In this episode of the Ecomm Breakthrough Podcast, host Josh Hadley shares how his ecommerce business nearly collapsed in January 2024, with only $30,000 in the bank against a $300,000 credit card payment. He reveals how failed product launches, poor financial forecasting, and complacency caused the crisis. Josh outlines three key lessons: implementing cash flow forecasting, creating a structured product launch playbook, and making more calculated bets. He details his recovery through diversifying sales channels, particularly TikTok Shop, which went viral and revitalized his business, ultimately turning a near-bankruptcy into a breakthrough success story.
Links and Mentions:
Cash Flow Management
“Cash Flow Forecasting Spreadsheet”: “00:03:56”
“YouTube Video on Cash Flow Forecasting Tips“: “00:04:56”
E-commerce Platforms
“Amazon“: “00:01:00”
“TikTok Shop“: “00:09:54”
“Shopify“: “00:10:50”
“Shein and Temu”: “00:10:50”
“Walmart.com“: “00:10:50”
Business Strategies and Lessons
“Sales Cures All”: “00:09:00”
“Creating a Playbook”: “00:05:55”
Timestamps:
00:00:00 Introduction & Crisis Unveiled
Josh introduces himself and describes the January 2024 financial crisis: $30k in the bank, $300k credit card due.
00:01:02 Causes of the Crisis
Explains the series of bad product launches, heavy ad spend, and lack of financial forecasting that led to the crisis.
00:02:03 Complacency and Lack of Process
Discusses complacency in product launches and absence of a defined process to stop losses early.
00:03:02 Cash Flow Forecasting Lesson
Highlights the importance of cash flow forecasting and how not having it worsened the situation.
00:03:56 Implementing Cash Flow Forecasting
Describes adopting a cash flow forecasting spreadsheet and the benefits of forward-looking financial planning.
00:05:06 Key Lessons Learned
Summarizes three main lessons: forecasting finances, creating a playbook, and launching better products.
00:05:55 Building a Product Launch Playbook
Details the new process for product launches, including team communication and documenting lessons learned.
00:06:46 Launching Better Products & Calculated Risks
Emphasizes the need for better product selection and avoiding multiple risky launches at once.
00:07:58 Systems Breakdown & Exposure
Reflects on how the lack of successful launches exposed weaknesses in business systems and processes.
00:09:00 Immediate Actions: Focus on Sales
Describes the shift to focusing on sales growth and stepping away from day-to-day operations.
00:09:54 Growth Initiatives & Channel Diversification
Lists four growth actions: retail outreach, TikTok Shop, Shopify, and additional marketplaces like Shein, Temu, and Walmart.
00:10:50 Results of Channel Experiments
Shares outcomes: retail failed, other marketplaces had minor impact, Shopify showed promise, TikTok Shop was the breakthrough.
00:12:34 TikTok Shop Breakthrough
Explains how going viral on TikTok Shop quickly generated revenue and improved Amazon sales.
00:13:29 Advice for Entrepreneurs in Crisis
Encourages creativity and aggressive action to drive revenue when facing business crises.
00:14:25 Doubling Down on Winning Channels
Describes the strategy of testing multiple channels, then focusing on the one showing early success—TikTok Shop.
00:15:15 Building a Flywheel: TikTok Shop & Shopify
Explains how TikTok Shop content and insights fueled success on Shopify and created a virtuous cycle with Amazon.
00:16:15 Encouragement & Lessons from Setbacks
Offers encouragement, sharing that setbacks can lead to breakthroughs if you focus on growth and don’t quit.
00:18:21 Sports Analogy & Final Words
Compares business setbacks to sports, stressing the importance of learning from failures and persisting.
