Neil Twa, Neil has 18 years of selling, coaching and mentoring, 10+ years on Amazon using Fulfilled By Amazon (FBA) with private label brands. He’s been operating as an entrepreneur and business owner since 2007. Today he has served over 1000+ people during his coaching and consulting career, and currently supports over 200 clients in their Voltage Holdings organization which owns software, private label brands, a coaching and mentoring for beginners to advanced sellers doing more than $10M a year on Amazon FBA called Voltage Business Builders. They focus on creating business owners who scale using our company as an incubator.

> Here’s a glimpse of what you would learn….

In this episode of the Ecomm Breakthrough Podcast, host Josh Hadley welcomes Neil Twa, founder of Voltage Business Builders, to discuss advanced strategies for scaling e-commerce businesses, particularly through an incubator model tailored for Amazon FBA brands. Neil, leveraging over a decade of experience, shares insights into his unique incubator approach, which contrasts with the traditional aggregator model. Key takeaways include the importance of focusing on profitability, optimizing inventory management, and understanding Amazon’s evolving ecosystem. Neil emphasizes the need for a coachable mindset and strategic product positioning to achieve sustainable growth and scale to eight figures and beyond.

Here are the 3 action items that Josh identified from this episode:

1. Implement a Product Audit with the “Greenlight Process”: Regularly categorize products by their profit potential—whether they have high growth potential, need improvement, or should be removed—to streamline inventory and enhance profitability.

2. Optimize Listings for Algorithm Visibility: Ensure product listings include high-quality images and clear, concise descriptions. Avoid keyword stuffing, and instead focus on relevant keywords that align with customer intent to improve rankings on Amazon’s evolving search algorithm.

3. Make Data-Driven Inventory and Capitalization Decisions: Use metrics like unit ROI and sales velocity to plan inventory levels and optimize capitalization. Maintaining optimal stock is crucial for sustaining visibility and capturing market share within Amazon’s A9 algorithm.

Special Mention(s):

Related Episode(s):

Sponsor for this episode…

This episode is brought to you by eComm Breakthrough Consulting where I help seven-figure e-commerce owners grow to eight figures.

I started my business in 2015 and grew it to an eight-figure brand in seven years.

I made mistakes along the way that made the path to eight figures longer. At times I doubted whether our business could even survive and become a real brand. I wish I would have had a guide to help me grow faster and avoid the stumbling blocks.

If you’ve hit a plateau and want to know the next steps to take your business to the next level, then email me at josh@ecommbreakthrough.com and in your subject line say “strategy audit” for the chance to win a $10,000 comprehensive business strategy audit at no cost!

Josh Hadley 00:00:00  Welcome to the Ecomm Breakthrough podcast. I’m your host, Josh Hadley, where I interview the top business leaders in e-commerce. Past guests include Kevin King, Michael Gerber, author of The E-myth, and Adam Heist. Today I’m speaking with Neil Toys of Voltage Business Builders, and with over a decade of experience selling in the Amazon FBA space, we are going to be talking about the specific levers and strategies you’re going to need to employ in order to turn it into an omnichannel business and scale to eight figures and beyond. This episode is brought to you by Ecomm Breakthrough, where I specialize in investing in and scaling seven figure e-commerce companies to eight figures and beyond. If you’re an ambitious e-commerce entrepreneur looking for a partner who can help take your business to the next level, my team and I bring hands on experience, strategic insights, and the resources needed to fuel your growth. So if you or someone you know is ready to scale, looking for an investment partner or looking for consulting, reach out to me directly at Josh at Ecomm Breakthrough.

Josh Hadley 00:00:45  Com that’s E com with two M’s. And let’s turn your dreams into reality. But today I am super excited to introduce you all to Neil. Neil has 18 years of experience selling, coaching and mentoring and over a decade of experience using the Amazon FBA channel with private label brands. He’s been operating as an entrepreneur and business owner since 2007. Today, he has served over a thousand people during his coaching and consulting career, and currently supports over 200 clients in their Voltage Holdings organization, which owns software, private label brands and a coaching and mentoring for beginners to advance sellers doing more than $10 million a year through Amazon FBA. Called Voltage Business Builders, they focus on creating business owners who scale using their company as an incubator. So with that introduction, welcome to the show, Neil.

Neil Twa 00:01:26  Hey, thanks for having me on.

Josh Hadley 00:01:27  Neil. So first and foremost, we talked about this briefly before we hit the record button. But you’ve created what this is. You’re the first guest I’ve had on that has an incubator for Amazon FBA brands and more ecommerce brands, omnichannel brands as a whole, which is different than the whole aggregator method.

Josh Hadley 00:01:43  That kind of blew up in many people’s face a few years ago. So, Neil, what’s the difference? Give me kind of the background. How did this incubator begin? And what in the world is an incubator?

Neil Twa 00:01:52  Yeah, it’s kind of grown out of thanks for asking. It’s kind of grown out of need in our own business and model to gain more traction in the market. Gain specific areas of market share and growth, which we set out to actually do in the. We have a Holdings company behind the scenes in the digital marketing portfolio side of voltage came online in 2019, because I had been spending quite a bit of time raising capital to go become an aggregator. and then through 2021, in November, we had raised close to $50 million from two different home offices. And we’re set to go by 50 something companies. But we looked at the numbers and realized that’s not really where we want to toss our hat in the ring. Everyone was buying at 30 and then 45 and then 40% above asking price, and we said, this is just a bloodbath waiting to happen.

Neil Twa 00:02:27  And so we pulled the plug, didn’t take the funds and back out. As it turns out, that was the right move. We felt it was. And now we sort of feel vindicated. Fast forwarding through what aggregators are doing today and what they’ve had to do and what’s occurring in that marketplace. But it kind of bore out of that, you know, the awareness, the amount of connectivity and networking that was done that we had this capability and skill set, and we were running these eight figure companies and they’re like, well, how can you show us? You can train us, can you do this? And so the management consulting side of it sort of was born out of that, that just modified itself and to, hey, if you’ve got a brand or you’re wanting to build a brand, we’ve already got the systems and tools, SOP, software methodologies that we deploy in our company will simply wrap that around you and kind of incubate in that position of helping you grow. For exit, really was the intent.

Neil Twa 00:03:03  And so the building, the launching or the turnaround or the growth of six, seven, eight, you know, figure companies was the focus of that endeavor that we set out to do. And so far I think we’re having some good successes with it. We have some amazing case studies. You can go check them out on my podcast, The High Voltage Business Podcast, if I can give a shout out to that, and no pun intended. But there’s, you know, a recent case study with one of our builders on there about how we got to half a million a month and how he’s on the path to beating another half a million a month, and the processes and optimizations of his business model. And I encourage you to go take a look. And at that, we’ll talk a little bit about that, I suppose, today as to what we’re doing there. But very specifically, the other half of that incubation is that we want to actually acquire. So as those grow and go, you know, and get past seven, eight figures, their EBITDA gets past seven figures, they become candidates within 3 to 5 years of acquisition.

Neil Twa 00:03:41  So as we gain them, grow and nurture them, you know, take them in, transform them, build them. My goal is to have an asset that we can acquire. We are part of a private equity group called Patriot Growth Capital, which is an investment backed fund from veterans managed by veterans and will employ and operate under veterans control. The businesses that we are acquiring, we are set to acquire five more by the end of 2025. We have a couple in Loi right now that look pretty ambitious and pretty excited about those, but those are relatively large acquisitions. They’re coming in around 10 to 15 million in sales for those acquisitions. So that kind of takes us through the part of the conversation that we’ll be looking at. You know, how do you build to a saleable asset, and what would somebody want to do to acquire that asset? I’m hoping that the people will glean that knowledge today so they can prepare and execute and, you know, optimize their business to become a saleable asset.

