501: Student Story – Making 7 Figures Selling Farmhouse Home Decor With JK Beaton

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You’re listening to the My Wife, Quit or Job podcast, the place where I bring on successful bootstrap business owners and delve deeply into what strategies are working and what strategies are not with their businesses. Today, I’m thrilled to have JK Beaton on the show. JK is a longtime student of my Create a Profitable Online Store course who runs a seven-figure business selling home goods over at saratogahomeonline.com. JK is an amazing person who I’ve hung out with on several occasions at the Seller Summit, and I’m happy to call him a friend.

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and in this episode, you’ll learn how he got started and how he continues to scale his e-commerce business. But before we begin, I want to let you know that tickets for the 2024 Seller Summit are now on sale over at Sellersummit.com. The Seller Summit is the conference that I hold every year that specifically targets e-commerce entrepreneurs selling physical products online. And unlike other events that focus on inspirational stories and high-level BS,

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Mine is a curriculum-based conference where you will leave with practical and actionable strategies specifically for an e-commerce business. Every speaker I invite is deep in the trenches of their e-commerce business, entrepreneurs who are importing large quantities of physical goods, and not some high-level guys who are overseeing their companies at 50,000 feet. I personally hate large events, so the Seller Summit is always small and intimate. Every year, we cut off ticket sales at around 200 people, so tickets sell out fast and we’ve sold out every single year for the past eight years.

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If you’re an e-commerce entrepreneur making over $250k or $1 million per year, we also offer an exclusive mastermind experience with other top sellers. The Seller Summit is going to be held in Fort Lauderdale, Florida from May 14th to May 16th, and right now this is the cheapest the tickets will ever be. Also, if you haven’t picked up my Wall Street Journal bestselling book, The Family First Entrepreneur yet, it’s actually available on Amazon at 38 % off right now.

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My book will teach you how to achieve financial freedom by starting a business that doesn’t require you to work yourself to death. Plus, you can still grab my free bonus workshop on how to sell print on demand and how to make passive income with blogging, YouTube, and podcasting when you grab the book over at mywifequitterjob.com slash book. So go to mywifequitterjob.com slash book, fill out the form, and I’ll send you the bonuses right away. Now onto the show.

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Welcome to the My Wife Quitter Job podcast. Today I’m thrilled to have my longtime student and friend, JK Beaton on the show. Now, JK signed up for my class back in 2017, made his first organic sale on July 9th, 2017. And today he runs a seven figure e-commerce business over at saratogahomeonline.com where he sells kitchen storage products. Now, what I love about JK is that he’s constantly learning.

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and always willing to share his knowledge and he’s an open book. In fact, he often helps other people with manufacturing, sourcing and logistics as well. And I’m so glad that we had the opportunity to hang out at the Seller Summit these past couple of years. So in this episode, what we’re gonna do is we’re gonna take a deep dive into his business and learn more about how he’s managed to create a successful kitchen storage business from scratch. And with that, welcome to the show, JK. How are you doing today, man?

03:15
Steve, thank you so much for that great introduction. I’m doing great. Excited to be here and share with everyone. I’m so glad you resurfaced that Facebook post. I had a good chuckle when I saw it actually. Yeah, you know what I did a little reaching back into the history of the company in preparation for chatting with you. And that post came to mind. like, think that because I was thinking when was my first sale, and I brought it up and it was such a

03:45
trip to look back and see people who I call friends today. So Amanda Wittenborn and Natalie Mountor and you of course commenting on the post back then and seeing where things are at now. It’s, yeah. That’s amazing. Yeah. So just for everyone listening, I think you wrote something like you were jumping for joy at your first sale. I can’t remember the exact words you used. Yeah. It made me jump. Something like that. And I mentioned my son who was three at the time. He’s now nine.

04:16
I have two more children, so three total. so, yeah, things have evolved not just in the business, but in my own life outside of that as well. So JK, just please tell the audience about your store, what you sell, and how you got started and kind of like your motivations for starting in the first place. Sure. So I started, like you said, this business and it was late.

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2016, we were vacationing, my wife and I and my oldest son, Pascal, in California, in Saratoga, close to San Jose. And I had tried to start, I think six businesses prior. And I was just recently licking the wounds of having my most recent business, an export-based business going the opposite direction, Canada to China.

