There’s a lot of definition to dropshipping but I think dropshipping is here to stay, depending on how you kind of
approach this business. Let’s start with a brief round of introduction, please. In case you do not know these guys,
you will in a second. Let’s start over there with Angus, please.
In just a couple of words about you, where you’re coming from,
and why you’re sitting on the stage now. This is Angus from Hong Kong. I am doing
Shopify for three years doing 9-figures every year. So I hope my experience can help the newbies or the guys in the industry for a few years. Hey guys, Steve Tan here from Singapore.
I’ve met a lot of you guys in our group and everything, so good to be here.
Happy to share like more stuff about ecommerce with Angus and my brother, so yeah thanks. Evan Tan here, so I think it’s our third time we’re in
Affiliate World. I’m happy to share more ecommerce knowledge with all of you guys.
Perfect. Well I’m looking forward to it, and you know I’m nasty right?
You know me. So let’s just kick off with your first official questions and
then see where we go. I already told the audience actually that I’m super
interested in where you did fail, like where did you start out and what was
the most humbling experiences, right? Obviously, you are big shots here
so whatever fails you had, you learned from those, and it probably helped you
build out your empires. Let’s start over there again. Share your story please. Okay, I think my biggest fail is I built my team so slow. I started ecommerce three years ago but in the first year I just hired 20 people.
The number is just a few millions every month, but when you know the process is
working and making money, the easiest ways to make more money is to duplicate
your process. Hiring more people, training more media buyer teams is key.
I simply just lost the first year in training people and there’s a lot of opportunity cost. Very true. Okay, how how big is your team now? My team, I got 120 something people physically in
Hong Kong and I got 400 VAs in the Philippines currently, and it keeps scaling. Who in here has 500+ people working for them in affiliate? I don’t. It’s what you need for 9-figures. Keep hiring, keep training people. Alright. I come from Austria. Do you know what the cost is? You know the burn rate per month employing 500 people? Okay, whatever. Alright Steve. I think for us, recently, probably in past few years, I’m kind of over-stocking in products. That is why we still like dropshipping business model. There’s a lot of definition to dropshipping but
I think dropshipping is here to stay depending on how you kind of
approach this business. It doesn’t matter if you’re doing dropshipping or brands, it’s still like shipping from China or US. It’s all
about customer support, experience, and everything. One thing we did last time was we’re really confident in one product and probably prior to Chinese New Year, we kind of wanted to give a super fast shipping time.
We stocked about 500,000 worth of one product. After Chinese New Year, probably a lot of competitors, a lot of spies, and everything, the product sales just dipped. It took us a very long time to kind of sell all our inventory. One thing we can be very careful
nowadays, is we don’t really overstock way too much.
Our inventory forecast is done probably more accurate nowadays compared to the
younger days. When we hired our warehouse associate and manager, he gave us
a very good inventory forecast strategy to procure sufficient enough goods,
instead of stocking 500,000. You’re gonna run into cash flow problems
if you’re not able to sell out all your products. Absolutely. Okay Evan, if you continue
with that, how do you actually manage and keeping the right balance of
products, because obviously you don’t want to run dry either.
Sorry, what? Run dry on inventory right? I mean that’s probably one of the worst things that can happen, like you have this campaign and it rocks, it sell. Right now for us, we use a hybrid system. Most people call dropshipping
as like, you don’t have any stocks. I mean, if you’re running volume then you
need to have some stocks for sure. What we do actually, we do a hybrid system.
So let’s say day one we sell 100 pieces. Instead of buying just 100 pieces, we’ll probably buy 200 pieces so that you can last for the second day as well. I mean on the day two, let’s say we sell 150, we still have a surplus of 50, so we can decide from a day-to-day basis on each
product how much more we want to order. We never run dry but we never overstock as well.
That makes a lot of sense. Another f*ck up?
What? Another f*ck up.
Oh, okay. For me, I think I was quite blessed to know to actually
start off the dropshipping journey but I think throughout, I think one of the few
f*ck ups is at the start I was very stubborn when I test products you know.
