 2025 is

15:54
there was an exemption that was announced right after, like I think on April 11th. So in April 2nd, this big set of tariff announcements came out. And then there was a series of backing off of those. And one of those was basically people realized, hey, our iPhones are gonna triple in cost if we actually do what we say we’re gonna do here. And so there was an exemption put in.

16:20
for phones and computers and a lot of peripherals. It’s got a name, right? Yeah, you know, it’s got a name and it’s a bunch of digits, you know, something, something, something. I call it the Tim Cook exemption. I don’t know if that’s the official name or not, but that’s what I call it. So it’s for all electronics, it sounds like, right? Because you don’t sell phones or anything like that. No, but it’s it’s we it’s it’s a weird line. It’s not all electronic. So chargers and cables, it’s not.

16:48
on those. And so, you know, we’re paying 55 % for the ones that we still have out of China on those. And unfortunately, the lower you go in ASP, the harder it is to get out of China. a lot of those low ASP items, we don’t sell a lot of them because we’re already kind of facing such competitive pressure from the Chinese brands on low ASP. But we keep the skews because it’s important for the kind of cohesiveness of our product line.

17:17
Yeah, and so we’re paying 55 % tariffs. So in about half of the cases, we’re discontinuing the SKUs. We may still be selling some inventory, but once the inventory is gone, we’re done. And then about half the SKUs, we’re just going to pay the 55 % tariff and continue. And then we have this larger set of SKUs, especially like the laptop docking stations, that right now are under this exemption. And so we’re essentially uh

17:46
you know, paying zero and we got out of China uh over the last eight years. So the combination of being out of China and being under this exemption for the moment is giving us a 0 % rate. But based on all the discussion, of course, we don’t expect that to continue. And so we’re kind of in this limbo. So I think that exemption expires in like less than a month, right? Or something has to happen less than a month, I believe.

18:14
So that exemption is similar to the uh pharmaceutical exemption where they put the exemption in place and said, we’re going to do this review of this category and then we’re going to come out with category specific tariffs and a strategy. So actually we don’t have a timeline on the electronic stuff. There’s been some, we now all have to go to true social for our.

18:40
for our business planning and the rumors out of Truth Social is that, yeah, they may come out with their electronics kind of strategy here in the coming months.

19:35
So how do you plan for that just internally? It’s maddening. I have to place purchase orders today for goods that I’m going to receive four months from now in terms of importation. And that’s like two tariff policy change cycles. Or more. uh

19:58
So, and it’s scary, you know, I mean, you know my business, Steve, right? I mean, I’m placing millions of dollars of purchase orders a month and it makes a big difference to me whether that tariff rate is zero or 25 or 50%. And yeah, it’s fascinating. think that all businesses, one of the kind of magic things that’s happened here during this time for the US consumer is all of the confusion.

20:27
and the lack of certainty has actually caused businesses to not raise prices unless they’re actually paying the tariffs. is what Richard told me last week. I was shocked by that. So you’re not seeing price increases. In electronics, as a category, but there are lot of exemptions, but as a category, prices actually went down. uh I just wanted to take a moment to tell you about a free resource that I offer on my website that you may not be aware of.

20:55
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21:23
Once again, that’s mywifequitterjob.com slash free. Now back to the show.

21:29
to kind of hide it by just increasing a product here and there. uh You’re right though, prices across the board don’t seem to have hit. Like I know inflation just kind of ticked up recently. Do you anticipate all these prices shooting up in the holidays as a result? do, ah but I’ve been wrong before. Yeah, but yeah, no, it really feels like there’s a, uh know, that the uncertainty has been holding back the flood. ah

21:59
And then also a little bit of the, you know, I don’t know what the pressure, right? You know, the visibility, like especially at the large company level, you know, if you’re a Walmart or an Apple or an Amazon, I mean, you’re literally getting media and political pressure and attention on your pricing. So, yeah, so I think what’s happened basically is that people are probably mostly