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not working out and I was looking for a different business model, something that I would have full control over. the motivation was really freedom of time. So freedom of my own time, freedom of time to spend with my family. love something I’ve always loved about the corporate world and that I continue to love is having a team.

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Um, so I really appreciated having my team back when I worked in, uh, in corporates, uh, I always hear corporate America. in Canada, so corporate Canada. Yeah. But yeah, I always loved that aspect. So being able to continue that, but so that, the motivation was around time. Uh, there we were in, in California. I came across your content a few months prior. I think I subscribed to your, newsletter and I kept getting great content from you.

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And your content and you resonated in a way because here you were, you were someone that was a bit like me. had two young children at the time. I had my son, I had my daughter on the way. You had gone from working full time to transitioning over to doing your businesses full time. And so I found that inspiring and also relatable. thought, you know, here’s Steve, great content. I think I can maybe replicate.

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what he’s doing to an extent in my own way. And you set out a path. So yeah, I signed up, signed up for a mastermind group, a focus group that’s been incredible, those experiences as well. And one thing, so just to kind of put a bow on the story. So being in Saratoga, one of my lessons in my previous attempts to start businesses was

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that I thought too much about trivial details. you know, so it became the placeholder. Saratoga Home was always meant to be a placeholder brand name. I thought, I don’t want to spend two months thinking about, is this brand name good? Should I change it? Should I get a focus group? Should I ask my family? So, yeah, so it’s stuck and over the years,

07:37
I heard great things about it. People seem to have, know, they, yeah, so they, the good connotations to the name Saratoga. Um, and as for the product, the first product I no longer have, it was an oversized party ice bucket. And I chose it purely based on the numbers. So I went based off your criteria at the time. It seemed like it would work. I thought, let me give this a try.

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And yeah, and that was the first product I sold on what was it July 9th, 2017. Just curious, you were working full time when you started, right? Correct. And what were you doing? And how many hours a week were you working? Just curious. Yeah, sure. So I was working for a large university in Montreal in a management position in student recruitment.

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So international student recruitment, which saw me traveling worldwide three months of the year. So I was working in the office, you know, my 35 to 40 hours a week, but then I was also traveling extensively throughout the year. Okay. And then you made it work though. How many hours were you devoting to your business in the beginning? So I tried to be disciplined and at least an hour or two a day. Okay. So my

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My thing was do an hour or two a day do what’s right in front of you. And then the next day do the same thing. And then just rinse and repeat. Nice. Let’s talk about that first product because in ice bucket, we actually have one in our garage. It’s a quite a big product, right? It’s not trivial. Was that into your consideration to do like an oversized product? How did you find your first manufacturer? How’d you get it made that sort of thing?

09:32
Yeah, no, you know, I wasn’t specifically looking for an oversized product. The price points made sense. So the margins, the keyword volume, the lack of competition or the competition that was there had products with lousy reviews or their listings were archaic. So it felt like there was opportunity there. I’m not.

09:59
I’ve had ice buckets in the past, but it’s, I’m not an ice bucket expert. But I became a bit of one as time went on and it, you know, choosing an oversized product as a first product did have its challenges. logistically, it was tricky at the time. Here’s a bit of a fun or sad story, depending on how you look at it. So for whatever reason, Steve at the time.

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I was looking for a 3PL to help me receive these products in the States and then forward it on to FBA. And so I chose a 3PL in Ohio of all places. It’s like, you you have to get it all the way to the West Coast, put it on rail, and then bring it to Ohio. And on top of that, I had been talked into by the owner of that warehouse that it would be a good idea to send everything to him.

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to help me kid it because it came in parts, right? You had the big bucket. Then you had the stand that was four pieces, four or five pieces. The stand was always a tricky part to get right quality wise. But all to say I was grossly overspending just to get it to Amazon in retrospect. I didn’t know that at the time. And so over the years, obviously I’ve optimized and we…

11:24
No longer have a warehouse in Ohio that we work with so today your 3p. I think is like right on the border, right? Is it in like Seattle? Yeah, so we have one in Vancouver, Canada that helps us with our Goods that come into Canada and then we have one close to LA as well. Okay. Yeah, how did you Validate this product before you started and what was your first order size? Just curious

11:55
Sure. First order size was 500. Okay. Validated purely based on the numbers. So I, one thing I wanted to be disciplined on looking back at my passion project slash business attempts from the past was that those didn’t really work out. And so this time around, I wanted to, it was just my own experience. I wanted to focus on something that I knew the numbers looked like it would work.

