Podcast: Download (Duration: 45:45 — 52.6MB)

AI for ecommerce is not a future thing. It is a right-now thing, and the highest-leverage use cases are product titles and descriptions, customer avatars, audience segment reports, long-tail keyword mining, and pulling actionable insight out of competitor product reviews. My guest John Lawson has built custom GPTs that do all of the above in a single interface, and he built them without writing a line of code.

This is a My Wife Quit Her Job interview with John Lawson, CEO of 3rd Power Outlet (a shoelace and apparel accessories brand), platinum eBay power seller, top-rated Amazon merchant, small business influencer of the year, and author of “Kick Ass Social Commerce for E-preneurs”. John has been actively using AI in ecommerce for years and is one of the sharpest practitioners I know.

Here is his complete playbook for applying AI to a physical-products business in 2024.

Key takeaways

• ChatGPT is one year old. It went from text-only to voice, vision and image generation in that single year. Sellers who wait for the tooling to settle down are going to lose to competitors who are learning it now.
• The top ecommerce use cases: SEO-rich product titles and descriptions, customer avatars, audience segment reports, long-tail keyword reports, and mining competitor reviews for product-improvement insight.
• Custom GPTs let you package your best prompts, methodology, and reference docs into a reusable app. John built his (EcomAIBoss.com) using natural language, no coding.
• The best review-mining trick: pull all the reviews for a competitor product, throw out the top and bottom scores, and have ChatGPT extract the middle-range complaints and suggestions. That is the shortlist of features that would make a better product.
• GPT-3.5 still handles almost every text task well if you know how to prompt. GPT-4 unlocks images, plugins, browsing and custom GPTs.
• On-device LLMs are coming. John predicts a ChatGPT 3.5-class model running locally on your phone within about a year, which changes the privacy calculus for sellers worried about handing their data to a large platform.
• Content is king, context is queen. Facebook and Instagram ads worked because they layered context on top of content. The next platform where that plays out is TikTok, and TikTok Shop is where a lot of the emerging opportunity lives.

What ecommerce use cases is AI actually good at right now?

The strongest ecommerce use cases for AI in 2024 are written-content creation and audience research: product titles, product descriptions, SEO-rich category copy, detailed customer avatars, audience segment reports, and long-tail keyword reports. These are jobs sellers used to pay experts for or spend hours doing by hand. Now they land in the time it takes to write a good prompt.

The measurable impact is on sales, not just search rankings. John’s shoelace business is a good example.

Shoelaces sound generic until you realize the audience splits into skaters, sneaker collectors, everyday fitness buyers and distance runners, and the same product has to be pitched differently to each group. AI is what makes generating four separate on-brand descriptions for the same SKU practical.

The materials-and-weaves conversation that AI can carry for you

John’s specific win was getting AI to talk about the technical differences in his laces, like the materials used and the weave patterns, in a way that resonates with buyers. Explaining why “not all shoelaces are the same” is hard for a business owner who has been living inside the product. It is easy for a well-prompted GPT that has the specs in the prompt.

How to build a custom GPT for your ecommerce business (no coding required)

Custom GPTs are small apps that run on top of ChatGPT and are specialized for one repeatable task. John packaged his own prompts, methodology, and reference PDFs into one GPT that will write a product title and description, create a customer avatar, generate an audience segment report, and produce a long-tail keyword report. The build was pure natural language conversation with ChatGPT’s GPT Builder.

Step 1: Describe the app you want in plain English

Open the GPT Builder and describe what you want the GPT to do (“I want an AI bot that writes SEO-rich product titles and descriptions for ecommerce products”). The builder configures the GPT in the background and shows a live preview panel on the right.

The left panel is where you keep talking to it, and the right panel is where you test what you just built.

Step 2: Name it, brand it, and set the voice

The builder suggests a name and generates an icon using DALL-E 3 inside ChatGPT. It then asks about the voice you want (formal, informative, casual) and how detailed responses should be.

You answer conversationally: “make it professional and informative”, “always output five to seven bullet points”, “keep product titles under 200 characters”. Every answer gets written into the app’s instructions automatically.

Step 3: Upload your knowledge base as PDFs, docs and CSVs

The knowledge section is where the specialization actually lives. Upload PDFs of your best prompts, brand guidelines, previous top-converting copy, a CSV of your SKUs, or docs describing your buyer personas.

The GPT references those files when it responds. This is how John’s GPT knows his methodology instead of relying on generic ChatGPT defaults.

Step 4 (optional): Add API actions via Zapier

Custom GPTs can call APIs. You can wire yours to a Zapier action that reads a Google Sheet of live inventory, updates a row, or triggers a downstream automation.

You do not need to know how to write the API call yourself: give the GPT the URL of the API documentation and ask it to build the call, and it writes the code for you.

How to use AI to mine competitor product reviews for product-improvement ideas

The single sharpest AI trick John shared is competitor review mining. Give ChatGPT a competitor product’s SKU or ASIN, have it pull the reviews, throw out the top and bottom scores (the extremes rarely carry useful information), and analyze the middle-range reviews for concrete suggestions and complaints.

Those middle reviews are where you find sentences like “I love this product but it would be better if it did X”. Every “I love this but” is a product-improvement hypothesis.

Do this across the top three or four competitor products in your category and you have a ranked list of feature gaps to build against. John used this exact loop to identify the shoelace category features worth investing in. Same play works for any physical-products category on Amazon.

ChatGPT 3.5 vs GPT-4: which one should ecommerce sellers pay for?

ChatGPT 3.5 handles almost every text task an ecommerce seller needs (titles, descriptions, avatars, keyword lists) if the prompting is good. GPT-4 is where you pay for image generation with DALL-E 3, web browsing (knowledge cutoff is now current to April 2023 with browsing), plugins, and the ability to build and use custom GPTs.

If you want to package your workflow into a reusable app or generate product imagery, upgrade to GPT-4. If you are just writing copy, GPT-3.5 still gets it done, and John predicts GPT-4 becomes the free baseline within six to eight months.

Are the AI-copy startups going to survive as ChatGPT adds features?

Most of the standalone AI-copy startups are not going to survive. The historical parallel is Microsoft Word: third-party spell checkers were their own businesses in the 1990s, then Microsoft folded spell check into Word as a feature and the market disappeared overnight.

ChatGPT is doing the same thing with the GPT Builder and its expanding native features. If your product is a thin wrapper around an OpenAI API call, that feature is going to arrive inside ChatGPT itself.

The businesses that survive move up the value stack: done-with-you (guided workflows), done-for-you (agency services), or vertical specialization deep enough that a horizontal platform will not build it. General-purpose “write my product description” tools do not clear that bar.

Can I run AI on my own devices instead of sending my data to a big platform?

Yes, and the timeline is short. Models compressed enough to run on a laptop with roughly GPT-3.5 capability already exist in developer communities.

John’s projection is that within about a year (from early 2024), you will have a ChatGPT 3.5-class model running natively on your phone in its own environment, with no calls out to a cloud provider. That solves the privacy question for sellers who are hesitant to feed their business data (customer lists, product roadmap, financials) into a third party’s training pipeline.

The interim step for privacy-sensitive sellers: use the ChatGPT API with data-sharing disabled, use enterprise ChatGPT (which does not train on your data), or run a local model on your own hardware today. All three are workable in 2024.

How AI is going to change search and SEO for ecommerce

AI is going to reshape SEO by moving the top of the search results into an AI-generated answer, and the sites that keep winning will be the ones that produce content people actually engage with. John’s KPI has already shifted from “how does this rank” to “does the reader take action on this”. Keyword-stuffed pages that used to rank at the top are going to lose that spot to AI-curated summaries anyway, so the play is content that resonates deeply with a specific audience.

The bigger shift is discovery vs search. TikTok has trained users to discover rather than search, and that pattern is spreading. Sellers who build a following on a platform where their audience discovers new products are less exposed to whatever Google does to its results page next.

Content is king, context is queen: how to make AI copy actually convert

Content is king, context is queen. John wrote that line in his 2014 book “Kick Ass Social Commerce for E-preneurs”, and it is more true now than then.

Great content shown to the wrong person at the wrong moment converts at zero. Great content shown at the moment the person is deciding what car to buy converts at a much higher rate.

AI is what makes context practical at scale. Instead of writing one generic product description and running it in every ad, generate five variants keyed to five audience segments (from your GPT-built segment report) and match each variant to the placement where that segment lives. That is the difference between throwing spaghetti at the wall and serving each buyer what they were already looking for.

Which platform should an ecommerce seller build content on first in 2024?

Pick one platform, exhaust it, then expand. Multiplication by zero is still zero.

If nobody is engaging on your Facebook page, moving to Instagram and Pinterest and TikTok all at once does not fix that. Fix the first platform or move to the one where your audience actually lives.

If John were starting over today, he would start on TikTok. The pattern in every prior platform cycle (Facebook ads circa 2013, Instagram circa 2016) is that the emerging platform is where the arbitrage lives.

TikTok Shop is opening up right now and the opportunity is early. The China political risk is real, but the platform is not going away in the near term.

Where the future of ecommerce is heading (5-year view)

Nobody knows for sure, but the base-case bet is that something will eventually displace Amazon. Yahoo got displaced by Google, eBay got displaced by Amazon, and that cycle does not stop.

TikTok Shop and YouTube Shopping are the two most credible candidates for the next platform, and both are inching toward serious ecommerce ambition.

Google has always had the raw ability to be a shopping destination and has always been reluctant to compete too hard with its own SEO business. That reluctance may end.

The safer bet for individual sellers: build brand and audience on the platforms where your buyers actually discover new products, and treat every marketplace as a distribution channel rather than a home. Marketplaces come and go. Your audience is your audience.

Frequently asked questions

Do I need to pay for ChatGPT Plus to use AI in my ecommerce business?

Not for the basics. GPT-3.5 (free) handles product titles, descriptions, keyword lists and audience research well if the prompts are good. You need ChatGPT Plus ($20/month) to use custom GPTs, generate images with DALL-E 3, browse the web, and access plugins, and if you are packaging your workflow into a reusable custom GPT, the upgrade pays for itself quickly.

Will Amazon or Google penalize AI-generated product listings?

Amazon has started asking sellers whether they used AI to write their listings, and there are already Amazon listings with titles that read “I cannot fulfill this request. It goes against OpenAI use policy”, proof that sellers are bulk-publishing raw AI output without review. The safe pattern is to use AI as a draft and edit for accuracy, brand voice and compliance before publishing; raw output at scale is a policy risk.

What is a custom GPT and do I need to code to build one?

A custom GPT is a specialized app that runs inside ChatGPT. It packages your prompts, methodology and reference docs into a single interface that always behaves the way you configured it, and you build one entirely in natural language through ChatGPT’s GPT Builder (no code required). Optional API actions via Zapier let a GPT read and write to external systems like Google Sheets.

How do I use ChatGPT to research competitor products?

Feed ChatGPT the competitor product’s URL, ASIN or a copy of the top reviews. Ask it to summarize the recurring complaints and suggestions in the middle-range reviews (three and four star reviews carry the most useful signal), then list features the product is missing that reviewers requested. Repeat across your top three or four competitors and you have a ranked list of feature gaps for your own product.

Which AI tool should I focus on if I only pick one?

ChatGPT. Most other tools use it as their backend anyway, so investing in prompting skills for ChatGPT transfers to the rest of the ecosystem. Google’s Gemini and Microsoft’s Copilot are worth watching, and Google is the safer long-term bet because of its data advantage, but ChatGPT is the tool to master in 2024.

Ready To Get Serious About Starting An Online Business?

If you are really considering starting your own online business, then you have to check out my free mini course on How To Create A Niche Online Store In 5 Easy Steps.

In this 6 day mini course, I reveal the steps that my wife and I took to earn 100 thousand dollars in the span of just a year. Best of all, it's absolutely free!

Podcast: Download (Duration: 48:16 — 55.5MB)

Ordinary people can start a 7-figure business in 48 hours by using a weekend to do three things: pick a niche you would work in for free, ask real people to prepay a small amount for the solution, and ship the first version by Sunday night. That is the framework Noah Kagan lays out in his book Million Dollar Weekend, and every one of his own 7-figure companies (AppSumo, Gambit, KingSumo) was started inside a 48-hour window.

The million dollars is not made in the weekend. What is made in the weekend is the validated $1 that proves someone will pay, and everything after that is compounding.

I brought Noah back on the My Wife Quit Her Job podcast to walk through the exact steps of his Million Dollar Weekend method, why fear (not skill) is what actually stops people, and the two-part “coffee challenge” he uses to rewire that fear in about ten minutes.

Here is the full breakdown of the framework, the anecdotes behind each step, and answers to the questions readers most often ask about it.

Key takeaways

• AppSumo, which will do $70-80 million in revenue this year, was started inside 48 hours. So were Noah’s other two companies, Gambit and KingSumo.
• The two fears that stop most would-be founders are the fear of starting and the fear of asking. Business skills are secondary.
• The “Law of 100” says most people quit at attempt 5 or 10. Commit to 100 tries (100 videos, 100 outreach messages, 100 pitches) before you evaluate.
• Validate with real money in the weekend. If three real people will each prepay $1, you have a business. If zero will, you have an idea.
• The “coffee challenge” (ask for a 10% discount at Starbucks) is the fastest way to train the asking muscle. Noah says it has changed more of his students’ lives than any business tactic.
• Noah’s YouTube channel went from 170K to 250K subscribers in 90 days once he stopped copying “safe” talking-head videos and doubled down on the format nobody else was doing.

