Brad DeGraw is a self-proclaimed Amazon nerd who started with $100 and a WiFi connection and built a 7-figure Amazon business. Now he teaches others his system to launch brands on Amazon. Brad is most proud of his family and overseas team.
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Time Stamped Show Notes
(click the time stamp to jump directly to that point in the episode.)
- [00:59] – Brad came from a farming community
- [01:49] – Value Bomb Drop: You can spy on your competition by using Jungle Scout. You can do A/B testing on Amazon with Splitly
- [03:22] – Brad’s 7-figure Amazon business
- [05:18] – What is something you’ve changed your mind about in the last 6 months? Brad used to believe that China was the cheapest way to make things –but it’s not. Brad sources from India now
- [05:50] – Check out TradeIndia and IndiaMART
- [06:21] – Worst Entrepreneurial Moment: Brad bought lumber to make bird houses in Fall and no one bought from him
- [07:14] – Do the market research
- [07:55] – 1 and 3-star reviews that Brad was surprised to read
- [09:23] – Entrepreneurial AH-HA Moment: Transitioning from arbitrage to private label to proprietary products
- [10:00] – Building the asset is just as important as building the cash flow
- [10:19] – What is the one thing you are most FIRED up about today? Split-testing
- [11:17] – The Lightning Round
- What was holding you back from becoming an entrepreneur? – Having a job
- What’s the best piece of advice you’ve ever received? – You can always go back
- What’s a personal habit that contributes to your success? – Compressing time and making things fail proof
- Share an internet resource, like Evernote, with Fire Nation – Use the internet – Facebook, Splitly, etc
- If you could recommend one book to our listeners, what would it be and why? – The One Thing – it helps you focus!
- Imagine you woke up tomorrow morning in a brand new world, identical to Earth, but you knew no one. You still have all the experiences and knowledge you currently have – your food and shelter is taken cared of – but all you have is a laptop and $500. What would you do in the next 7 days? – Listen to EOFire, create a network of students and gurus, and launch kitchen products
- [15:17] – Connect with Brad on his LinkedIn Account
- [15:23] – Get FREE tools and Resources from Brad here
- [15:35] – Decide your outcome, make a flexible plan and start now
Brad DeGraw: Hell, yes!
John Lee Dumas: Yes! Brad is a self-proclaimed Amazon nerd who started with just $100 and a Wi-Fi connection and built a 7-figure Amazon business. Now, he teaches others his system to launch brands on Amazon. Brad is most proud of his family and overseas team. Brad, take a minute, fill in some gaps from that intro and give us a little glimpse of your personal life.
Brad DeGraw: So, I came from a farming community in Southwest Missouri, so building a business online wasn’t even on the radar. We raised beef and turkey. Eventually, I had jobs, but I kept getting fired like other entrepreneurs, and I read a book that put forth the idea that you could buy clearance merchandise from retailers and sell it online for full price, sometimes even higher. So, I started with $100. In the first year, I made six figures with really no coaching or tools or anything because back then, there was nothing available. And I realized that could turn into a business, and that’s what we have today.
John Lee Dumas: That’s kind of what I want to talk about because you have now that area of expertise. So, give you two value bombs within that area. What are two things that we don’t know that we should?
Brad DeGraw: Absolutely. So the first one, on Amazon, and that’s really where we focus. Amazon is our focus. The first one is, you can spy on your competition. You can see how much traffic they’re getting, you can see how many sales they’re getting. There’s some great software. One of them is called Jungle Scout, and it’s amazing. You can see, kind of X-ray vision how your competition’s doing before you actually invest in a specific market or products. The second one is, you can actually do A/B testing on Amazon. It’s not really set up for it, but with another tool called Splitly, you can do A/B testing and test out different price points, different images, titles, bullets, product description. If you’re doing weight loss, you can go with the positive, the vision of what they want, you could go with the negative, “This is what happens if you don’t do it.” It’s awesome. There’s so many tools that are available now that didn’t exist years ago.