I always think, oh man this product is gonna kill it. And I really like that product. I spend like 99% of my efforts of the week preparing that product hoping, not hoping, but wanting
that product is going to work but sometimes at the end of the day it’s just
never going to work, because it doesn’t matter what I think but what is important is actually what the consumer wants in the market. How often are you right?
How many times out of 10 are you right? And how do you fail when
you’re thinking a product will rock? Right now, I don’t do the decision-making.
The product research, they choose. Because so many of your decisions are
wrong when it comes to product? Yeah, I mean, many people make mistakes especially in
product research all the time. That’s just normal to happen. It is. For sure. I just want to encourage
people to test more because if you guys fail, you screw up. I guess it’s a natural
thing. It’s natural. Cool alright. You already mentioned dropshipping
right and how you work with inventory and that definitions can be very
different. You also touched on user experience and how important it has
become especially if you work with traffic sources like Facebook, but
there’s many other reasons to that as well of course.
Maybe Steve you want to start on this one. Tell us how you currently work with dropshipping
and what’s your biggest success in tweaking the traditional model of dropshipping. I think our model is not like super different with everyone. I think our strength is probably creatives. We have a strong team of creative people that manage all our media buying and everything. Right. I think nowadays the landscape is a little bit harder than the past few years
because there is more competition. The barrier to entry is lower. Facebook is
clamping down a lot on, not really legit or there’s a lot of scammers around that don’t ship products and everything. So I think one good way that we did differently is we invested more expensive shipping lines, direct shipping lines to the US.
Last time, like probably dropshipping you guys could do probably 2-3 weeks shipping time. If you miss out, I mean, if it’s Q4,
Christmas, that’s something different. But like most of our packages reach US in like 5 to 10 days, like 10 days or less, and that’s gonna help your feedback score dramatically a lot. The biggest challenge right now for
dropshipping is probably Facebook. Yeah, very true. Very true. So last time product is king right. Nowadays I was telling Angus, accounts is king now. If you have a lot of accounts. I think I was talking to Alex just now as well, I kind of felt brands is way easier right now compared to dropshipping
because brands are very stable, like what Savannah was talking about, the simplified campaign structure and everything. It’s set and forget and so easy. For dropshipping especially when
you’re scaling, you need a lot of accounts, a lot of BMs, especially with all the recent clamp down on Facebook. But it’s usually the bad guys that affects the entire industry, that cause things getting harder. I mean it’s still very doable but just what you have to tweak
it a little bit more in terms of probably like customer experience, this
product quality, shipping times. I think that would make your dropshipping life
much easier if you care more about the longevity of the business.
Absolutely. Let’s let’s touch on that a little bit later, specifically Facebook. I think
most people here do run Facebook traffic to the ecom shops for a good reason.
Angus, how do you approach dropshipping and do you think you do stuff different
to other people so you succeed in this industry? What do you do different to other people?
What I do different to other people, I think, repeat again, just build the team first
because a lot of people just have a very tiny team. They couldn’t test enough to know what is good, and what is not in Facebook and we try to do what Facebook wants. Facebook, they have a page score.
They want their customer to have good user experience so we try to ship faster,
have customer service for 24 hours to reply. So it can lower your Paypal reserve fees as well if you can reply to your customer promptly. It is how we’re doing things a little different and I think we are using a lot of emails. For example in Black Friday, some of our stores can do more than 25% in email revenue compared to the store. If the ROAS in Facebook is not doing good, you need SMS message. You need everything to increase your AOV. Increase of repeat customer. This is
what we do, which see the lifetime value of a customer instead of just a first time to chase. When you try to build a business,
you need to take care of customer. Very true, yeah. I think that’s just hard when you’re starting out with dropshipping right? There’s so many different things to work on and then in the end everybody wants to make money, so they disregard the customer and focus more technical aspects, and maybe that’s
an approach that you should question right from the start.
Let’s speak about traffic sources. We’ve had a lot of discussion
lately about owning your customers, owning the data, owning the way of sending them to your shop right? Van just to talked about push notifications. Email obviously is a big thing
but Facebook remains king in many ways. How do you diversify your traffic sources to hedge against different risks? Which one has been most successful for you?
I guess volume-wise it’s still Facebook, I assume. In terms of profitability, any pointers to what should people look at? What kind of traffic sources? Right now, I think for us, we’re still looking at Facebook.