What is the Million Dollar Weekend framework?

Million Dollar Weekend is Noah Kagan’s framework for starting a business over a single 48-hour weekend, using validation-first tactics that require zero capital. It compresses three actions into two days: pick a customer, pitch them a solution, and collect prepayment from at least three of them before you build anything.

The name is deliberately provocative. Noah is not claiming you will bank a million dollars by Sunday night. He is claiming you can put the machine that eventually makes a million dollars into motion inside a weekend, and that most people never do because they wait months or years for the “right time” to start.

Noah’s evidence is his own portfolio. AppSumo is on track for $70-80 million in revenue this year and was built from a $50 domain and one weekend of hustle. Gambit and KingSumo, his other 7-figure companies, followed the same 48-hour launch pattern.

Why fear (not skill) is what stops most entrepreneurs

The single biggest thing blocking would-be entrepreneurs is fear, specifically the fear of starting and the fear of asking. Noah says every one-on-one call he does with a student turns into what is essentially a psych session, not a business tactics session.

His reasoning is stark. There are literally millions of business books, YouTube videos, and $10 Udemy courses teaching how to get rich.

If information were the bottleneck, everyone would already be rich. The real bottleneck is the willingness to do two uncomfortable things in public.

Noah puts it this way: “The distance between me and most of the listeners is a lot closer than they think. And the distance between where they are and where they want to be is even closer than they expect.”

The two fears you must break before you start a business

Noah identifies exactly two fears that hold new entrepreneurs back, and the entire Million Dollar Weekend method is designed to train both of them out of you in a single weekend. Everything else is downstream.

Fear of starting

The fear of starting is the belief that you need more research, more credentials, or a better setup before your first move counts. Noah’s antidote is the “now, not how” habit: pick the next 60-second action and do it now, worry about the process later. His own $25K-per-month YouTube channel started with him shirtless in his 800-square-foot house, filming on a phone, and the first video is still up.

Fear of asking

The fear of asking is the reason most businesses die between “I have an idea” and “someone paid me.” Noah’s antidote is the coffee challenge (see the next section), plus a rule: any time you want something (a raise, a partner, a customer, a podcast guest), you have to actually ask for it. Hoping is not asking.

The coffee challenge: how to train the asking muscle in 10 minutes

The coffee challenge is Noah’s single most famous exercise, and it is dead simple: walk into a Starbucks, order a coffee, and ask the barista for a 10% discount. That is the whole exercise.

The point is not the dollar you save. The point is teaching your nervous system that asking for something absurd in public does not kill you.

Noah has run this challenge with thousands of students and says it is the exercise that most changes people’s lives. Once you have asked a stranger for a discount you have no right to, asking a real prospect to prepay $50 for your product feels manageable.

The follow-on is where the money is. Nearly every real business outcome you want is an ask: a customer buying, an investor writing a check, a partner saying yes, a journalist covering you. Train the muscle on coffee so it works when the ask actually matters.

How to validate a business idea in a weekend

To validate a business idea in a weekend, get three real strangers to prepay you real money for the solution before you build it. That is the whole test. If three people will not each Venmo you $1 (or $10, or $100) for what you are proposing, no amount of building will save the idea.

Noah is emphatic that “signups,” “email addresses,” and “great conversations” do not count. Only money counts, because money is the only signal that separates people who want your thing from people who want to be polite. A ten-person prepay list is worth more than a 1,000-person waitlist.

This is the step most first-time founders skip, and it is why most first businesses fail. They spend three months on a logo, a website, and a business plan for a product nobody has agreed to buy. The weekend format forces the opposite order: sales first, product second.

The Law of 100: why most people quit right before it works

The Law of 100 is Noah’s rule that you must commit to 100 attempts at anything before you are allowed to evaluate whether it works. Most people quit at attempt 5, 10, or 20 and conclude the strategy failed. In reality, they quit before the strategy had a fair shot.

Noah’s own YouTube channel is the case study. He and one other person shipped three videos a week for 50 weeks (150 videos) before anything hit 100K views.

He had a goal of 250K subscribers with 90 days left and only 170K, and he almost quit. Instead, they scrapped talking-head videos and shipped the “knocking on doors” video, asking rich strangers in Austin how they got rich, which hit a million views and pulled the channel to the target.

The lesson: the video that worked did not exist until attempt 151. If Noah had quit at 50, the channel would be dead.

How Noah built AppSumo to $70M in 48 hours

AppSumo was built in a single weekend for less than $60, and it now does $70-80 million per year in revenue. Noah bought the domain, wrote a landing page, and pitched a lifetime software deal to his email list before any deal was in place. Once people paid, he called the software company and negotiated the discount using the money already in hand.

That sequence (sell first, source second) is the AppSumo playbook in one sentence. Most people would spend six months negotiating deals with software companies and then try to find buyers. Noah reversed it, and the reversal is why he had traction on day three.

The AppSumo business model has since expanded into recurring revenue products (Sumo.com, TidyCal, KingSumo) specifically because deal revenue is lumpy: a $2M month can be followed by a $10M month with a $1.5M monthly payroll to cover. Software subscriptions smooth that out.

How to pick a business idea worth building

The best filter for a business idea is what you would do for free. Noah’s rule is that if you would keep making the content, keep having the conversations, or keep solving the problem even with no paycheck attached, you have found a business you will still care about in year seven when it gets hard.

His own examples: he has been publishing since 2000 (blogs, then YouTube in 2006, now podcast). AppSumo is the paid version of what he already loved doing, which is promoting good products and giving people a deal. YouTube is what he already loved doing, which is meeting interesting people and asking them how they made their money.

The related filter is the “freedom number”: how little money per month do you actually need to have full freedom over your time? Sam Parr had one, Noah has one, and it is usually far lower than people assume. Once you know the number, you can build toward it directly instead of chasing an ever-moving “more” target.

Doubling down: the growth lever most founders ignore

The most obvious yet least-used growth lever in business is to do more of what already works. Noah calls it the “double down” principle at AppSumo, and it is the reason a random YouTube format experiment became a two-video-a-month franchise instead of a one-off.

The pattern is: run cheap experiments, notice which one gets an outsized response, and pour the entire budget into that one. AppSumo tested YouTube affiliates in Q1, saw insane ROI, and by Q4 had a five-person team running just that channel. Same story with the “asking rich people how they got rich” video format on Noah’s channel: three attempts worked, so it became the whole channel.

The trap on the other side is emotional investment. Founders keep pouring effort into the tactic they wanted to work instead of the tactic that actually worked. The double-down rule is the fix: promote the winners, cut the losers, do not negotiate with a losing tactic just because you spent three months on it.

Why traditional publishing beat self-publishing for Million Dollar Weekend

Noah chose a traditional publisher (Portfolio/Penguin Random House) over self-publishing for Million Dollar Weekend specifically because he wanted the book to be treated as a “major league” project, with the professional editing, production, and distribution infrastructure that comes with that path.

His challenge to me on the show was to name five self-published business books that are as iconoclastic as the top traditionally-published ones. I could name one (Brandon Turner’s real estate book), and he could not name any.

The books that have durably changed how people think about business have almost all been traditionally published.

That said, Noah is clear this is a project-fit decision, not a religion. Self-publishing is faster, keeps more of the money, and is right for many books. For a one-shot lifetime work, though, the trad-pub infrastructure (a professional audiobook engineer, a top-tier editor, and a distribution machine) was what he wanted.

Frequently asked questions

Can you really start a million-dollar business in a weekend?

You cannot make a million dollars in a weekend, but you can lay the foundation of a business that eventually does. Noah’s own AppSumo, Gambit, and KingSumo were each started inside a 48-hour weekend and each grew into 7-figure companies. The million dollars comes from years of compounding, but the machine gets started in the weekend.

What is Noah Kagan’s Million Dollar Weekend method?

Noah Kagan’s Million Dollar Weekend method is a three-step process for launching a business in 48 hours: pick a customer group you already understand, pitch them a specific solution, and collect real prepayment from at least three of them before you build anything. Prepayment is the only proof of demand that counts.

What is the coffee challenge?

The coffee challenge is an exercise where you walk into a Starbucks, order a coffee, and ask the barista for a 10% discount for no reason. It is designed to train your comfort with asking, which Noah says is the single biggest skill blocking new entrepreneurs. The dollar you save does not matter; the reflex you build does.

What is the Law of 100?

The Law of 100 is Noah Kagan’s rule that you must commit to at least 100 attempts at a new tactic before you evaluate whether it works. Most people quit around attempt 10 and conclude the tactic failed, when in reality it just had not had time to compound. Noah’s own YouTube channel needed 150 videos before it broke out.

How much money did AppSumo start with?

AppSumo started with less than $60, mostly the cost of the domain and a basic landing page, over a single weekend. Noah pre-sold a lifetime software deal to his email list and used the customer money to negotiate the deal with the software company after the fact. AppSumo now does roughly $70-80 million in annual revenue.

What is the “freedom number”?

The freedom number is the minimum monthly income you need to fully control your own time, and Noah recommends building toward it explicitly instead of chasing “more.” Once you know your freedom number, you know exactly how big your business needs to get, and you stop over-scaling for status reasons. Sam Parr, Noah, and many other 8-figure founders each set one early.

How do you know if a business idea will work?

The only reliable test for whether a business idea will work is whether real strangers will prepay you real money for it. Signups, likes, and “great conversations” do not count. If you cannot get three unrelated people to Venmo you before you build the thing, the idea is not validated and you should either reshape it or drop it.

Where can I get Noah Kagan’s Million Dollar Weekend book?

Million Dollar Weekend is available at milliondollarweekend.com, where you can also get a free chapter and the accompanying templates (one-minute business model worksheet, validation scripts, and market-research walkthroughs). It is also on Amazon in print, ebook, and audiobook formats.

Ready To Get Serious About Starting An Online Business?

If you are really considering starting your own online business, then you have to check out my free mini course on How To Create A Niche Online Store In 5 Easy Steps.

In this 6 day mini course, I reveal the steps that my wife and I took to earn 100 thousand dollars in the span of just a year. Best of all, it's absolutely free!

Podcast: Download (Duration: 14:10 — 16.5MB)

2023 was an infrastructure year for Bumblebee Linens (my 16-year-old ecommerce store) and a breakout year for My Wife Quit Her Job (my content business), which grew roughly 60% in revenue. Bumblebee revenue was up modestly and profit was way up because we bought our own office and stopped paying $6,500 a month in rent. The content business grew because I nearly killed myself doing 50+ podcast interviews to market The Family First Entrepreneur, which hit the Wall Street Journal bestseller list in May.

This is a solo My Wife Quit Her Job episode where I break down the wins, the losses, the Google core-update hit that clipped our SEO in October, and the exact plays I am running in both businesses in 2024.

Here is the full recap of what worked, what broke, and what I am changing next.

Key takeaways

• Bought a new office at the end of 2022 to escape a 30% rent hike (from $5,000 to $6,500/month). Lost most of January to the move, but eliminated a $78K/year expense.
• Personalized linens (handkerchiefs, napkins, towels) grew double to triple digits year over year. Non-personalized linens dropped 8-9% to Amazon and marketplace competition.
• Google’s back-to-back October 2023 core updates hit our blog-driven traffic. Retention.com (which captures visitor emails without an opt-in) offset most of the damage by adding ~50,000 emails in a year.
• Launched a new custom-printed linen line on Black Friday 2023 with no fulfillment process ready. Sold 23 items, burned a batch by setting the heat press too hot, and still made a few thousand dollars while learning the workflow.
• My Wife Quit Her Job revenue grew ~60% in 2023. The lift came from the promotion cycle for the book, not the book itself: 50+ podcast appearances in three months spiked YouTube and blog traffic simultaneously.
• YouTube ad revenue peaked at nearly $30,000/month during the book launch surge. Blog ad revenue peaked near $10,000/month. The channel is now over 280,000 subscribers.

What happened at Bumblebee Linens in 2023

Bumblebee Linens had a modest revenue year and a very strong profit year in 2023. Revenue was up thanks to a double- to triple-digit surge in personalized products, offset by an 8-9% drop in non-personalized linens. Profit was way up because we bought our own office building and eliminated the largest fixed cost on the books.

The shape of the year was ugly at the start and strong through the middle. January was gutted by an office move; February through September were record months; October brought a Google update that clipped the blog. November added an unforced-error product launch that still worked out.

The through-line: the parts of the business with a defensible moat (personalization equipment, direct email list, brand) all grew. The parts that lean on marketplace visibility (generic linen SKUs, blog SEO) went the other way.

Why we bought our own office building

We bought our own office building because our previous landlord raised the rent 30% on a 2,300 square foot space, from $5,000 to $6,500 per month. That is $78,000 a year for a small space we had been in for six years, and buying pencils out much better than renting at that price.

The move itself was painful. We shut down the shop for the first two weeks of January to physically relocate six industrial embroidery machines, 500+ SKUs of inventory, and the entire fulfillment workflow. January revenue basically disappeared as a result.

The upside is that Bumblebee no longer pays rent at all, and the space is big enough to last us a very long time. On a business doing 7-figure revenue, eliminating $78K in annual fixed cost is one of the biggest single-decision profit lifts we have ever booked.