John Lee Dumas: Jungle Scout and Splitly. Fire Nation, we’ll definitely have both of those in the show notes. But, yeah, I’d heard of Jungle Scout, but Splitly is definitely new to me. So, I love that idea because, you know, that’s one thing I’m looking to working on right now is the Freedom Journal is doing really well on Amazon, but how can I do better, how can I learn more about my competition, how can I learn more about the best price points? All exciting stuff. Now, Brad, you’re a self-proclaimed Amazon nerd, and you’ve also self-proclaimed you have a 7-figure Amazon business. What’s 7-figure Amazon business? What is the revenue coming from? Where is that?
Brad DeGraw: It’s from inventory. So, for example, we pick a market. Like I mentioned earlier, it could be weight loss, it could be people with diabetes… It’s a specific problem/fantasy/desire, and then we make products that match up to those missed expectations. So, people buy things –
John Lee Dumas: Give me one good example of what that looks like.
Brad DeGraw: Yeah. So, for example, let’s say you have curly hair and you want straight hair. That’s a common thing. So, we look at what are the products? Well, you have irons, you have shampoos and conditioners and hair treatment. So, we look at what are people buying, and then on Amazon, we look at the one, two and three-star reviews. So, let’s a say an iron to flatten the hair. So, we look and see what are the problems with it. Maybe it heats up to slow, maybe it’s too small. We find the flaws in the existing design and then we reach out to manufacturers and say, “We need a product like this, but can you make the irons larger?” Or, “Can you make it smaller so it’s travel-size?” And we get samples. If the samples are right, we got right into production. If the samples are wrong, we have them tweak it again once it’s right, then we go to market.
John Lee Dumas: So, what does a 7-figure Amazon business mean? Are those overall gross sales, like if you sell and iron for $40, does that figure get added in for your 7 figures, or are you talking net profit?
Brad DeGraw: I’m talking top-line revenue. Everyone uses top-line to brag, right? But at the end of the day, you can really only spend bottom-line.
John Lee Dumas: Okay, so what’s the bottom line for you?
Brad DeGraw: It’s about 25 percent give or take.
John Lee Dumas: Okay, so whatever your top-line is, you’re keeping in your pocket at the end of the day, 25 percent of that.
Brad DeGraw: Yeah.
John Lee Dumas: Okay. So, what’s something that you changed your mind about, Brad? What’s something that you used to believe six months ago that you just don’t believe anymore for any number of reasons?
Brad DeGraw: You know, I used to believe that China was the cheapest place to make things. The reality is, it’s not. We started sourcing products in India and we’re having fantastic relationships with the folks in India to make the same goods we were making in China.
John Lee Dumas: Wow! Now, what do you use to find people in India, like, I know a lot of people like Alibaba, or maybe they don’t like it, but the use them. What are you using to find great companies in India?
Brad DeGraw: This is why you show’s awesome. You get to the meat. It’s TradeIndia.com and IndiaMart.com.
John Lee Dumas: TradeIndia.com and IndiaMart.com. Again, Fire Nation, those will be in the show notes. So definitely check those out of you’re struggling with Alibaba or if you just want to try something new, check it out. So, Brad, let’s talk about the tough times. Let’s talk about the toughest time. Let’s talk about your worst entrepreneurial moment to date. Take us there and tell us that story.
Brad DeGraw: You know, like I said, I came from a farming background, so getting into sales and marketing and mindset and behavioral economics, it was a stretch for me. So, one of my first entrepreneurial journeys is there was a company that was going out of business, and we bought out their lumber to build birdhouses. Made tons and tons of birdhouses. Keep in mind; I’m, like, 17. And I stayed up for days and nights and weeks and made all these birdhouses – hundreds and hundreds and hundreds of birdhouses to sell at the fall festival. Because I didn’t do any research and realize that birds actually migrate away for the winter, nobody cares about homeless birds because there are no birds. So, because I didn’t do that research, I lost virtually all my money, and all of my sleep and all of everything. But, I learned the powerful lesson – you know, you have to turn it into a positive – is do the market research. Sell the things that people want to buy first. Look at the buyer before you look at the product. Just because I could buy a lumber company for pennies on the dollar, didn’t mean it was a good buy. I had to have something that people wanted to buy.
