Shannon Schewe – How She Quit Her Job To Sell Full Time On Amazon
Shannon is one of those Amazon sellers who’s doing so well she quit her successful mainstream career to sell online. And she’s doing it with hefty profit margins! You will want to hear from this stay at home mom who got started selling junk on eBay. All coming up in this episode!
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We are lean and mean. I keep those margins high and I keep them high because I’m doing it all myself with it, which is opposite of so many people not wanting to touch their products, but I can keep my margins higher than almost anybody right now because it’s all, you know, we have so low overhead, but I have been bundling my own products in my dining room since I started.
from amazing freedom. You’re listening to the Amazon seller podcast with Nathan Slamans, Andy Slamans, and Liran Hirschkorn, the show about building brands on Amazon brought to you by three sellers who actually do this every day in the stories of other Amazon sellers on how they built their businesses.
There’s a lot of noise in the Amazon seller space. A lot of people giving advice and talking strategies who don’t even sell on Amazon themselves. That’s why I decided to interview 100 real Amazon sellers over the next 12 months so that you can hear the stories of the sellers and the real moves they’re making, the crush it on Amazon. You’re listening to a hundred real Amazon sellers, episode two with Shannon Schewe.
What do you think of an Amazon seller who’s doing so well that they quit their successful mainstream career to sell online with hefty profit margins? A lot of things come to mind, but not always a stay at home mom who got started selling junk on eBay. When I met Shannon on our trip to Guanzhou earlier this year, I was blown away by her drive and growth.
Well, I started in September of 2017 so just over two years ago and I was working full time in while I was, my background is healthcare. So I worked in a hospital. I had been a stay at home mom for five or six years. My kids were little at that time, but I knew I had to go back to work and I wanted to go back to work, just not quite at the hospital. Um, about that time when my kids were ready to go back to school, my parents got ill, so I was lucky enough to continue to stay home and take care of my parents. But I started selling off their estate on eBay and I was pretty good at it. Um, I found a few items that sold really well and I would actually end up going out to estate sales and buying more home with a carload.
And my husband thought I was crazy but I just have selling and selling and selling.
He’s probably like, Oh no, I’ve married a hoarder.
He did. He’s like, I can’t believe what you just came home with. I mean I filled my minivan one time, we went away for a weekend and I look, there’s this opportunity to buy these and he’s like, go for it. I couldn’t even fit my kids in my minivan. They had to drive with my husband on the way home cause I filled my car. So I was at a neighborhood party and I was, you know, my neighbors kind of knew what I was doing cause I was always asking them, do you have any boxes? Do you have any boxes? If you have any boxes, I’ll take them. Um, my neighbor was telling me about, he has a friend who does the same thing, but he does it on Amazon. And I went, you can do this on Amazon. Isn’t that just, you know, so I said, okay, you know, tell me more. So he’s like, well, he makes these videos. I watching this guy’s videos and this, the guy happens to be you, Andy.
That’s funny. Yeah, I remember that.
This was the guy who I met at the parties. Tell me about how he went to high school with Andy. So thanks to my neighbor, I followed Andy’s videos. I sign up for the course and the rest is history.
It’s encouraging to hear Shannon say that because that’s often how I tell people to start. Start on eBay or Amazon selling stuff around your house, get a feel for the marketplace and selling online and then scale up. However, that’s where most people stop or give up. But Shannon, she decided to keep going and go bigger.
The pull away was I was selling, um, vintage new items. So these were items that were, you know, still new in the box and they were out of people’s basements and garages and the boxes were dirty and dusty. And for every 10 that were, you know, decent, I’d find one that was going to profit, you know, $100 each one. But they were dirty and dusty and gross. And there I just kept it in my mind going, there’s a limited quantity to how many of these I can find. And that’s not gonna last, you know, I kept scouring the area, but there’s just a limited quantity of these items. So that’s when I was watching the videos. I’m like, I got an idea. I’m like, I could find something like this. So, um, and I was sick of touching dirty boxes.