Why personalized linens grew and generic linens shrank

Personalized linens grew because personalization is genuinely hard to copy, and generic linens shrank because generic products are a race to the bottom on Amazon. Our personalized handkerchiefs, napkins, and towels grew double to triple digits year over year. Our non-personalized SKUs dropped 8-9%.

The moat is physical. We run six industrial embroidery machines that cost tens of thousands of dollars each, and there is a steep learning curve on running them well. A drop-shipper cannot copy that in a weekend, which is exactly why the category is defensible.

My rule for building a durable ecommerce business is to never do what is easy. The easy plays (drop-shipping, buying from Alibaba and reselling on Amazon unchanged) get flooded with copycats within months. The hard plays (personalization, custom manufacturing, brand-building, content) compound instead.

How the October 2023 Google core updates hit our SEO

Google ran four consecutive core updates in the fall of 2023 to fight AI-generated spam, and one of them caught Bumblebee Linens in the blast radius. Most of the traffic loss was on blog posts that ranked but did not convert, so the sales impact was smaller than the traffic impact suggests. It still hurt.

The bigger structural shift is that Google is now weighting user-generated sites (Reddit, LinkedIn, Quora) and mega-established sites (Amazon, Etsy) much more heavily. Independent brand sites are being crowded down the page as a result. Every operator I know in the space is seeing the same pattern.

The saving grace was our owned email list, which had grown by roughly 50,000 addresses over the previous year thanks to Retention.com (a service that captures visitor emails from your site without a formal opt-in). Owned channels do not care about Google’s mood. They just work.

How Retention.com added 50,000 emails to our list

Retention.com is a service that identifies email addresses of anonymous visitors to your site and adds them to your list without requiring a signup form, and it added roughly 50,000 emails to Bumblebee Linens in a single year. It is legally in the clear (US CAN-SPAM permits opt-out consent for commercial email) and it works dramatically better than any opt-in tool we have used.

The tool matters because it converts wasted top-of-funnel traffic into an owned asset. On a typical ecommerce site, 97-99% of visitors leave without buying or opting in, and most of that intent evaporates. Retention captures a slice of it before it does.

A meaningful number of the 50,000 addresses have converted into new or repeat customers, which is why the tool paid back its subscription cost many times over. It is one of the few “growth hacks” I run in 2024 that I unreservedly recommend to other operators.

The Black Friday custom-printed linens launch (what went wrong)

We launched a brand new custom-printed linens line on Black Friday 2023 with essentially no fulfillment process in place, sold 23 items, burned a batch by running the heat press too hot, and still made a few thousand dollars while writing the SOPs on the fly. It was a mess and it was worth it.

The backstory: we bought a DTF (direct-to-film) fabric printer from Sublistar mid-2023 to answer customer requests for printed graphics on our linens (something our embroidery machines cannot do). Running a DTF printer is nothing like running an inkjet at home. Print head cleaning, powder application, oven baking, and heat pressing are all separate, hands-on steps.

I was so nervous about volume that I did not even mention the new line in the Black Friday email. We created new categories on the site, launched with nine design choices, and let customers discover it organically. In hindsight, launching an operationally complex new product on the busiest shopping day of the year with no test batches on all 500 SKUs was a genuinely dumb move that turned into a very cheap lesson.

How the Family First Entrepreneur launch grew My Wife Quit Her Job by 60%

The Family First Entrepreneur launch grew My Wife Quit Her Job by ~60% in 2023, but the growth did not come from book royalties. Every cent of my six-figure advance was spent on marketing and a book-launch coach, so the book itself made me zero dollars. The revenue lift came from the promotion cycle around the launch.

Between mid-February and May, I did 50+ podcast interviews (some days four in a row). Those episodes all released within roughly the same week, which drove a simultaneous traffic spike on my blog, YouTube channel, and course page.

Random course inquiries surged. Ad revenue exploded.

At the peak of the surge, my YouTube ads were paying almost $30,000 per month and my blog display ads were paying almost $10,000 per month. Both settled back down after the launch hype faded, but the channel emerged from the cycle at 280,000+ subscribers with a much bigger baseline than before. The book was the excuse; the promotion tour was the growth engine.

What I am doing differently in 2024

In 2024, Bumblebee Linens is testing an AI voice bot for basic customer service calls, and My Wife Quit Her Job is going all-in on video volume across YouTube long-form, YouTube Shorts, Instagram Reels, and TikTok. The theme on both businesses is “be everywhere the customer already is,” which the last year of Google turbulence has made non-negotiable.

On the ecommerce side, I am also building a handwritten-message embroidery product (brides keep asking) and figuring out how to automate the workflow so as few humans as possible touch each order. Custom-printed linens will become a real profit center once the new SOPs are stable.

On the content side, I hired a scriptwriter for YouTube long-form and someone to slice each long-form video into Shorts. I am running a real test on whether a human editor beats AI for that job, because if AI is close enough, I can scale the format to daily posting without hiring further.

Frequently asked questions

How did Bumblebee Linens perform in 2023?

Bumblebee Linens grew modestly on revenue and grew significantly on profit in 2023. Personalized products (handkerchiefs, napkins, towels) grew double to triple digits year over year, generic linens dropped 8-9%, and eliminating rent by buying our own office removed $78K of annual fixed cost.

Why did My Wife Quit Her Job grow 60% in 2023?

My Wife Quit Her Job grew about 60% in 2023 because of the promotion cycle for my book The Family First Entrepreneur, not the book royalties themselves. I did 50+ podcast interviews in three months, which released simultaneously and drove a huge traffic spike across the blog, YouTube channel, and course page.

How much money did the book actually make?

The book itself made me zero net dollars. My entire six-figure advance from Harper Collins Leadership was spent on marketing, PR, and a professional book-launch coach. The financial payoff came indirectly, through the traffic and course-sale surge that the promotion tour produced.

Which Google update hit ecommerce sites in late 2023?

Google ran four consecutive core updates in the fall of 2023 targeting AI-generated content and low-quality pages, and the October and November rounds hit many independent ecommerce sites hard. The updates also boosted user-generated content sites (Reddit, LinkedIn, Quora) and giant marketplaces (Amazon, Etsy) at the expense of smaller brand sites.

What is Retention.com and does it work?

Retention.com is a service that identifies anonymous visitors to your ecommerce site and adds their email addresses to your list without an opt-in form, and yes, it works well. It added about 50,000 addresses to Bumblebee Linens in a year, and a real slice of those addresses converted into new and repeat customers. It is legally compliant under CAN-SPAM.

Should I sell on Amazon or on my own website?

You should sell on both, with your own website as your home base and marketplaces as additional channels. Amazon-only sellers are exposed to policy changes, price competition, and account suspensions with no fallback, while owned-site-only sellers miss a huge chunk of buyer intent. Omnichannel is now the baseline, not the advanced play.

Is drop-shipping still a viable business model?

Drop-shipping is technically viable but structurally weak, because the low barrier to entry guarantees hundreds or thousands of stores selling the same product at ever-lower margins. The durable ecommerce plays involve either private-label products, custom manufacturing, personalization, or genuine brand-building through content. Easy is not the same as good.

What are the biggest ecommerce priorities for 2024?

The biggest ecommerce priorities for 2024 are diversifying traffic sources beyond Google, building an owned email and SMS list you can market to for free, and adding operational moats (personalization, customization, content) that copycats cannot replicate overnight. Video content across YouTube, Shorts, Reels, and TikTok is now a baseline requirement for reach.

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My six ecommerce predictions for 2024 are that cheap Chinese drop-shipping dies as a viable model, Temu eats the unbranded commerce category, Amazon’s newest fee stack pushes casual sellers off the platform, content-driven brands become the only durable moat, skilled labor mass-outsources overseas, and AI-generated spam floods every content platform. Every one of these trends started in 2023, and 2024 is when they become the default reality.

This is a solo My Wife Quit Her Job episode where I walk through each prediction, the numbers behind it, and the moves you need to make right now if you are running an ecommerce or content business.

Here is the full breakdown, prediction by prediction, plus what to actually do about each one.

Key takeaways

• Small-ticket drop-shipping ($10-$20 items from AliExpress) is no longer economically viable in 2024, mainly because Temu and Shein sell the same items direct-from-factory at ~1/3 the price with free shipping.
• Temu went from launch to roughly 1/3 the traffic of Amazon in one year (Nov 2022 to April 2023) and became the top-downloaded app in the App Store. Amazon’s apparel division is down 30% year over year against Temu and Shein, per Amazon reps.
• Starting March 2024, Amazon adds a new inbound placement fee ($0.21-$0.68 for standard, $2.16-$6 for oversized) plus a new low-inventory fee if you carry less than 28 days of stock. FBA now punishes both too much and too little inventory.
• US credit card debt hit a record $1.079 trillion in Q3 2023 (per LendingTree), the highest since 1999. Over 62% of Americans (and half of those earning $100K+) live paycheck to paycheck (per CNBC).
• ChatGPT has erased the “native English writer” premium. Overseas content teams plus AI cleanup produce work that is functionally indistinguishable from US-based writers at ~1/3 the cost.
• Chinese Amazon listings are now nearly indistinguishable from US listings thanks to ChatGPT, which has removed one of the last language-based advantages US private-label sellers had.

Prediction 1: Cheap drop-shipping dies in 2024

Cheap drop-shipping of $10-$20 products from AliExpress and similar China-based apps stops being a viable business model in 2024, because Temu now sells the exact same items direct from the factory at roughly one-third the price with free shipping. The dropshipper is a middleman who no longer has any pricing advantage, only cost and hassle.

The math is brutal. A T-shirt dropshipped from a US store will cost the customer $20-$25; the same shirt on Temu costs $7 with shipping included. No customer pays 3x for a functionally identical item unless there is a reason (a brand they trust, a story they care about, service they can rely on) that the dropshipper does not provide.

Dropshipping also comes with hidden operational costs most tutorials skip. Quality control is terrible, packaging arrives damaged, shipments get lost in transit for months, and you (the dropshipper) still eat every customer service ticket and refund. Low margin plus high hassle plus no moat is the definition of a business that dies when a factory-direct competitor shows up.

Prediction 2: Temu will eat unbranded commerce

Temu is going to continue its explosive growth in 2024 and structurally destroy the unbranded commodity ecommerce category. Between November 2022 and April 2023 (five months) it captured roughly one-third of Amazon’s traffic and became the number one downloaded app in the US App Store. That trajectory is not slowing.

Temu’s competitive advantage is that it removes every layer between the Chinese factory and the US consumer. There is no importer, no US wholesaler, no dropshipper, no Amazon FBA fee stack, and no US retail markup. On a $7 T-shirt with free shipping, there is literally no room for a Western middleman to insert margin.

The macro tailwind is worse for US sellers. US consumers hit a record $1.079 trillion in credit card debt in Q3 2023 (per LendingTree), the highest since 1999.

Over 62% of Americans live paycheck to paycheck (per CNBC), including more than half of those earning over $100K. Wallet-stretched consumers flock to the cheapest possible option, which is Temu.

Prediction 3: Amazon’s 2024 fee hikes will wipe out casual sellers

Starting March 2024, Amazon is layering two new fees onto FBA sellers (a per-unit inbound placement fee and a low-inventory fee) that will push a large chunk of casual and marginal sellers off the platform entirely. The professional operators will survive; the “throw up a listing and see what happens” crowd will not.

The specific numbers: a new inbound placement fee of $0.21-$0.68 per standard-size item and $2.16-$6 per oversized item, on top of every fee Amazon already charges. Plus a new low-inventory fee that triggers if you keep fewer than 28 days of stock in the warehouse. Combined with the existing over-inventory fee, sellers now have to walk a tighter inventory tightrope than ever before.

The strategic implication is that Amazon in 2024 requires real professional operating discipline: accurate demand forecasting, tight supply-chain execution, and financial visibility into unit economics after every fee. Sellerboard is the accounting app I recommend to see your real net profit; if you have not run your account through it, do that this week.

Prediction 4: Content becomes the only durable brand moat

Content-driven brand building becomes the only durable moat in ecommerce in 2024, because commodity products are getting eaten by Temu and unbranded Amazon listings are getting eaten by fee hikes. If customers do not know who you are and why they should buy from you, price wins, and you cannot win on price against a Chinese factory.

The mechanic is straightforward. People buy from operators they know, like, and trust, and the only scalable way to create that at internet scale is content: blog posts, podcasts, YouTube, TikTok, short-form video showing the day-to-day of the business. My own online-store course competes against hundreds of alternatives, and students buy mine because they resonate with my story and teaching style, not because it is objectively cheaper.

Practically, that means every ecommerce operator in 2024 needs a content channel where they show up as the human owner. It does not have to be all four platforms. It has to be at least one, done consistently, with your face and voice on it.

Prediction 5: Skilled labor mass-outsources overseas (thanks to AI)

Skilled ecommerce labor (content writers, social media managers, developers, engineering directors) is mass-outsourcing overseas in 2024, and AI is the reason it finally works at scale. ChatGPT cleans up any grammar and phrasing issues in non-native English copy, which erases the one durable advantage US-based writers used to have.

I have shifted nearly my entire writing team overseas. The workflow is simple: overseas writer produces the draft, ChatGPT smooths the phrasing, editor does a light final pass. Output quality is indistinguishable from what I got at 3x the price from US-based writers a year ago.

The same dynamic is playing out on Amazon. Chinese-owned Amazon listings used to be spottable in three seconds because the English copy was rough, and that tell is gone.