Josh Hadley 00:04:21  Yeah, I love that, Neil.

Josh Hadley 00:04:22  So I’m curious for our listeners, if what is that kind of like structure look like, if they want to join the incubation program? Like is this a monthly fee that they’re paying? Is it there? You know, you’re you’re getting equity of their business or are they selling a portion of their business to help our audience understand what kind of investment looks like for the incubation? Yeah.

Neil Twa 00:04:40  So since we’re private label only, we’re not in the retail arbitrage, you know, wholesaling product, flipping for money, you know, opium guru place. Just so we’re clear. As management consultants, we have a one year agreement to come in and help them turn that business either into 100 K net new profit, or turn a new brand up into 100 K and net new profits at a base case minimum. So we work for 12 months. We have a performance goal. I had a 10-K bet IV as part of our fee, that we will reach that goal together or they simply won’t pay it. And we’ll keep working together until they get it.

Neil Twa 00:05:04  So it’s either existing turnaround new or a brand new product launch. Is that what we’re shooting for is obviously more money. That’s the the base expectation that we’re going to see occur. And of course, as you and I discussed earlier, there’s got to be some levers that have to be pulled for that to occur. Since we’re not looking at taking in hundreds of clients a month, I’ve taken less than ten clients a month and they’re chosen by me. I don’t have a sales team. I interview every person. They must fit a specific risk profile assessment, and they must understand the time, energy, attention and money to be dedicated to the process of growth or we simply won’t qualify them. I can’t help people that won’t help themselves, or won’t be willing to change and do the things that are necessary to grow. What always surprises me is people come in and thought, I’ve been to all the events, I’ve watched all the growth seminars, I’ve tried all these different things, and nothing’s working, you know, what are you going to do to show me something different than I already don’t know in the marketplace? To which I will usually respond, it’s probably time to hang up this call and go do your due diligence, and then come back to me when you’re ready, because this isn’t a good fit.

Neil Twa 00:05:47  So I’m not here to sell anybody or close anybody on what we do at voltage? I’m simply here to tell you there’s a different way about building a business. If you’re open to looking at what growth becomes when scale is possible in marketplaces or situations where a lot of times, quite honestly, Josh, they’re missing some of the core fundamentals of business. They’re understanding some of the technical natures of the Amazon marketplace. But if they’re not in separate marketplaces, if they haven’t looked at PNL statements really in detail, they don’t understand how they’re making money and what it’s actually costing the business and what their true net profit is. They don’t understand how to grow the business. And many, many times I’ve spoken to existing sellers who don’t know their numbers. And if you don’t know your numbers, you’re not going to able to grow your business. Yeah.

Josh Hadley 00:06:20  Neil, this. That sets a fantastic stage for our conversation today. So you’re very selective with the people that come into this incubator program. Right. And so it’s more of a privilege honor to be selected.

Josh Hadley 00:06:31  So let’s dive into a what is the right type of person look like. What are they doing correctly in their business. And then maybe we’ll do a follow up question after that, which will be, okay. Then once they’re on board, what what levers do you employ to help them really scale to that year and beyond?

Neil Twa 00:06:45  So I’ll tell you a little story that kind of answers that question. I had a gentleman come into me and he looked like he had a really great brand. And online and everywhere else in social media, it all looked really fantastic. It could sell about 3 million a year, which sounds great. Probably lot of sellers on here. They’d love to be selling multiple seven figures. It turns out after all, taxes, expenses, operational costs, PPC cost, inventory costs, you know, freight and return and manufacturing and all the non, you know, things that fly into this particular kind of business model. he was netting about a hundred K after taxes. So he was spending about 2.9 million to make that business run.

Neil Twa 00:07:11  And so what he had was a high volume business, okay. A great revenue generating business that was very low on the profit margin. How about 7% triple net on his avatar. So at the end of that, he really was running a sexy looking business, but not really a profitable business. That is not something I want to buy just so we’re very clear. Plus, he had about 4 to 5 products in the entire niche. One hit wonder products. It turned into 7 or 8 figure businesses that do not expand into omni channels or additional products are not going to be the great targets of acquisition, right? This is specifically getting tough, as people are getting more aware of what the aggregators did to bring awareness to this marketplace. On the other side of that, the market of buyers has become much more sophisticated and understanding where the business should run. So if you’re running a single channel Amazon seven figure business, you’ll need to have above 15% net profit to really see this go correctly or a path forward to get it there.

Neil Twa 00:07:55  Which means you may need to either spend more money or find ways to reduce costs there, either knowledge or execution. Right. And some of that could be fundamental work that isn’t being done in the business. And so that would be something that would qualify people, if they’re an existing seller, to come in and take a look at that business, look at their levers, look at where they are, look at their opportunities. And many times it’s going to summarize itself into optimizations and capitalization. If they’re not doing a conservative effort of daily weekly optimizations to tweak and adjust their data set. I know everybody continuously focus on products, but you’re not gonna hear me talk a lot about the product when you’re at a transactional level with Amazon and its movement of products to the customers, that’s what they actually do. What you’re going to hear me talk a lot about is the business, the direct response marketing, and how you’re optimizing the business processes within that company, because that’s where you’re going to see most of your money actually come out of.

Neil Twa 00:08:33  It’s easy to negotiate with manufacturers. Everybody should be doing that. You should have secondary and tertiary manufacturing. In today’s world. If you don’t, that’s a good opportunity for you. But in a particular person who may or may not understand that, it’s really getting down to whether or not they’re coachable, okay, sometimes you see people getting into this and getting a few products that take off really well, but their personality type never really operated at the Ecom operations level. It operated more at the this is a sexy business. This look at me and look what I’m doing. And I got $3 million a year in business, but nobody ever knows that it’s not really that profitable. So what I find, though is my best, you know, profile in a risk assessment, which I encourage anybody to go Google that while we’re done with this or call or whatever and look up what the measures of a risk assessment are. It’s a particular ES or SC profile that’s a standardized, type of test that is not like what you feel and what you, you know, believe in butterflies and all this stuff.

Neil Twa 00:09:15  It is about your business assessment and capability of understanding and accepting knowledgeable, tacit and implicit, and whether or not you can turn that into an executable steps correctly. Even with only 80% of the decision making data, you need to be able to move confidently. And that’s some of the things I see people not willing to do. I tried this little thing. I tried that little thing. By the time you’re at six and seven figures and wanting to hit eight figures, your level of risk goes this wide, not this wide. So I see a lot of people saying, well, I want my business to be this big, but I’m only willing to risk this much, okay? And many times they think they’re making this much in their head because that’s what they believe, or they thought or they’ve convinced themselves that they’re doing, but in actuality, they’re executing at this level, this much thought process up here and all this thinking and this much level of execution, show me somebody of an average intelligence who comes in and actually execute the process.

Neil Twa 00:09:55  And I will show you a seven and an eight figure seller who’s extremely profitable, not because they’re the most genius person in the world, because they did the work that was necessary to get there and took the risks. Maybe they didn’t know better. Maybe they just followed the process, I don’t know, but they took the risks. Other people tried to convince themselves weren’t possible or weren’t needed, or that they could figure out another way to just growth hack their way into that system. If you’re specifically on the Amazon channel, it will not work that way because there are levers inside of Amazon’s technology and its big filing system that will simply not let you overtake market share in a specific node inside of Amazon’s system. If your current market share, for example, has a better data set or has better inventory okay, stacked in behind it and is already meeting customer demand or has more profitability per unit than you. Oh, surprise, Amazon knows what your cost of goods is. They also know where your price and profitability margin is.