No. Yeah, I totally hear you on that. I often share this story. When I first started, I was buying these huge book gaylords right? From like donation bins. And um, I, at one time I bought four, uh, at a, at one time. And after I finished those four, I swore that I would never sell a book again because you actually have to climb in those bins. And those books are just nasty. And you know, like you got full protective wear on cause you know, you just don’t know what you know you’re going to find or whatever. And for me, that was my early days. That was within the first year. And I thought the same thing like man, you know, for some people they really enjoy that, you know, they’re hunters, they’re pickers. I said that’s not me like my lifestyle. I want to be able to send in a thousand units of something. And it sounds like that’s kind of what you wanted as well.
Yeah. And I liked it. It was profitable, but I knew I just, there wasn’t a quantity that you could scale. So if I wanted to continue to grow, I gotta find something else to do. So that’s when I decided to go private label.
Awesome. So, so you’re working and you were full time. Um, your kids start to get a little older, so you start to scale down your full-time job. Uh, you’re selling on eBay and then, you know, when, when was it, you know, that you finally said, “okay, you know what, I’m done kind of working part-time now I’m going to just go all-in on online business?”
Um, you know, it was just recently, so it was I think June or July of this year that I, I kept getting busier and busier selling on Amazon. And I just, every time I went into the hospital, it was time that I couldn’t devote to my business. New fourth quarter was coming and if I wanted to have a good fourth quarter, I had to do the prep work in June and July and I just decided cut the ties. Now…
What’s interesting to me though is that this was your building up. So you started selling on eBay like 2017 so this is like a two-year process right before you finally said goodbye to one, go into a job or you know, working for someone else. Right?
Oh, it was a slow process. This, and I’m lucky enough that my husband works in the corporate world, so he is our primary breadwinner for now. Won’t be for much longer, very breadwinner. But this way I can, um, you know, we, we are a self-funded business. We never took any loans. My eBay sales gave me enough money originally for my first private label product. Once that one start, well my first one didn’t do very well. Um, my second private label product sold so well that I was able to find the third one and the third one funded the fourth one and they just kinda kept self-funding,
like snowballing. And again, this is, this is what I love. I love, I tell people, um, you know, stay in your full-time job as long as you possibly can. If you have another income stream coming in, you know, you just want to scale your business up, uh, as much as you possibly can. Like you said, until you realize that working maybe somewhere else is costing you money because you could be making more, you know, selling on Amazon. Is that kind of how you looked at it?
That is exactly how I looked at it. And I mean we could have taken big loans out at the beginning and grown a lot faster, but it’s all your comfort level. You know, I’m a kind of a cautious person. I’m, I like, you know, safety of what I’m doing. I like to make sure I’m really confident. So I didn’t take a big loan out in launch eight products at the same time. I did one at a time. I made sure they were successful then I moved to the next one.
So I love that. I like what you share just a little earlier too that you started researching, right? You’re selling on eBay and then, um, you know, I think it was my childhood friend that you came in contact with. So you started watching some videos that I’m putting out, but then you really start digging in and you start, you know, looking like, Hey, is this Amazon thing kind of real? Uh, but then what you shared is like, your first product wasn’t successful. So w you know, a lot of people when, when they’ve done research, they’re digging in their first pride, it’s not successful. They might just like, you know, say, Oh man, this is not for me. I’m going to go do something else. What was your experience with that? Like what was your thought process?
I looked at my first product as part of the education. It’s the cost of education. So I watched every video and I came up with, I couldn’t find a product. I was like, I don’t know, you know, product research for me is a really hard area. So I couldn’t just come up with like, it was too many choices. So I found something that I was like, well this will work. I can do this. And it was a flop. We actually are still selling it because I’m just going to sell through that inventory slowly and be sold out this month. Finally, I’m washing my hands of it. But it was a learning experience. I did my first ocean shipment. I had to deal with duties. I had to deal with um, you know, the manufacturer communicating, you know, is the packaging, right? Does the packaging the way I wanted to. It was a huge learning curve. And had I had to do that on a product that ended up being successful, maybe it wouldn’t have been as good because this product was more of a me-too product. And I should’ve known that from the beginning. Um, but I had to learn about it, but I learned a lot about logistics and shipping and marketing and photos.