Chinese sellers now produce US-quality listings via ChatGPT, and they still have the underlying factory-direct cost advantage. That combination is a structural problem for US private-label sellers who assumed their language edge would last.

Prediction 6: AI-generated spam floods every content platform

2024 will produce more AI-generated spam and misinformation than every prior year combined, and every major content platform (Google, YouTube, Amazon Kindle, Instagram) will spend the year losing ground to the flood. Google ran four back-to-back core updates in 2023 to fight it and is still visibly losing.

On YouTube, tools like InVideo AI and Rizl let one operator produce millions of faceless AI-generated videos in a matter of days. Look at your own YouTube homepage right now. My recommendations are 10-20% AI-generated video already; that share is only going up.

On Amazon Kindle, AI-generated ebooks are already flooding the store faster than moderators can pull them. And AI influencers are becoming a real category: Aitana Lopez, a fully fictional AI influencer, has over 200,000 Instagram followers and charges $1,000 per sponsored post (per Ars Technica). The line between real and generated is about to stop being useful.

What to actually do about these 2024 predictions

The 2024 ecommerce playbook that survives all six of these predictions is: sell your own branded product (not commodities or dropshipped items), invest heavily in content that shows your face, keep FBA inventory tightly forecast, own your customer relationship via email and SMS, and use AI plus overseas talent to keep your unit costs low. Every one of these moves reinforces every other one.

The one prediction I am least certain about is government intervention. The US labor market cannot indefinitely absorb the outsourcing wave AI is enabling, and I expect some form of political response by the end of 2024. That could be minimum wage hikes (like California’s), tariff changes, or something else, and it will affect operator economics in ways that are hard to price today.

The through-line across all six predictions is that 2024 rewards operators who own their brand, own their audience, and own their cost structure. Everyone else is a middleman getting compressed from both sides at once.

Frequently asked questions

Is drop-shipping dead in 2024?

Cheap drop-shipping of $10-$20 products from Chinese suppliers is no longer economically viable in 2024, because Temu sells the exact same items direct-from-factory at roughly one-third the price with free shipping. Higher-ticket private-label and branded drop-shipping can still work; commodity drop-shipping cannot.

What is Temu and why is it growing so fast?

Temu is an online marketplace that ships products directly from Chinese factories to US consumers at prices US retailers cannot match, and it is growing because it removes every middleman layer from the supply chain. Between November 2022 and April 2023, Temu grew to roughly one-third of Amazon’s US web traffic and became the top downloaded app in the US App Store.

How much are Amazon’s 2024 FBA fee increases?

Amazon’s March 2024 FBA fee increases include a new inbound placement fee of $0.21-$0.68 per standard-size unit and $2.16-$6 per oversized unit, plus a new low-inventory fee that triggers when you carry fewer than 28 days of stock. These fees are additive on top of Amazon’s existing fee structure.

Is Amazon FBA still worth it in 2024?

Amazon FBA is still worth it in 2024 for sellers who have professional-grade inventory forecasting, accurate unit-economics tracking, and a private-label brand that commands premium pricing. It is no longer worth it for casual sellers throwing generic products on the platform, because the new fee stack will erode their thin margins to zero or negative.

Will AI replace content writers and developers?

AI will dramatically reduce demand for entry-level content writing and developer work in 2024, without fully replacing either role. My own 2024 forecast is that senior operators plus AI produce more output than a full junior team ever did, so hiring shifts toward fewer, more experienced people and heavy reliance on AI tools.

How is ChatGPT changing Amazon listings?

ChatGPT has erased the language advantage US-based Amazon sellers used to have over Chinese sellers, because non-native English copy can now be polished to native quality in seconds. Chinese factory sellers now produce US-quality listings while retaining their factory-direct cost advantage, which is a structural problem for US private-label competitors.

What is an AI influencer and are they profitable?

An AI influencer is a fully fictional social media persona generated by AI that posts content, gathers followers, and earns sponsorship revenue like a human influencer. Aitana Lopez, one of the most followed examples, has over 200,000 Instagram followers and charges $1,000 per sponsored post, showing the category is already commercially viable.

How do you compete with Temu as a US ecommerce seller?

You compete with Temu by building a branded product with a story customers care about, showing up as a real human via content (blog, podcast, YouTube, short-form video), and owning the customer relationship through email and SMS. You will never win on price; you can win on trust, brand, and service.

Ready To Get Serious About Starting An Online Business?

If you are really considering starting your own online business, then you have to check out my free mini course on How To Create A Niche Online Store In 5 Easy Steps.

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Podcast: Download (Duration: 14:18 — 26.2MB)

PayPal charges online stores 2.9% + $0.30 per credit card transaction and 3.49% + a fixed fee for any checkout paid with a PayPal balance, which makes it easily the most expensive way to accept payments online for any store doing meaningful volume. On top of that, PayPal stopped refunding processing fees on returned orders in 2019, so a $1,000 sale that gets returned still costs you the full $29.30 in fees. In this solo episode of the My Wife Quit Her Job podcast, I walk through the year-end payment processing audit I ran on my own store, Bumblebee Linens, and share the exact steps that took my effective rate from 2.99% down to 1.7%.

I also cover why PayPal limits or freezes seller accounts, the specific triggers my PayPal account manager told me they watch for, and the “interchange plus” pricing model you should be asking every processor to quote. If you process more than $10,000 a month and you have not looked at your payment processing statement in a year, this post will almost certainly save you thousands.

Below you will find the current PayPal fee schedule, a side-by-side cost comparison at $1M in annual sales, the account-freeze checklist, and a five-step plan to renegotiate your processing costs.

Key takeaways

• PayPal charges 2.9% + $0.30 for credit card checkouts and 3.49% + a fixed fee when a buyer pays with their PayPal balance, making it the most expensive mainstream option for online stores.
• PayPal has not refunded processing fees on returns since 2019, so every refund you issue is a permanent fee loss.
• At $1M in annual sales with a 50/50 PayPal/credit card mix, PayPal costs roughly $31,950 per year. A 2.2% interchange plus deal costs about $22,000. That is $10,000 in pure savings.
• Ask any processor for “interchange plus” pricing so you pay a fixed markup above the non-negotiable wholesale rate. Anything else is a black box.
• PayPal freezes accounts most often on unusually large deposits, chargeback spikes, restricted categories (CBD, controlled substances), mismatched business info, or logins from strange locations.
• If PayPal payments are a big share of your checkout, Braintree (owned by PayPal) is the easiest way to keep the PayPal button while cutting your effective rate.
• Cardfellow.com is the fastest way to comparison-shop processors like Authorize.net and Elavon on real interchange plus quotes.

How much does PayPal really cost merchants?

PayPal’s current standard merchant rate in the United States is 2.9% + $0.30 per credit card transaction and 3.49% + a fixed fee per transaction when the buyer pays with a PayPal wallet balance or PayPal Credit. That 3.49% number is the one most sellers miss, and it is the single biggest reason PayPal has become the most expensive way to accept payments on your own site.

For over a decade I had a negotiated PayPal rate of 2.2% + $0.30, which is genuinely competitive. I got careless and stopped reading my statements. When I finally audited the account, the rates had drifted back up to standard pricing and no one at PayPal had ever emailed me about it.

Paying with a PayPal balance costs PayPal effectively nothing to process, so charging half a point more than a credit card is pure margin for them. Accepting PayPal on your site used to be the cheapest option, and now it is the most expensive.

PayPal fee example: what a $1M store actually pays

A store doing $1M per year with a 50/50 split between PayPal wallet payments and credit cards pays PayPal roughly $31,950 per year in processing fees. A comparable interchange plus deal at 2.2% costs about $22,000 for the same volume. The difference is nearly $10,000 a year in pure savings you can redirect to inventory or ads.

My own effective rate on Braintree over the 2023 holidays came in at 1.7%. That is less than half of what I would have paid on standard PayPal pricing on the same sales.

Why PayPal is worse now: no fee refunds on returns since 2019

Since 2019, PayPal no longer refunds the processing fee when you refund a customer, so every return is a permanent 2.9% + $0.30 loss on the original sale. On a $1,000 return that means you eat $29.30 out of your own pocket even after refunding the customer in full.

Most major competitors, including Stripe and Braintree, also stopped refunding processing fees over the past few years, so this is now industry standard. That makes your interchange plus markup even more important, because you cannot recover those fees on any returned order.

The higher your return rate, the more this hurts. Apparel sellers with 20%+ return rates should model this line item explicitly when comparing processors.

Why does PayPal limit or freeze seller accounts?

PayPal is a low-risk payment processor with a strict list of prohibited categories and fraud triggers, and once your funds are frozen you can lose access to them for up to 180 days. I have friends running digital product businesses who have had accounts locked immediately after a big launch, including one who had $40,000 held for 180 days.

I called my PayPal account manager to ask what actually triggers a freeze. Below is the list they gave me, straight from the source.

PayPal account limit triggers to watch for

• You received an unusually large deposit that is well above your normal average, like right after a launch or a viral post.
• A customer filed a complaint against your business through PayPal’s resolution center.
• You have a series of chargebacks in a short window.
• Your site sells restricted or questionable content, including CBD, controlled substances, or anything that violates PayPal’s Acceptable Use Policy.
• Your account information is out of date or your account is not fully verified.
• Someone logged into your PayPal account from an unusual location.
• A background check flags credit history or prior fraudulent activity on the account.

How to prevent PayPal from freezing your account

The single highest-leverage move is to call PayPal before any large launch or promotion so they see the incoming volume ahead of time and mark the account as expected activity. Everything else on the checklist below is about eliminating mismatches that trigger their automated fraud rules.

PayPal account safeguards checklist

• Call PayPal ahead of any big product launch, giveaway, or sales spike so a real human notes the expected volume on your account.
• When you fill out PayPal’s onboarding survey, check off the higher revenue tiers so their expected monthly volume matches reality.
• Confirm your account has no daily or monthly receiving limits. Call support and ask them to remove any caps that were auto-set at signup.
• Make sure your business name on PayPal exactly matches the name on your bank account, EIN registration, and credit card statements.
• Use the same address and phone number across PayPal, your bank, and your business filings.
• Ship with a tracked, verifiable carrier so every dispute can be answered with delivery confirmation.
• Confirm your EIN or Social Security Number on PayPal matches the legal business name on the account.

What is interchange plus pricing (and why you should demand it)?

Interchange plus is a payment processing pricing model where you pay the card network’s fixed wholesale “interchange” rate plus a small, disclosed markup, instead of a blended rate the processor sets themselves. It is the only pricing structure that lets you see exactly what the processor is making on you, so it is the only structure you should accept if you are doing real volume.

Every time a card is swiped, the card-issuing bank charges an interchange fee that is set collectively by Visa and Mastercard and is identical no matter which processor you use. For a standard swiped Visa consumer credit card, current interchange is about 1.51% + $0.10, and a Visa Reward Signature card runs around 2.3% + $0.10. Processors have zero control over that wholesale rate.

With interchange plus 0.1%, you pay 0.1% above the wholesale rate on every transaction plus the actual interchange for the card used. On a $100 sale on a standard Visa card, that works out to roughly $1.61 in interchange plus about $0.10 in processor markup.

The alternative, “flat rate” pricing (like Stripe or standard PayPal), bundles interchange and markup into one number that hides how much margin the processor is taking on premium cards. On rewards cards where interchange spikes above 2%, flat rate looks reasonable. On plain consumer cards where interchange is 1.51%, you are handing the processor a huge premium.

PayPal alternatives for online sellers: Braintree, Stripe, Authorize.net, Elavon

The four PayPal alternatives most worth pricing out are Braintree, Stripe, Authorize.net, and Elavon, because they all offer interchange plus pricing at competitive markups and integrate with the major shopping carts out of the box. The right choice depends on how much of your checkout flow currently runs through PayPal.

If PayPal is a big share of your checkout, Braintree is the easiest switch because it keeps the PayPal button live while dropping your effective rate. If most of your customers pay by card, use Cardfellow.com to run a competitive bid across Authorize.net, Elavon, and a few regional processors and pick the lowest interchange plus quote.

How to audit your credit card processing fees in one afternoon

Pull your last full month of processing statements and calculate your effective rate: total fees paid divided by total sales processed. Anything above 2.5% is worth renegotiating, and anything above 3% means you are almost certainly on flat-rate PayPal or Stripe pricing and leaving money on the table.

Step 1: Calculate your current effective processing rate

Add up total processing fees and total sales for the same month, then divide fees by sales. If you are paying $3,000 on $100,000 in sales, your effective rate is 3.0%.

Step 2: Separate PayPal wallet volume from card volume

In your PayPal or gateway dashboard, filter transactions by payment source. Knowing the PayPal-wallet share tells you whether Braintree (keeps the button) or a pure card processor (drop the button) is the better switch.

Step 3: Get three interchange plus quotes

Run your volume through Cardfellow.com and request quotes from Braintree, Authorize.net, and one bank-backed processor like Elavon. Insist on interchange plus with a single markup number, no monthly minimums, and no early-termination fees.

Step 4: Model the return-fee cost

Multiply your annual return volume by your current effective rate to see how much you are losing on returned orders. This is money the new processor also will not refund, so factor it into your annual number.

Step 5: Switch and re-measure after 60 days

Migrate to the winning quote, run 60 days of live volume through it, then recalculate the effective rate. If it is not at or below the quoted number, escalate with your account manager before month three.