I mean, still no doubt Facebook is tough, getting tough but it’s still
the most profitable one for us for sure. That was a very diplomatic answer but
what’s the second best? Second best I think for us, we see things more in
terms of a skill. I mean definitely there’s other like SEO, like Google shopping, that’s all good. I mean the ROAS goes through the roof when comparing up Facebook and everything. It’s the same concept that I mentioned like a couple of years ago at AWE.
I mean if you are driving let’s say a $1 million per month, and
probably like another source could be like 10x, 20x ROAS, but it’s only probably
generating like 10% it doesn’t matter. For example, dropshipping profit could be very little like what 10%, 20%, 30%, I mean 30%
is good back in those days, but probably Angus is driving 9-figures per year. Given that small percentage those are
stupid crazy profits and everything. It’s more like a lot of people have
to see this more like a business and in terms of scalability, and
what kind of traffic source could bring most volume. I kinda had a few chats with Ezra as well. Why should I focus on other traffic channels? I should just focus all my time in Google, Facebook, and YouTube because those are the three major biggest channels. And probably I think a few guys I met saying native is good, so we’re gonna
start testing out a little bit more like native, probably Snapchat
as well after speaking with them. Definitely a lot of like you know.
Don’t forget about TikTok right. TikTok is great but I’m not
sure how converting it will be so we’ll test it out too. Do let me know if you get started on TikTok. We can compare some stats. Angus, I’m super interested. Where is your biggest market? Are you actually selling within China as well or is it Western countries mostly? No. Basically we sell worldwide except China because China if you want just to buy a Taobao. It’s stupid to sell in China it’s just a waste of your ad spend. Facebook is banned in China. Facebook, Google, YouTube, everything
everything you want is banned. Alright, so then I guess your biggest market is still the US. So you sell a lot around Asia, other Asian countries so you sell a lot around Asia, other Asian countries and Europe as well? I sell mostly or US, tier 1, English-speaking countries. Because I was wondering how you deal with languages actually at that scale right? I mean just having everything in English is a lot of
headaches already but once you diversify into different markets obviously you
wanna use the local languages as much as possible as well. Do you actually do that
or are you doing 9-figures with English only? Actually we are doing 9-figures with English only. So there’s still a lot for me to improve right?
9-figures is not the end. It’s just interesting. I’ll just rethink of my strategy. I think I have to head out now. I have some notes. Never mind. Let’s speak about fulfilment next. That’s also a big thing, I’m speaking about ecommerce and very specific to ecommerce. Three of you
touched on that before. Can you share a little bit more about how you do fulfilment these days? What kind of setup you use, partners
that you use and so forth? We work with REO as well that’s one of our partners that we used for part of our shipping lines. We do have strategic warehouses in China.
I mean there’s different demographics across China that has different products that you source from. For example, Guangzhou and Shenzhen are probably more for electronics. Then probably in Ningbo area, which is close to EU, is more for accessories, fashion, and some leather goods. When we ship out our products, it’s mostly from either Shanghai port or Shenzhen port. Different lines could arrive faster or slower depending on which tier cities. But
ideally, we still ship up most of our products from Shenzhen because it’s
kind of the fastest way out of China. And it’s port is really way faster compared to some second tier cities. Some of the problems that I’ve
mentioned before is like the slow shipping times that you guys get is
because you get different tiers of epacket. Different tiers, different city tiers. They give different rebates, different discounts, and everything.
For example, your supplier might be giving you very good
pricing and shipping but it’s very slow, because they’ve routed through
different cities second tier, third tier well there’s less volume.
They get way better pricing but that also affects your shipping times.
Shipping times obviously affects your customer experience again
and that influences your ratings or scoring on Facebook and
so forth. It can be a vicious circle or in your cause —
I think the feedback score is a good thing in a way. It kind of pushes all our dropshippers in our space to provide better support, better customer experience. But something you can say when you’re on top. You’re starting out. It definitely raises the bar for newbies to get into the space. I
think we’re all you know lucky in a sense that we got into the space early
when everything’s still easier. I was thinking we were chatting
the other day. If we bring whatever we know now and go back in time, like three
years, we can probably make a lot a lot more money.