I mean that’s, you know, and, and you know this, but we say that all the time too. And I’ve had multiple products where when I analyze the data I thought, Hey, this one’s going to hit. And then for whatever reason, it just doesn’t. Right. Um, and so, you know, what I’m thinking is going to be a double ends up being a strikeout and you know, like you, you are doing now or did with yours. It’s the same kind of way. Like I just had to sell through slowly, uh, you know, break-even and then reinvest that money.
Yeah, it’s a break-even. And I’m just finally done with the inventory real soon.
Awesome. So you do that product and then you know, you’re in the Amazon space a little more. You figured out, you know how to work with the manufacturer. And then, you know what, what I’ve asked the previous folks I’ve interviewed is what, what are some of your research strategies? Obviously, you know, not selling the niche, not, uh, not sharing the niche, not sharing what the product is like. What are some of your thought processes? And everyone’s different on this, right? Some people are very analytical. I’m much more by my gut. I use data, but I go by my gut. What are some things that have helped you find successful products?
Um, well our second product we did was out of a kind of need. It was something that my daughter used and there was only one manufacturer of it and the quality wasn’t that great. So we said, well, this would be a great product and it took us so long to find a quality manufacturer. Now I know why the quality wasn’t great because it’s hard to find. We probably in the meantime trying to research this product. And this was just a gut, you know, it was something my daughter used. We couldn’t find anywhere anybody else that makes this. So we said, we’re gonna make this. We introduced four other products in the meantime, while we’re still tried to source this original product, we couldn’t find a manufacturer. Um, now it’s one of our number one products and we still have it and we love it and it’s great.
Well, I love, I love that because that happens often. Like you’ll see a product and opportunity on Amazon where it’s maybe average three-star rating and it’s the same kind of deal. It could be a product that’s extremely challenging to source, which is why no other sellers have brought that product to market. And so that, that’s a barrier to entry. Right? So you found this and then you’ve, you know, in the meantime, I’m sorry I didn’t mean to cut you off. So you’re searching for this product. In the meantime, you launch other products.
Yeah. So in the meantime, we found a few other kinds of products that were related to that. One. And we found one and that led us to another one. And then we got really lucky with finding a manufacturer who we really liked and who I visited when I was in China. And he’s like, he kept saying, what about this product? What about this product? And we went, okay. And that was our next four products from the same manufacturer. He just kept sending us samples they were for similarly related products and that started the niche are in and we’ve built our brand around that. So there was a lot of luck at the beginning, but there was a lot of, we like this product, there’s a need in the market now. It’s not a huge niche. So, um, you know, that’s a barrier to entry too because of a lot of people like big numbers, big numbers.
This is a smaller niche, but we have, you know, continued to grow and now we’ve added lots and lots of different products around that. So now our main product research is finding other products that complement the ones we have now. Um, when I went to China with you last year, we decided we wanted to start a new brand. We really wanted to expand. So we went out on a limb again and just kind of went, what interests us, what, you know, what do we like, we found some things we liked and then I looked at the numbers. So I’m kind of, uh, by my gut first and then I, you know, do the math and do all the numbers, make sure it all works.
Shannon recently had her first 40-foot container show up at her house. She’s bootstrapping and she’s scaling the same way I did when I first started.
Well, so we went to China, we found a product, it happened to be an oversized product. So we shipped it. We don’t do as a third party warehouse because all of my other products fit in my basement. Um, I have two storage, like closets in my basement, all fit in there. They’re small. Um, but this one is big. So I had a full size container delivered and I used my husband, my brother, and a very good friend packed a full size floor loaded container in an hour and 45 minutes into a storage unit. Would I recommend this? No, probably not.
Well, what I like and we were talking about before we went live is I just did an interview with Wesley pack and he is like almost the exact opposite. So he does not want to see his product. He doesn’t want to touch his product. So he’s creating these systems where you and I, when we’ve both first started, even now, once a week, I go in and I touch my products. We’re much more trying to stay like lean and mean, right? And grow it. And hopefully, we’ll get to the point. I think that’s probably a goal of yours, right? Like as your profit goal grows, that there will be one day where you’re not going to be unloading 500 cartons from a container.