John Lee Dumas: So, you’ve already kind of given us that lesson, so I’m going to kind of shift my question to you back to Amazon, because I’m kind of curious about this. What’s a one-, two- or three-star review that you read that you were actually really surprised about? You were like, “Wow, I never would have thought that this would have been a complaint, or a problem or an issue for this particular product, but it is.” Like, what is something that just surprised you when you read it as a consistent review over and over again?
Brad DeGraw: Here’s an easy one. So, airline-approved pet carriers. So, people with small animals that can take them on the plane, the number one complaint – well, there’s two complaints, those one-, two- and three-star reviews. One, I’m buying the wrong size for my animal; it’s either too big or too small. And the second one is, the zippers don’t stay zipped. Well, geez, that’s easy. You put a latch so the zippers clasp together, and the other one is, maybe you put a sizing chart. Maybe an actual picture of the dog and the breed and the weight, and you didn’t actually have to change anything substantial. You just made the graphics easier, and you made a clasp for the zippers. Simple, simple stuff.
John Lee Dumas: I mean, Fire Nation, if you’re willing to put in the time, the energy and the effort to go through these one-, two-, three-star reviews in Amazon, maybe even just narrow it down to areas that you like or areas that you’re familiar with. If you want to even give yourself a little bit better of a chance to succeed, it just takes the energy. It just takes the bandwidth. It just takes sitting down, reading through these things, and just waiting for an “aha” moment. Don’t have to search for your “aha” moment; it’ll just ding above your head. Like, Brad was like, “The zipper doesn’t stay up, but it’s not that hard of a problem to solve.” Ding! And it really can be that easy when you put in the time with an open mind. Now, let’s talk about an “aha” moment you’ve had, Brad. You’ve had a lot of those “dings” go off. What’s one of your greatest? Tell us that story?
Brad DeGraw: You know, like I said, when I got started, it was arbitrage, and I was buying other people’s brands of inventory low, and selling high. The “aha” moment came when I realized that this isn’t even a business. This is really just a glorified job, because I don’t have anything that I can scale or sale. So, transitioning from arbitrage, to private label to proprietary products that we actually have something that we could sell, that was the “aha” moment – knowing that we had something that we could retire and move to Puerto Rico, because now you own something. So, building the asset is just as important as building the cash flow, if you have to boil it down to one sentence.
John Lee Dumas: Building the asset is just as important as building the cash flow. Love that. So Brad, right now, today, what has you most fired up? What are you most excited about?
Brad DeGraw: I’m really most excited about split testing. This is a big deal. Being able to dial in the images, the price points, everything in virtually real time. Every 24 hours, we can run a new variation. This is a big deal going from, let’s say, a ten percent conversion rate to a 20 percent conversion rate. That doubles your revenue. That’s a big, big deal. And it’s just so easy with this software. I’m so excited about split testing.
John Lee Dumas: And you’re going back to Splitly on that? Is that the major software that you use?
Brad DeGraw: Yeah, that’s it. We had four people trying to do a split test, you know, because you have to document each change, and the time, and go back and look at the data. Now with this software, we have these four people who can focus on other things, and just let the software do its thing.
John Lee Dumas: Amazing. Amazing. Fire Nation, we have amazing [no audio] [00:10:21]. Brad, are you prepared for the lightning round?
Brad DeGraw: I am.
John Lee Dumas: What was holding you back from becoming an entrepreneur?
Brad DeGraw: For me, the thing that was holding me back most was having a job. You know, when you have a wife and a kid, you start to make decisions differently. You know, we start to be more and more conservative with our cash and our risks. And for me, having that job, I felt that I was tied down; that was the best thing I could do for my family. In fact, I was never really building an asset; I was only watching my cash flow.
John Lee Dumas: What is the best advice you’ve ever received?