What if PayPal already froze my funds? How to get your money back

If PayPal has limited or frozen your account, call PayPal Merchant Services directly, ask to speak to a resolutions specialist, and be ready to supply invoices, tracking numbers, and proof of fulfillment for every recent order. The single fastest path to unfreezing funds is providing evidence that every recent order was legitimately fulfilled and delivered.

If the hold is fraud-related, PayPal is legally allowed to hold funds for up to 180 days under their user agreement. During that window, stop routing new orders to PayPal, switch checkout to Braintree or another processor immediately, and file a Consumer Financial Protection Bureau complaint if PayPal will not give you a specific resolution timeline.

Do not send more transactions into a frozen account trying to “flush” the balance. That triggers additional fraud flags and can extend the hold.

Should I still accept PayPal on my online store?

Yes, you should still offer PayPal as a checkout option, because a meaningful share of online shoppers will abandon a cart before typing in a credit card, and PayPal auto-fills their address and payment details. The right way to offer it is through Braintree, so you get PayPal-button acceptance at a lower blended rate than PayPal charges directly.

There are two reasons I still recommend keeping the PayPal button live. First, PayPal auto-imports the buyer’s shipping and payment info, which is a huge conversion lift on mobile where typing a full address is one of the top cart abandoners. Second, some shoppers only pay by PayPal and will not go dig up a physical card.

Just do not accept PayPal directly. Route it through Braintree so you keep the button, keep the conversion lift, and cut the fee at the same time.

Frequently asked questions

What percentage does PayPal take from a sale in 2026?

PayPal’s standard US merchant rate is 2.9% + $0.30 per credit card transaction and 3.49% + a fixed fee per transaction when the buyer pays with a PayPal balance or PayPal Credit. Higher-volume merchants can negotiate down to roughly 2.2% but PayPal rarely offers it unless you ask directly.

Does PayPal refund fees on returns?

No, PayPal stopped refunding processing fees on refunded transactions in 2019. On a $1,000 sale that gets returned, you still pay the full $29.30 in fees even though you refund the customer 100%.

Why did PayPal freeze my account?

PayPal freezes accounts most often after an unusually large deposit, a chargeback spike, a customer complaint through the resolution center, a login from an unusual location, or a mismatch between the business name on your PayPal account and your bank or EIN records. Sales in restricted categories like CBD or controlled substances will get you banned outright.

How long can PayPal hold my funds?

PayPal can hold funds for up to 180 days under their user agreement when a hold is fraud-related. Providing invoices, tracking numbers, and fulfillment proof to a resolutions specialist is the fastest way to shorten that window.

What is interchange plus pricing?

Interchange plus is a payment processing pricing model where you pay the card network’s wholesale interchange rate plus a small, disclosed markup on every transaction. It is the only pricing structure that shows exactly what the processor is charging you on top of the non-negotiable wholesale rate.

Is Stripe cheaper than PayPal for online stores?

Stripe’s standard rate of 2.9% + $0.30 matches PayPal’s card rate but is 0.59% cheaper than PayPal’s 3.49% wallet rate, so Stripe is cheaper for any store that would otherwise take a lot of PayPal-wallet payments. At higher volume, Stripe’s enterprise team will negotiate interchange plus, which is where the real savings live.

What is the cheapest way to accept credit card payments online?

The cheapest way to accept card payments online is an interchange plus merchant account through Braintree, Authorize.net, or a bank-backed processor like Elavon, with a fixed markup between 0.1% and 0.3% above wholesale. At $1M+ in annual volume, that setup typically comes in around 1.7% effective, versus 2.9%+ on flat-rate PayPal or Stripe pricing.

Is Braintree cheaper than PayPal?

Yes, Braintree is meaningfully cheaper than direct PayPal for the same PayPal-wallet acceptance because Braintree quotes interchange plus pricing while direct PayPal charges the flat 3.49% wallet rate. Braintree is owned by PayPal, so you can keep the PayPal button on checkout while cutting your effective rate.

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To choose the right ecommerce platform for your online store, use the same five-rule framework I use with the students in my Create A Profitable Online Store course: (1) only pick a cart backed by a well-funded, well-known company (or a widely-supported open source project), (2) require deep third-party developer support, (3) demand the platform be easy to maintain, (4) size the true monthly cost including apps, and (5) confirm the built-in blogging platform is good enough to rank in Google. Apply those five filters and your realistic short list collapses to Shopify, BigCommerce, WooCommerce, and Shift4Shop, with the right pick depending on your budget, technical comfort, and how much of your traffic will come from content.

In this solo episode of the My Wife Quit Her Job podcast I answer the single most-asked question I get, which is which ecommerce platform should you use to start an online store. I walk through why I still run my own store on the obsolete OS Commerce cart 17 years after launching Bumblebee Linens, and the exact conditions where I would pick Shopify vs. BigCommerce vs. WooCommerce vs. Shift4Shop.

Below you will find the five rules explained one at a time, a side-by-side comparison of the four platforms I actually recommend, and answers to the questions I get most often about switching, pricing, and SEO.

Key takeaways

• The five rules that matter: backer strength, third-party developer support, ease of maintenance, true monthly cost, and blog/SEO quality.
• Never build on a cart run by a two-person startup. If the developers walk away, you inherit an unsupported codebase, which is exactly what happened to me on OS Commerce.
• Applying the five rules leaves you with Shopify, BigCommerce, WooCommerce, and Shift4Shop. Everything else is a compromise on at least one rule.
• Shopify wins on developer ecosystem, loses on true monthly cost. The average Shopify store runs seven paid apps, and my course students average around $200/month in Shopify app spend.
• BigCommerce is the best “get most of what you need out of the box” pick and pairs cleanly with WordPress for SEO through their WordPress plugin.
• WooCommerce is the cheapest and most flexible, but you own the server and every plugin upgrade is your problem.
• Shift4Shop is 100% free once you process $500/month in orders, which makes it the strongest budget alternative to WooCommerce.

Why choosing the right ecommerce platform matters (my $16-hour cautionary tale)

Picking the wrong ecommerce platform locks you into years of pain because migrating a live store to a new cart is one of the hardest technical projects in ecommerce. I know because I have been running my store, Bumblebee Linens, on OS Commerce since 2007, back before Shopify, BigCommerce, Shift4Shop, WooCommerce, or even Amazon Marketplace existed the way they do today.

OS Commerce was the best open source cart of that era and cost me $7 a month to host. It made my family millions of dollars over the years. Then the core developers walked away from the project and it went dead in the water.

By that point I had written so much custom code that migrating to Shopify or BigCommerce would have cost more than maintaining OS Commerce myself. Last month I spent 16 hours of my own time doing a full upgrade to keep it patched. That is the cost of picking a cart that outlives its maintainers.

The 5 rules for choosing an ecommerce platform

Here is the 5-rule framework I use to filter down every ecommerce platform on the market: verify the backer, verify the developer ecosystem, verify it is easy to maintain, verify the true monthly cost, and verify the SEO story. Applied in order, they eliminate 90% of the carts on the market before you have to compare features.

Do not skip a rule to save a decision. Every store I have watched fail on platform choice failed because they weighted price or design ahead of long-term supportability.

Rule 1: Pick a cart backed by a large, well-funded company

Only pick an ecommerce platform run by a well-known, well-funded company with a real war chest of cash, or a popular open source project with thousands of active contributors, because if your platform goes bankrupt or gets abandoned you inherit an unmaintained store overnight. This one rule alone eliminates most of the “cheap” carts people email me about every week.

If a subscriber emails me asking about some free cart I have never heard of, I visit the vendor’s site and almost every time it is a two-person side project. That is a nonstarter. If the founders lose interest or their day jobs get busy, your store dies with the codebase.

A public company is safest because if they go bankrupt someone will buy them and keep the lights on long enough for you to migrate. The open source exception applies when the project has genuine breadth, like WooCommerce or Magento, where thousands of independent developers maintain forks and patches.

Ecommerce carts that pass Rule 1

• Shopify (public company)
• BigCommerce (public company)
• Shift4Shop (backed by Shift4 Payments, public company)
• Square Online (public company)
• Wix (public company)
• Ecwid (owned by Lightspeed, public company)
• Squarespace (public company)
• WooCommerce (owned by Automattic, large open source community)
• Magento / Adobe Commerce (owned by Adobe)

Rule 2: The platform must have deep third-party developer support

Your ecommerce platform must have a large third-party developer ecosystem, because the moment you need a feature the core cart does not offer, you are going to need a plugin, and plugins only get built for the platforms developers can make money on. The two carts with the deepest developer bench today are Shopify and WooCommerce.

Two years from now the norm is going to be an AI shopping assistant embedded in every store. If your platform is not big enough for someone to build that plugin, you will be stuck buying an off-the-shelf widget or waiting on the vendor.

If you look at overall US market share among all shopping carts, Shopify leads, followed by WooCommerce, Wix, Squarespace, and Ecwid. If you filter to the top one million websites in the world by traffic, the picture shifts to WooCommerce and Shopify dominating, with Magento and BigCommerce in the running.

Wix, Square, Squarespace, GoDaddy, and Big Cartel all have large parent companies but do not have meaningful third-party developer ecosystems. The most well-supported ecommerce carts are Shopify, WooCommerce, BigCommerce, and Magento.

Rule 3: The platform has to be easy to maintain

The right ecommerce platform for most non-technical founders is a fully-managed SaaS cart like Shopify or BigCommerce, where the vendor handles servers, security patches, and core software upgrades. Self-hosted platforms like WooCommerce and Magento are more flexible and cheaper, but you are on the hook for the server, the patches, and every broken plugin.

WooCommerce is free but you still pay for hosting, and you still have to lock down your own server against hackers. WordPress and WooCommerce do have a push-button upgrade flow, but bad things happen. A couple of weeks ago I upgraded my Bumblebee Linens WordPress blog and a bunch of plugins broke and I had to hand-debug what went wrong.

The upside of owning the source code is total flexibility. On my store I let customers see a mockup of the finished personalized product before checkout, and no plugin does that. WooCommerce let me write it myself.

If you have zero interest in maintaining a server or debugging plugin conflicts, this rule alone narrows your list to Shopify or BigCommerce.

Rule 4: The platform has to be reasonably priced (true monthly cost)

The true monthly cost of an ecommerce platform is base subscription + required apps + payment processing markup, and Shopify’s true monthly cost is much higher than its $30 sticker because the core cart is deliberately thin on features and nearly every store ends up paying for seven or more apps. The typical Shopify user in my Create A Profitable Online Store course spends around $200 a month on Shopify apps alone.

BigCommerce ships with most of what you actually need out of the box, so you do not get nickel-and-dimed the same way. Shift4Shop is a genuine outlier because the shopping cart is roughly as powerful as BigCommerce and Shopify, and it is 100% free as long as you process at least $500 a month in orders through their payment processor.

WooCommerce is 100% free to run, WordPress has thousands of free plugins for it, and your only fixed cost is hosting. If price is your primary constraint, WooCommerce, Shift4Shop, and BigCommerce are the three carts you should short-list.

Ecommerce platform true monthly cost comparison

Rule 5: The platform must have a good blogging platform for SEO

If organic search traffic is going to be a meaningful channel for your store, pick a platform with a genuinely capable, WordPress-grade blog engine. Shopify’s built-in blog is not that. It is limited in features and has a suboptimal URL structure that hurts ranking.

WooCommerce has the best built-in blog by a wide margin because it is literally WordPress. BigCommerce is the smart middle ground because their WordPress plugin lets you run your store on BigCommerce and your blog on WordPress under the same subdomain, so you get store-quality checkout plus WordPress-grade SEO.

If SEO is a top-three channel in your business plan, this rule alone collapses your list to WooCommerce or BigCommerce paired with WordPress.

Which ecommerce platform is best for me? (my picks by use case)

Below is how I actually match the four short-listed platforms to real founder situations. Every recommendation assumes you have already passed the first two rules (real backer, real developer support).

How hard is it to switch ecommerce platforms later?

Migrating an established store to a new ecommerce platform is painful, expensive, and disruptive to search rankings, which is why platform choice matters much more than most first-time founders realize. Product data and customer records port cleanly. Custom functionality, URL structures, and search rankings do not.

Every custom feature you build on top of your platform is technical debt that has to be reimplemented on the new cart. Every URL that changes during migration is a redirect you have to set up correctly or you lose the SEO equity that URL had accumulated. Every checkout flow that changes is a conversion risk.

Get the choice right the first time and you can grow on the same platform for a decade. Get it wrong and you either eat a painful migration or, like me, get stuck maintaining a cart that has outlived its maintainers.

Frequently asked questions

What is the best ecommerce platform for beginners?

For most non-technical beginners, BigCommerce is the best pick because it includes most of the features you need out of the box, does not require you to maintain a server, and pairs with WordPress for content marketing through an official plugin. Shopify is a very close second and wins on app ecosystem, but the true monthly cost climbs faster.

Is Shopify or WooCommerce better for a new online store?

Shopify is better if you want zero server maintenance and the deepest app ecosystem, and you are comfortable spending around $200 a month on plugins on top of the base plan. WooCommerce is better if you want full flexibility, own your source code, need a serious blog engine for SEO, and are comfortable maintaining your own hosting.

How much does it really cost to run a Shopify store?

The typical Shopify store in my Create A Profitable Online Store course spends around $200 a month on Shopify apps on top of the base plan, because Shopify ships intentionally lean and charges for common features like advanced shipping rules, subscriptions, and reviews. Budget $240 to $300 per month all-in for a starter Shopify store, plus payment processing fees.