Neil Twa 00:10:36  And guess what’s going to happen, okay, to your product versus your competitor and your node if you’re not making as much profit than them. Is Amazon going to let you overtake that? Not necessarily. It’s going to be a lever they look at and determine whether or not the product that could meet the existing demand for that channel coming through in 30s or less has the data is in line with the customer expectations and makes them more profit. So this is where I see a lot of these volume based revenues will argue, well, Neil, I’m selling a 9.99 product with 10,000 units a month. Great. Enjoy your dollar 50 in profit. I prefer to have minimum net $12 in profit per unit and we go up from there. So we’re working on what I call. Am I answering your question? Is this too far down the tangent?

Josh Hadley 00:11:07  No, this is great, Neil. So before you before you go down, because I think now we’re now we’re talking about kind of some of like the levers and stuff like that.

Josh Hadley 00:11:13  Yes.

Neil Twa 00:11:14  We’re talking about the numbers, the levers, the mechanism.

Josh Hadley 00:11:15  Yep. Let’s pull back to let’s, let’s do the entrepreneurial risk assessment. What in your mind and what you’ve seen. What is the ideal risk assessment look like for.

Neil Twa 00:11:24  Well that’s that is stable and conscientious. Right. If they have a bit of AI or a moderately high D, they’re going to be a great dominant second. But they don’t need to be a dominant first. And what I mean is they don’t need to be the forerunner of the brand ambassador, the YouTube guru, the podcast host, the person who does all the forward conversation and topics, but never actually executes any of the business model. Okay, so the best risk assessment is someone who is more stable and conscientious, who sees daily, weekly, monthly tasks as how they make money and follow a progressive and repetitive process. Okay. And standardizing that process and optimizing it for people of that mentality is kind of fun once they see how it works, because they actually know if they do it right, they can train the right people to come in and replace them.

Neil Twa 00:12:00  Can we call them CEO operators? Right. Because they are capable of doing the operations. They didn’t know how to start being trained by us as mentors to move them into the CEO role and help kind of bridge them out of that operational structure that got them where they were going on the success, but is not going to get them to the next level of growth. If they can’t standardize that across other roles in an organization, they’ll just be a single man operation. Okay, now there’s nothing wrong with that. We operate relatively large, single man run CEO operators who have multiple assistants and contracted relationships and systems of automation and technology setting below them. Yeah, right. Not employees. A lot of vanity metrics. And the idea well, I’m hiring this and I’ve got five employees in my company and that’s fine. That’s great. If that’s your vanity metric, it’s not mine. I’ve had 12 before And that’s not really sexy. And I don’t really like running employees. They have no dedicated interest to the work of the actual business and its outcome.

Neil Twa 00:12:43  Okay, well, Neil, make them a shareholder, give them some common stock. No, that actually comes more convoluted and they can still leave the business. What I want them to do is be ingrained in the success and the outcome of the business of their own free will first. And then when we work together, the outcome is ten times greater. If they need me to convince them the value of the business and the action of, you know, actionable items that will turn the levers for them and make it go better, then we’ve already missed the boat. Yeah, yeah, we’ve already missed the boat. I am not going to be able to motivate, convince them and rob them into doing things that they can’t see themselves doing on their own. So first I train them how to do it on their own, build them up in that process, and then it’s very easy for them to translate that backwards into doing something with us. Right? Which is where that risk assessment falls in line nicely, because later on, when they’re in our enterprise, when they have become a successful operator together, we offer them opportunities to partner on businesses we get involved in, to take ownership in brands that we can co-develop together.

Neil Twa 00:13:28  We go deeper and longer with those individual relationships. And then I’m not needing any micromanagement of those people. Right? Okay. Status check ins could be 15 30 minutes once a week. Just to say, how are you doing? Where you’re going? What’s up? How’s the client? How are things moving? Client sees us. They see them. It’s a very. You know, I was gonna say that’s probably the right word. it’s a very, you know, linear, less work, literally, for us, because the operators already know exactly what to do and don’t need us to micromanage them through, you know, the tactics, if you will.

Josh Hadley 00:13:54  Yeah. Makes a lot of sense. So you’ve got somebody that. Yeah, they’re willing to follow that process. And then we’re kind of like systematic. That’s how they became successful.

Neil Twa 00:14:00  Yeah. They became successful following the process either from existing businesses or new business brands that were started up. They saw the process work. They saw it grow.

Neil Twa 00:14:06  They saw the proliferation of their activities and our strategies and guidelines for them to stay within. And so then once they see how that works, of course they understand it all.

Josh Hadley 00:14:14  Yeah. Okay. So now let’s let’s turn this into the fun part. All right. So you’ve got a new brand that comes in as an incubator brand right. What are the first actions that you typically walk people through.

Neil Twa 00:14:23  So the first thing we’re going to do is audit them through what we call our greenlight process. It’s a similar process to a brand new brand, but we’ll take existing products and brand through that process, and we’ll evaluate where the opportunities are for products that maybe have the most profit and upside potential, those that might be in the middle range. Okay, these are possible if we optimize, tweak or manage. And then there’s going to be a line in the sand below, if you will, products, data and information that simply says you’re hanging on to that believing and hoping it’s going to get better. But it never got better six nine months ago.

Neil Twa 00:14:47  And you should ditch that product when we see that actually occur, when we help them audit and show them the actual numbers and show them what particular metrics that we focus on as the right levers to turn inside the business financially. A lot of times they go, oh, like, they get it. They see it for the first time. They understand that, and then the next steps become sort of more in tune. This particular, you know, set of products has a, you know, a good a cost for its acquisition model. But most importantly, it’s to cost is setting right here between 8 and 15%. And with that particular number and these particular brands, we can pour on more PPC and optimize against current, organic traffic. And then we’re going to see how we can exploit and expand that product and raise its retail price point, or even come in and help them negotiate it with secondary suppliers. We’re gonna help them optimize the best products for highest profitability and fastest growth. What we’ll end up occurring a lot of times when we do that, Josh, is they’re going to want to dump that bottom half of the product out of there, because it’s simply costing them money.

Neil Twa 00:15:35  They’re going to want to redeploy it into the optimization and the efficiency stage, and then they’re going to realize really quickly that the, you know, once the levers are pulled, the next opportunity is capitalization, because once their data set gets better and the improvements start to show over 60 to 90, you know, 180 days, they’re going to now realize that they’re missing a lever is capitalization with capitalization and inventory leveled up after data is now optimized, they can take over existing market share away from their competitors. That would not be given to them if their inventory levels couldn’t handle it. So it’s not checked in to Amazon or it’s not upstream, and you’re simply not going to overtake their market share. Amazon’s going to give it to those who can continue to deliver the amount of units and required to meet the inbound and existing customer demand, because this isn’t a Captcha.

Josh Hadley 00:16:12  All right. So Neil I’m going to interrupt you there because. So what you’re saying is that you believe part of the A9 Amazon algorithm. They’re looking at what you have at Ord.

Josh Hadley 00:16:20  They’re looking at what you have in for what’s inbound. And that’s a component of do we want to give these people more organic ranking?

