Dave Kelly 3:48
Absolutely. And I’m looking forward to following more on Advantix through LinkedIn. And of course, if you’re looking for a product demos and comparisons and real life work from anywhere environments, make sure you check out our YouTube channel youtube.com/globalteckworldwide
Rolando Rosas 4:06
. All right. So, Dave, you know we’ve got a really good guest today, who’s jack of all trades. He’s a co founder of several companies. Let’s jump right into his bio and tell you a little bit bit more about Yoni. So Yoni Kozminski is an expert in scaling business and has applied his knowledge to help companies like Mercedes Benz, MasterCard, and Sony, and then to develop their strategies. His experience led them to create iscala a premium business Consultation Service and multiply meet an end to end executive recruitment and HR Solutions firm. Additionally, Yoni is a seasoned podcaster I love that. And that podcast is called successful scales podcast, which focuses on Questions related to growing, selling, acquiring and scaling a business. So without further ado, let’s bring in Yoni. Kozminski. Hey, Yoni.
Yoni Kozminski 5:12
How you doing, guys?
Rolando Rosas 5:15
Awesome. Hey, where are you checking in from today?
Yoni Kozminski 5:17
I’m checking in from Tel Aviv,
Rolando Rosas 5:20
Israel. Shabbat shalom.
Yoni Kozminski 5:21
Shabbat shalom. We’re a little early, but we’re getting there.
Rolando Rosas 5:26
Hey, but you have an accent. It’s almost sounds honestly to me,
Yoni Kozminski 5:29
you’d be right there, Rolando. I am from none other than Australia. I grew up in Australia, I spent still most of my life there.
Rolando Rosas 5:38
That’s so cool. But now you’re parked in Tel Aviv, that’s actually a very growing Telecom, tech web hub. For the world right now, it was a little bit sleepy, you know, we’ve done some work with Israeli companies in the past. And now it’s really blown up to the UN it power, you know, in a small country, they develop such interesting and unique solutions. Time and time again,
Yoni Kozminski 6:05
it’s pretty wild. Honestly, Tel Aviv makes up for about 5% of the population of the entire country of Israel, but it’s responsible for 25% of the GDP. And if you look at the surrounding, it can go up to about 40%. And most of that is through technology companies. I think last year, Tel Aviv or Israel was the most funded country on planet Earth from venture capital, and just general funds coming in. So a lot of exciting tech plays that come out of here. And it’s just really exciting to be in around and seeing so many of these huge companies, their embryonic stage, I used to been away work and just everywhere you look, it’s a move into a way where they get their own office, they get to their series, DC, wherever they’re out, and then they IPO. And it’s pretty cool to say
Rolando Rosas 6:52
it is amazing. You’ve got powerhouse companies, they’re also moving in and doing r&d there. Because they have such a good engineering base. They’ve got a good developers as well, based on it, I gotta tell you, I’ve met with tons of engineers around the world. And the ones that consistently impressed me the most, were the ones that were based in Israel, for some reason. They just have that extra gear, to go beyond the problem at hand and look at multiple angles in a way that maybe engineers from the US or other teams and other places and big firms are putting r&d centers right there in Tel Aviv.
Yoni Kozminski 7:34
It’s a super fiercely competitive environment that exists here, small country, huge demand, and it pushes you also, everyone is conscripted to the military. And many of these tech entrepreneurs come out of the 8200 division, which is military intelligence. So they’ve been dealing with this stuff for many years at a level that most of us mere mortals will never even have access to saying. So those are a couple of the reasons why and you feel it here. It’s a really impressive environment and something as an entrepreneur living here, it pushes you to go further, because there’s like a vibration here of everything that’s happening from particularly the tech environment, and you feel it.
Rolando Rosas 8:16
We’re feeling the vibration from a sponsor right now. And I’m gonna hand it off to Dave to go ahead and read that off for us.
Dave Kelly 8:23
So we’re gonna jump into all things tech, but before we do a quick read from our sponsor, hey, listen, are your clients keeping you awake at all hours of the night? And like many salespeople, you probably use your personal number for work. Did you know that you can easily use Zoom for both online meetings and phone calls. So Take Back the Night so that you can sleep better knowing your phone won’t ring at all hours of the evening. Zoom phone allows you to keep your personal phone number separate so that you can rest more easily and be more efficient during the day. And with Global Teck Worldwide as your zoom partner. Setting up is as easy as 123 Check them out at teck.global/zoom to get started.
Rolando Rosas 9:15
Dave, I don’t like my phone ringing in the middle of the night, man. And anything that makes it easier. I’m totally down for that. So zoom phone, everybody. So let’s resume our conversation with Yoni Yoni, I want to ask you, and we’re talking about tech, we’re talking about things that are just blowing up around us. But what right now in the world of tech, are you either nerding out on geeking out on or fine? totally fascinating.