Transcript:
Josh Hadley 00:00:00 I had $30,000 sitting in my bank account with a $300,000 credit card payment coming due, and I had no idea what to do. Welcome to the Ecomm Breakthrough Podcast. I’m Josh Hadley. I’ve scaled my own ecommerce brand from 0 to 8 figures, and I’m actively building towards nine figures in sales. This podcast is where I document that journey and share the systems, the strategies, and the lessons learned in real time so that you can learn what actually matters and scale your own business. First and foremost, who am I? My name is Josh Hadley. I’m a man of faith. I am a father of four and a husband to a beautiful wife. I’ve been selling into e-commerce space for over a decade, doing multi millions in revenue on different sales channels such as Shopify, TikTok, shop and of course, Amazon. And I am also the host of the number one business strategy podcast in the e-commerce space. And that is E-com breakthrough. This was January of 2024 for me, and this was the first time where my back was severely up against a wall to where I felt like, is this where I have to declare bankruptcy? It was a very, very uncomfortable position to be in.
Josh Hadley 00:01:02 And to be honest with you, I felt like I had failed miserably as a business owner, and this has been the first time where I actually had to dip into my own personal bank account just to fund payroll. That wasn’t even to cover the credit card payment that was going to be due. I had to cover payroll for the week, and I didn’t have enough money in the bank account. I’m going to share with you, like, the actual things that I implemented in the business to get us out of this really, really sticky situation and to clear the way through what I thought was going to have to be us declaring bankruptcy for the overall business. So what happened here is basically a series of like, unfortunate events that kind of like compounded onto each other. So let’s dive back in. Like what drove me to only have $30,000 sitting in the bank account with a $300,000 credit card payment coming due. Well, what happened is, number one, we had some bad product launches. So in the months of November and December, we had launched some new products and I was very optimistic about these products.
Josh Hadley 00:02:03 We placed some large purchase orders for them, and then we invested heavily into pay per click ads on Amazon, thinking that we knew how to rank these products well. Well, sadly, these products did not go over as well as I as I had thought. And so we accumulated a massive advertising budget for those products. And then they didn’t even sell very well. And now I was stuck with a lot of inventory, but b I had a bunch of ad spend that was now added to my credit card bill that was going to be due. The other thing that I learned from that process is that, hey, we didn’t have a really good process of launching products like up until that point, maybe I had just been like winging it, or I thought we knew the process to launch products successfully on Amazon. But what I forgot was that, you know, I had basically gotten complacent where we had just launched successful after successful after successful product on Amazon, but then got too complacent to where I thought I knew everything and we didn’t have a great defined system.
Josh Hadley 00:03:02 So when my team actually launched these products and they didn’t perform very well, there was no process in place to stop the bleeding. There was no process in place for somebody to, like, raise their hand and say like, hey, this isn’t going the direction you want it to. Do you want us to keep going? And with this playbook? No. We just kept digging ourselves a hole further and further and further for the course of 30 days. On top of that, I did not have what I have now in terms of a cash flow forecasting spreadsheet. I was just kind of like looking every month to be like, oh yeah, there’s cash in the bank. Good. Everything’s good. But had I looked at a cash flow forecasting spreadsheet, I would have been able to see around the corners to be like, ooh, do you actually want to launch this product during November and December, where it’s kind of like it’s peak Q4 time. So ad costs are going to be really, really high, and it’s going to be really competitive.
Josh Hadley 00:03:56 And your chances of success are maybe going to be a little bit more challenging. And during that like gap between November and January. Like you’re going to be a little bit cashflow constrained because you’re waiting for those Amazon payments to come back. Well, I wasn’t looking at any of that. I was just looking at the cash that was sitting in my bank account today. And so that is something that we’ve implemented into our business. And in fact, I have a whole YouTube video that’s about that. Go check out my cash flow forecasting tips here on YouTube. You can see the actual like spreadsheet that we’re using now. There’s like a QR code. You could go download your own copy of that and also have it as a podcast episode as well. But like from that, I learned that the most critical thing that I should be looking at on a weekly basis is, hey, what is my cash look like? And before I place a Po and before I decide we’re going to launch this product, am I launching it at a period of time where I’m going to be in a healthy cash position for the business, or am I intentionally putting myself into a really sticky situation where, dang, I might be forcing myself to need to take like a cash advance predatory loan from some of those, you know, lenders that will advance your Amazon disbursements and things like that.