Neil Twa 00:16:27  The AI will literally determine that if my market share in your market share. Okay. Or say 5 to 10% difference and I and there are maybe 2 to 3 competitors between us okay. And I have better data in my system. I got better conversions, better CVR my my a cost is great. My to cost is between 8 to 15%. I’m getting a 10 to 1 click to sell ratio on my campaigns for my best targeted keywords. Okay, at that point, the only way the Amazon is going to let me stock out is if I do it on my own. What they’re not going to do is let you stock out of a product that is in demand by their customer that they want to fulfill and keep available in the system, even if they have to throttle you back to ensure that it stays there. Because they want the availability of the product in the customer.

Neil Twa 00:17:05  What they don’t want is tens of thousands and hundreds of thousands of products disappearing from the search result. So they’re going to throttle those products back and bring them down below the fold and into the lower half of first and second pages, so they aren’t eating up 80% of the available traffic that is on top keywords top and top search positions. Right? I’ve been around the A9 engine for a long time, but I also helped develop part of it when I was at IBM a long time ago. So at the latent semantic knowledge level, machine language learning side of knowledge management systems that deliver data. The A9 engine was one that delivered customer data, and they attached a logistics company to the back end to allow the fulfillment of the product to occur. But the front end is a learning and machine language learning system, or was about to turn into a full blown system with Cosmo. Okay. So we developed those systems, we developed that knowledge, we deployed it into large infrastructures. Fast forward, I’m out on Amazon one day, and it strikes me that I should take a look at the way that they’re doing their search results.

Neil Twa 00:17:51  And it suddenly dawned on me that A9 and I discovered this right around 2012, was basically a latent semantic knowledge management engine with machine language learning very, very similar in the patterns of response and behavior and call and response we were seeing with the AI that I developed back in 2003, five and seven when I was in IBM. So of course I went into research mode and spent about 18 months determining was it title, was it image, was it copy? What was the weighted ness of this listing in terms of its search engine, its back end keywords, its search density and all the other things? And then how would it respond if I did things like search and buy, which was something that we did and launched in 2014? How do I go out and get it to search and respond positively and then watch? Those indicators caused my product listings to rank? Well guess what? It ranked really fast. And then 7 to 21 days we were launching products that we’re ranking in the top best sellers over and over and over again.

Neil Twa 00:18:31  That kind of caught on later on, and people figured that out, and then we probably told it too soon in some event back in the day. And then kind of everybody figured that out and Amazon shut that down. but in their terms of service, I can’t do it anymore. But the core engine of A9 is still there in that learning and mechanism. But it’s about to change. So fast forward, Cosmo’s rolling out. As of February 2024, they did a 10% search change, got about 0.7% CTR, and that was equivocated to around 4.9 billion, according to their white paper in new sales. So that will be rolling out replacing that machine language learning AI system of the past and become a intent based, engine that is going to reduce the amount of keywords, in terms of our control. But take keywords from the copy image, graphics and other, relative data points across the interwebs, including watching Amazon Prime videos and freebie videos as to how that intent might work for, say, a pregnant woman whose feet hurt and by her social media post and purchasing history, it starts presenting shoes for pregnant women.

Neil Twa 00:19:21  It’s going to change. Think Minority report right by the end of 2025 2026, Amazon is going to change its holistic service as a way from data driven AWS, etc. into its most profitable side, which is going to be search based advertising. If you don’t catch on to this, you’re going to become a victim of it. So as we look forward to this and how that profile and operations works and optimizations for getting to 7 to 8 much of the time, not all the time. Let’s not brushstroke this, but much of the time the listings and business and seller account I just described a second ago and those products that are dipping below a certain amount of volume, of inventory, as well as CVR and other metrics are simply dragging the entire seller account down once removed from the system, once the assets stop selling the good assets that are above mid to high range and optimization, the entire seller account will get a lift in the Serp engine, right? Because your entire account affects all assets within it. All assets within it are like a portfolio, and all portfolio assets will have positivity and search and organic ranking.

Neil Twa 00:20:08  Some will be higher, some will be dragged down less because of their performance. And that will actually cause even if you got a full greenlight seller health account, it will actually cause your entire search portfolio to drop, right? So if you eliminate those bad actors inside of your account, you’ll actually watch the entire seller account and all search engines get a lift, but it’s still green lights across the board. Neil, how’s that possible? They want to make more money, and they want to make more money with the brands that have more money and profits that are producing the greatest amount of demand that is already coming against demand inbound, and is giving it to those who can draw that capability out.

Josh Hadley 00:20:39  Man. Neil. My head spinning. That’s a lot. It’s a.

Neil Twa 00:20:42  Fun system. It really is. It’s AI driven. It’s about to mature in a way we’ve never seen before. Yeah. And it’s just going to be a whole lot of fun for those of us who are paying attention and riding the wave, it’s not gonna be so much fun.

Neil Twa 00:20:51  For those people who have three and five year old listings who are not listening or taking any action to find out about this, how to optimize for it, how to present here. Here’s a pro tip for your group who’s listening right now. If I take your images right now from your listing, pull them down. And I went over to say, chat GTP and uploaded that image and asked it to describe it to me, what do you think happens if that image does not give me a proper description of your product.

Josh Hadley 00:21:11  It’s probably not going to show up on the search results. You’re going to.

Neil Twa 00:21:13  Rank in the search engine as that Cosmo system gets rolled out faster and faster, right? If it’s not presenting correctly because the reviews and other information in your listing are not properly presenting the correct narrative in this example of a pregnant woman who was feet hurt. Okay, but you’ve been keyword stuffing and playing around this algorithm, and you’re historically grandfather locked in to one version of the A nines, you know, 500 different versions, then you’re going to watch that change.

Josh Hadley 00:21:35  Yeah. Are you saying that images are like your main lever to influence.

Neil Twa 00:21:40  I’m saying one pro tip today is that your images are going to have a direct impact on whether or not the AI shows your product correctly to the right buyer at the right time.

Josh Hadley 00:21:49  Okay. Makes a lot of sense.

Neil Twa 00:21:51  You can’t keyword stuff those images. That’s not how I works. You might wanna do some quick research on that. there are just things about it that it needs to understand. It will read the image. It will determine what the image looks like. It will determine the environment, the background, the product itself. And if you’re selling a blender and it recognizes a bar of soap. Your host.

Josh Hadley 00:22:07  Yep. Okay, Neil, I’m on the bandwagon there with you. we were talking about we were talking about capitalization. So yes. Another level. So the first thing that you talked. So let’s let’s digest let’s take a step back here because I’m following everything you’re putting down here, which is? This is a juicy, episode, by the way.

Josh Hadley 00:22:23  I’m loving it so far. First thing you do is you come in, a brand comes in, and you’re talking about efficiency, cutting the dead weight of maybe some of the products that are inefficient in terms of their capital return for the business. And it’s dragging down overall performance. And you’re basically taking the, what, 20% of Asians that are driving 80% of the profit and revenue of the business. And that’s a way.

Neil Twa 00:22:44  Of summarizing that that.

Josh Hadley 00:22:45  Is correct. Is that basically, yes, because.

Neil Twa 00:22:47  What happens next is when that optimization comes up and you’ve now focused your intent down to what is only working and not all these other wide things. You may have tested them a while ago. We have a phrase in our company says, don’t marry your product, right, steal somebody else’s girlfriend instead. So a lot of people have married that time, energy and effort, money put into that product, and they still have that hope that this thing is just going to magically take off. I will tell you, if it does not take off in the first seven, 21 and 30 days, okay, you have got optimization levers to pull during that timeframe or your score inside Amazon, which is known as the ID, Q score will come down.