My goal is never to unload a container again, but I have a feeling I’ll be doing one again in February. So I’ll see. Um,
so talk, share a little bit about your other products if you don’t mind. Like how, how are you working? Cause I know there’s some, uh, bundles that, that you make. Uh, and you know, if you mind me sharing, which I think is awesome, she just shared, she has one bundle that’s selling 50 units a day, which is just phenomenal. So how do you manage that?
Well, lately it’s a lot of work so we are lean and mean. I keep those margins high and I keep them high because I’m doing it all myself with it, which is the opposite of so many people not wanting to touch their products. But I can keep my margins higher than almost anybody right now because it’s all, you know, we have so low overhead. But I have been bundling my own products in my dining room since I started. And when I started this bundle that really took off really well. Like recently, um, I had to enlist the neighbor, the neighborhood lady. Um a stay at home moms who come over and they sit in my dining room and they bundle and they love it because they’re earning a little extra Christmas cash and they are um, you know, they get to set their own hours. So it was great and they came a lot Thanksgiving week. Nobody wanted to work, but that’s all right. I, that’s what I expect. Um, my kids actually do bundle for me also. They want to earn some allowance. They can do some bundling and we keep those margins nice and high.
Shannon has done an awesome job keeping her business lean and focusing on profits. She is snowballing in her cash flow and keeping expenses low, but because she, but she continues to have big goals that she has in 2020.
2020 is going to be, um, adding new products because between 2009, between 2018 and 2019, we triple their sales. So our goal between 2019 and 2020 is to do the same. So we need to add new products. We need to, um, how do you say, cut away the dead stuff. We have a few products that you know, aren’t, aren’t great, and we’re just going to sell through the inventory. Hopefully this Q4 and then cut, cut the waste there.
So share a little bit about that because that’s a huge principle when you’re dealing with inventory. Many times it’s like the 80, 20 principle, right? Like 80% of your profit is, is, you know, brought in by 20% of your products. Uh, and so now you’re, you’re identifying those products that maybe are, you know, what’s the phrase? Is the juice worth the squeeze? Maybe your cash flow could be better utilized elsewhere. And so that’s been a process for you.
Yeah. And they’re, um, they’re, they’re taking too much of my time. I’m going to sell off the inventory. I’m not going to reorder them. I don’t want to have to look at their PPC. I don’t want to have to worry about the listing, worry about the reviews. So we’ve identified which ones we’re just trying to sell off the inventory. And then we’re going to wash our hands with those. And we’re going to go bigger on the 20% that are earning more money.
Awesome. So another thing that you just shared a little earlier is that you, you’ve identified some products, right? So you got them going, they’re selling well and, and now instead of unfortunately as I did early on. I had a nice niche going and um, uh, a nice brand I was building and then I started chasing the shiny objects. It sounds like though what you’ve done is you found this niche, you had some good sellers and now you’re just like trying to build out that brand.
Um, when I entered this, this niche, there were a few major players and I kind of worried that, you know, who’s going to buy from me? Everybody’s going to buy from these big brands. Um, but we have really kind of introduced quality products. Cause if it’s not quality, nobody’s going to like your stuff. We’ve introduced quality products and we’ve kind of spread ourselves around and now people buy in in a single order. They ordered two or three different things because they identify, we have this item, well this item relates to it and Oh, you have this item also. So we’re really trying to build that brand out so people know our name. Um, it’s been hard to get the customers to become loyal to us, but that’s my goal.
Awesome. So what, what are, um, what are some of the biggest challenges that you face or where do you find yourself spending the most time? And so let’s think about someone who’s never sold on Amazon before. Like they have this idea like, wow, this is like a passive income, you know, and it, and it sounds too good to be true, which, you know, probably does and a lot of different ways, but what, what are some of the things that, you know, you had no idea, um, before you got into and now you’re like, wow, I didn’t realize this is really time-consuming.