Josh Hadley 00:05:06 But like, you can see around all of those corners if you just like forecast enough. And so those were like the three key lessons learned. So number one was I was not forecasting the finances of my business and looking at the bank balance and what it would be three months from now, four months from now, five months from now, right now, I always look at like I have an estimation of what my cash is going to be in my bank account 12 months from now. Now, obviously, like it’s hard to predict everything that’s going to happen in 12 months, but I definitely have a really high degree of accuracy of what’s going to happen over the next 30, 60, 90 days, right? And then as it goes further out, it’s a little bit more of like a ballpark estimate. But at least I have like a really good idea of like, oh, these are good times to launch products. So that’s lesson number one. Lesson number two goes back to actually creating a playbook.
Josh Hadley 00:05:55 And so my team instead of just like keep doing the thing. Even if it’s broken. It’s hey, raise your hand if something’s not going according to plan. And by the way, we also need to have some processes in place if it isn’t going to plan. And what’s the alternative? If you know the launch doesn’t go this way, maybe there’s some other levers that we could pull to actually find success with this. And so the good news is we’ve been able to revamp our processes to be able to contain that. We as a business, we learned our lesson and it was a hard lesson. We got kicked in the face. Right. And that’s a really hard battle to fight, like $30,000 in the bank account, $300,000 like credit card payment coming due. Yeah, that’s not a fun situation to be in. Okay. But what we did is we learned our lesson, and then the team documented the lessons. We refined our process so that if a product doesn’t launch according to plan, well, we don’t keep digging ourselves a deeper hole now and then.
Josh Hadley 00:06:46 My third and final thing here, lesson learned is launch better products. Honestly, those products that we launched were just bad launches overall. We were kind of saying, I think it’s worth a bet because we had had success in other areas, but this was a kind of a new, unproven area that we were going to be taking a risk on, and it just simply did not pay off for us. And so while you always need to be taking bets, you should take them wisely and not say, hey, I’m going to take three wild bets consecutively week after week after week, and launch three different products with some really high ad budgets consistently to put yourself potentially in a really precarious position. If none of them go according to plan, if one of them hit, it probably would have like masked the situation. And to be honest, as I reflect back on myself, that’s why I had kept getting by for so long, not needing to do any cash flow forecasting and having kind of a lazy product launch process, because the products that we would launch and win on were they would outperform so magnificently that it would like overlook all of like the blemishes of the bad product launches, and it would make up the deficit for all of the bad decisions in kind of the wrong things going on in the business.
Josh Hadley 00:07:58 So when that went away and no products were successful, that’s when I was just kind of. Ultimately was everything. Every system process in financial forecasting in the business, like broke. And I was standing naked out there exposed to everybody because like, it was just there was nothing for me to hide behind any successful product launches. So let’s talk about what are the things that I actually did when I realized, crap, I have $30,000 in the bank account and a $300,000 credit card payment coming due. What am I going to do in the meantime? And I’m happy to tell you, I did not take out a loan to solve this issue. Rather, the best thing that you can do as an entrepreneur if you’re ever in this situation is sales. Sales cures all. And I cannot repeat that enough. Too many entrepreneurs get stuck working in just the thick of thin things. They get stuck working in the weeds of the business, and they get stuck doing the the inventory reconciliation or the inventory forecasting or placing the POS or the PPC Management in your job as the entrepreneur.
Josh Hadley 00:09:00 As the business owner is not to run the day to day business. Your job is to actively focus on the growth of the business and exclusively growth. And so yes, I also would have been better off had I actually been focusing on more growth initiatives prior to this $30,000 situation that I got myself in. And so it did force me to put my back up against the wall and to take some swings that I would not have otherwise taken. Had I not been in that position. So what are these swings that I took from a growth standpoint that honestly, because I was just too lazy and complacent with the existing cash flow that we had in the business? I wasn’t taking these swings. Well, here are the four things that I did. Number one, we went all in to say, hey, if Amazon’s no longer working, our playbook of launching products was no longer working. It was basically broken. I said, well, screw it, we can’t just launch more products on Amazon. Let’s go try to push any of our existing products into retail.