Yoni Kozminski 9:42
I mean, Rolando, it would be very hard to look past everything in the AI environment and what open ai ChatGPT are up to I’ve got a product team of 13 inside of the group of businesses that we’re running here, and we’ve been building some interesting ChatGPT integrations to be For example, better job descriptions for businesses and trying to help people understand how they can craft in a better way. So that’s been a pretty cool experience to seeing how we’ve been able to train the AI to deliver what we would define as a recruitment business, a really strong job description. That’s one application. I don’t know that we’ll have enough time to go through every single application. But it’s amazing. I’d love to hear how you guys are leveraging and what you guys are seeing,
Rolando Rosas 10:26
we’ve actually given ChatGPT A name. Because if you say ChatGPT, as much as we do, you got to change it up. So we gave it, Eddie. Eddie, internally means ChatGPT. For us. Hey, did you have Eddie proofread that? Did Eddie helped you on that idea or brainstorming? So yeah, we’re fully immersed into Eddie right now.
Yoni Kozminski 10:49
I mean, the fact that you’re calling him her Eddie just goes to go either way. Yeah, we’re we’re moving into this whole, they are taking over AI is taking.
Dave Kelly 11:01
It’s taking over but it’s only as good as he or she or they that are controlling it. And putting in the pront. We had a meeting recently, we probably had 14 or so participants in this meeting from all of our different departments. And we asked everyone to show an example of how they’re using Eddie ChatGPT in their kind of daily workflow. And it has been useful in everything from customer service type replies, to Amazon listings. We’ve even used that for 30 days schedule of LinkedIn posts that revolve around AI, whatever it might be. We learn from each other every single day, we get really excited about it and respect to AI. What other practical impacts do you see that this could help with Amazon sellers? So you’re talking for job descriptions, but for an Amazon seller, where do you think some of us are gravitating towards with AI?
Yoni Kozminski 12:00
Yeah, I can already share with you some examples that I’ve seen in the wild already. I feel like a lot of companies are really jumping onto this quickly. One, I don’t know if you guys are familiar with zon guru. But design Guru is geared toward agencies and the literal integration that I saw him run in front of my eyes was insane. He was able to pull inside of the platform, the listings of key competitors and look at the rankings as to where they list in their seller ranking score. And on the back of that, pull out the keywords that were missing, build a new listing, ultimately leveraging Edie, and on the back of that O inside of the platform, it ranked it at a higher percentage, like in the top one percentile, just like that. So the idea from keyword research all the way through to integrating it into your listing gone. And that happens within seconds, I think this is going to revolutionize the way in which people are leveraging it to save a ton of time, what I would say becomes really interesting. And maybe we’re not quite there yet. But how you can then take that to things like recommending how your image structures should look like or your enhanced brand content or how that then feeds into your PPC Strategy. And I’m sure people have already thought about this. But this is what I’ve seen. And this is where I see probably the biggest early levers being pulled.
Rolando Rosas 13:24
You know, for me, the next evolution is right along those lines. So building listings takes forever the normal way to do it. Right with most sellers. I think I saw that demo that you’re talking about. I saw one done by Dr. Pineapple, Dr. Travis Ziegler. He’s a fan of Amazon guru. And it literally took them two minutes to build a new listing with what you just said, which is wild. For me. I think the next step, once we get beyond the building, the listing is really on the analytics, can we use and leverage AI to then tell me and or predict which keywords when you using it with advertising or SEO are going to go? Well for us? I mean, he could tell you this right now, this is what your competitor is using. You should use it in your listing. But I wanted to tell it to tell me more based on the data that’s out there, whether it’s brand analytics, the PPC, you take all those different pieces of data combined, and it could just start spitting out based on all the data that you have. Here’s what’s going to work and here’s what’s not going to work. I mean,
Yoni Kozminski 14:37
imagine if you could take it to a level where you take out that brand analytics insights, the times in which things are selling and then gives you a recommendation on when should I be turning on and off my media Sven what are the critical hours that make the most sense and then running that into a platform like quartile or petrol? Or whatever media A play you’re leveraging technology where it’s actually running those for you building that closed loop system would be it save you a lot of money and probably make you a lot too there’s a cost of doing write down.