Um, well if you take a year ago today. So when I was selling for just about one year, I kept a spreadsheet of my expenses and you know, I had Fetcher going and I thought that was all good enough and I hit Q4 last year and realized I made way too much money and my books were a mess. It was, it was bad. So last year was I spent probably a good three or four weeks all of my time consumed of getting my books in order, getting, you know, everything I found a great accountant. Um, somebody from, um, he’s actually from our private, he was a recommendation from our private label inner circle group and he’s been very patient me, because I don’t have an accounting background or a business background and it took a long time to get those books in order. But now this year, you know, a year later we’ve tripled our sales and I am very confident going into the end of the year that we know what we’re doing. He’s not going to panic and, um, you know, spend hours with me on the phone. So we know
That’s, that’s great advice. You know, for my first three years selling on Amazon, I had an extreme amount of anxiety because I was using, you know, like different software, but I didn’t have a dedicated accountant. And so, you know, every time tax came time came around, I would just have this, you know, huge amount of anxiety. And finally, I said, look, I’m willing to pay whatever I need to pay to hire a professional that can, I’m confident in that can take that anxiety away. And so here’s a question for you. At what level do you think, you know, um, a seller needs to hit and we can just talk general revenue? I personally think probably like around $300,000 or more that they probably need to go seek professional help when it comes to the numbers and accounting.
Um, yeah, you know, that’s about where we were at when we said, Whoa, you know, my little spreadsheet isn’t cutting it anymore. We were actually a little bit lower than that when we were beginning to look at, into the year numbers. And we went, we earned way too much money. We’re going to be taxed on all this profit and you know, we called an accountant, and he was able to change us for, you know, and into an S Corp and get all that, that type of stuff straightened away. Um, because getting your books in order is so important, because if you don’t know your profitability, revenue means nothing. It doesn’t matter how much you sell if you don’t make a profit. So that’s a thing that last year we panicked with and this year I feel like we’re sitting pretty. But if you want to know what we’re working on most this year is supplier communications, probably
talk about that for folks again who aren’t, who aren’t in this, maybe they do retail arbitrage or online arbitrage. Uh, and this is something I had no idea how time-consuming supply communication. So share with us a little bit about your experience.
Um, just communicating every detail of a new product because you know, you see this product, do you know what you want in your mind, but you’re communicating to them. What does the packaging look like? You know, I just got an a, we chat on Thanksgiving night saying, how, why do you want the label? And, and she’s like, are you available? Can you talk? How, why do you want the label? And I was like, Oh, okay. You know, we’re done with Turkey dinner. So, you know, I was like, go find my sample. I gotta find how, why do we want it? You know, because they need to know every detail or else they’re going to figure it out themselves. Why the label is, what color should it be, you know? Um, what size should the polybag be like every minute, little detail or else it’s not going to be the way you want it. And that takes a lot of time.
Yeah. So, you know, the last few interviews that I’ve done that has been one of the themes of the interview was specking out your product. And, and so if you’re listening to this or if you’re watching this and you’re, you know, interested in importing from China, what she just said there is so important. You have to be extremely detailed when you spec out your product. Otherwise, they will make things up and they’re going to try to cut their costs as much as possible. And so you cannot just order a sample, you know what you see on Alibaba.
You may order that sample and maybe a good sample and then tell them, okay, I want a thousand of these. You have to do an Excel spreadsheet and spec it out as much as humanly possible and spell it out. As well as I would add in to like a contract, like saying, you know, hey look, if there are two to 3% defects, if I get customer returns at two to 3% defect rate, I expect to be reimbursed for these defective products. Before you place that order you needed to negotiate that in. That’s just part of specking it out. Um, and so do you have any experiences, cause I, you know me, I can share some about where you haven’t specked that out early on and uh, and maybe, you know, things happen.
I had a very early on. Um, so we, we had ordered a product and we liked it. It was selling well. There were a few variations of it. And we reordered it. No problem. Night, you know, great, great manufacturer. He liked to call us every few months. Um, just so he could show us that he spoke a little English. I think that’s why he called us. Um, great manufacturer. We liked them. And about our third or fourth reorder, we didn’t get an inspection. And it arrived and they were about two inches bigger than normal. And this is, um, an item you wear. So if you add two inches, it doesn’t fit. I pulled them out and I went, oh my God. Like, you know, what are these?
So they were, they were the wrong size and I’m not sure why they changed them. I looked at our order stated the size on it, but they made ’em a different size and the material was slightly different too. So I panicked. Um, the story does have a happy ending though because I sent, uh, our current sample, I sent the new sample. Like I sent him pictures and I explained to him like, what happened, you know, why did this happen? And they actually remade the product correctly and reshipped it to us.
