Inside A Millionaire’s Arbitrage Account: Gaye Lisby’s February Month End Numbers
By Garry Ray – April 15, 2022
Hi, it’s Garry here. Today, I’d like to share my wife and I’s Amazon arbitrage account in March.
As many of you know, we have a private label account, totally separate from this arbitrage account. So let me talk a little bit and share something with you. Maybe a bit unorthodox, but it might help, especially the new sellers. My heart goes mainly to the more recent and mid-level sellers. I’d probably say even more to the mid-level sellers because many people start and quit, and people who quit never succeed in anything. But once you make it to a middle-level seller and you’ve done it for several months, and you’re getting ten thousand, twenty thousand a month in sales, you’re starting to prove you’re a mid-level seller, and you’re positioning yourself for some significant growth.
Now, my wife and I have been selling on Amazon for seven years in just a few months. And we had no previous E-retail experience at all. When we signed up, one of the first things we did when we started selling was join a group and pay $5,000 to join a coaching program for $500 a month.
Fortunately for us, Gaye Lisby was our first and, after all the coaches went by, affectionately said the best coach we had. She introduced me to many things after I joined that coaching program that advanced us by years in just days and weeks.
We learned things that we never would have learned on our own. It’s kind of like being a brain surgeon. You go to college for, you know, eight, twelve, or whatever years it is to become a surgeon. Imagine how long it would take you if you didn’t spend that money on training, it would’ve taken you forever. Right?
So, I want to give a little bit of coaching and reflect on my March operation in our business, except this time, I’m not going to talk about outcome-based reporting.
When they get into a lot of businesses, many people focus on the outcome. They focus on earnings. They focus on income and who can blame them. I mean, that’s what we all have to have, right? But in truth, what creates profit and income into the bank account is actually what comes into the business.
WE ARE BUYERS FIRST
I remember this line that Gaye Lisby dropped that wowed everybody at our private sellers’ meeting. Indeed, in a world of confusion, we are so quickly side-tracked at every little button, scanning app, or thing that comes along that we often forget this one thing… we are buyers first.
We’re counting on a restructuring phase, which goes all the way down to the first day of March. When you total all this up, it comes to 3,134 pieces that we sent to Amazon in March.
You would see how much we shipped in March, all of our shipments in several SKUs, number of pieces. You can take this and divide 24 SKUs into 97 pieces. And that’ll tell you, on average, how many pieces per skew that my little two and a half-million-dollar Amazon business does.
This is all everything you’re seeing on mine now is all online arbitrage. There’s no wholesale here. There’s no RA here.
When you find these individual shipments, you can click on the blue line to show the Total Buy Cost for that shipment.
That will translate into $13,504 in sales, netting us $3,267 in profit. My buy cost resulted in how much sales. And I came up with a 2.2, four multipliers. The point is it’s good to know for every dollar I spend, what does it turn into sales. In this case, right here, $6,600 in buy cost will result in $13,500 in sales.
If you want to have a very profitable arbitrage business, it is to have a 2.0 multiplier or up. Now I know some people with a 1.9 multiplier, meaning they have a dollar 90 cents in sales for every dollar they buy, and they have very profitable Amazon accounts. Why? How can they do that? Because they do all the labor, buying, prepping, and shipping.
In my case, we don’t do that. My wife and I don’t buy, and we don’t prep and ship. We hire it all done. So, I need a 2.0 or better to turn a profit.
The goal of any restaurant owner, motel owner, etc., is to turn a profit. So, to turn a profit, you need to know your numbers. Well, the beauty about inventory lab is you can quickly know your numbers. $6,600 buy cost $13,500 sales value. It even tells you what cubic features you take up, which is awesome. I also want you to notice this sales rank is 49,000. That’s the average sales rank.
You need to understand that input methodology or philosophy is critical in any business when I talk about input. The outcome will be there if the input is correct, just like Starbucks. Starbucks’ input is coffee and its advertising. That’s their primary input.
Those are the two things they focused on in the beginning to create a lifestyle experience. And we all have to agree. Starbucks is not a necessity, nor is Netflix, for example. Yet I, and many of you, like Starbucks, but far as basic coffee, you can stop at a truck to get one for $2. That’s basic coffee. So, if you want to say coffee’s a necessity, there’s a way to get basic coffee.
We focus on the “Top 0.37%”. I want to make sure that the stuff I buy is top 1% or less 0.9 is better than 1.8 is better than 0.9, and so on. This means that in this category, patio, lawn, and garden, there are, I don’t know how many pieces I don’t even want to look it up, but probably a million, maybe 3 million different items on Amazon. That’s for sale in the patio, lawn, and garden categories. And this tells you that this thing is 0.37 of everything in the patio, lawn, and garden right here, which means it’s pretty awesome. It says it sells for 60 a month. Now we know we’re entering the springtime of the year right now, and this will be going up, and this will be in high demand.
BEST BUSINESS MODEL
We sent in 3,100 pieces in March. That was all top 1% or better. These are some of the back ends of how I do my business. We buy the top 1% or better. Most of it is Online Arbitrage. Send it to FBA. We do very little MFN. That’s our business model. Is it the best business model? No. The best business model is the one you perfect for you. I can’t tell you what’s the best business model for anyone.
Some people will say the best business model is a private label. Well, I agree. I know people who make millions doing that; others say Retail Arbitrage, discount stores, Nike outlets, things of that nature. They sell millions, 7 million, 10, 11, 12 million a year doing that. And then I know some that do Online Arbitrage like me. I do 10 million a year.
So, the best business model is the one that works for you. Do not get the whole squirrel syndrome to where you’re bouncing around all the time, looking everywhere. You’ll never be successful at anything. One of the things I’ve had to coach people is getting them to settle themselves.
DON'T BE A SQUIRREL
People come into the e-commerce world, and they come in sometimes like a squirrel on crack cocaine, and they do everything. And then they’re frustrated. They say there are not enough hours in a day, and there are not. And then they get frustrated and tell them, settle down, settle down in any sport.
The highest-paid athletes normally are good at one thing. If they’re quarterback, it’s throwing and then maybe a little bit of running, or it’s running and a little bit of throw. And in basketball, it’s a big guy inside dunking or a little guy outside shooting three-pointers. You have to settle yourself down. Don’t bind all the hype of all the millions. Don’t get into that. Understand a typical blue-collar mindset of input philosophy into your business. When you get the input right, the output takes care of itself.
And this is why I wanted to show you a little backend on my business on input philosophy. So, you can understand how this works.
Don’t quit. No matter how much you stumble in life and falter, don’t quit. Quitters never win, and winners never quit. And remember, the difference between champ and chump is that hump.
Let me end this with my favorite poem:
“When things go wrong as they sometimes will
When the road you’re trudging seems all up hill.
When funds are low and the debts are high.
And you want to smile, but you have to sigh.
When care is pressing you down a bit.
Rest, if you must, but don’t you quit.
Life is queer with its twists and turns.
As everyone of us sometimes learns.
And many a failure turns about
When he might have won had he stuck it out.
Don’t give up though the pace seems slow –
You may succeed with another blow.
Success is failure turned inside out –
The silver tint of the clouds of doubt.
And you never can tell how close you are.
It may be near when it seems so far.
So stick to the fight when you’re hardest hit
It’s when things seem worst that you must not quit.”