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And I thought I had a good chance with it. And so that that was really the basis for that first product. And it continued to be for for subsequent products as well. remember how much you invested in that first product for this 500 years? Yeah, it seemed like a fortune at the time it was so landing the product, getting it kitted by that Ohio warehouse and to Amazon, I think it was in the range of around $8,000. Okay, for a single product.

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Yeah, for a single product. And then when you listed it, did you do anything special to get that first sale? Were you running ads? Yeah. So I tried to create a better listing. So tried to create a listing I thought would out convert the competition. It was a unique product at the time before it started getting copied after a few months. And yes, we ran Amazon PPC at the time.

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and that would have been how we got our first sale. Okay, cool. And then you mentioned you’re outselling it today. Is it because it got copied and the competition became fierce on it? Yeah, that’s part of it. was that the margins decreased on it. I think as my business sense got stronger, I realized it wasn’t that great of a product. And there was also the opportunity cost of, you know,

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$8,000 for the initial order. So if you’re ordering a thousand, two thousands of these, have a lot of money tied up in it. At the time, I think the first year, the net margin was around 10%. So not a lot, right? So the thinking became, I don’t have a ton I want to tap into for my savings. So let me cut this product. It was tough. It’s tough cutting your first product.

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but it allowed me to launch three more products that that all did very well. So these products that you have, and I’ve taken a look at your website and your products, are you designing those yourself or how are you getting them made and conveying the design that you want? Yeah, so it’s evolved over the years. In the first year, it was me taking a picture pointing out things with a program like snag it.

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or doing hand sketches. I’m a lousy drawer, so I don’t know how they understood that at the factory level. And then being disciplined on sampling. So going back and forth on multiple iterations until they got it right. It’s evolved over the years. So we now have someone part-time that helps their professional product designer. And so we look at…

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different aspects of the product. look at the functionality, we look at the aesthetic, we look at what’s out there. We heavily use polling, so A-B testing before we launch products. So it’s matured the way I’ve done it over the years. And it’s still one of the most fun and terrifying aspects for me in the business, because you want to get it right. And it’s fun trying to get it to the point where you think it’s right.

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for polling and serving, are using PickFu or some other service? Yeah, we’ve used PickFu. We’ve also used product pinion. I like them both. Okay. And then in terms of the actual manufacturer itself, did you find your first factory on Alibaba? Yes, yeah, back in the day, it was through Alibaba. And has that evolved? Do you have a sourcing agent now? Or I know you you help people with it. So that’s why I’m asking. Yeah, that’s right. So it definitely has evolved.

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So back in 2021, when the high pandemic sales were starting to come down, and at least in my space, in the home goods space, my major factory was cutting staff. And so they were cutting my foot, the rep that I had worked with for years had always appreciated you’re so detail oriented.

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And he really knew the market. She had been in the space for decades, working in factories and trade companies, Western companies and Chinese companies. so it initially became, hey, would you be interested in consulting for us? I’d love to get like a behind the scenes take on what you’re seeing and how we can improve our quality and our pricing and our time to market and all that.

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And it fast forward, it became that she was full time for us within a couple of months, we were testing it, it worked well for her, worked well for us. And so we leveraged that she’s been full time on the ground with our factories since, well, since she started in the fall of 2021. Awesome. It’s been incredible. Yeah.

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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. If you are interested in starting your own online store, I put together a comprehensive six day mini course on how to get started in ecommerce that you should all check out. It contains both video and text based tutorials that go over the entire process of finding products to sell all the way to getting your first sales online. Now this course is free and can be attained at mywifequitterjob.com slash free.

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just sign up right there on the front page via email and I’ll send you the course right away. Once again, that’s mywifequitterjob.com slash free. Now back to the show.

18:19
No, that’s cool. Yeah. I’ve looked at your products also, and I just did like a cursory look on Amazon. There’s actually quite a bit of competition. So how do you stand out? Is it just by nature of you constantly releasing new products? And I mean, basically what I’m asking is what would you say is your superpower with the product? sure, sure.