Nice. So, but you were able to do that because you had the gold sample is like what we like to call it. And then you were able to show them clearly in the documentation and in pictures that what they made is not what, what, what they say.
Yes. So it all worked out for us, but you know, from one reorder to the next, we made the mistake and didn’t get an inspection and they didn’t make us the same product. They peaked out and bought something different. And um, we ended up going out of stock for a little bit because we had to wait for them to remake the product, reship it to us. Um, but it all worked out in the end. But now I do an inspection even on reorders.
Yeah. That’s awesome. And if you listen to the podcast or if you, you watching these interviews, you know that we, we stress that every single order you get produced, you need to have an inspected. And the inspection company needs to have your specs. So you need to communicate very clearly what that inspection company, what you are telling them to specifically look at. Because you know, these are just workers that go all throughout China to different factors. They don’t know your product from anything. And so you have to be very detailed what that inspection company as well, you know, with potential problem areas that they can focus on. And so, you know, not only does your communication with that supplier need to be tight, right with your specs, but then your communication with the inspection company. Because we’ve had, I don’t know if you have had this happen before, but we’ve had where we sent an inspection company in and we didn’t give them clear guidelines, and unfortunately, they miss some things that they would have caught and we alerted them to it.
Again, that’s a learning curve item. Because my first, you know, inspection report I filled out, I, you know, I was very vague. I was like, well, I want it to be like this and you know, I didn’t like, now I have the preset form for each product. And you know, every time I do it, I add another little, like little tiny and spec on there that I want to make sure they hit. Oh yeah. We do it every time now.
Awesome. All right, well we’re coming up on a half-hour, so I’m going to ask you one more question here. Uh, you know, if you’ve listened to our podcasts, if you’re watching this now, you know that I tell everybody that I feel like I’m living the dream. Uh, it’s not without its challenges, right? Like anything that, that you work at. Uh, but honestly, I love being able to stay at home. I love not having to depend on someone else for a paycheck. It really all rests upon me. But what are some things or what is, um, so what, what, what’s some wisdom that you could give to folks that may be interested? So, you know, like you were back in 2017 what, what would you tell them just about the opportunity on Amazon or uh, you know, what are, what are some mindsets or things that they need to have if they want to be successful?
Um, my two biggest things are, you know, with Facebook nowadays, you know, I, I’m on Facebook all the time and I have lots of, you know, Amazon channels that I follow. You, you gotta know what you’re doing and your goals. Because I see posts all the time. I sold, you know, $50,000, you know, and in one day, and that’s all great, but what other profits, you know, like don’t worry about what everybody else is selling. Don’t compare yourself to somebody who’s selling huge numbers, but their profit might be 5%. No, what you want to do, what are your goals out of your Amazon business? Is it to be hands-free or is it to get your profits as high as possible? Is it, you know, everybody’s got different goals. Don’t compare yourself to everybody on Facebook because who knows how much they’re selling? Who knows how much their profits are. Who knows if they’re working 24 hours a day?
Don’t compare yourself to everybody on Facebook. Set your own goals and try to achieve your goals. What are the steps you need to achieve those goals and do what you have to do to achieve them? Know your neighbors because, without your numbers, you can’t know any of that.
Awesome. I love that. Shannon, thank you so much for joining us today. I hope those of you that are watching, and those of you that listen on the podcast have enjoyed Sharon Shannon Shannon’s experience becoming a fulltime seller on Amazon. Uh, I love how you’ve grown your business and I’m excited to see where you’re taking it from here. And next time when you unload that container, can you please get some videos? Because I like to watch that. I mean, I, we unload containers once, uh, I guess about once a month now, but we have a dock. I can imagine you, that’s a lot of work, but I appreciate and I have a huge respect for that.
Well. Thank you, Andy and I couldn’t have done any of it without you. Uh, you were inspirational to me at the beginning and every time I have a question, either you, Nathan, earlier on, you answer it within like seconds. So that’s amazing. I wouldn’t have done it without you guys.
Hey, real quick. As we end the show, I want to thank you for being a listener. It really means a lot to us that you put your faith in us to get you valuable information. And as part of that, one of the things that really help us is if you share the podcast with friends in other sellers.