Josh Hadley 00:09:54 So we reached out to some brokers to just try to say like, hey, can we get any momentum right here? Okay. Number two is we got on to TikTok shop and we had actually taken it over from an agency just a month earlier who told us, hey, by the way, we had tried TikTok shop and it was not successful. Actually, nobody’s interested in your products on TikTok shop, so I would recommend you don’t do it. It’s only for beauty brands. Well, my back was up against a wall and I had felt led to go dive into TikTok shop. And so it was a channel that we were going to try to tap back into. Even though the agency said it was not a good idea for me. The other thing that we tried experimenting with was, again, Shopify. We just said like, okay, well, can we take any of these existing products and try to get some sales on Shopify? Like, I just need to close this gap and can I just generate some sales on Shopify right now? And then the other lever that we pulled, number four, was getting onto additional marketplaces.
Josh Hadley 00:10:50 Shein, Temu is just like, I don’t know, maybe we’ll have success there, maybe not, but let’s light them up. And also, while we’re at it, light up Walmart.com and just take whatever the existing products are. And let’s just try to expand our distribution. And so sure enough, that’s what we did, is we just kind of threw all four of those things at the wall at one time. And let me just tell you, kind of like, here’s the TLDR of like what happened. Number one, retail was not the answer I had. I did retail just because, like I was, I had no idea what was going to work and what was going to pay off. Now, there were some good things that we learned about retail. And the nice part about working with a broker is like, they’re earning a commission on whatever they sell for you. And so I didn’t have to upfront any money to them. Well, retail never really went anywhere at all for us. So we could kind of close that loop.
Josh Hadley 00:11:37 What happened? What the other marketplaces. Well, the other marketplaces had some mediocre improvement to the overall business. It brought in some sales, but nothing quite like Amazon. I think at best we were we were seeing like 5%, 10% of what our sales were on Amazon. But then I had people like trying to manage Shein and Temu and Walmart and it you know, it was a somewhat of a logistical or operational nightmare just to kind of like try to maintain those channels. But I was just hungry trying to like generate some type of growth in revenue for the business to be able to pay off this credit card bill. All right. Well, what about Shopify? The good news is, on Shopify, we actually began having a little bit of success on Shopify. Like we had found a small little funnel that was working for us where we could get kind of like a membership program going. And it it did bring in some revenue for us, but it wasn’t the unlock that I was looking for, but it got us in the wavelength of thinking about Shopify.
Josh Hadley 00:12:34 So that was probably the most helpful thing. But where we experienced the unlock was in TikTok shop and sure enough, within 30 days of going live or launching on TikTok shop, we went viral. And as soon as we went viral, not only did our Amazon sales increase, but also, you know, TikTok shop sales increased and at the time, TikTok shop was just like they were covering all of your shipping costs and everything. So it was actually very profitable in early 2024 to be on TikTok shop. Not so much now, by the way, but in early 2024, it was very profitable for us. And so that’s how we brought in quick revenue to the business to be able to cover that credit card payment and be able to move forward. So my recommendation to those of you listening to this who have been in similar situations where your back is up against the wall, think of the things that you can do to immediately drive revenue yourself. And as the owner of the business, maybe that forces you to do things that you never otherwise would have done.
Josh Hadley 00:13:29 Maybe you have a customer list and you could start emailing those customers, or even calling some of them and offering them a high ticket program. Or maybe you’re selling supplements and you’re like, crap, this whole Amazon thing is no longer working for us, but I’ve got all of these people that buy my pre-workout supplement, and so maybe I could get them onto some type of fitness subscription or membership or lifestyle program or something like that. This is where you got to just start being creative. And this is again, when your back is up against the wall. Typically I say, hey, distraction kills, but focus and system scale. Now that is true. But if your backs up against the wall, you best start swinging and trying to take some like big swings to the fence to try to like resurrect your business or to get it back on track. And guess what inevitably happens as you take those swings, you’re going to find something that just works. And so sure enough, we found something that worked and that was TikTok shop.