Rolando Rosas 15:12
Absolutely, because you know, we are drowning in data. I don’t know if you run agency. So you notice that if you have 123 clients, you can manage it, you get the 10 100 200 1000 clients, the scale, as aggregators, now know, becomes very difficult, because the tools for an Amazon ecosystem are still in its infancy compared to let’s say, QuickBooks that’s been around for over 20 years, they’ve had time to develop, make things better over time. And so scaling those solutions in AI making that simple, and knowing when to pull the levers would make things so much easier. And like you said, even probably more profitable. Yoni, I want you to fill in the blank here, when asked you this, as someone who finds talent for Amazon sellers should never blank. And then we’ll repeat that again for you. Amazon’s sellers should never blank, fill in the blank for
Yoni Kozminski 16:13
Amazon sellers should never assume that there isn’t a better way. So what I mean to say by that is that I think Amazon sellers tend to gravitate toward, you know, if come up with a brilliant product idea they’re selling, they’re figuring everything out that tinkering, they’re really looking to figure it out, and that they are the one that are going to be best suited to solve every problem. And I think as you grow that business, there are other ways be it technology, personnel, automations AI integration, like there are ways in which you can clawback your time and energy level to focus on the things that are actually going to move the needle most for your business. So that would be my response.
Rolando Rosas 16:59
Until things that move the needle, I’m all about things that move the needle for Amazon sellers, because like you said, you only have so much time. And and no for us this is the case, if you’re growing your business, where should that resource be redeployed? We know whether it comes to people, technologies, teams, and you’ve been around the block. So if you were building a team, I think about this in in football terms is I played football. You need a good coach, you need a good quarterback. You need a general manager, you’re in Israel, and I know they’re big into basketball over there. The team has to be built around either good center or point guard or whatever. But like a team, what would you say? Is the winning formula so that you can build a team of remote professionals that will allow you to take your organization to the next level?
Yoni Kozminski 17:55
Yeah, it’s a great question. Rolando I’m actually a big Australian rules football advocates. So that’s a totally different sport. Is that like rugby. So that’s like a combination of I would say rugby, basketball and soccer mixed into one that’s just super violent. And it’s played on a pitch about four times the size of a soccer pitch. 18 aside, it’s it looks like absolute mayhem on the screen.
Rolando Rosas 18:19
They don’t play with helmets, right, like the American football,
Yoni Kozminski 18:21
no helmets.
Rolando Rosas 18:23
I’d be afraid to jump on the field and Australia. With a helmet. And I know how violent that could be with a helmet. I can only imagine without a helmet.
Yoni Kozminski 18:34
Let’s just say childhoods. For those of us who played it growing up as a lot of injuries. Yeah, so back to your question.
Rolando Rosas 18:44
The formula for winning team. So the formula
Yoni Kozminski 18:47
for winning team. So I think one, I want to split this into two aspects. So the start of the question was like, how should you focus your time to pull the biggest levers possible? And I’d say, as a baseline and to answer both of these questions here, one around the team and one around what to do. It’s really on a case by case basis, it depends on the size, you’re at the level of sophistication, the advice that you give to a million dollar seller versus a $50 million seller is going to be wildly different. So you’ve just started selling, you are doing $5,000 a month, you’re just getting started wherever you’re at in your journey. And then the first and most important thing to do as you’re trying to understand where should I be investing my time and as money starts coming in the door? Where should I be investing that money to buy me more time? It’s really understanding how am I spending my time right now glad to hear for a pro tip. So if you’re trying to figure out how to spend your time when you are early stage just getting out and selling or any stage for that matter and you haven’t figured it out. What I like to do is I like to time block my calendar. So I’m looking at how I invest ever single hour of my week. And it doesn’t matter if you’re spending 70 hours a week, which I hope you’re not, or 20 hours of your week, how are you investing your time and what is every hour accounted for. And then what I’d like you to do is look at that calendar and then write everything from a one to five, where five needs to be something that me as an individual, I need to be the person who delivers on that. If it’s not me, then something will fall off. And it’s that critical. And just to make a clear distinction, here, a five is something like setting up and incorporating the business at an early stage and doing all the legal documentation. A five is not doing PPC, because I’m the very best at it, or I believe to be, you know, that might be something more like a to write because that’s something that is very possibly delegated or so once you have that insight as to how am I spending my time, start to delegate those tasks, that are ones and twos, three through five, those are things that probably need to stick with you. And as you continue to evolve that model, and understand how you operate best and where the most value is achieved with the time you invest. That’s how you start to really move things away from you, and focus on the things that have the highest amount of value to the business growth.
Rolando Rosas 21:19
Interesting. So I would imagine that some of those tasks that you would consider one, two, and even three are tests that a lot of founders, owners, folks that are senior at the company for a while, could lead to burnout, because you’re handling way too much on your plate. And you’re like, I’m done, I’m cooked. And so getting to those fives being your weekly things that you’re working on are really where it’s at, rather than than 123.