22:28
pricing in the tariffs they’re already paying. And I think so the amount of tariffs, I was trying to get the numbers before the call. So one way to look at it is how much tariff revenue is the government collecting? And so in Q2, the US government raised $64 billion of tariff revenue, which is up from 17 billion uh last year at the same time. So basically like a fourfold increase or so. ah

22:58
And so, you know, prices will go up by that much for sure. And it’s just a matter of kind of these delays. uh you know, and then of course, this next set that’s being discussed, because it affects not just China, but our friends and allies and the whole world, I collectively, it’s a much larger tax increase on imports. So, uh

23:25
Yeah, these things will come through with price increases and because it’s been delayed, kind of expected to come in a uncomfortable kind of breaking of the dam where prices go up fast at some point. You mentioned your smaller SKUs that you have to pay 55 % towards. oh You’re basically just selling those because they’re complements or maybe upsells to what you already sell. And others you’ve just delisted on Amazon, right?

23:54
ah Yes. Do you feel like it’s leveled the playing field though in a way or are you just not going to ever be able to compete against the Chinese manufacturers for those types of products? Yeah, so the problem with tariffs as your one mechanism of competition is they can be avoided. And one big mechanism of avoidance uh has been closed, which is the de minimis uh importation of goods.

24:23
which was used a lot for order by order shipments, parcels with China Post and stuff. But it was also used a different way. It was used by a significant number of Chinese companies and also some US and Western companies to import in bulk into Canada and Mexico and then come in in small under $800 batches into the US. So both of those have been closed, which is great. mean, that’s just a totally positive thing to close those loopholes.

24:53
But the trouble is that uh this is basically kind like a volunteer tax tariffs. When you have your goods go and clear, you submit some paperwork. And on that paperwork, you say how much the goods are worth. So if you’re a US company and a US person, uh the government has the right to audit those going way back in time.

25:17
And I actually, unfortunately, I see a lot of friends right now talking. I watch the discussions online and they’re using kind of gray strategies to get their declared cost of goods down and things like that. And unfortunately, a set of those people are going to get into trouble where they’re going to at some point in a year or two get an audit. They’re going to go back all the years and they’re going to get a bill that’s going to destroy their business. ah But if you’re if you’re a Chinese company or any actually foreign company.

25:45
uh You have very little at stake there. You’re not going to get thrown in jail. uh You can get a bill, but you can also just disappear as a company and come back in a new form. may get a particular shipment uh held and lost. uh So that’s definitely at risk for anybody, regardless of where they are. But that’s just one shipment or one set of shipments. So basically what the aggregate pattern that we clearly see, even based on the 2018 tariffs.

26:15
is that overseas companies are very aggressive about using strategies to avoid tariffs. Mis-declaring HS code, mis-declaring value of goods, there’s some legal ways. mean, as you know, Steve, if you’re a company in China, you can legally declare a lower value of goods than a US company importing the same good because we have to declare exactly what we pay to the other supplier.

26:43
But the supplier themselves, they just have to declare all of their input costs to the physical goods. And there’s a lot of things that you can take off of that legally, including your own profit. You can just profit shift. so already from a legal perspective, it’s a lower. And then once you get to big tariff numbers, like 55%, if you can just pay 20 % less, 30 % less, that’s the whole ball game.

27:11
electronics electronics is a single digit net margin industry. So that’s the whole ball game. I would imagine that the larger guys have to comply right? Like the anchors and the you greens. No, not necessarily. mean, I think I think, you know, it comes down to company culture. Like I think those are two great examples. I don’t want to talk too specifically about them. But I think I’ll just I’ll just talk positively about anchor. I anchor

27:40
has not always been perfect. Like for example, they got hit with a million dollar VAT bill in the UK a few years ago because they grew for years in the UK with a 20 % advantage because they weren’t paying VAT. But then it caught up to them all at once because they’re a big, now a big global, reachable, identifiable company. But generally, Anchor is a pretty good company in terms of ethics. But don’t assume anything about the rest of the brands.