Neil Twa 00:23:11  And once it sets down into that, especially if you’re in high volume, high capacity types of nodes, we’re moving, you know, thousands of units a day. You are quickly not just because you went out of inventory, but you’re going to quickly see yourself stagnating in the growth of that and the value that that engine now sees against your data and history compared to other sellers. And it’s going to stagnate you. And so for you to break out of that, it’s going to take quite a bit of time to re optimize, re-engineer that and bring it back into organic love with the engine before even applying any PPC strategy to it. So you’re better off literally, in some cases pulling that ace and down and redistributing the inventory, uploading a new asset and starting over from scratch with a different narrative on your listing, one that could possibly in 7 to 21 days, take off differently. Why do I say that? Because many people think is still about the product. Many of you are still most likely hearing me saying product, product, product, product when I never actually said that.

Neil Twa 00:23:53  What I’m saying is data, data, data. It is a direct response marketing engine. That’s what it is. You got to see it for what it is. It happens to move product as it’s transactional outcome. So get the data right. If the product goes out and you are not answering the questions in the mind of the consumer, okay. And you’ve not done that, well, the algorithm is not going to love you. It’s just not. And until you optimize and pull that conversation back into the mind of the person who is actually wanting that product in 30s or less. Those actions will not take off, so there’s some work to do there to find out whether or not you can do that. In some cases, the work is not worth what you would deploy, and time, energy and attention money back to Asians that are now making 80% of your profit. If you were simply to eliminate the other time wasted in energy and redeploy time and capital back to the priority of those top listings, your account and you might actually what feels like take two steps back.

Neil Twa 00:24:37  You’re actually going to take one large step back to jolt two steps forward very fast.

Josh Hadley 00:24:41  Right? I love that, I think that I think that’s a very important mindset, right, is to, you know, as people build out products and that’s typically what’s happened on Amazon’s like product first. Right. And its products. And I’m getting into niches that I see as opportunities. And then it’s really hard to, you know, go and shoot that product behind the barn and say like no, you’re done because I’m sorry, your.

Neil Twa 00:24:58  Data set is done. The product may not be bad. You may be able to fix the data set, change the narrative and avatar and restart that with the exact same product. Why? Because we’re at a two day or less transactional arrangement. Josh, when you buy a product for your family and your kids on Amazon, are you buying the product?

Josh Hadley 00:25:11  No, I’m buying it to serve a need.

Neil Twa 00:25:12  You’re buying the outcome and you’re expected in two days later through the transaction that you get and move this product and use it, and it doesn’t break in the first five minutes, you’re completing that in a happy, you know, mechanism.

Neil Twa 00:25:21  You’re excited about that. You might even be so excited you want to leave a review 10% of the time. So the end result is that it isn’t about the product until it’s about the product. Some of you are thinking, well, my sales numbers aren’t great, so I need two other things I hear constantly that need to be fixed. Why do I need to get all this outside Amazon marketing done? And then two, I need to go fix all my product cause nobody wants to buy it. Well, nobody knows about your product yet all they know is about what they see on Amazon. Fix that problem first, okay? Do not take time and energy in my world. We will not take time and energy off Amazon. Try to manipulate an audience conversation over here in the social world to come back on to Amazon to affect Amazon’s own ecosystem. People get that backwards. If I don’t have Amazon’s ecosystem done correctly, if I’m not in line with the demand coming through, that can be captured whenever I push anything back out the other direction, which we will, as we explained earlier, an omnichannel strategy when I take it to TikTok or Shopify or retail or out into the television world or wherever, it is, simply not going to respond positively, it’s going to be a wasted amount of energy and effort and which I hoped I would get more sales, and that that byproduct of people coming back was going to positively impact my Amazon.

Neil Twa 00:26:13  I had this thing happen the other day. A guy told the story, and I think it was in one of the forums. I was on Facebook and he said, basically, you know, I blew out of my inventory the other day and you couldn’t figure out why this had occurred. And when he went through literally a ten day, you know, post mortem effective y, his inventory all blew out. Turns out it was a viral video on TikTok shop that was his competitor’s video that went viral, and they ended up on Amazon and they found his product. Good for him. Very bad for the TikTok shop person who thought that product and information that went viral was going to benefit them because it actually went back and benefited him greatly. In fact, he went from a couple hundred sales a day to 500 plus sales a day, and all of a sudden his inventory was getting blown out. He couldn’t figure out why he thought I give a coupon wrong. He thought something had gone haywire. He thought a hacker had got in or something real bad was happening with his listing in his product.

Neil Twa 00:26:52  And it turns out it was just that video going off that caused it to respond properly. But the effect is when to do things, not to do them. And I think people think the win is whenever I’m not making enough sales on Amazon, I need to go do all these other things to affect Amazon. And they watched this little promo go up and this little spike, little roller coaster thing occur a little. And they never see that constant movement or that hockey stick that all of us want to see occur. And it is because they are not in full alignment with the data, the system, the organic and the PPC within Amazon first. So no outside influence is going to positively affect that long term.

Josh Hadley 00:27:18  Okay. So Neil, rattle off what are the specific data metrics that you’re looking at. Yeah. To know I’m winning or time to go shoot this thing behind the barn.

Neil Twa 00:27:26  First off profit profitability first. If I’m making $5 on a unit. And here’s the thing that people have such a hard time in their limiting and scarcity belief overcoming.

Neil Twa 00:27:34  And it’s one of the things we work on with people who existing or existing sellers. If there is a $20 version of that product, there’s a 60, 80 and $120 version of that product. Okay, if there’s a women’s bag at Walmart for a purse, there’s a Prada at 1000 or $2500. Your limiting belief says, I can’t sell that product, or nobody wants that product, or no one’s going to want it from me, and you’ve already shot yourself in the foot. So you need to look at the product types you have and look at how you elevate those profitability first. Okay, from profit, you pay yourself more, the business has more money, your PPC can get more money. And a lot of the problems with people going, well, I can’t spend more than 30% ACOs and if I do that, then nothing’s going to be profitable, have limited theirself in the system and their ability to grow. So 30% a cost, a cost for us, if it’s 89%, I don’t care because I’m acquiring the customer that would have bought your product.

Neil Twa 00:28:15  So what do I actually care about? I care about Amazon’s 12 month KLTV customer lifetime value. Amazon Prime members over 200 million have a $1,000 a year or more that they spend on Amazon Prime. If I asked you right now, roughly, Josh, what do you think your family spends in a year? It’s probably more than $1,000 in it. Definitely, definitely. Well, so I have four kids, right? So are you one on the way? You’re about to spend a whole lot of Amazon money, getting new kid stuff, right? If it’s okay if I say that all out. Oh, yeah. Okay. Don’t worry about your family situation if you don’t want me to say it out loud. but the long story short is when you know that. What am I out to attract? What are the levers? What are the metrics I should be focused on when a customer buys my product, okay. And I’ve won them in the system versus another, it is my job to keep them at that point is my job to get them to buy up to $1,000 in a 12 month period from us.

Neil Twa 00:28:54  What does that mean? I need to sell them one $1,000 product. Okay, I need to sell them ten 100 products or so on. I need them to buy additional products to equate to that value. I need them on subscribe and save. I need them in my ecosystem at first, you know, after first purchase, if you are listening to this and you are not willing to even consider, do or approach or execute against that, you’re going to lose against brands. We’re running in the marketplace because we are, and I’m in a group of people who are doing that. So that means you’ve got to think about how you’re going to compare and compete with other market levers. Again, profitability, accessibility, inventory level is a big one, okay. If you can’t capitalize all of those cues in your system, and you’re going to reduce down to just what is making me all of my profit, which could be for a little while, maybe one, 2 or 3 SKUs only. But I’m now going to redeploy all the capital necessary to level up my inventory levels.