Yoni Kozminski 21:49
Yeah, absolutely, absolutely. I can give you a tangible example, when I came into an Amazon business that I was able to help scale from two to 5 million that was ultimately acquired. That was 12 months that I was working there. When I came in, and my now co founder also brought into that business, the CEO and founder of the business was spending probably 60 to 80% of his entire week on responding to customer support messages and what his logic and rationale there was, which is not wrong is that this is the only time that I get to interact with my customer base my clients. And if I get negative reviews, if I mess this up, then it’s going to be detrimental to my best seller ranking, it’s going to hurt my brand image. And that is where he spent all of his time. And literally my co founder was actually in a matter of weeks able to build out a system that we were able to delegate to five different people that worked at different time slots where we were able to effectively have these responses done in real time with clear working SOPs. And all of a sudden, he got 60 80% of his time that I could think about working on things like new product development, brand expansion into EU channel expansion. I could listen here for a long time of time better spent. But I think the key distinction here, guys is that these things are critical. They’re urgent, they can’t be simply left by the wayside. And I’m not going to deal with customer support today. But you need to build a way in which you find your way out of it. Right, right.
Dave Kelly 23:23
Well, you only have a follow up to that. So with delegation to team members comms collaboration and communication. So what are some of the struggles that you hear from your clients in respect to managing, communicating and collaborating with teams as they grow? So you’re talking about people that might be in five different locations, different countries, but what struggles do your clients have with communicating with these people in keeping the tasks in front and completed?
Yoni Kozminski 24:00
Yeah, it’s a very high value question. And I’ve got, in my mind a very dense response to it. Because there are so many different facets. I’m coming to you talking about the fact that over the last three or so years, we’ve placed nearly 700 people into different businesses. I personally have about 125 people that report into sort of our businesses here into our leadership team. And the first thing let’s talk at a high level here, the cultural differences and timezone, the communication channels, and how information flows through the business are some key things but I think like one of the most important things is setting your business operating cadence. So I’m just going to leverage something that has had a transformative effect on our business and one of my businesses is a process improvement management consultancy where we build systems for businesses. And before we even got into that game we started running on it’s called aos. If you guys are familiar with the Entrepreneurial Operating System, I’m seeing nods here which is fantastic. So for those of you listening, it’s a book. It’s a pretty simple rate grant for a proto.
Rolando Rosas 25:11
Yoni, what’s that book called?
Yoni Kozminski 25:14
So the book is called traction. And the book is all about the Entrepreneurial Operating System. EOS is what they call it for short. And what it is, it’s a methodology on how to run businesses that are from five to 250 people. And inside of this framework, and I’d say the thing that I find most valuable is a meeting called the l 10. Meeting, the level 10 meeting. It’s a 90 minute meeting that happens once a week where you cover all the business metrics across each department, everyone has a couple of minutes to explain, are they on track or off track on the things that they’ve committed to, for that quarter, they’re called rocks, you’re looking at the actual business performance, are we hitting our revenue goals are things running in the way that they should be. But the bulk of the session is spent on what is called the IDS section, identify, discuss, solve. And in that section, it runs for 60 minutes, you will each put down any key thing that has happened, any issue that has come up in that week that you couldn’t solve yourself that wasn’t siloed, to your department, or just you and the colleagues that you work with closely. And I have found that having that level of alignment, and clarity, it’s the one meeting I won’t miss every week. And it’s something that has had a transformative experience for us as a business and how we operate.
Rolando Rosas 26:33
You know, that sound very close to kind of what we’re doing here. You know how a lot of folks in especially as you’re getting larger, you’ll have separate sales teams, marketing and social media, we’ve combined that into one group, because it’s one of the most important groups. And then we have some catalogs, stuff that spills into there as well. So that if we’re making all this effort of promoting things online, and ads, and so forth, but the salespeople, customer service people, and then ultimately our logistics, seems, is not aware of that we’re going to be ramping up or need to ramp up because we’re going to be throwing these activities online, then you have out of stock. And that’s the worst thing that can happen. When you’re selling on Amazon, it’s just not have any inventory to sell. So I’ve really loved that approach, and makes me feel pretty good. Actually, I didn’t know about this book, but I’m going to check it out. Because it probably can refine what we’re already doing.
Yoni Kozminski 27:33
It’s a great methodology, really simple to get through. I got through it literally, in an audio book over a weekend, I would say on the back of that, I handed it over to my co founder and CEO and he was actually the mastermind that was able to build it into the framework that it is but honestly, it’s built for entrepreneurs who aren’t super technical. And it’s an incredible thing. They also have what’s called implementers that you can pay to help run this through your business. And yeah, I highly rate what it is the conference is actually going on right now. Last year, I flew to Orlando to attend it. That’s how much I believe in it as a methodology.
Rolando Rosas 28:13
Well, definitely, that is a book to check out Traction, for sure. In picking the traction. And what are those kinds of key things that make things really drive a business? I want to jump into a segment that we call best kept secret,
AI 28:31
well kept secrets, well, secrets, gotta keep them safe. And sound. Well, secret secrets are just like diamonds.