28:09
And sometimes you can just see it. I just look at the pricing on the same product. That’s not manufacturing magic. That’s paperwork magic. Yeah. Okay. Fair enough. uh I know you’ve been doing a lot with AI and you’re a coder or an engineer. what have been your most impactful automations or agents or what? Like, I’m just curious how you’re using it. Yeah. You know, I think the most impactful thing, and I think you’ve

28:37
I got to hear you speak at your conference, Steve, and I was just so impressed with all the automation that you’ve done for your business. uh So it’s probably similar to you that the most impactful automation is the creation of code. ah That if I want a little script to automate this or that, ah it is easily five times faster than it was in the past, maybe 10 times faster. I can sit down in a uh AI-centric

29:06
code editor like Cursor have a framework for my scripts, how they run, uh run on a schedule on a particular server, and I have whole bunch of different tasks. And I can add a task that goes and connects with an API, it grabs the data, and shoves it into my database. That can be done in 30 minutes, like five minutes to the first code, and then 25 minutes to fix the problem or two in that generated code.

29:35
And suddenly I’ve connected to an API and I’ve got the data in my database and I’m ready to go to the next step. Something like that would have easily taken me, I don’t know, like four or eight hours before because I personally would have had to go understand that API and kind of figure a bunch of stuff out. And now that’s given to me as boilerplate code by the LLM. So that’s probably the number one area for me and kind of to your question. I think for the business, it’s actually strategy.

30:05
uh It’s actually all of my executive team brainstorming back and forth with AI using the reasoning models, the more advanced ones. I have my whole team on the OpenAI paid plan. uh So we’re able to have only company-visible GPTs that are matched one-to-one with roles inside the company. And we load them up with all of our SOPs and documents and knowledge about how we do that. And now any of our team members can

30:35
ask questions kind of at the SOP level or at the strategy level about how do I fix this? How do I do this? And uh yeah, so it’s kind of both sides. uh Somebody once told me that the text generation of LLMs feels like the right brain creative side of AI, but what’s the left brain logical side of AI? Because the creative side is a little unreliable, like it hallucinates and it

31:05
Sometimes you can’t trust it. Well, it’s code generation. That is rendering this logical thing that once it’s working will execute again and again. No hallucination because it’s created code. I love thinking about that interplay between the creative and the logical and how do you harness AI to do both things for your business. For the people listening, most of them aren’t technical.

31:34
And I’ve actually been struggling with this with my son. Like he wants to create this app. uh But he’s not really a coder. Is most of the employees at your company who do this, are they coders or even non coders using AI to create tools in your company? um Yeah, a lot of them are people who have always wanted to learn coding, but you know, maybe didn’t get a degree, didn’t

32:01
they didn’t get there kind of as, or at least they were really dabblers before. And then also executives who have coded in the past who do know about coding, but they haven’t been doing it day to day. And so they’re dabblers in a different way. They actually know quite a bit, but in the old world, previous to LLMs, if you weren’t coding every day, you’d forget everything. If you got all the syntax, you’d forget all the interfaces.

32:29
So that’s me. That’s me. I feel like it’s such an unlock for my productivity. But on the side of the dabblers, you just need to be careful about the framework. The two biggies for us are SQL and Apps Script. We’re a Google workspace shop. So Apps Script is a powerful way to automate anything related to Gmail and spreadsheets. And so

32:56
And they almost by design are these little standalone scripts that run in one of the Google apps. So that’s a really great area for a non-programmer to go ask the LLM to go automate something for them. And then when they deploy it, just paste the script in, if something goes wrong, the effects of that are limited, and it just works. And the same with SQL. uh

33:23
I have my finance team is taking that raw data that I might have pulled out of an API, and then they take it from there. And they’ll roll that data up with a series of joins, and you’ll get that into a combined inventory sheet or a combined run rate sheet. We use BigQuery to Google Sheets. There’s a feature called Connected Sheets that lets us pull data from databases and spreadsheets. We use that all the time. Marketing team, same kind of stuff.