Neil Twa 00:29:36  Inside that system, you watch the inventory get checked in, and then 15 to 30 days later, watch what happens, right? Products you thought couldn’t sell more suddenly are going to start selling a lot more. Just inventory because your inventory now is checked in higher. Okay. Then the other competitors in the marketplace and with your inventory checked in, if all other metrics, okay, your CVR, your CPA, your profitability numbers and other metrics in the system are showing the organically ranking and moving up the supply chain, including organics, which is important because we always push for very high organic above PPC. That that thing with David LeBlanc I mentioned on my podcast earlier is 500 K a month is running at 90% organic right now. So with that, you understand what level to pull. You understand where to deploy that capital and get your inventory above the next 2 or 3 competitors in your node. Once you do that, as long as your front end metrics are all better than them, including your profitability, you are going to watch those products take off.

Neil Twa 00:30:23  And some of you have been holding on going, well, I’ve only got 1000 units. I only got 3000 here this continuously. But Neal, I don’t want to put more inventory in. I got 1000 units. I haven’t sold it all through yet. Put more inventory. Well, I don’t know that it’s going to sell more, put more inventory. And they resist what is required at the next level of risk to bring that business up to another level of maturity. Okay. That means you might spend 200,507, 50 or 1 million in the next three, 4 or 5 years to see you turn into an eight figure business. If you are not willing to do that, then you’re going to try to hope you’re way into that with 5000 units, and it simply isn’t going to happen. It’s not going to happen, right. But anyway, I can go over to social commerce and TikTok and a video can go viral. Great. And then you run out of inventory, right? Hypergrowth problems or problems too.

Neil Twa 00:30:59  So what we really want is organic growth that begets continuous and long term growth, because we know at some point down the line, two, three, four years into this cycle, a hockey stick moment is going to occur. We’re going to have the next level of capitalization. Someone’s going to fall out of the market. We’re going to take a little bit bigger boost on a holiday than we expected. Good things are going to happen with time and market, okay. And we’re going to watch this thing go. The last component that I rattle off on your metrics is to understand what the system is actually doing and when it’s doing it, so you can be rewarded by it instead of fighting with it. Okay, get in line with what the system wants and it will reward you. Please understand SKUs launched this year, 2024 or the next year, 2025. By the time this probably comes out, you’re listening to 2025. So let’s say SKUs launched this year, 2025. The max that they can overtake the entire retail system of Amazon is 5% okay.

Neil Twa 00:31:41  Amazon’s own admissions and numbers. When you talk to their account managers, they have finally told us things we’ve been asking them for a long time. Just as you launch this year, you can see up to 5% of all the retail sales that jumps. You know what the number is in year two, Josh jumps to 20% time and market maturity. Your additional capacity, inventory and meeting the demand for positive reviews as well as positive inventory means you can take up to 20% of that market share out of the 20% for excuse that were launched in year one. Go to year two, and by year three, it’s 40%. Wow. Okay, so those who are playing a 12 month game need to be thinking about a 36 month game when it comes to Amazon. So when we talk about forecasting, planning, capitalization management, optimizations, metrics building profitability and supply chain redundancy for speed to market, we are talking about 36 months. If you’re not talking about 36 months and you’re missing the opportunity, why? Because by year four, it can explode into the scale that you want.

Neil Twa 00:32:31  Daniel, ESP is a client of ours. We started him at zero. You can go check it out on my podcast. we did with him just a little while ago. He’s got his updated. He’s on year four. Okay. In this scale, he’s deployed about 750,000 to the business. He is going to hit 16.5 million this year. Year four. Okay, that’s the kind of scale I’m expecting to see. That’s the level I want to operate down to the businesses we’re acquiring. We’re looking at those level levers to be able to pull those levers in more in the existing business, knowing that we’re going to hit scale and capacity faster when we simply do the things they weren’t willing to do. So whenever we acquire a business, there must be a warchest of funds to increase funding for particular product SKUs that are going to meet our lever. We’re going to move some of those SKUs out, and we’re going to optimize the middle layer and find out where our next winners are.

Josh Hadley 00:33:08  Brilliant, Neil, this is this is fantastic.

Josh Hadley 00:33:10  So follow up question on this would be with the amount of increased competition, especially from overseas sellers, we have we have found in a lot of people that I’ve spoken to at conferences and whatnot, feel like the product life cycle on Amazon is getting shorter. You release something, and if you don’t have a patent, a utility pad specifically around it, it’s easy. You’re going to have somebody knocking you off from overseas 3 to 6 months after you launch, and they’re going to just drive down the the pricing of the product. Right. And they’re competing on price. So how do you approach that? Because it sounds like you’re doing the exact opposite. You’re like you’re more focused on like the premium pricing making barrier of.

Neil Twa 00:33:43  Entry is very.

Josh Hadley 00:33:44  Different. So maybe talk to us about that.

Neil Twa 00:33:46  I don’t sell products that are sub 30 to sub $50 unless they add a specific targeted lead gen or value, you know, value added to the products that are 50 to $200 in price point. Okay, so if I launch a product and are averaging 100 to $200 in our retail price point, then I’m going to look backwards at some point and say, what are all the additional accessories and tools or things that are around this product base for this particular customer and their specific solution and outcome they want? And then I can launch those additional products that are maybe 20 or $30, knowing that it’s a volume play, okay, not a profit play, but a volume play to suck up more of the market share.

Neil Twa 00:34:18  Okay, for them to touch us the first time on first acquisition so that they’ll come into a second and 10th and 20th acquisition with the other products we have. So we’re building out a portfolio. Okay. That kind of help answer your question. Yeah.

Josh Hadley 00:34:27  And then you’re saying so in the higher price products, 100 $200, you’re seeing less less overseas competitors knocking people off brand to brand competition.

Neil Twa 00:34:36  Where are they playing at is what I call Amazon’s moshpit okay. If you play in the sub $50 range, you are now in Amazon’s moshpit and they’re about to try to compete with many of you at the level of that platform. And I’m concerned for a lot of those people who are sitting at that level because they’re going to get victimized by a market they weren’t willing to move out of, or got sold into, or somehow became in bed with and can’t divorce because that’s where they started or where they’re growing. It sounds really sexy to say I got $600, you know, worth of inventory for 9.99, and suddenly I’m making two and three sales a day.

Neil Twa 00:35:00  That sounds great. And it’s good for those who are beginners. Okay, I’ve been a beginner. I’ve had a business that went bankrupt and I had no money. So no more power to everybody’s hustle, right? But where we’re at is a tier two, tier three, in our psychology buyer within Amazon. Right. So it is not about how many volume units I move per one SKU. It is the profitability of that SKU and my ability to go get ten more of them. Yeah, okay. With that I can get volume of units moved over ten different Asians targeting a specific customer avatar for a, you know, 50 to $200 price point and then just go in and own that market until success is boring. Okay. So then I’m going to just keep replaying that same thing, selling more of the same thing to different packaging, to to different people in the same niche. That’s kind of that base of a pyramid, right? Yeah, I think a lot of people are playing in that sub market, and they are going to be affected by the Chinese sellers and the easy to market people and all the other, you know, tool based driven simulator tools where everybody ends up in the same market segments.

Neil Twa 00:35:46  Yep. we have a developed tool set, AI driven called node Hunter, along with our, finder tool is behind my NDA. Only my clients and my business uses it. And it really goes into what are the actual data requirements of a particular product that fit those assumptions, and then we only look to target those products for market test. And once a market test is validated, then we go to a full product launch. So it’s just really a different way of thinking about how to approach the marketplace and then go to brain to brand competition. All right. And do what’s required to go head to head with other brands, no matter who they are, Amazon or otherwise. People like Amazon’s in my brand. I don’t care. That just proves competition is there. That proves demand’s there. What I need to go do is say, can I own that market at a higher profitability? Could I retail this price for three, five, $7 more retail price per unit than all the other combinations below me? And many times we do.