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So it is a challenge. I’ll say that first off. It is a challenge to stand out, especially in the last couple of years. I feel the competition that’s come in has grown through the pandemic. put a lot of eyes on e-commerce. So competition has grown. We try to separate ourselves with our branding, with our packaging, with the unboxing experience where a lot of our competition

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their boxes will ship out in a plain cardboard box. We’ll do a nice white box with a nice marketing insert that tells a bit of better brand story. We’ll look at differentiating our products in different ways. We’ve tried IP in the past. So we filed design patents, which are still pending though. Those take a while. Of course we’ve had our trademark since I think 2018, but it is tough.

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on Amazon. think anyone selling on Amazon will know that. so we focus a lot on our product pipeline. So innovation. So getting new products out, realizing when old products need to be cut. So right now we have something like 10 products in the pipeline at various stages. We have three in production. If otherwise not all 10 of those will get launched.

20:07
good half if not more will get cut. But we’ve we’ve made it a focus to really really focus. Yeah, hammer down on on our product pipeline. Would you advise getting a patent? I don’t know. It’s I think I can’t fully speak about it because we haven’t gotten a completed patent back yet. It seems like a good idea. Because apparently through brand registry on Amazon,

20:36
there is enforceability around that. Maybe in our next conversation, I’ll loop back to that and let you know where things are at. What triggered it actually? Have you gotten attacked in the past or copied directly? Well, it was twofold. One was being able to put patent pending on our listing to dissuade competition from thinking we were low hanging fruit. That’s number one.

21:04
So I think in that way, it was probably worth it in itself. secondarily was using brand registry to help enforce our unique products on Amazon. So if someone’s outright copying our design, especially the aspects that we’ve patented, then brand registry should be able to step in and help out. Yeah. mean, have you taken advantage of that to knock off certain brands?

21:33
We’ve had varied success. So we’ve definitely used brand registry. We have some copyrights as well that we’ve used for images to, you someone’s outright copying our images. Usually brand registry is good at suppressing, not suppressing the listing I found, but suppressing the actual image they use. they’ll knock out image two on the competitor’s listing if that was the one that was causing trouble.

22:03
In terms of your supply chain, you mentioned you use a 3PL. A couple of questions there. So does everything get sent to that 3PL and then you kind of trickle it into Amazon? You know, it’s been an evolution. for years, yes would have been the answer. In the last couple years, with the market shift, we’ve been looking for ways to increase our margins. And one of those, especially now that

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that shipping rates and shipping speeds and reliability have come back largely to pre-pandemic levels. We are now trying to hold more inventory with our warehouses in China and then send from China direct to FBA. So we’re skipping the 3PL, not giving them that chunk of the margin that we were before.

22:57
With that being said, that’s imperfect. So we’re also looking at a blended model, I’d say Steve, so where we have some inventory at the 3PL, especially for Q4. So 3PLs thankfully don’t charge Q4 rates like Amazon does where inventory will triple the cost of holding anything with them.

23:23
So yeah, we’re looking at a blended model, but the majority, I’d say 80 % of what we send now to the US or to Canada goes direct to FBA. Cool. And so when you say factory, I’m sorry, warehouse in China, is the factory holding it for you or do you have a warehouse in China physically? We have our factories holding it for us. Nice. How did you negotiate that in? Well, I think

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In recent years, in our space, I’d say many spaces, we have some leverage as importers that we didn’t have before. Many factories are seeing their volume drop over the last couple of years. And so not just on price, but I think there’s different areas such as this, like holding inventory for you at low cost or at no cost that can be worked into your

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your agreement with them and it’s been great for us. So that’s exactly what we’re doing. We’re holding inventory. It’s amazing for cash flow because then we put our deposit down and we don’t pay the balance until that inventory leaves their warehouse. Yeah, no, that’s great. That’s fantastic setup. I’m looking at your journey and you said you had that first product and your first sales. Things didn’t really pick up until maybe a year later. What caused you to turn the corner?

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in expanding further? Yeah, exactly. Was it just more products? Yeah, yeah, it was more products. So I went from that ice bucket to learning my lessons from it. It margins weren’t great. Quality was difficult because of that stand, I just could not engineer it. So people would stop complaining about it. So I pivoted from that did my research.