Josh Hadley 00:14:25 But it was doing a lot of things all at the same time. Yes it was. We were going like an inch deep into all of those, but all I was trying to do was just see, like, do I get any early momentum signs from any of these channels? Because if I do, I’m going to double down and I’m going to triple down, I’m going to ten x my time in those channels. And sure enough, that’s what TikTok shop did. I saw the early warning sign. We went an inch deep on all these channels. TikTok shop began to pay off the fastest. And so we doubled down on TikTok shop and we did not like. The good news is, like I said, we were taking swings. We learned some great lessons about Shopify. So guess what happened? Six months after we went viral on TikTok shop, we launched our Shopify storefront, and we took all of those lessons learned from those earlier punches and swings. But now we had the momentum of TikTok shop behind the scenes, and guess what TikTok shop was was doing for us.
Josh Hadley 00:15:15 Number one, it was a beautiful content engine for us to be able to feed, kind of like the algorithm for meta and being able to like produce more content there. But number two, we learned what worked, what funnels worked and what did not work earlier that year. And so once we gained that experience, when we saw what was actually selling on TikTok shop, we said, all right, if those can go viral there, let’s see if we could push videos in ads on meta for that exact same product that was going viral. And sure enough, that’s where the unlock came was because now we understood the hook, the pain point that customers were experiencing, and then basically applied that into all of our marketing material. And so from that, the nice part is like, now that you had TikTok shop going, you had Shopify going. It creates this like virtuous flywheel where you have this halo effect onto Amazon. And so like all the sales on Amazon started to rise. And so that is kind of like my words of encouragement for you is like, you’ve got to just like continue to focus on growth in sales.
Josh Hadley 00:16:15 Sales will cure all if you’re if your back is ever up against a wall, but do so methodically and do so where you’re just trying to get early warning signs or I guess, some early success signs that say, hey, spend a little bit more time here. Inevitably, in the life of business as a business owner, you’re going to go through some rocky times. There are going to be times where like, truly like you will fall to your knees and you will cry tears and you will be praying and asking for relief. I have been there multiple times, and I share these stories as some of the most painful stories that I have had in my own business to share with you these specific action items that I took to resurrect things, and what I would say every single one of these stories. There is a there is a rainbow at the end of the this thunderstorm. Okay. When I shared previously the story about Covid and my business going down 90% overnight, the unlock that it the basic outcome of that is we unlocked a completely new category in the homeschool educational supplies category, and that we have not stopped since that day in this situation where we had multiple failed product launches on Amazon and a massive cash flow constraint.
Josh Hadley 00:17:23 What I learned is the breakthrough was in TikTok shop, and now TikTok shop is what is basically the lifeblood of the entire business as the content engine. And so when you go through those dark times, know that if you are actively focused on growth, these dark times can actually be the moments where, like serendipity hits. You will be prepared to basically take your brand to the next level. There will be some dark days, and honestly, January of 2024 was the darkest time of my life. Okay, for 30 days. It felt like I was just like running through mud and had no idea and no way out. It seemed like everything was falling apart in the business. But you can get through this if you keep moving forward. Don’t give up. You will only fail if you quit. I tell that to my baseball team that I coach my son’s baseball team, my daughter’s softball team, and their basketball teams. If we lose to a competitor, we only lose and fail if we quit and we don’t come back and go to practice and figure out how we pivot and learn from those games.
Josh Hadley 00:18:21 The good news is, my favorite analogy in business is likened unto sports. We lost to some teams that smoked us, but then guess what we learned? We applied those lessons into our practice plans, and we made sure we weren’t going to repeat those same mistakes. And guess what? We beat those teams in the championship. So that’s what’s going to happen to you as a business owner. Document the lessons learned from every setback, every failure. Keep growing. Focus on that growth. And as you do that, the the light and the path will reveal itself to you in due time. So there’s my words of encouragement to you to go out and keep crushing it.