Is Shift4Shop really free?

Shift4Shop is 100% free as long as you process at least $500 a month in orders through Shift4 Payments, their in-house payment processor. Below that threshold, you either pay a monthly fee or accept payment processing charges as your only cost.

Which ecommerce platform is best for SEO?

WooCommerce is the strongest ecommerce platform for SEO because it runs on WordPress, which has the deepest blogging feature set and cleanest URL control. BigCommerce paired with the WordPress plugin is the strongest hosted alternative because you get BigCommerce checkout plus a full WordPress blog under the same domain.

Should I ever pick Wix, Square Online, or Squarespace for an ecommerce store?

Wix, Square Online, and Squarespace all pass Rule 1 on backer strength but fail Rule 2 on developer support, because independent developers do not build many meaningful ecommerce plugins for these platforms. They can work for very simple, small-catalog stores, but they will constrain you as you grow.

What happens if my ecommerce platform shuts down?

If your ecommerce platform shuts down, you either have to migrate every product, customer, and URL to a new cart, or maintain the software yourself, which is why Rule 1 matters. This is exactly what happened to me on OS Commerce, and 17 years later I am still doing occasional 16-hour maintenance upgrades because migrating was worse than staying.

Ready To Get Serious About Starting An Online Business?

If you are really considering starting your own online business, then you have to check out my free mini course on How To Create A Niche Online Store In 5 Easy Steps.

In this 6 day mini course, I reveal the steps that my wife and I took to earn 100 thousand dollars in the span of just a year. Best of all, it's absolutely free!

Podcast: Download (Duration: 52:57 — 60.9MB)

Temu and Shein are decimating US ecommerce sellers because they ship direct from Chinese factories to US consumers under the $800 “de minimis” import loophole, which means the same $20 t-shirt an American seller has to price to cover cotton, printing, labor, tariffs, and Amazon fees can be sold on Temu for $6 with no duties, no customs inspection, and no meaningful IP enforcement. Ann Arbor Tees founder Jerry Kozak has watched his eight-figure printing company’s apparel category fall 30% in 2022 and another 30% in 2023 as a direct result, and in this episode he lays out why the current legal setup is a one-way trade agreement no one voted for.

Jerry Kozak founded Ann Arbor Tees in 2008 out of his college apartment and grew it into a full-service print and embroidery operation doing eight figures a year, with roughly 70% of top-line revenue running through Amazon FBA. In this episode of the My Wife Quit Her Job podcast we dig into why the entire apparel category on Amazon is down 30% year over year, what Temu and Shein are actually doing differently from Wish, and the strategic moves Jerry is making to fight back through brand, direct-to-consumer, and political action.

Below you will find the core mechanics of why Temu and Shein have a structural cost advantage, the specific numbers from Jerry’s business, and a practical playbook for US ecommerce sellers on how to compete.

Key takeaways

• Ann Arbor Tees is down roughly 50% from its 2020 peak (2M units) to 2018 levels (~1M units), driven mostly by Temu and Shein taking share in apparel.
• An Amazon insider told Jerry the Amazon t-shirt category is down 30% year over year, with 99% confidence that Amazon’s own numbers are included in the decline.
• Temu can sell the same shirt Jerry sells for $20 on Amazon at $6 delivered. That is below the cost of a blank shirt shipped USPS across the street in the US.
• The $800 de minimis loophole lets roughly 2 million packages a day enter the US uninspected from China, with no duty collection and no customs enforcement of intellectual property or forced-labor rules.
• A Bloomberg-commissioned isotope study found nine Shein cotton samples traced to Xinjiang, the region under US sanctions for forced Uighur labor. Under $800 packages are almost never inspected, so the sanctions do not bite in practice.
• According to Wired, Temu is reportedly losing about $30 per package shipped, extrapolating to roughly a billion dollars a year in subsidy. Grizzly Reports flagged the Temu app for aggressive on-device data collection.
• Two bills are moving in Congress (led by Senator Cassidy in the Senate and Rep. Neal Dunn in the House) to close the de minimis loophole for non-market economies. A bipartisan letter from 12 senators asked the Biden administration to act.
• Jerry’s plan: build brand and direct-to-consumer to insulate on the micro, and lobby your congressional reps on the macro. Do not fight Temu on price.

Who is Jerry Kozak of Ann Arbor Tees?

Jerry Kozak is the co-founder and CEO of Ann Arbor Tees, an eight-figure print-on-demand and embroidery company based in Ann Arbor, Michigan, that services universities, artists, corporate uniform accounts, and Amazon FBA at scale. He started the business in 2008 out of his college dorm with a $15,000 loan (at ~18% interest) from local professors he had landscaped for during college.

The company grew from an illegal apartment print shop to a 40,000-square-foot warehouse, added a manual screen press, then an automatic press, then embroidery, then giant car-length automatic presses. At their 2020 peak they shipped 2 million units. In 2023 they were back to 2018 volumes.

Today about 70% of top-line revenue comes through ecommerce, and the majority of that is Amazon FBA on fixed apparel designs, with the remainder in custom brick-and-mortar work for universities, local businesses, and corporate uniforms. They were also, briefly, the biggest t-shirt printer for NATO in Afghanistan before the drawdown.

How much have Temu and Shein hurt US apparel sellers?

The US t-shirt category on Amazon is down roughly 30% year over year, and Ann Arbor Tees is down about 50% from its 2020 peak, and Jerry attributes almost all of it to Temu and Shein pulling US apparel demand off Amazon and onto direct-from-China marketplaces. An Amazonian sourced by Jerry said they were 99% sure the 30% category decline includes Amazon’s own retail apparel numbers.

Jerry’s own top-line trajectory tells the story cleanly. 2020 was the pandemic peak at 2 million units. 2021 dropped as expected. 2022 dropped another 30%. 2023 dropped another 30%, putting them back at 2018 volumes.

The obvious macro story (gas at $5 a gallon, groceries eating a mortgage payment) does not fit the data. T-shirts historically sell better in a recession because they are an “affordable luxury.” Jerry called around to peers in the Ecommerce Fuel forum and no one else in adjacent categories was seeing 30% two years in a row.

Why can Temu and Shein sell so cheap? The $800 de minimis loophole explained

Temu and Shein can sell so cheap because US law waives all import duties, tariffs, and customs inspection on packages worth less than $800 declared value, and roughly 2 million such packages enter the US every day, predominantly from Temu and Shein shipments out of China. That is the “de minimis” loophole, and it is the single largest structural cost advantage Chinese direct-to-consumer sellers have over US ecommerce sellers.

Historically the de minimis rule was written for returning travelers bringing home souvenirs. In practice today it is a de facto one-way free trade agreement that Congress never voted on, because the packages never touch normal customs enforcement.

Why the de minimis loophole matters for US sellers

• No duty collected. Apparel tariffs are typically 15-25%. Under de minimis, that revenue is not collected on Temu or Shein shipments.
• No customs inspection. Forced-labor cotton (Xinjiang), counterfeit goods, and unsafe products enter uninspected because CBP does not test sub-$800 parcels at scale.
• No IP enforcement. Search “Rolex” on Temu and near-clones under alternate brand names (like “Oleg”) show up immediately. Enforcement requires inspection.
• No level playing field on regulations. US sellers must comply with CPSC, FTC, prop 65, and hundreds of category-specific rules. Direct-ship parcels do not get checked.
• US is a global outlier. Most countries set de minimis at $500 or lower. China’s own de minimis is about $7. The US is one of only a handful of countries above $500.

Temu vs Shein vs Wish: what is actually different this time

Temu and Shein are not “just Wish 2.0” because Wish never got mainstream American shoppers comfortable with buying direct from Chinese factories, and Temu and Shein together now do roughly a third of Amazon’s daily traffic with 100 million-plus US downloads apiece. The behavioral change is the important part, not the specific apps.

Shein proved the model. Temu blew past it with a Super Bowl ad, aggressive referral bounties, and creator payouts. Jerry says he personally gets Temu outreach almost every day offering top dollar for a one-minute TikTok, and the referral program is unusually generous even by influencer-marketing standards.

The Temu price problem: a $20 shirt vs a $6 shirt

Jerry’s top-selling shirt on Amazon retails for $20 to $22, and the same design listed on Temu goes for $6, which is less than the wholesale cost of a blank shirt plus USPS shipping across town. The pricing is not something a US apparel seller can respond to on the merits.

There is no lever in a US supply chain that closes a $14 gap on a $20 shirt. Cotton, blanks, printing, labor, warehousing, Amazon fees, and returns each cost real money. The Wired reporting that Temu is losing about $30 per package extrapolates to roughly a billion dollars a year in subsidy, which suggests the goal is either market share or data harvesting, not near-term profitability.

Do not try to compete on price. Compete on brand, direct relationships, service, and the parts of the customer experience Temu structurally cannot deliver.

Is Temu safe? Data collection and forced-labor concerns

Temu’s Android app was flagged by short-seller Grizzly Reports and referenced by Wired as the most egregious mainstream shopping-app spyware they have analyzed, with the reported ability to compile its own code on device after installation. Bloomberg commissioned isotope testing on nine cotton samples pulled from Shein orders and found the cotton traced to Xinjiang, the region under US sanctions for forced Uighur labor.

Both stories rely on reputable outside experts and neither has been meaningfully rebutted in the trade press. The mechanics matter less than the pattern. Under the current enforcement setup, US customs does not inspect the parcels that would surface either problem.

For US shoppers this is a personal decision. For US sellers this is a competitive one. It is very hard to argue “buy American-made because our cotton is not from a forced-labor region” when nothing at the border enforces the sanctions regardless.

What US ecommerce sellers should do about Temu and Shein

The right response is a two-track plan: on the micro, invest in brand, direct-to-consumer channels, and service quality that Temu structurally cannot copy, and on the macro, contact your congressional representatives to support closing the de minimis loophole for non-market economies. Jerry describes the brand track as your “micro-moat” and political action as the “macro-moat.”

Step 1: Build a real brand, not a commodity SKU

Temu and Shein win on interchangeable commodity SKUs, and they cannot easily copy a brand people already trust, subscribe to, or feel a story about. If you sell plain white t-shirts, you are exposed. If you sell True Classic Tees with a $100M brand behind it, you are not.

Step 2: Move traffic and repeat business off Amazon and onto direct-to-consumer

Jerry admits Ann Arbor Tees never invested in its own site because Amazon was easy, and he is now working backwards to build that channel out. Direct-to-consumer gives you customer email, purchase history, and pricing power Amazon and Temu both take from you. Own the relationship.

Step 3: Compete on the parts of the experience Temu cannot deliver

Fast shipping, easy returns, in-person or phone customer service, and trust are the four experience gaps Temu cannot close under a 10-15-day cross-Pacific model. Lean on speed, service, and returns hard. A percentage of shoppers will pay a premium for it.

Step 4: Diversify beyond a single platform

70% of Ann Arbor Tees revenue running through Amazon left them structurally exposed when Amazon apparel demand fell 30%. The generic ecommerce rule (“do not put all your eggs in one basket”) is hard to follow when you are growing 4-5x a year on one channel, but it matters at inflection points like this one.

Step 5: Contact your congressional representatives on de minimis

Two bills are moving to close the de minimis loophole for non-market economies (which would primarily affect China, Russia, and potentially Vietnam). A bipartisan letter from 12 senators pushed the Biden administration on it in mid-2023. A phone call or email to your congressional office is one of the highest-leverage low-effort things a US ecommerce owner can do this year.

What happens if the de minimis loophole gets closed?

If Congress closes the de minimis loophole for non-market economies, apparel imports from Temu and Shein would face roughly 15-25% duties, packages would slow at the border, and Temu and Shein would have to open US warehouses, import in bulk, pay duties, and follow US laws the same way domestic sellers do. That closes most of the pricing gap.

Jerry is careful to say he is not an isolationist. Chinese factories that want to sell into the US would still be welcome. They would just have to play by the same import, tariff, and IP rules everyone else follows.

Even without legislation, the underlying behavior change (US shoppers becoming comfortable ordering direct from Chinese factories) is durable. Sellers should build brand and direct-to-consumer regardless of what happens in Washington.

Frequently asked questions

What is Temu and how does it work?

Temu is a Chinese-owned marketplace (parent company PDD Holdings, formerly Pinduoduo) that ships goods direct from Chinese factories to US consumers, typically in 10-15 days, using the US de minimis import exemption to avoid tariffs and customs inspection on packages worth under $800. Prices are dramatically lower than Amazon on comparable items because Temu bypasses import duties, US warehousing, and (per Wired) reportedly subsidizes shipping by around $30 per package.

What is Shein and how is it different from Temu?

Shein is a Chinese direct-to-consumer fast-fashion marketplace focused mostly on apparel and accessories, especially for women, and was the most-downloaded shopping app in the US in 2022. Shein and Temu use the same de minimis import mechanics, but Shein is narrower on category (fast fashion) while Temu is a broad cross-category marketplace.

What is the $800 de minimis loophole?

The de minimis rule is a US law that lets any package worth $800 or less enter the country without duties, tariffs, or normal customs inspection. Roughly 2 million such packages enter the US every day, predominantly from China, and Temu and Shein are the two largest users of the exemption at scale.

Why are US apparel sales down so much in 2023?