33:53
pulling data, transforming data. And so SQL is this, yeah, I guess this is one of the tricks of LLM programming is really constraining it. You’re giving it a strong set of limitations in how and what it can do, then it’ll be much more likely to give you what you want. And I love LLMs generating SQL because it’s a really good example of that. So for the people listening, uh

34:23
App Script sounds like a great way to just get started. What are some scripts that your employees have been using just with their Google tools that has saved them? Yeah. Let’s see. So some of it is um connecting with BigQuery and then saying, OK, we want to transform this data and then put it in a spreadsheet. um Some of it is like an API like uh

34:49
In the Amazon world, there’s this API that’s been around forever called Kipa, and it gives you this history of what’s happened with a product statistically on Amazon based on them scraping the page. So you can literally call Kipa from Apps Script and then just fill in the rows with the results from that uh API call. And that’s probably a good meta example. uh

35:13
Mostly I’m going from API into database, but it’s very easy with Apps Script to go from API into spreadsheet. It’s interesting. I go the opposite direction. Most of it is grabbing stuff from my database and then formatting it away for my wife and the rest of the people. So I’m doing the opposite, I guess. The only reason I didn’t emphasize that is because Connected Sheets does that pretty well. With Connected Sheets, if you’re on the

35:42
the higher Google plan, the corporate plan, you get that feature. And then you can just give a SQL query and it’ll do the query from the database, transform it and put it in your spreadsheet. And so we don’t need to use Apps Script for that, we can use SQL. Oh, nice. I hope we didn’t go over the listener’s heads. See, what’s funny about all this is like, I’m actually encouraging people in my class to try coding. And so one thing that I’ve been working with my son on

36:11
Not quite yet, but there’s this tool called replet. Yeah, I don’t if you’ve used it before but it’s like an easy way for you to just Have AI built in and you can deploy a full-blown app with technically not Even knowing how to code and then there’s like tools like lovable which are really good at creating like front ends for stuff and I really think that this is where the world’s going and you really don’t need to Know how to code you just need to be able to explain things very well

36:40
I think, on paper. It’s just a test of communication, really. Yep. And what’s communication? It’s conceptual clarity and having the words. ah So a lot of what we need to do to be successful with LLMs is actually to be widely read ourselves so that we know what’s possible, we know the concepts, and we know what words to use, whether we’re talking to a human being or talking to an LLM to say, hey, I want this.

37:08
I actually agree with you. I think that if you’re a good boss, you’re probably going to be a good app creator. Because you can’t just go to employee and say, hey, do this. Right? You need like one of my pet peeves when I used to work. And my job as an engineer, someone will come to me and say, it’s broken. Right? And I’d be like, well, what’s broken? And it’s like, well, I’m getting this blank screen. I’m like, well, what did you do? You know, you know, I’m saying like, you need a lot of detail in order to help.

37:35
And that’s the same skills that you would need to create some sort of app. You need to get very detailed on exactly what you want. So it’s really not really coding anymore. It’s just an exercise in, in communication is the way I see it. love that. And I love, first of all, I love that you said that when you used to work, you know, cause now you’re not working, know, a day job is what I meant. still work just for the record. But the other thing I loved about what you said there is managing. really do think that, um, making good use of

38:04
of LLMs today and then expanding on that, you know, as we’re heading here a year or two from now, you know, using all of these, you know, semi-free agentic employees that you have at your beck and call, it’s a management problem. And, you know, in management, you described really well kind of the challenge of delegation and delegating, or one of the challenges of delegation, you know, which is describing what you want effectively. You know, the other

38:32
There’s a bunch of other aspects that are hard about delegation. One of those that’s really hard is that when you delegate to somebody, they’re not going to do it the same way you would. And they’re probably not going to do it to your quality standards, at least not initially. all of us who’ve managed people, managing is hard. We started out being very frustrated by that process. Like, oh, I could hand off this task, but

38:59
It’s going to take them twice as long and they’re going to do a terrible job, right? But that’s what you learn as a manager is I got to do it. It’s the only way ultimately to get scale in the long term. And I see so many people in my circle struggling with that right now with LLMs, where they’re going, if I ask an LLM to do this, it’s going to give me back some slop. It’s not going to be as good as what I do. It’s not going to be as crafted as what I do.