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again and found three products. was a set of storage baskets, three tier storage baskets, which still are selling to this day, salt and pepper shaker set with a caddy and a planter pot set, which we just cut. So went for those three products. That was a huge step for me at the time, going from the initial PO, I think that one was something like 20, $25,000, which, you know,

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It’s like going to the gym. Over the months, you’ll be able to lift a little bit more, but it feels different because you still, every time you go to, just before you hit the button to transfer that money, you grit your teeth and you’re like, oh, this is I know exactly how that feels, yeah. What is your criteria for cutting a product? We look at profitability. I had thought about the concept of the lost leader concept.

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I don’t think it really applies to an Amazon business. Exactly. Yeah. don’t think it does either. Yeah. Yeah. Okay. Um, so yeah, so I don’t see a lot of benefit for having products that are, uh, that are barely profitable or in some cases not profitable. There’s again, opportunity cost, but over the years I’ve, I’ve really tried to increase my, my

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understanding the financials of the business. And that’s been a point that we’re focusing on. Just curious, what is your threshold on margin? So threshold now it changes. now anything that’s net 15 % or less, we’re usually looking at cutting anything 15 to 20 % ish, we’re keeping an eye on. And we don’t cut right away. We’ll try to we’ll try different things to boost the product that we don’t.

27:21
It’s not fun to cut. Like you spent a lot of time developing those products and you have reviews and, you do have repeat customers coming back. Um, so we don’t take the decision lightly. We’ll usually try to position it differently. We’ll try a different approach with pricing with PPC. Um, but ultimately if none of that works, then, then we will cut and we’re trying to be more disciplined to do it quicker. Um, I’ve waited in the past far too long to cut products and

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and lost a lot of money because of it. Yeah, I’m curious, what about just like raising prices and maybe taking a hit on demand, but still making it profitable and keeping that product in circulation? Yeah, we have tried that as well. And it does work, it has worked and continues to work for some products. And we’re fine with that. Like we just put in smaller POs, but there are other products where no matter.

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what you try, it’s had the kiss of death and you can’t revive it. So it’s those products that we will end up cutting. But yeah, we’ll try pricing, we’ll try pricing up and increasing profit that way and seeing if demand maintains at least an acceptable level. So I know you have this website, Saratoga Home Online. I’m curious what your plans are with that. I assume most of your sales are coming from Amazon at this point.

28:45
Is that accurate? Yeah, that’s right. So we’ve for a long time, the website was secondary to Amazon. We’re turning a corner on that. We’re currently working on redesigning the site. We’ve been working on improving the SEO. I’ve actually been returning to your course quite a bit to examine some of those modules. And we’re looking at with the redesign site.

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advertising on key products that are high profit for us and are well liked by customers as an experiment because we want to diversify off of it. We still like Amazon, of course, that’s what’s done really well for us and that’s our focus. But I’d love to build Shopify up to a lot more than what it is currently. Because the loss leader actually works quite well in your store. Because once you have that customer, you can just cross sell them a bunch of related things.

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which isn’t really feasible on Amazon. You’re right. So that’s cool. Okay. So you’re so well, that’s one of your focuses is on diversification, probably because Amazon is getting pretty competitive or has gotten pretty competitive over the years. If you were to start all over today, what would you do from scratch? Would you proceed in the same manner? Go all in an Amazon first and the site or would anything change?

30:14
Well, I think time is part of it. So if you’re working full time like I was, you need to decide a direction that the website, so I would have spent more time knowing that SEO, blog posts, they need time to have an effect, right? So it would have been nice to have planted those seeds back in 2017 for sure.

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But I was at the time I only had the hour or two every day. It’s kind of just how it worked out. I had started on Amazon. always had the idea to pivot somewhat to Shopify. But there was that time crunch. And the past three years, I’ve been full time in the business. So we’ve had have my team now as we’ve had more, more of an ability to to attack a few platforms.