US apparel sales, especially on Amazon, are down roughly 30% year over year because Temu and Shein together are pulling meaningful demand off Amazon and onto direct-from-China channels, and the underlying pricing gap (a $6 Temu shirt vs. a $20 Amazon shirt) is structural, driven by the de minimis exemption. Peer businesses in adjacent categories are not seeing declines anywhere close to 30%.

Is Temu selling counterfeit or unsafe products?

Temu hosts many near-clone products (search Rolex and you will get “Oleg” watches with the Rolex crown), and enforcement of intellectual property, product-safety, and forced-labor rules is very limited because sub-$800 packages are almost never inspected by US Customs and Border Protection. A Bloomberg-commissioned study also traced cotton in Shein garments to Xinjiang, a region under US sanctions.

Is the Temu app safe to install on my phone?

Short-seller firm Grizzly Reports and outlets like Wired have flagged the Temu app for unusually aggressive on-device data collection compared to other mainstream shopping apps, including reports that the app can compile its own code on device after installation. Whether that is disqualifying is a personal call, but the reporting is meaningfully worse than the industry norm.

How can US ecommerce sellers compete with Temu and Shein?

Do not compete with Temu and Shein on price. Compete on brand strength, direct-to-consumer relationships, shipping speed, returns, and service quality (the parts of the experience Temu structurally cannot deliver under a 10-15-day cross-Pacific ship model). At the policy level, contact your congressional representatives to support closing the de minimis loophole for non-market economies.

Will Congress close the de minimis loophole?

Two active bills (one in the Senate, one in the House) target closing the de minimis loophole for non-market economies, and a bipartisan letter from 12 senators asked the Biden administration to act on behalf of the US apparel industry. Timing is uncertain, but political attention is meaningfully higher than at any prior point in the last decade.

Ready To Get Serious About Starting An Online Business?

If you are really considering starting your own online business, then you have to check out my free mini course on How To Create A Niche Online Store In 5 Easy Steps.

In this 6 day mini course, I reveal the steps that my wife and I took to earn 100 thousand dollars in the span of just a year. Best of all, it's absolutely free!

Podcast: Download (Duration: 59:18 — 68.1MB)

Ecommerce conversion rate optimization means editing the listing itself, not buying more traffic. My guest this episode, Chris Shaffer of Brand Creators, grew one client’s sales 247% in a single year without spending an extra dollar on ads, without launching new SKUs, and without touching keyword research. He did it by lifting the conversion rate on the listings he already had.

That is a hard shift for most sellers. Traffic feels controllable, so we throw money and keywords at it. Conversion rate is the number Amazon, Etsy, and Walmart actually rank you on, and it is the number almost nobody touches first.

Here is Chris’s full playbook, including the exact benchmarks he uses per platform, the three listing elements that move the needle, and the buyer-survey data behind it.

Key takeaways

• Chris grew a client’s ecommerce sales 247% in one year by fixing conversion rate, without adding traffic, launching products, or changing keyword strategy.
• Target conversion rates: Amazon 10-15% (20%+ is excellent), Walmart in the middle, Etsy 5-8% (3% is the platform average).
• Amazon calls conversion rate “unit session percentage.” Find it in your Business Reports, not anywhere labeled conversion rate.
• Titles, product images, and product descriptions are the three levers that move conversion rate. Chris’s Etsy buyer survey rated images 9.23/10 for purchase influence and confirmed 68% of buyers always read the title.
• Write feature-and-benefit copy, not spec-sheet copy. “Keeps drinks cold for 24 hours” converts. “17 oz double-wall vacuum insulation” does not.
• 96.3% of Etsy buyers with 11+ purchases go to a seller’s storefront first before searching. Repeat customers are where ecommerce profit actually lives.
• Negotiating payment processing rates saved Chris roughly 1% on total revenue in one afternoon of work. On seven-figure businesses that is tens of thousands per year.

Why ecommerce conversion rate optimization beats chasing traffic

Ecommerce conversion rate optimization outperforms traffic hunting because it hits the one signal Amazon, Etsy, and Walmart actually rank you on. The platforms are search engines built to show the product most likely to sell, not the product with the most keywords stuffed in. Higher conversion tells the algorithm you are the safe bet, which then earns you more organic traffic for free.

Chris framed the mistake this way in our conversation. Most sellers feel they can control traffic (better keyword tool, more ad spend), and feel they cannot control the listing itself. The reality is the reverse: you have very little control over keyword volume estimates, and total control over the words, photos, and descriptions on your page.

His clients that focused on conversion rate saw a 247% year-over-year sales lift with no additional ad spend, no new products, and no keyword overhauls. Traffic followed the conversion rate up.

How Amazon, Etsy, and Walmart actually decide who ranks

All three marketplaces run what Chris calls a two-stage algorithm. Stage one is a yes/no relevance check: do the keywords the buyer typed appear somewhere in your title, description, or backend keywords? If yes, you qualify.

Stage two is where you win or lose. Among all qualifying listings, the platform ranks by which listing is most likely to convert that specific search into a sale. Conversion rate, average sell-through, price competitiveness, and personalization signals all feed into that ranking.

Two listings with “red t-shirt” in the title both pass stage one. The one converting 9 out of 100 clicks beats the one converting 8 out of 100. That is the entire game.

What is a good conversion rate on Amazon, Etsy, and Walmart?

Good conversion rates vary by platform, but Chris shared the benchmarks he uses when auditing client accounts. Use these as your floor before you decide whether a listing needs work.

• Amazon: 10-15% is solid. 20%+ is excellent. Chris has listings that consistently hit 20-25% and topped 30% last year.
• Walmart: Sits between Amazon and Etsy. Fewer public benchmarks because the platform is newer for most sellers.
• Etsy: Platform average is around 3%. 5-8% is above average. 8%+ is genuinely strong.

Amazon does not label the metric “conversion rate” anywhere in the seller dashboard. They call it unit session percentage and it lives in the Business Reports section. If your unit session percentage is well below the benchmarks above, that listing is where your optimization time should go.

Etsy actually labels it conversion rate in the Shop Manager stats. Walmart calls it out in the Search Insights report. In all three cases you can also just calculate it yourself: units sold divided by sessions.

Step 1: Audit whether you are getting the right traffic

Step 1 of ecommerce conversion rate optimization is checking whether the traffic you are getting is even relevant. Wrong-intent clicks drag your conversion rate down even when the listing itself is fine.

Pull your search-term report from Amazon Ads (or Etsy’s beta search analytics report, or Walmart’s Search Insights). Look at what keywords are actually driving impressions and clicks. Then ask one question of each: is that person really looking for my product?

Chris’s example: a 64-ounce stainless steel tumbler was showing for “coffee mug” because Amazon opens the funnel wide when you run ads. Someone typing “coffee mug” expects a small ceramic cup.

They click, see a giant metal tumbler, and bounce. Your conversion rate takes the hit.

Chris’s rule for cutting a bad keyword

If a keyword’s conversion rate is significantly below your listing average, cut it. Pull it out of your title, description, and backend search terms. Turn off the ad targeting it.

There is one exception. If that single “wrong” keyword drives 80% of your sales, do not touch it. Instead, rebuild the listing around what those buyers actually want.

That situation is rare.

The subtle version of this trap: words that mean different things in different markets. Chris pointed out that “thongs” in Australia means flip-flops.

If a US flip-flop seller is paying for “thongs” clicks that expect underwear, the conversion rate on that keyword will be terrible. Cut it.

Step 2: Fix your title so a human can read it

Step 2 is rewriting your title in plain English instead of keyword salad. Chris’s buyer survey found 68% of shoppers always read the title before clicking, and if the title reads like a robot wrote it, they scroll past.

The old-school SEO title (Insulated Water Bottle Water Bottle Tumbler Thermos 32oz Double Wall Vacuum Stainless Steel Wide Mouth) worked in 2015. In 2024 it hurts you three ways: humans do not click it, the platform does not need the repetition to understand plurals and synonyms, and even if it ranks, it converts worse because expectations are unclear.

Amazon, Etsy, and Walmart all handle plurals, misspellings, synonyms, and word order internally. Etsy documents this explicitly in their seller handbook. Amazon does not document it, but every large-scale test has confirmed the same behavior.

The one-sentence test for a good ecommerce title

Read your title out loud as a sentence. If it parses as English, you are 90% of the way to a good title. If it sounds like keyword-stuffing gibberish, rewrite it.

Etsy’s documentation adds one nuance: keywords near the beginning of the title carry slightly more weight than keywords near the end. Put your most important term first, then write the rest as a readable phrase.

You do not lose SEO by dropping repetition. You gain click-through rate and conversion rate, which are the signals that actually rank you.

Step 3: Rebuild your images to answer buyer questions

Step 3 is treating your product images as your primary answer to the question “what does buying online lose vs. shopping in a store?” In Chris’s Etsy buyer survey, images scored 9.23 out of 10 for purchase influence, higher than price, higher than shipping cost, higher than anything else.

The point of an ecommerce image is to let the buyer do the thing they would do in a physical store: pick it up, look inside, check the material, compare the size, hold it against their body. Your job is to answer all of those questions in a photograph.

If your listing has one hero shot and four staged lifestyle photos of models jogging, you are wasting seven of the ten slots Amazon gives you.

What to actually put in your product image slots

Chris’s checklist for image slots that move conversion rate:

• Hero shot on white, showing the whole product clearly.
• Size and scale: product next to something recognizable (a hand, a phone, a wine bottle). One popular water bottle went viral because it stated “fits a full bottle of wine” and showed the photo.
• Material and construction: show the inside if the material matters. A plastic-averse buyer will look for the plastic liner. Show them there is not one.
• Benefit demonstration: not “stain-proof fabric” as text, but a split-screen photo of red wine poured on the fabric and the same fabric coming out of the washing machine spotless.
• Feature callouts with short labels: 24-hour cold retention, dishwasher-safe lid, leak-proof seal.
• Comparison chart against your other SKUs so buyers pick the right size or version.
• Lifestyle shot at the end, not the middle. Emotional payoff after you have earned the click.

Step 4: Rewrite product descriptions in benefits, not features

Step 4 is rewriting your bullet points and description so every feature has a benefit attached. This is the single most common mistake Chris sees when he audits a listing.

Feature-only copy reads like a spec sheet. “16 oz. Double-wall vacuum insulation. Powder-coated 18/8 stainless steel.”

That tells a metallurgist something. It tells a shopper nothing.

Benefit-attached copy translates the feature into the outcome the buyer cares about. “Keeps drinks cold for 24 hours or hot for 12, thanks to double-wall vacuum insulation.” Same feature, but now the buyer knows why it matters.

The fabric-weight test

Chris’s litmus test: can you, the seller, explain your own spec to a friend at dinner? “This shirt is 240 GSM cotton.” What does 240 GSM mean to someone who is not in textiles? Nothing.

“You can machine-wash this shirt 100 times and it will still feel like the first day you put it on.” That is the same information the buyer actually wanted.

Rewrite every bullet in your listing using this template: [Feature] so that [benefit the buyer feels]. If you cannot finish the sentence, the feature does not belong in the bullet.

How storefronts and repeat buyers change the math

Storefronts matter far more than most Amazon and Etsy sellers realize, because repeat buyers overwhelmingly start their next purchase there instead of at search. Chris’s survey found that among buyers with 11+ purchases in the last year, 96.3% start at a shop they have bought from before.

Here is the full ladder from Chris’s survey data:

• Buyers with 1-5 lifetime purchases: 80.2% likely to return to a shop they have bought from.
• Buyers with 6-10 purchases: 89% likely.
• Buyers with 11+ purchases: 96.3% likely.

Two takeaways. First, if you sell one SKU and never build a storefront, you leave money on the table. Repeat buyers want to buy from you again, and they cannot if there is nothing else to buy.

Second, capture the customer even when Amazon owns the transaction. The Amazon buyer who becomes an off-Amazon subscriber on your own site is worth 10x the one-off. Which brings us to Buy with Prime.

Should you add Buy with Prime to your own website?

Chris is testing Buy with Prime on one of his brands specifically to see if it lifts the conversion rate on his own website. His reasoning: on your own site you pay the fulfillment fee but skip Amazon’s 15% referral fee, so it comes close to break-even on cost.

The old Pay with Amazon button barely moved the needle because Amazon shoppers shop on Amazon and website shoppers shop on the website. Buy with Prime is a different pitch: two-day shipping and Amazon’s return safety net on your store.

The one real risk is inventory cannibalization. If Buy with Prime pulls from the same Amazon FBA pool that fulfills your Amazon orders, a website surge can starve your Amazon listing. That is the reason to test before rolling it out across a portfolio.

How to negotiate down your payment processing fees

You can negotiate payment processing fees down to under 1% all-in if you have the volume, and it takes about an hour of work. Chris did this across two of three brands he consults with this year and cut roughly 1% off total revenue in fees, which on any decent ecommerce business is tens of thousands of dollars.

The move: get on interchange-plus pricing instead of a flat rate. Interchange-plus means you pay the actual card-network cost plus a small markup, instead of a blended flat like 2.9% + 30 cents. On volume, interchange-plus wins nearly every time.

Chris’s business moved to Wells Fargo for card processing (already had a business banking relationship, so setup was 30 minutes) and now pays under 1% blended. They also negotiated down failed-payment fees, which on a subscription business can add up to thousands per year on their own.

If you take a lot of PayPal, use Braintree

PayPal charges 3.49% + fixed fee on standard commercial transactions, and most sellers do not know this is negotiable. If PayPal is a meaningful share of your sales (Chris and I both estimate a third), the fee difference matters.