Brad DeGraw: The best advice is, you can always go back. For instance, if I went out and tried to be an entrepreneur and failed, I could always go back and find another job. If you try to go to market with a product and it doesn’t work, you can always go back to looking for a new product or a new market. Don’t be afraid of the risk that you’re taking. You can always go back to whatever you were doing before.
John Lee Dumas: What is a personal habit that contributes to your success?
Brad DeGraw: Compressing time and making things fail-proof. So, if you have ten minutes to do something, but it’s a two-minute task, do it in the first two minutes, rather than the last two minutes.
John Lee Dumas: Knock it out, Fire Nation. Knock it out. Give us an internet resource, like Evernotes, with Fire Nation.
Brad DeGraw: So, being able to create a network of students and gurus and launching, that’s really kind of a big thing for me. Going into a specific market, and focusing on those products and serving those people, that’s a big deal. Focus on those things.
John Lee Dumas: What’s the resource?
Brad DeGraw: The resource is the internet. I mean, just go out, use Facebook, use the software. Splitly is amazing, go use Jungle Scout, and then, just go use your resources. This podcast is amazing. You always have great, great actionable tips and very specific actionable places to go.
John Lee Dumas: Brad, what’s a book that you would recommend for our listeners and why?
Brad DeGraw: The One Thing. It’s a book that really helps you focus on doing one thing rather than trying to do 20 things. Focus on one thing and knock it out, and then, you can focus on another thing.
John Lee Dumas: Brad, we’re going to test your EOFire skills. What does the acronym FOCUS stand for?
Brad DeGraw: Aw, man!
John Lee Dumas: Follow One Course Until Success. FOCUS.
Brad DeGraw: Yes!
John Lee Dumas: Brad, this is the last question of the lightning round, but it is a doozy. Imagine you woke up tomorrow morning in a brand new world identical to earth, but you knew no one. You still have all the experience and knowledge you currently have, your food and shelter taken care of, but all you have is a laptop and $500 dollars. What would you do in the next seven days?
Brad DeGraw: I would listen to your podcast, create a network of students and gurus and launch a line of kitchen products. You can find a kitchen product that you can get off the ground for less than a grand. And then, just keep listening to the gurus and keep interacting with those peers who are about the same level.
John Lee Dumas: Now, why kitchen products? Is it just because it’s under $1000 can you get it going?
Brad DeGraw: It’s an easy jumping off point. You know, there are cheaper markets, but this is one where you can still jump in and make your niche. There’s not enough brand loyalty to really crowd anyone specific out.
John Lee Dumas: Cool. So, that’s definitely something to think about, Fire Nation. Look at your market and say, “Is there super brand loyalty here?” If the answer is yes, maybe think twice. Because, if brand loyalty is a factor, it’s going to be a big factor. But if it’s not, it’s an opportunity. So, Brad, let’s end today on fire with a parting piece of guidance, the best way we can connect with you, and then we’ll say goodbye.
Brad DeGraw: You know, our website’s Amazonsherpa.com. We’ve got some cool tools and resources for the Fire Nation there; it’s /firenation. And there’s all of our training doc, our resources, everything to help get you going in the right direction.
John Lee Dumas: And that parting piece of guidance.
Brad DeGraw: You know, decide your outcome and make a flexible plan, and get started now.
John Lee Dumas: Fire Nation, you’re the average of the five people you spend the most time with. You’ve been hanging out with BD and JLD today, so keep up the heat and head over to EOFire.com. Just type Brad in the search bar. His show notes page is going to pop up with everything that we’ve been talking about today. These are the best show notes in the biz. We’ve got timestamps, we’ve got links galore. And I just want to say, if you’re not heading over to Amazonsherpa.com/firenation, and you have any inclination or curiosity about Amazon, you’re making a big mistake, Fire Nation. So, Amazonsherpa.com/firenation. Brad, thank you for sharing your journey with us today. For that, we salute you and we’ll catch you on the flip side.
Brad DeGraw: You rock. Thanks!
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