Rolando Rosas 28:47
And we want to create Eddie, for helping out with the composition on that. So that was almost 100% Ai, from the music to the written score. So thank you, Eddie, wherever you are. So Yoni, as you’ve talked the businesses, and like you’re saying they’re things that help businesses thrive either same time, or even big mistakes out. What’s number one on your list for a secret? Or something fine on the radar that sellers should be aware of?
Yoni Kozminski 29:30
Yeah, so keeping with that theme of Amazon sellers, and really looking specifically as to what are the challenges that they have? And they face I would say the best kept secret, or one of them is what we like to call internally in a scholar as hero product syndrome. And what we mean by that is that you typically will see let’s say you have a SKU count of 3030 different skews, right, not a huge number, but something where It becomes harder to get your hands around from one to three, four or five, what you’ll see is that the top, say three skews will be the ones that are probably resulting in 80% of the revenue. And while these other 27 products have huge upside potential, there’s this disproportionate amount of focus, but on the things that are performing well, so what we really advocate for is building out the processes that enable you to actually allocate time and resource to achieving all the same amount of keyword research, design work, EBC, reviewing of analytics, like making sure that you’re actually getting to each one of them and making good decisions. So you might find that those 27 actually had the potential those top three and all of a sudden, your business has skyrocketed, or you’ve given it the same love and attention. And ultimately, that bottom 10, or 15, are just not what you thought they could be. And so all of a sudden, it’s a massive unlock in terms of either focus, or let’s try to evolve our brand catalog into the next direction here. So I would say it’s a pretty big lever.
Rolando Rosas 31:09
Alright, so here are product syndrome. Love that concept. And I heard you say something to the effect that as you’re building out the processes, you should look at things in processes that you have for launch. And the teams that do that, versus the teams that then maintain your catalog in your brand. Can you expand on it? I think that’s probably one of the other things that you wanted to mention as one of those secrets.
Yoni Kozminski 31:37
Yeah, absolutely. Absolutely. So, as we all know, when selling on Amazon, when you launch a new SKU, it is a very complex, there’s a lot of different moving parts. Launch perspective, you know, from speaking to your supplier, making sure that it lands getting all of those things created for the first time from your hero image to all the subsequent images, keyword research, we’ve touched on a lot of these things, PPC, etc, there is a huge degree of focus that needs to go into that launch. And getting that right when Amazon and the algorithm doesn’t actually know where to place you, if you have a successful launch that can literally change the face of what your brand and what your product looks like. So what we like to do, and one of the recommendations that we have and have seen work extremely well is a decided split between what does it look like in the first 90 days and having a launch strategist or someone focused on what the launch Strategy looks like how you’re going to be potentially more aggressive on your PPC spend, because it’s not just about getting the A cos right, it’s about making sure that you’re getting the reach and awareness and getting into the face, and hands of the people that are going to be your target market buyers. So and then from a brand perspective, of course, you can do things like re launch campaigns and things like that. But having that clear, handover, letting people farm the work versus really grow and hunt and get things right makes a huge thing. You know, having that level of accountability and responsibility around success in that first 90 days will literally change the shape of your business. If you get that right.
Rolando Rosas 33:13
No doubt, no doubt. I mean, if the goal is to really grow the business on Amazon, you really have to have a team that’s got to handle just for an example of what you’re talking about the we internally have one person dedicated to trouble tickets, through Seller Support, that come from all sorts of places, catalog issues, image issues, they’ll turn off a listing because a word pops up. So we have a specialist internally. That’s all her focus. It’s nothing to do with launch, but issues within Amazon. And I would offer that up that if you have a brand team, you got to have someone like that internally, because I’m just gonna say crap happens on Amazon, right? Everybody knows that fat. If you spread that out through different folks that kind of own different pieces, you don’t really have a person who will intimately be involved in the process of discovering and this is where it’s been helpful for us the process of discovering certain levers internal to Amazon and their processes. Because every now and then something change, oh, this tweaked over here. But if you use this in this field, all of a sudden your flat file works, right? And so I would offer up augmenting an a brand team with a specialist that is a fixer of sorts. And over time that fixer has become so valuable, especially when crap hits the fan.
Yoni Kozminski 34:50
Fact Yeah, so Steven Pope talking about this just yesterday on LinkedIn saying that there’s going to be a rise of this type of talent, you know, clogging or All the issues that come up inside of Amazon and just how valuable someone like this is to troubleshoot all the problems that come through.
Rolando Rosas 35:07
Oh, no doubt, somebody told us recently that Amazon Seller Support actually our last guest, Michael Fleming. I love this phrase. He says it’s an oxymoron. How is it? It shouldn’t be called Seller Support. It should be called that if they actually deliver on that.