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So just coming from someone who hasn’t gotten started yet, what would you say was your biggest challenge in just getting started with this? Honestly, it was probably the habit building. So what I mean by that is finding the time and making the time no matter how I felt, no matter what was going on in my personal life, making it a priority and it’s easier said than done. I remember in the initial months,

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I would come home from work, I’d hang out with the family, we’d have supper together, play with my son, chat with my wife, and then go to my desk and say, okay, now I’m going to work. And I would be an absolute zombie. I would be so tired. I had nothing in me, right? And that frustrated me for months, but I made it work. But it gets to a point where…

32:09
You know, you’re banging your head against the wall. I’m hardly getting anything done. I’m sitting at the computer for two hours. And honestly, my output is, is likely equivalent to if I had spent 10 minutes at a different time of day. So I, uh, I then started trialing, waking up really early in the morning, uh, before the family was awake before I had to go to work and giving myself the gift of having like the freshest time of day to myself, which previously.

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I would have given to my full-time job in those morning hours, albeit a little bit later. There’s something, maybe the last thing I’ll say on this point, and I was listening to a podcast, was two or three years ago, and they were interviewing this really successful artist, I can’t remember her name, but, so the host asks her, what do you attribute your success to? And her answer was,

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getting in the taxi every day. And she went on to describe what she meant by that was she was a New Yorker and getting the taxi was the most important thing to ensure that she showed up at her studio every day to put in the work. No matter how she was feeling, no matter what was going on, she would show up. Maybe the day wouldn’t be great. Maybe she’d only put in an hour or two of actual good work.

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or she might be on fire and she would kill it that day. But it’s that habit of showing up day after day and getting the taxi. So I’d say to anyone starting out, get in your taxi every day, figure out what that means to you. And you’ll optimize over time, but try to build those habits where you make it a priority. because we’re all gonna run into the various challenges early on, but it’s that habit.

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that is going to keep you going. And it’s not the inspiration that’s super fleeting at the start. we talk about your decision to quit your full time job? Because you had a pretty good job that paid a pretty decent salary, I would imagine. Yeah, that was a really tough one. That that was certainly one of the pivotal points. So it there’s also a story involved. I mean, I think in many things there is. So I met again, I was doing student recruitment.

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I was on a trip in East Africa in Uganda and I was in a taxi with another, I sharing a taxi with another Canadian that was part of the tour and he happened to own his own flight school. But his background was selling on eBay and he had built up an automotive parts business and sold it and done really well for himself. So we’re chatting. The ride was

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something like 20 kilometers, but because of the state of the roads, it took an hour and a half and it was the happiest hour and a half I get in a taxi I think I’ve had, where he was chatted and connected and we kept in touch. And as time went on, he offered me to come work for him on a part-time basis from home matching my salary, giving me more time to work on my business. So Steve, like I had envisioned it and I think many people do have like,

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making a ton more than my salary and like just walking out of my job. All right, see you guys later. But it did not happen like that. It was more of a stepping stone. So that was in 2019, August of 2019. And then the pandemic happened as we know in March of 2020. Everyone in that flight school, myself included, got furloughed. Sales tanked at the same time in March when everyone was panicked and didn’t know what was going to happen.

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And I still remember pacing the roads early in the morning thinking, oh man, I don’t have a job. My business has, has completely fallen apart. But the weeks past still started taking off. And I get the call in late June to come back to work. And I was able to say thanks, but no thanks. I’m going to continue full time in my business. So it’s truly in

36:30
It’s funny how life is, but that’s how it worked out for me. Interesting. Yeah, that was a great decision because home goods like took off big time. Like crazy big time after that. Okay. So these last years of questions I have for you are more catered to people who are just kind on the sidelines and they just want to know, you know, how other people have gotten started. So how much money did you risk getting started? Was it that initial $8,000? Yeah, it was initially $8,000.

37:00
What I liked about this business model is the worst case scenario I saw was maybe losing a little because ultimately if the product didn’t work out, as long as it was a quality product, I’d be able to liquidate it and not lose my shirt. So I might have lost time, but I still would have learned and grown from it. So I would say don’t quit your job right away while

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unless you’re in your early 20s and you can eat ramen at home and sleep on someone’s couch. But I was in my early 30s and I could not do that. I had responsibilities. So keep your job going, build it on the side, make risks that are both a little uncomfortable but also acceptable to you. Because I think, we talked about like hitting the button on that PO payment is never gonna feel good. It never feels good, it still doesn’t.