Braintree is owned by PayPal and lets you negotiate both credit card rates and PayPal rates in one contract. It also offers interchange-plus pricing. If you are on Stripe today and PayPal is a big chunk of revenue, Braintree is worth a serious look.

The three-line action item: pull your last three months of merchant statements, calculate your blended effective rate, and call your processor. If they will not budge, quote another processor’s offer and try again.

Frequently asked questions

What is a good conversion rate on Amazon?

A good Amazon conversion rate is 10-15%, and an excellent one is 20% or higher. Amazon labels this metric “unit session percentage” in the Business Reports section, not “conversion rate.” If yours is below 10%, focus on titles, images, and descriptions before adding more ad spend.

How do I find my conversion rate on Amazon?

Log into Seller Central, open Reports, then Business Reports, and look for “Unit Session Percentage” in the Detail Page Sales and Traffic report. That column is Amazon’s name for conversion rate. You can also calculate it manually as units ordered divided by sessions.

How does the Amazon search algorithm actually rank listings?

Amazon uses a two-stage algorithm. Stage one is a relevance check: do the buyer’s search terms appear somewhere in your listing? Stage two ranks the qualifying listings by which one is most likely to convert that specific query into a sale, using conversion rate, sales velocity, price, and personalization signals.

Does keyword order in a listing title matter on Etsy or Amazon?

Yes, but less than most sellers think. Etsy’s documentation confirms keywords near the beginning of the title are weighted slightly more, and Amazon appears to work similarly. Both platforms handle plurals, synonyms, and word rearrangement internally, so you do not need to repeat every variation.

How much do product images actually influence ecommerce conversion rate?

Chris Shaffer’s survey of a couple hundred Etsy buyers rated product images 9.23 out of 10 for purchase-decision influence, the highest of any listing element they tested. Images beat title, price, shipping cost, and reviews. Treat your image slots as the answer to every question a buyer would ask in a physical store.

Should I write product descriptions as features or benefits?

Write benefits first, then attach the supporting feature. “Keeps drinks cold for 24 hours” is a benefit. “Double-wall vacuum insulation” is the feature that produces it.

Buyers care about the outcome and use the feature as proof, not the other way around.

How do I negotiate lower credit card processing fees for my ecommerce store?

Ask your current processor to move you from flat-rate pricing to interchange-plus pricing, which passes through the actual card-network cost and adds a smaller markup. Get quotes from at least two competitors (Braintree if you take PayPal, Stripe or a bank-owned processor otherwise) and use them as leverage. On any six-figure or seven-figure business, an afternoon of negotiation is worth thousands per year.

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Podcast: Download (Duration: 52:30 — 60.4MB)

Selling an ecommerce business almost never runs on the schedule the seller expects, and the ecommerce brand my guest Mike Jackness and I owned together is a case study in exactly how much can go sideways. We listed it in February 2022 expecting to close by that summer. We finally closed in June 2023, after two failed LOIs, a private-equity backout, an SBA lender getting acquired mid-close, and a buyer landing in the hospital with Lyme disease.

Mike is the founder of EcomCrew and has owned dozens of ecommerce brands over the last 20 years. In this episode he walks through what happened, why he then sold nearly all of his other brands and laid off his Philippines team, and the single “focus on one thing” lesson he now runs his life by.

Here is the full timeline, the mistakes worth learning from, and what Mike is doing next.

Key takeaways

• Selling the ecommerce business took 15 months and three buyers: private equity backed out over interest rates, SBA buyer #2 got Lyme disease mid-close, SBA buyer #3 walked because the SKU count intimidated him. Buyer #4 closed in days because prior due diligence was reused.
• Investors returned double-digit annualized returns during a period the S&P 500 returned about 2%, so the outcome was good despite the process.
• Mike then sold every other ecommerce brand he owned except one (Ice Wraps) and laid off nearly his entire Philippines team.
• The lesson: running one thing beats running seven. The second brand is not “twice as easy,” it is roughly five times harder, and attention gets fractionalized across a portfolio.
• Real moats matter more than ever. Great photography and copy used to be a moat; AI has closed that gap for overseas sellers. IP, manufacturing, and defensible product categories are what still hold.
• Consumable products with defensible IP (his old coloring-book brand, Color It) are the model he is trying to rebuild toward next.

Why selling an ecommerce business took 15 months and three failed deals

Selling an ecommerce business took 15 months in our case because macroeconomics, SBA lender consolidation, and pure bad luck stacked on top of each other in a way none of us could have predicted. The business itself was solid the entire time. It was the deal process that broke, three separate times.

We put the business up for sale in February 2022 through Andrew Youderian’s investor group at eCommerceFuel, expecting a summer 2022 close. Mike had been running it for about 14 months. The board decided we could sell it now for what we had hoped to get in year three, so we booked the win.

The first offer came from a strategic private equity buyer at above-market value. Due diligence took months (they hired four separate diligence firms because private-equity rules do not scale down for smaller deals). The buyer signed off on everything.

Then interest rates spiked, the stock market dropped 40%, and PE said they were freezing all new investments. Deal dead.

The Lyme disease deal that fell apart at the finish line

We put it back up for sale, got under LOI with an SBA buyer, and got all the way through underwriting. Then the SBA bank funding the loan got acquired the same week we were supposed to close. The loan was handed off to another bank, delaying close by a week or two.

The buyer, frustrated at the delay, went on a hike. He got bit by a tick. He got Lyme disease bad enough to end up in the hospital and could not close the deal.

That is not a metaphor for a bad deal, that is the literal reason it fell through.

We relisted in January 2023. Third buyer got under LOI, made it through due diligence, and then decided the business was “too complicated” (roughly 100 SKUs and light assembly). He walked.

The banker who saved the deal

The SBA banker had already done all the paperwork twice and refused to lose the file. He said he knew a buyer he had recently sold another business to who was looking for exactly this kind of deal, and the fourth buyer closed within weeks because we reused the previous buyer’s due diligence report.

We signed the closing paperwork at Seller Summit in May 2023 (Mike literally signed the DocuSign during my keynote about hitting the Wall Street Journal bestseller list). The deal officially closed June 2, 2023.

Net outcome: investors got double-digit annualized returns during a period the S&P 500 returned about 2%. On paper it was a success. On the ground it cost Mike 15 extra months of his life and derailed every other plan he had.

What Mike would do differently the second time selling an ecommerce business

The biggest thing Mike would do differently is never commingle operations between a business he owns solo and one he owns with investors. On paper the acquired business had its own team, its own contracts, its own cost accounting. In practice they all worked out of the same Philippines office and knew each other.

That created a soft failure mode: any HR decision Mike made in one business rippled into the other. Layoffs, benefit changes, or a bad manager conversation in Brand A would spread through the office and destabilize Brand B. Even though the entities were separate on paper, the humans were not.

Second thing he would change: do not commit to a “run it for one year, hand it to a new CEO in year two” plan when you have never run a hired-CEO transition before. He now believes it is very hard to find someone who will care about a business as much as the owner-operator.

Why he now believes reusing prior due diligence is the deal-closer

The reason deal four closed in days instead of months is that the fourth buyer accepted deal three’s due diligence report unchanged. It had been produced by a well-known ecommerce diligence firm within the last 90 days.

If you are selling and a deal falls through late, keep every diligence artifact. The next buyer will save months by inheriting it, and a smart broker or banker can push for that reuse. It is the single biggest lever we saw for compressing a deal timeline.

Why Mike sold every other brand and laid off his team

Mike sold every ecommerce brand except Ice Wraps and laid off nearly his entire Philippines team because he concluded, after 20 years and a five-brand portfolio, that focus beats diversification for entrepreneurs like him. The revenue was fine. The mental cost of running it was not.

His argument, drawn from The One Thing and Essentialism and from watching peers like Spencer Jan at Solo Stove: successful founders who compound to nine-figure exits almost always ran one thing at a time. The founders with 17 side projects and five brands tend to plateau in the seven figures across all of them.

His own portfolio proved the point. Any single brand, given his full attention, could have been dramatically bigger than the whole portfolio was together.

The “twice as easy” trap

The specific trap Mike wants ecommerce founders to avoid is the belief that the second brand will be easier because you have already done it once. His experience: the second brand is roughly five times harder, not half as hard.

The setup mechanics repeat and stop being novel. New LLC, new bank account, new insurance, new tax return, new Amazon seller account, new social accounts, new email list, new ad accounts. None of it feels exciting the second time, so you cut corners.

Meanwhile the founder’s finite attention gets split. One brand pulls ahead, one stays flat, and the bottom three get almost no time at all. The end state is a portfolio of underperforming brands instead of one strong one.

The moat conversation: why AI killed the “great listing” advantage

Mike’s ecommerce moat for a decade was writing better copy and shooting better photos than sellers in China, Pakistan, and India. That moat is now closing fast because AI tools have given every overseas seller the same capability at near-zero cost.

His mental model: he had built a moat, and now dump trucks are backfilling it every day. The only response is to find a different moat.

The moats that still hold in 2024 are the ones AI cannot replicate cheaply. Physical manufacturing capacity is one. Intellectual property is another (his old coloring book brand Color It had copyrightable artwork that was easy to defend).

Local final-assembly operations and consumable products with real repeat purchase round out the short list.

Why Color It was his best moat and what he wants to build next

Color It, Mike’s coloring-book brand, had four moats stacked: consumable product (buyers had to reorder), copyrightable IP (artwork that could not legally be knocked off), a proprietary manufacturing process, and a defensible category. He sold it because his cousin (a partner in the business) needed liquidity, and the business was cash-strapped from growing 2x per year.

In hindsight, Color It is the one he wishes he had kept. It is the closest thing to the business he wants to build next, though he is not ready to name the specific product category on a podcast yet.

The playbook he is rebuilding around: consumable, IP-defensible, ideally with a manufacturing or assembly component that overseas sellers cannot replicate from Alibaba.

What is next for Mike, and Ice Wraps as the SBA-ready exit

Mike’s plan for Ice Wraps is to run it clean and focused through 2024, generating a strong trailing 12-month P&L and a clean tax return, then list it in early 2025 for a mid-seven-figure SBA-qualified sale. That is a deliberate, boring, disciplined 15-month plan and it is a shift from how he used to operate.

He is intentionally not starting the next business yet, even though he has one in mind and wants to lease the building and buy the machinery tomorrow. The discipline is the point. He wants to feel what it is like to run one thing at a time before he adds the next.

The de-stress since selling the other brands and letting the team go, he estimates, is roughly half from having one brand instead of five, and half from no longer carrying the weight of investor and employee expectations.

Frequently asked questions

How long does it take to sell an ecommerce business?

A clean SBA-financed ecommerce sale typically closes in three to six months from listing, but 12 to 18 months is common when deals fall through. In our case, the business took 15 months and three failed buyers before we closed with buyer four. Macro conditions (interest rates, credit markets) can add six-plus months to any timeline.

Why do ecommerce business sales fall through?

The three most common reasons are financing (SBA lender changes, interest rate shocks, private-equity investment freezes), due diligence surprises, and buyer cold feet about complexity or SKU count. In our 15-month process we hit financing failures, an SBA bank acquisition, an actual medical emergency (the buyer got Lyme disease), and a buyer who decided the SKU count was too high.

Should I run multiple ecommerce brands at once or focus on one?

Focus on one until it is genuinely maxed out. Mike Jackness ran a five-brand portfolio for years and concluded that a single focused brand almost always outperforms the same operator’s diluted attention across five. The founders who hit nine-figure exits (Spencer Jan at Solo Stove is a public example) almost always ran one brand at a time.

What is an ecommerce moat and which moats still work in 2024?

An ecommerce moat is something that makes it hard for a competitor to copy your business. AI has erased the old moat of “great copy and photography” because overseas sellers can now generate the same quality at near-zero cost. The moats that still hold are intellectual property (copyrightable artwork, patents), physical manufacturing capacity, local final-assembly operations, and consumable products with real repeat purchase.

What is SBA financing and why does it matter for selling an ecommerce business?

SBA (Small Business Administration) financing lets a buyer put down as little as 10 to 15% instead of the traditional 20% and finance the rest through an SBA-backed loan. That expands your buyer pool dramatically because more individual buyers can afford your business. To qualify, you typically need a clean trailing 12-month P&L, three years of tax returns, and books that stand up to lender scrutiny.

How do you avoid commingling operations between multiple ecommerce brands?

Separate the physical workspaces, not just the legal entities. Mike’s Philippines team for the co-owned brand shared office space with his other brands’ teams, and even though every contract and cost was separate on paper, the humans talked, and HR decisions in one brand rippled into the other. If you must share a building, isolate teams by floor or wing and treat internal communication between them as a compliance issue.

What should I do if my ecommerce business deal falls through late in diligence?

Keep every diligence artifact and negotiate hard for the next buyer to reuse it. Our fourth buyer closed in days instead of months because he accepted the third buyer’s due diligence report from a reputable firm produced within the last 90 days. A good SBA banker or broker can push for that reuse and cut months out of the next attempt.

Ready To Get Serious About Starting An Online Business?

If you are really considering starting your own online business, then you have to check out my free mini course on How To Create A Niche Online Store In 5 Easy Steps.

In this 6 day mini course, I reveal the steps that my wife and I took to earn 100 thousand dollars in the span of just a year. Best of all, it's absolutely free!