39:29
I’m expert at this. Why would I ask something that isn’t going to do as good a job as me to go do this? Well, it’s the same reason why in an organization you got to delegate because that’s the only way to get scale. ah You know, it’s the only way to multiply your value. so uh I think basically you and then sorry to expand on that a little bit more. You know, in organizations, you always have a certain set of people who are interested in management and then a certain set of people who are not.

39:59
The people who are not, who want to remain individual contributors, they are experts, they are proud of their work, they are proud of their craft. And the scary thing is that this LLM, this AI era is not well aligned with that. And I’m kind of worried for those people, those friends. I agree. The other thing I wanted to kind of add to that is uh I used to think that I was doing coding well with the LLMs.

40:28
but then I talked to one of my buddies in industry who I just had lunch with, and they have this like 10 page SOP that they feed in so that the code comes out exactly how they want. And so really what I’m trying to say here is if you’re not getting what you want out of the LLM, chances are the problem is you and not the LLM itself, right? Yeah, yeah, those coding.

40:54
There’s kind two styles of vibe coding right now. One is where you’re just cutting and pasting back and forth with the, you know, with your LLM of choice. But the other is where you’re using one of these AI tools. Like I’ve been using cursor replets, another one. uh Amazon just launched theirs out of AWS last week at Kiro. ah There was just a billion dollar deal that happened and fell apart between OpenAI and a company called Windsurf, which does a similar type of product. And what these products do is they are

41:22
Actually, several of them are branches of Visual Studio Code, Microsoft’s kind of ubiquitous development environment for software developers. And they embed AI in a way where, I was talking earlier about the importance of constraining your problem, putting guardrails around the LLM. They do it systematically like you’re describing, Steve. Cursor calls it cursor rules. Yeah, so for this big project that I’ve been doing in cursor the last few months, I have, I don’t know, maybe like

41:51
thousand lines of readable English statements of, doing this in Google Cloud, we’re using BigQuery as our database. Whenever we process an item, we log a metric, the Google Cloud metrics. Whenever we have to have something that we can’t do synchronously, to use a term you would know, but we can’t do right away, we use a Google Pub Sub to queue up a message and then pass that to the other system. Basically, it’s an architectural description.

42:21
of how to do this piece of software. And it just is, it’s groundbreaking because it’s simple, but it’s groundbreaking because if you don’t do that, the LLM over time will do all kinds of different choices. uh It’s not really hallucination. It’s often working code, but one time it’ll decide to use this database. The next time it’ll decide to use a different database and you’ll end up with a disaster of an application.

42:47
You know, kind of that architectural step and describing and constraining what the LLM does. You know, it’s a really key part as soon as your uh project is bigger than a single script uh and it’s, you’ll be maintaining it over more time and it’s not just a one-shot automation. Which is just like having an employee, really, right? Unless you give guidelines, the employee is just going to do whatever it takes to get the job done. Yep. So,

43:15
And this is really just for the listeners out there. Like if you’re having problems getting chat, GBT or whatever to do what you want, it’s probably your problem that you’re not explaining it well enough. And I’ve seen enough of like my buddies who are, you know, working now and what they’re working with to make me realize that I’m not doing a good job of it either. So blame yourself first is I guess the the moral of the story here. Isn’t that always the rule? And it’s just a question I think

43:45
I was thinking about this the other day, how LLMs are replacing jobs and whatnot, but I think it’s going to shift now towards, as you mentioned earlier, people who can communicate ideas and organize architectures better. That’s where the next level of jobs are going to be, I think. Yeah. And everyone will be a manager. uh Everyone will have a team reporting to them. And many times that team is going to be uh a set of AI or AI agents.