Dave Kelly 35:26
But it seems like they certainly do a great job in supporting the buyers, right? If buyers claim they didn’t receive the items, Amazon is right there to solve it, give them their money back. But when sellers have an issue or a question, you have to resubmit it three or four times it has to get escalated to multiple different groups before they really have an interest in giving us the seller support that we’re
Rolando Rosas 35:51
actually looking for another No, you fix that, theoretically, I’m hearing that AI will help solve that. I was reading an article in the Harvard Business Review. And they were talking about how zoom has started what they call the virtual agent. And that agent came as a result of internal help and support for what they were doing. And they rolled that out as a product. And it’s cut down the amount of time and energy people spend that are external to the company, when they’re looking for a solution, and saved millions of dollars to zoom as an organization in the process. And generally, folks that are interacting with this AI virtual agent have been very happy about getting a solution very quickly. And then if they need to escalate it, they are actually talking to human that actually knows the problem and knows how to fix it. I don’t know how Amazon has so far missed the boat on that. I don’t know Yoni you deal with clients. So you may have a little bit more awareness as to why that is. But man for an organization that has AWS under their feet. And they’re talking about using more AI. I just can’t believe how big of a misstep, this has been for the support side for the sellers, as opposed to on the client facing side of things.
Yoni Kozminski 37:17
Yeah, from my lens as well. I mean, you know, that’s a ongoing joke about just how poor that support is from Seller Support. But I’d say to Amazon’s defense, and don’t get me wrong, I’m on the seller side here. I’ve dealt with some absolutely horrific things, we look at bigger and bigger companies we’re supporting, sometimes companies that are doing north of $200 million in revenue here. And the scale and complexity that the Amazon machine is right now is just, it’s insane to me like that, to me is almost it’s a scary size of a business. And so good luck to anyone trying to coordinate projects internally. Inside of that business. Honestly, it’s like, I’m getting like anxiety, just thinking about what that would be to try and roll out a project that touches on just
Rolando Rosas 38:07
somebody sending me a drink, please, to calm him down. Seriously, anxiety goes away.
Yoni Kozminski 38:11
Seriously, it’s it’s just crazy. When you think about just how many different people’s lives like I look at Amazon as a business as probably the greatest business that was created in probably our collective generation, not just from what they’ve done, you look at the apples of the world, the ecosystem that they’ve been able to create, and how many other like supply chain logistics, the fact that we’re sitting, we’re having a whole podcast on this. It’s just, it’s wild. So I come back to it. And I just think imagine what it is to run that internally. And how how you’d even get that over the line, I have no idea.
Rolando Rosas 38:49
But you know, you think about me talking about customer service for a point for a moment. You sit Apple, the interaction you have with apple from the get is different than you have it with Amazon, I’ve interacted many times with Amazon. And I’ve had interactions as well with Apple, let’s just put the retail store part to the side. The moment you have an online interaction with Apple, there is a knowledgeable person on the other side, the moment you open the case, they’re usually based in the US. And they’re vested in interested in resolving the issue at hand, rather than a group of folks that are in some foreign country. And they’re not really empowered to solve the issue. They’re there to take the case, file it and maybe send it somewhere else. It’s a very big difference. The moment you start with Amazon, you may not get to the end quickly or at all for quite some time. So really huge difference. I would imagine this speaks to the culture of Apple versus Amazon, they’re both two tech giants, but approach customer service differently.
Yoni Kozminski 40:05
Well, I would I don’t want anyone to get me wrong here. I am not defending Amazon customer support for one second. It is Jeff Bezos Waterford is absolutely terrible. It is horrendous, but put yourself in, if I’m trying to compare apples to apples here. Think about your experience that you have when you’re dealing with Amazon, customer support when you don’t get a product that was supposed to be sent to you. And I would say living here in Tel Aviv, I get 80% of the shit that I order online, realistically, like it just doesn’t just doesn’t come through. All I have to do is it’s a little bit hard to find. But you find where it is, instantly? Do you want it credited back to your credit card? Do you want it as like no questions asked, don’t worry about sending it back, I could literally just send something and say that it didn’t get through, and I would get it. Luckily, I’m an honest guy here. But the from a brand perspective, Apple, it’s a closed loop system. Like they own the hardware, the software and they own they own the experience. And I think to your point, like Apple is at an absolute different level. But I don’t Yeah, I do not envy the task of what it would be like to try and deal because think about it, you’re dealing with third party sellers, who they have their own interactions. On the back of that they’re trying to deal with the customer facing side, they’re trying to decide what is more valuable to them, the customer that they own, or the supply side we were fitting in is three P cells. I think that they don’t give us as three P sellers, enough attention, love credit. And if they’re not careful, the Walmarts of the world are going to take over if they find a way to really drive forward. And I think in the coming years that’ll become a really interesting conversation is like the targets and the Walmarts of the world. Are they really doing a lot more to actually support the business? And I think that’s how I think we’re building a Strategy here on how you can actually really command some market share or close a market share. Because if you could get that right for sellers, you’d be very inclined to move over. If you could do the same numbers on Walmart, it would be a no brainer. Right, right. Well, I
Dave Kelly 42:13
have a question as in respect to sellers and profitability. You know, if you’ve run a $200 million business on Amazon, you obviously need to be making some profits. It’s very expensive. We all know, it’s very expensive to sell on Amazon. So what are your predictions for the future on what it will take to be profitable? selling on Amazon?