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And certainly the first time you do it, you feel like, you know, I hope this works out, but I’m not fully sure. on the liquidation. Have you ever had to liquidate a product and how did you do it? Yeah. So we’ve liquidated a good chunk of our inventory in the last 18 months because of the cease of pandemic sales. So much like the big, big guys like Target and Walmart,

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been heavy on inventory, us little guys, the same thing happened. We had huge volume in 2020 into mid 2021. And we were all ordering to meet that volume. So it created a situation where everyone was liquidating at the same time to recoup cashflow when sales, sales dropped off. So we used a few different ways we’ve liquidated through Amazon, through pricing.

38:56
It’s probably our preferred way. We get the most back that way. We’ve worked with third party liquidators. That is the least comfortable way. You get the least back. But I mean, ultimately you have to look at your financials. There’s a cost of holding inventory, especially if you’re paying a warehouse to keep your goods. And so we were paying month over month for inventory that wasn’t really moving.

39:25
a tough decision to make, but a decision that made all the sense in the world. How long did it take you to make your first sale from when you started the sourcing process? Sure. So we started seriously looking at products in January of 2017 after thinking about it and going over the course initially in things late 2016.

39:54
I had a product in mind, want to say within two months, probably late February, early March, did sampling back and forth for several weeks, put the PO in, received the product in Ohio in June. I’m still kicking myself. I drove to Ohio, by the way. From where you are? Yeah. Oh my God. I was so dedicated just to make

40:23
sure that first order worked out. Yeah. Okay. Yeah. Yeah, from about February when we had the product idea hammered down. It was until July that it was ready for sale on Amazon. And on the sourcing side, have you ever actually gone over to China to visit your factories? Yes, yes. And I highly recommend it. So if

40:50
Ticket prices are a little high right now, but if you’re able to swing it, you will have, assuming you’ve never been, you’ll have the time of your life. People are super friendly, really welcoming. You will absolutely build a stronger reputation with your factories. You’ll go out for dinner together. You’ll talk about each other’s families.

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and you’ll get connected on WeChat, which you may not have before. And for everyone out there, if you’re not on WeChat with your factory, you have to get on WeChat. Email is a thing of the past, I find with a lot of factories. Business is very much done on WeChat. So with our setup, Steve, my wife went back to China in June of this year. I remember it very well, because I was home alone with the three kids and had to manage that.

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and everything. We started also on the side a boutique sourcing agency back in early 2022. And we’ve been working with a handful of customers between five and 10. So she went back to do visits for our customers. We did some training on the ground. We’re looking at hiring another person in China to build that out a little bit more. There’s a great event every year, is twice a year, the Canton Fair.

42:12
good opportunity for folks to go to China. It generally will be more expensive during that time because flights go up, hotels go up. So I’d say if, I don’t know if I’d go to the Canton Fair if you were brand new, unless you had, you were able to afford the trip.

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but it would be a great trip to have for someone that’s in a slightly more mature business, maybe a few products in hand, they wanna meet more factories, they wanna get a sense of what’s out there. It’s funny, because the Canton Fair in many ways is how we got started. I mean, the first vendor we found was actually through Google, kind of randomly. But I remember that first trip to the Canton Fair, we came home with like a whole bunch of suppliers and new products, and that’s what launched the whole thing, and it was so quick.

43:04
It was so quick because everyone had their products there. We could talk to them. They even had samples made on the fly that got to us within two days. So I think yeah, it does. It is expensive. I would say you’re probably going to spend like five grand maybe. But I think that’s worth it. Just just from a time perspective. Yeah, yeah, yeah. No, that’s that’s a good counterpoint. If you have the cash to spend, take the trip. It’s gonna blow your mind. You’ll get a ton of factories.

43:34
But it’s I’ve also been to Ningbo or you you I don’t know it’s worth going to personally. No, no, no, I wouldn’t run. You’ve been? No, I’ve had friends who’ve gone but I’ve I’ve gone to you has a website. You will go. I just you just look at the stuff. It’s it’s the typical cheap Chinese stuff. Yeah, I’d say unless you have a business where I don’t know you you have a

44:02
you want to build a huge catalog of trinkets, it’s probably not the best place to go. Just curious, JK, have you looked at sourcing beyond China, like in Vietnam, India, and other places? Over the years we have, we’ve considered it. I think there’s things to be said. You know, there’s lesser tariffs comparing to China. We still keep coming back to China. We actually looked at sourcing in Mexico three years ago for some of our

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metal based products. I had the dream of taking a straight shot flight down the East Coast, no time difference, to Mexico City and doing a couple days there and flying back. So that was really what was motivating me to look there. I thought, man, this would be so much easier. We’re under the free trade agreement that we have the three countries.