Neil Twa 00:36:25  We own the highest priced product in that niche, right? Why? Because I can also go back and justify then what? Josh an 89% costs because I have the profitability to drive that acquisition. And once I have the acquisition, I’m winning. Yeah.

Josh Hadley 00:36:38  Do you do any strategies you talked about having maybe not necessarily a loss leader, but cheaper products, right. In that sub 25 sub 50 moshpit.

Neil Twa 00:36:46  Only if they complement the primary product okay. The primary product is setting at 180 right. But there are 5 or 10 ancillary products, you know, at the 30, 50, 70, $60 range I’m wearing there. I’m going to launch those products to grab those people who needed that product, but then would look and say, well, I could also get the other one. It could be that I need the air pump additional thing or any patches for my air mattress. Yeah. That’s right. Like now I’m in the target niche of gear and accessories that is specifically around a target product. Are you selling all of that gear and accessory?

Josh Hadley 00:37:14  Are you doing insert cards or anything like that to insert?

Neil Twa 00:37:17  Cards are great and that helps with the packaging is important.

Neil Twa 00:37:19  Of course, to get the whole brand expectation away from a Chinese seller packaged box that come in for a sub $20 product, right? So we always want to present a brand evaluation. Haier inserts. Did you check out our other products? Of course. We spend time now making sure our Amazon storefront looks really good. The beta version of their DTC, Shopify Killer is about to come online, which is going to be an amazing way to drive that additional brand referral traffic straight to a DTC converting store like, you know, Shopify on Amazon. I think a lot easier for Amazon sellers to get a DTC front end presence, then have to try to open a secondary Shopify center to technical. All this. Amazon’s going to be doing a lot of optimization, which I’m kind of fascinated to see how that works out. Some of the major brands right now are testing that out, and the pages look really good, right? These are like Shopify killing systems and tactics. So really to get down to is, you know, technical and growth and all these does sound really sexy, but at the end of the day is am I talking to the right person at the right time? And that 30s or less.

Neil Twa 00:38:04  And I’m not trying to convince them to buy my product. I’m trying to just say, this is not, you know, don’t buy the other ones because you were already here. This is the one you actually wanted. So go buy it. Yeah, right. Just I’m not convincing them to buy the product. I’m reinforcing the buying decision at the moment. They hit my listing. And I think a lot of the optimizations we talked about over the course of this chat is so many people trying to force the system to do something instead of really understanding what it’s actually doing, who they’re speaking to, and fixing those problems.

Josh Hadley 00:38:27  Brilliant, Neil, I love that. I think this and hopefully I think our listeners are going to need to hit the rewind button a couple times, because I think there’s a lot of mindset shifts that people need to, you know, process and go through because what you shared, Neil, flies in the face of everything that has been taught from all the so-called gurus over the past decade of selling on Amazon, making a quick million bucks.

Josh Hadley 00:38:46  Right? You can’t run a.

Neil Twa 00:38:47  10 to $20 million company running with those particular business models. I can’t acquire companies at that level and expect to do what they’re doing and keep them running. So yeah, we’re operating at quite a different kind of mindset now.

Josh Hadley 00:38:56  Absolutely brilliant, Neal. Before we start wrapping things up here, is there any other message that you want to drive home that we haven’t haven’t hit these seven figure sellers? They want to scale to eight figures and beyond. I would say.

Neil Twa 00:39:06  To most all of my existing sellers, okay. Hear me when I say this. In all love and kindness, your opportunity begins at the end of your excuses. Why I can’t do this, why it doesn’t work, why I’m not willing to risk the next capital on a product that’s making me profit. Why I’m not. Why this? Why not that? Why this? Why does this person say that? Why did you say this? When you stop with the excuses and you actually get into an executable state of getting down to what is it fundamentally I should be doing to turn the levers in my business? That is when your opportunity is really gained that will get you the knowledge you’re looking for.

Neil Twa 00:39:32  Okay, which should put you into more of an independent mode and out of coaching and growth seminars and into mentorship, which is where you should be if you’re really going to get to 7 or 8 figures or more and get out of that mindset that there’s scarcity limiting around everything, the money is not gone. It’s just not near you. The opportunity didn’t leave. It’s just not near you and you can’t coax it to come closer to you. You’re going to have to move closer to it. It is a river flowing through there, and you can’t just yell at it and get it to move over to you. You got to move to the river. That’s a huge opportunity if you’re willing to make the effort to get to that knowledge, and then you’re going to get the wisdom that’s necessary to actually reach that level of business.

Josh Hadley 00:40:03  Beautiful words of wisdom. Love that. All right, Neil, as we wrap things up, I’d love to leave the audience with three actionable takeaways from every episode. So here are the three actionable takeaways that I noted.

Josh Hadley 00:40:12  You let me know if I’m missing something. Yes, sir. So Action item number one is exactly what you do with brands that first come into your incubation program, which is number one, looking at your product efficiency. And you talked about number one, the core data metric that people should be focused on is the profitability of those views. How much profit? What is your return on capital on those SKUs? What is your inventory turnover rate on those SKUs? The more you can be able to fine tune and focus on the winners, you will be able to grow faster. And so look at that 8020 principle, right? What 20% of my SKUs are actually generating 80% of my profits in the business. That’s probably the best place to start and then go maybe kill the other 80% of your SKUs so that you can then in turn, be able to further capitalize on those SKUs, which you talked about ordering enough inventory. And what I loved here is another pitch for which Amazon is, without saying it, they’re increasing all their fees, force feeding everybody into food.

Josh Hadley 00:41:04  And I think the reason why is because they want visibility into those three plus to truly understand how much inventory people have and what is interesting in Amazon, you can see how much like just on your FBA dashboard, it shows you how much is in, how much is available in the future, right? I can’t remember the exact term, but they have. That is like future sellable inventory. I think they call it. Right. Yeah, exactly.

Neil Twa 00:41:25  You’re looking at that sell through rate. Absolutely. They want to know if you can meet the demand. Yeah.

Josh Hadley 00:41:28  So I love that. And if you can further double down on your inventory and actually have enough inventory, as you talked about planning for three years now I’m not saying go buy three years worth of inventory. That’s not what I said either. But I’m saying, like being able to scale up to that. Yes. And plan for that. Correct. What is the right? So while we’re on this topic, what is the right amount of inventory that you want to be showing to Amazon? Like, hey, I have enough coverage of future sellable inventory between FBA and all of.

Josh Hadley 00:41:53  Is it three months? Is it six months? Is it a year? What, in your opinion, is the right amount?

Neil Twa 00:41:58  We have a metric called unit ROI percentage, which is a percentage of our belief that in 90 days that amount of inventory is going to turn over. So every quarter by quarter, we’re looking at how much inventory is growing and going and how much we need to capitalize in the next quarter to allow that to go up or even level up to another level. So that could be your 1000. Going to 2000 could be your 3000 going to five, could be, you know, buying a full container. Could you buy multiple containers. It’s like a wave. I don’t think everybody understands this as a data wave going along. And when you’re riding that wave, it will continue to push you up. And if you’re willing to capitalize the next level of inventory, whatever it is, 2000, 5000, another 40 foot container, it’s going to help take you along on that wave as you meet demand.