Yoni Kozminski 42:35
Yeah, that is definitely a tough question to answer. Because what we’ve experienced really is compression on both sides at the moment, it’s a tough spot in time right now, to be an Amazon seller, Amazon continues to the days where 25% conversions for very minimal spend was the norm. I remember when I stepped into Amazon in 2015 16. whatever year it was, and I saw the numbers and the conversions, and I’d come from a pure DTC ecommerce experience I thought I wanted to build to build a DTC brand and turn this Amazon brand into a real brand. I saw those numbers and I said, Forget everything I’ve said to you, I am 100%. Wrong, it’s gonna take me many years to even entertain getting somewhere close to this. And I don’t even know if I could compete. So what we’re seeing now today in 2023, is that everything from the supply chain side is much more expensive. Obviously, we’re not in those wild sort of COVID $20,000 container environments, which is crazy. But you’ve got Amazon pushing, you’ve got your supply chain also pushing, they’re trying to compete with China now which Thanks, Eddie, who’s really helping close that gap for really closing the gap on what was you needed to have very great and articulate and intelligent ways to market these things, but you can really gain the system now. So I would say to be profitable one, you’ve got to be picking the right businesses and brands to be selling on Amazon. Obviously something like a perfume and things like as my friend Chad likes to call it during a bottle, anything that is like in the beauty space, the margins on those products are insane. You’re talking about 80% margins, generally,
Rolando Rosas 44:22
is that we’re not in the beauty space. But I would imagine there’s anybody can be in the beauty space. You tell me, Yoni, I would imagine that differentiator in the beauty space is either you have something unique and different. You discover some compound in the rainforest that nobody can get to or in Israel, they develop a certain compound that you put into beauty product or you say My brand is a lifestyle brand. Everybody wants to be Kardashian cologne for everybody, right?
Yoni Kozminski 44:51
Yes, I think you actually hit on a very important point here. And that is that to be successful on Amazon and if we’re talking about doing a bottle or anything else, like picking the right category is really important. But also building brand is really critical. So the thing that China won’t compete on, at least not yet, I believe is that ability to understand the true market in what the US consumer is looking for, and what a lifestyle brand looks like, and how to actually market it. And what to bring in a really simple example, I saw come up on my newsfeed yesterday was, yeah, got it in front of me. Hydroflask, right, they are a water bottle company, double walled aluminum water bottle, you’ll pay 40 bucks for this thing, 4050 bucks for this thing, right? That’s what the market price is, you could go now I think like the design patterns are no longer valid. That’s been, whatever, 15 years or however long the patents are. And so you could literally go and buy the exact same thing for $4 from China. And it’s literally it’s identical, just doesn’t have the Hydroflask design on it anymore. And I would say people will still buy Hydroflask because there’s trust and brand equity there. They know what they’re getting. And other customer support is there. They know who they want to be. And the fact that it has this little label on the bottle, it means something to people, even though I can get the exact same product, and it just don’t have that brand. So those are some of the things that I would say are going to be really important as we move forward into it is investing in the build out of the brand and who your perfect avatar is and not just relying on keyword research and having, you know being that race to the bottom. Because ultimately, if we’re all trying to sell the same product at the lowest possible price, we all lose.
Rolando Rosas 46:41
Great, right. And the Chinese sellers, like you were saying, they’re really good at that. Because on the manufacturing side, a lot of things come from there. And their incentives are not necessarily the same as the US seller, their overhead is not the same. They’re not paying the income taxes that we need to pay here and the health insurance, they have state health insurance. So that alone, put some profit back into their pocket that we would need to pay as a seller here in the as a US based business. But what I also want to jump into with you is something we call a rapid fire segment. And you touched on some of these during our conversation. So there’s no right or wrong, sir. These are five words. And I want you to tell me what phrase or emotion comes to mind when I tell you these things. All right. You ready Yoni?
Yoni Kozminski 47:33
Stress now? Yeah, right.
Rolando Rosas 47:36
No right or wrong answer. It’s what’s in your mind. First one, Chinese sellers. Powerful. Number two, Amazon Seller Support.
Yoni Kozminski 47:53
Terrible. Tick, tock, interesting and very strong for brand building in the current environment. But let’s see what happens with the whole us trying to close it down.