45:00
But ultimately, our experience was it was really tough talking to factories. They were not welcoming like China. They weren’t flexible. For example, getting our boxes made, our color packaging, they said straight out, we have no idea how to do that. We have no one we can introduce you to. Go figure it out yourself, which is very different than China’s, I’m sure you know where.

45:27
They’ll have partners they work with and they can kind of take everything and give you a final package product. Vietnam, I’ve had friends that have sourced from Vietnam. I hear good things. can be, I visited a factory on behalf of one of my friends in Vietnam. And what I’ve heard is it can be a little tricky getting in the door with factories. It’s not the same as China’s.

45:52
perhaps not as easy to find factories in China, in Vietnam as it is in China. I don’t think they have a site like Alibaba. Yeah, they don’t. Yeah. India, we looked at two. They have some, I think some great areas of specialization. Ultimately, we found for our product mix that samples we received and the impression we got was that we wouldn’t have that uniformity.

46:21
that we wanted across a thousand units. you’d have things were more handmade. There’s less of a formalized production process as we would get in China, which I think for some businesses definitely work, but for ours, it could not. Yeah, I think for your stuff, which is a lot of metal, I think India thrives in textiles actually. So we actually get some stuff over there. final question for you, JK, is I know there’s a lot of people listening that are kind of on the sidelines.

46:50
What advice would you give them to maybe give them that push to get started?

46:57
I would say do some journaling. Think about what this step means to you. Think about five years from now, what it could become. There’s a quote that I often reflect back on whether I’m thinking about my language learning or going into the gym to work out or my business is most people largely overestimate what they can accomplish in a year, but they underestimate what they can accomplish in five years.

47:26
So I would say limit your expectations for the first year. Go through the process. There’s a lot of great courses out there, including yours. Go through the process. It’s already mapped out. It’s right in front of you. Try to build that habit. Spend the time it needs to take. Oftentimes early on, it’s almost every day of the week where it can be, or you could build your own schedule that works for you.

47:55
dedicate yourself to the process and stick with it for at least a year, if not two years, because it can take time to see results and it did take time for me to see results. And then over time, you’ll optimize. Maybe the last thing I would say is, I think just in time learning the concept of this is so important. A lot of people will get worried when they’re in the product

48:25
concept phase about how much they’re going to have to, or how they’re going to bring their shipment into the US. And then they’re like, oh man, I to find the answer for this. I don’t know how that’s going to work. But truly, I think if you focus on just what’s in front of you, you’re not going to psych yourself out and you’ll be able to find the information, tackle that, take care of that. Over time, as the process extends, you will figure everything else out. So I think I would share that.

48:54
And I’m certainly open to communicate with anyone that would like to get in touch and I love the community, love the community that you’ve created Steve and the Facebook group and your in-person event. It’s been incredible. I look forward to being a long-term participant there. It’s been great. Cool. Well, JK, thank you so much for coming on. If anyone has any questions for you or wants to check out your products or needs sourcing help, where can they find you?

49:23
Yeah, so they can find me at jk at China product pros.com. Cool. Once again, Jake, I really appreciate you, you know, being in the class and helping out with answering questions and Facebook group. You’ve been very helpful. Thank you, Steve. Thank you for this opportunity as well. appreciate it.

49:44
Hope you enjoyed that episode. And if any of you need sourcing help, feel free to contact JK. And if you want to join my Create a Profitable Online Store course, head on over to profitableonlinestore.com. For more information about this episode, go to mywifequitterjob.com slash episode 501. And once again, tickets to the Seller Summit 2024 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,

50:13
then come to my event. Go to SellersSummit.com. And if you are interested in starting your own eCommerce store, head on over to MyWifeQuarterJob.com and sign up for my free six day mini course. Just type in your email and you’re sending the course right away. Thanks for listening.