Neil Twa 00:42:30  If you do not meet that demand and you stagnate that data, but your inventory levels of your competitors go up, that’s when you get host. If you’re not willing to ride that growth, it’s literally like a wave.

Josh Hadley 00:42:39  Okay, awesome. Great great words of wisdom there. All right. So that’s action item number one. Action item number two is to prepare for the eye change that is already underway Amazon. And your biggest hack so to speak or recommendation is look at your images. easy way. Upload them to ChatGPT and see what ChatGPT says about your images. And if you’re not showing up semantically for what you think you should be, then it’s probably best that you you start changing those images, the lifestyle, like what’s in the background, what else is surrounded by it, correct. And all that intent. Amazon’s also understanding like what type of customer is this? Is this a customer that typically shops for eco friendly products right in their very natural recyclable products? Right. That’s what they tend to purchase a lot.

Josh Hadley 00:43:21  Then guess what? If Rufus Cosmo can find that type of product that is, you know, eco friendly and recyclable or whatever, that’s probably going to get served up, but only if Rufus actually understands it, right?

Neil Twa 00:43:34  Yeah. The language and intent is going to be very important, because we might have been looking at like keyword phrases before, like, say, winter coat, but now that engine after it goes through the rules based filtering, after it does its large language, after it goes through. It’s not, you know, knowledge modeling, maybe even a little bit of human feedback. It may say something like, you know, long sleeve puffer coat. Right. And the intent is to provide a high level of warmth. So you’ve got to look at this a little differently. And the way you language and translate even down to what search engine terms and the natural language of the bullet points title copy a plus content and back end data are going to start showing with that intent, which is going to flow through a natural language.

Neil Twa 00:44:04  It’s smarter than we are guys, so we’ve got to learn how to program it. Right.

Josh Hadley 00:44:07  Beautiful. All right. My third and final action item here in one kind of mindset shift that you talked about here, which is hey, if if you’re in that Amazon’s mosh pit sub $50 products, which I.

Neil Twa 00:44:19  Know people are gonna be hating on me.

Josh Hadley 00:44:21  If if you were in that space, it’s probably a good idea to start looking at those 50 to $200 price products because, as Neil mentioned, there’s lesser competition. Not that there’s no competition, but lesser there, probably fewer, you know, overseas knockoffs that pop up three months down the road. And so I like that mindset shift in terms of don’t, don’t do away with your $25 products, but see them as ancillary products to your higher average order value product.

Neil Twa 00:44:47  The other value of the product that are around it, they may compliment at 50 to 200. Go the reverse direction if that’s where you’re at. And also understand Amazon Prime Day numbers showed us that that change had occurred dramatically.

Neil Twa 00:44:55  It went from 58 to $60 a AUVs during Prime. So people are actually buying that mid to higher level product more now than ever. Which sounds really counterintuitive to the world we’re living in right now. But there’s still a lot of money flowing and a lot of opportunity. And people are getting smarter as consumers. So yeah, look for the 50 to $200 products, it may become main components where your product might just be an accessory of one of those main products that you could actually sell.

Josh Hadley 00:45:14  I’m curious, Neal, with brands that come to you, do you ever have a brand that comes that is in the so-called Amazon mosh pit that you you say, okay, I think they have a good groundwork, but one of our focuses is implementing some of these 50 to $200 price products. Like, is that one of the.

Neil Twa 00:45:29  Elevating the brand is always going to be key because usually not all the time. Again, not broad stroke, but usually more often than not profitability is suffering greatly. And without profitability.

Neil Twa 00:45:37  They are taking out either too much capital from the business to keep it from moving forward because they don’t have enough profit to subjugate something in their life they need, or the income they’ve got to take from it. And then the capitulation of the business and its inability to grow out of any capitalization is what’s causing it to stagnate. And or they aren’t willing or aren’t capable, or don’t know how to get additional capitalization necessary to allow the business to grow. Right. So they’re not capitalizing the risk against the business properly. And the outcome is a business that simply is not growing profitably. Yeah.

Josh Hadley 00:46:02  Okay. You summed it up well there Neil. All right Neil, final three questions I ask every guest. All right. Number one let’s spend the most influential book that you’ve read and why.

Neil Twa 00:46:10  So I’m going to say the Bible for me and Proverbs there’s just such practical knowledge very closely behind that in the business world would be something like good to great with Jim Collins. While it’s still older, the case studies, the principles and the differentiation between what makes a good brand and a great brand is still a fundamental tool that should be trained into every business, person or otherwise in the world.

Neil Twa 00:46:28  And I’ll give a shout out to the e-myth too, because who doesn’t like Michael Gerber? And who doesn’t like the practical knowledge and wisdom of a startup that he gives out in his books?

Josh Hadley 00:46:35  Yeah.

Neil Twa 00:46:35  I’ll give him one.

Josh Hadley 00:46:37  I’ll give. I’ll echo all three of those sentiments there. Yeah. All righty. All right. Neil, what’s your favorite AI tool that you’ve been using that you think other people should be utilizing?

Neil Twa 00:46:44  So right now, I mean, I’ve been having a lot of fun with grok, too. And the beta version right now on, x some of the, you know, fingers, facial structures and graphics of it in the background, especially the background, detailed graphics that you’re seeing that I couldn’t quite see on Midjourney lately. It’s coming out very powerful on grok. It’s not as advanced with certain features and inpainting and stuff. I’ve really enjoyed playing around with grok lately. so you might want to check that out. If you aren’t, you have to be a subscriber to ECS to do that, but it’s definitely been a fun tool for images and prototyping images and even in use images, for products that we’re prototyping or taking for test market.

Josh Hadley 00:47:14  Fascinating grok. Is it grow?

Neil Twa 00:47:17  okay. Okay. Right on the X interface or on your app, you can get access to it if you’re a premium subscriber. Awesome.

Josh Hadley 00:47:22  Okay. Final question. Who is somebody that you admire or respect the most in the e-commerce space that other people should be following in Y besides you?

Neil Twa 00:47:29  let’s see, who else should they be following in the eCommerce world? Gosh, that’s a tough one. I had a great conversation with Brett Currie over at OMG Commerce the other day, and so I definitely give him a shout out. He’s a thought leader in the space of e-com and omnichannel on YouTube as well, so I definitely give him a shout out to somebody who should be following and listening to.

Josh Hadley 00:47:44  Yeah, 100%. We’ve had Brett on the on the show before, so go back, take a look at his episode. He shared a lot of really good strategies for omnichannel growth.

Neil Twa 00:47:52  He does and he’s only about an hour from me.

Josh Hadley 00:47:54  So we love that.

Neil Twa 00:47:55  Yeah we were laughing.

Neil Twa 00:47:56  We didn’t do the podcast in person.

Josh Hadley 00:47:59  Well Neil, this has been an excellent episode. If people want to follow you, they want to learn more about you, follow your journey. Where’s the best way that they can follow you? At.

Neil Twa 00:48:05  go to voltage, DM, comm, voltage, digital marketing comm. Check out our free presentation. Check out the book. Oh, in fact, we were going to give ten free copies away to people on your episode. So ten free copies of the book that outlines the strategy almost automated income with FBA, case studies the strategy itself. The foreword was written by my mentor, Kevin Harrington. about the business and strategy we go through. So I encourage you to check that out, check out the presentations, and of course, hit me up on the interwebs. My name, my last name is, You can’t miss me and get the airline. You’ll follow me on any social media channel that makes sense to you.

Josh Hadley 00:48:29  Awesome. Neil, thanks so much for your time.

Neil Twa 00:48:31  Thank you, sir, for having me on, I appreciate it.