44:14
And it’s a very different world. It’s not this is not easy. know, humans are remarkably flexible, remarkably adaptive. There will be plenty of work to do moving forward. But the degree to which this work looks so different is jarring. We’ll see how goes. So my kids are applying to college right now, or one of my kids is applying and we’re trying to figure out what like the most future proof major is going to be, because I don’t I feel like it’s not CS or

44:44
or engineering anymore. It’s going to be more of the soft skills or I don’t know. We’ll see what happens. I’m a little scared. Yeah, no, it is scary, especially for also kids in college. Yeah, in one hand, I think the broad based education so that you can you have a lot of concepts in your head and you have a lot of the words for those concepts. And that’s a skill that actually traditionally a four year college degree was really focused on that actually going

45:14
Back in time, maybe a bit more focus on that. Maybe that’ll come back around on that sort of broad-based education. But yeah, in terms of specific skill areas, on one hand, if you go really deep in certain areas, the rewards are huge. Like, I mean, this crazy competition right now for hardcore AI, foundational AI developers, mean, hundreds of millions of dollars are getting thrown around at individuals. Insane.

45:42
And yet I know a bunch of really great programmers who’ve been out of work. as we think about our kids, how do we help our kids navigate this divergence uh where some things and some skills get supervalued and then so many other ones get devalued? It’s part of the disruption which is so scary.

46:10
But I you know, think we need you know, we need to navigate it and I I don’t know I feel like I’m doing a bad job But I feel this urgency to help the people around me navigate this because it’s not easy I think it’s all gonna come down to relationships in the end people skills and then everyone’s gonna be able to create apps and hopefully it’ll just be based on your creativity your relationships and your ability to Organize something and make something come to you Bernie. Thank you so much for coming back on the show

46:40
I’m always thrilled to see you at Seller Summit. We just announced Seller Summit next year. Would love for you to be a part of that as well. But once again, thanks a lot for coming on the show. always love to come on and talk with you, Steve. In one hand, I think the broad-based education so that you can, you have a lot of concepts in your head and you have a lot of the words for those concepts. And that’s a skill that actually traditionally a four-year college degree was really focused on that.

47:09
back in time, maybe a bit more focus on that. Maybe that’ll come back around on that sort of broad-based education. But yeah, in terms of specific skill areas, on one hand, if you go really deep in certain areas, the rewards are huge. Like, I mean, this crazy competition right now for hardcore AI, foundational AI developers, mean, hundreds of millions of dollars are getting thrown around at individuals. Insane.

47:37
And yet I know a bunch of really great programmers who’ve been out of work. as we think about our kids, how do we help our kids navigate this divergence uh where some things and some skills get supervalued and then so many other ones get devalued? It’s part of the disruption which is so scary. uh

48:05
But I you know, think we need you know, we need to navigate it and I I don’t know I feel like I’m doing a bad job But I feel this urgency to help the people around me navigate this because it’s not easy I think it’s all gonna come down to relationships in the end people skills and then everyone’s gonna be able to create apps and hopefully it’ll just be based on your creativity your relationships and your ability to Organize something and make something come to you Bernie. Thank you so much for coming back on the show

48:34
I’m always thrilled to see you at Seller Summit. We just announced Seller Summit next year. Would love for you to be a part of that as well. once again, thanks a lot for coming on the show. I always love to come on talk with you, Hope you enjoyed this episode. If you are not implementing AI into your workflow, you are leaving massive productivity gains on the table. For more information and resources, go to mywifequithejob.com slash episode 604.

49:02
Once again, tickets to the Seller Summit 2026 are now on sale over at sellersummit.com. If you want to hang out in person in a small intimate setting, develop real relationships with like-minded entrepreneurs and learn a ton, then come to my event. Go to sellersummit.com. And if you’re interested in starting your own e-commerce store, head on over to my wife quitherjob.com and sign up for my free six-day mini course. Just type in your email and I’ll send the course right away via email.