Rolando Rosas 48:09
I’m just going to tell you my thoughts on that tick tock. We’re going to see a lot of puffing and political chest thumping. In the end of the day, I think they have around six to 7000 us employees. No, Senator, no congressperson wants to have offices close in their state.
Yoni Kozminski 48:28
You’ll see that’s that’s a good, that’s a good prediction.
Rolando Rosas 48:31
So a lot of chest thumping, Tiktok mad, they’re terrible. They’re awful. All the things you’re going to hear it. And I think at the end of the day, there’ll be some improvements with the privacy policies and all the rest, but the end of the day they stay alive. That’s just my prediction. The next one right up your alley, aggregators
Yoni Kozminski 48:54
struggling, I would say yeah, I would say just in general, the way in which the equation was looked at was switching out, motivated, definitely underpaying themselves founder who are super utility, spending every waking hour trying to improve into these higher cost, less knowledgeable, centralized, focused talent to deliver it just totally changes the way in which the model works. And what’s more is with the aggregation of brands comes out of complexities.
Rolando Rosas 49:28
So no doubt,
Yoni Kozminski 49:30
I would say that a lot of them are definitely struggling, but the ones that will make it will make a lot of people a lot of money.
Rolando Rosas 49:36
No doubt the ministry this, it doesn’t just highlight what we’ve been talking about it how difficult it is to run an Amazon business. And if you’re scaling that with multiple business, it’s a very difficult thing to do to grow and do it successfully and profitably, it is just not that easy. It’s not passive in Come, right?
Yoni Kozminski 50:01
Yeah. Anyone who still calls it passive income and draws people into that idea is just straight up line. Oh, it’s absolutely
Rolando Rosas 50:10
100%.
Dave Kelly 50:11
What do we say? We say if someone calls a passive income, they’re lying, or they’re trying to sell you something?
Rolando Rosas 50:20
Absolutely. And here’s the last one, we touched on this earlier, but I think you said it, this is going to be the battle royale of the future. Here’s the phrase, Walmart versus Amazon.
Yoni Kozminski 50:35
I still have my money on Amazon, I think that they got in much earlier. And we’re talking about the complexities of Seller Support. And what that looks like, these guys have 1520 years to catch up on Amazon just to get to a terrible baseline, I’d find it really hard to believe that they’ll be the market leader. But I’m often wrong. Let’s see what happens.
Rolando Rosas 51:00
We will all see what happens. I think, the last couple of quarters Emma’s been reporting that their numbers have been growing faster, as it pertains to online versus Amazon. But ladies, you said the pie that Amazon has is very massive compared to Walmart right now. Yoni, we’ve been talking about all kinds of things on profitability, how different aspects of business needs to be really paid attention to, is there anything that you want to say that’s on your chest that we’ve missed out on that you want to deliver to our audience,
Yoni Kozminski 51:42
I would love to share. And obviously, I’m not here to promote and to sell anyone,
Rolando Rosas 51:48
whatever is on your mind.
Yoni Kozminski 51:49
So what’s on my mind is we recently launched this $50 million fund, which I talked about a little earlier in very, for a microsecond. But, you know, we’re actively looking to actually help ecommerce and Amazon can be either both sellers scale their business to exit over a two year period where we’re looking to write checks of a million to $5 million, and actually guide them through this journey, and see them see the multiples that they deserve with the hardware they’re doing. And that was the thing that really gravitated me toward creating this joint venture with sellers fi and with GW partners and investment banking partner. And so I would say, Listen, if you’re inside of our sweet spot, and you know that the market isn’t great right now, which we all know, but we have a lot of confidence that over the next 12 to 18 months, it will shift and what’s more, is when you start hitting numbers, like 1015 $20 million in revenue, and you can sit at that 20% profitability mark, the whole world opens up to strategics and private equity buyers. So I just say anyone who’s listened in and has liked anything that I’ve been talking about, it’s probably worthwhile checking it out. And there’s even a YouTube that one of our advisors just brought out really explaining his take on what the business model looks like and how it helps sellers.
Rolando Rosas 53:08
Okay, is there a particular page or site that they should go to, and we can direct them where they can get more information,
Yoni Kozminski 53:15
Southcol.co and I can send you guys for the notes.
Rolando Rosas 53:19
Okay, perfect. So, we’ve been talking to Yoni Kozminski, one of the oh geez in the Amazon space, and we’ve been loving the conversation that we’ve been having with them today. But if you want more, we won’t want to just leave me with just this. There’s more episodes that you can tune in and listen to it. So if you’re watching us on YouTube, go ahead and check us out. We’ve got a couple other helpful videos that can help you grow your business faster. And you’ve been listening to the Amazon series where you can find additional episodes wherever you consume your podcasts or on circuitloops.com. So we want to thank you today for tuning in. And we will see you in the next one.
Outro 54:05
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