The interesting question then is, and this is off charts of course,
so what’s the new sh*t now right? I mean looking at the stuff that
you do, ecommerce, dropshipping, the way you approach stuff, what are the new
things that you look into right now? Obviously you wouldn’t share your
secret sauce here, but what stuff that is available for most people here in the
audience that they should start now so they’re on top in two or three years
from now? Well that’s a tough question. Let’s start with Angus.
I can answer for you. I think if you want to use Intercard. Yeah
I am the biggest Intercard man now. You’re dismissed now. This is not a promotion stage. Freaking affiliates. Using every single second to sell that sh*t. So to be serious, you need to build up your own funnels. But in Intercard all you do is connect it and you have everything to use. You need to improve your conversion rate because Shopify default funnel is not that good. And the profit margin in the ecommerce is just 15-20% right. Imagine you have 20% more conversion rate. This is like to pull
your profits already. Make sure your funnel, you need to have like post upsell
and downsell functions. There’s a lot of other applications can do as well in the market. I think it is a must. When I go to the spy tools, I spy, a lot of people still not using any customised funnel and just using Shopify default.
They’re leaving half of their profits on the table. I think just now like the ecom mix, I was talking to a few people, and I think they are brand. They did $1.5 million in 3 months and they are
not using any upsells even like post-purchase upsells. It’s like, what? You’re
leaving so much money on the table. I say, you guys are doing email marketing but
you’re not doing post-purchase upsells. Thinking that doing having post-
purchase upsell might make the brand look bad. People want to buy more right? Giving them 30%, 40% after buying is still very attractive to people and it doesn’t mean it will affect their brand. You’re leaving money on the table if you’re not using any apps like that, like Intercard. You guys don’t have to use Intercard. There’s so many other solutions. But do make sure that you guys are optimising your conversion rate, trying whatever you guys can to boost your average order value. If three, four years ago you tell me,
Steve you need to do all that kind of stuff, no I don’t need to
because times are good right? But with all the CPMs going off the roof
and everything getting more expensive, you’re spending way more to acquire a
customer. You better make sure that you’re doing whatever you can to squeeze
every single penny out of the traffic that you’re driving in, and the easiest
way to do, I think one of the biggest mistakes a lot of people do is
they spend all their time driving traffic, but when people are on
your store you need to be finding ways how to convert them better, like A/B split-testing, increasing your conversions, pricing, testing your pricing, and everything. We develop this own tool for our own use
initially, but we kind of felt there’s a demand in the market to how
people go from probably breaking even or probably doing 5-10% percent to
making good money. That’s why we’ve launched solutions that help Shopify, only Shopify users, to kind of change the game in a sense. Funnels is just a big thing here. Funnels, check-out, conversion rate, AOVs. Every side bit. It’s funny it’s like back in the days, when somebody on the
stage mentioned like, you really gotta do retargeting. Yeah exactly.
Like yeah really? Retargeting? I guess in a couple years from now.
I think it takes time to hit people like, oh it’s common sense.
Eventually this I think this will all become the norm, the norm right now. Even brands, you guys are leaving so much money on the table. That’s very true. Talking about money, next question is all about money right. You three have been
in the space for a longer time. You also started off small, but what made you big
also is that you continuously reinvested money into your business right? So yes, drive the fancy cars, buy the nice house, show it off on freaking Instagram, they do. But most of your money goes into your business right? So you prep yourself for the next stage. How do you actually approach this? Is there a certain percentage of money that you tend to reinvest? Is there certain aspects of the business that you always have on your agenda
where money goes first? Because I’m sure that you have also had phases were you
were tight on cash flow right? Maybe money was good but cash flow was not, or
the other way around right? How do you deal with that?
What’s on your mind when it comes to securing your finances and getting ready
for the next stage in terms of investments? Evan? I mean for us, we always definitely keep a healthy cash flow in the company for sure. It’s a must for us to keep a cash flow. I
mean whether it’s in personal, business, for us, we’re always on the lookout
for new partnerships, for new projects. For example, next year me and Steve, we are actually opening an events company in
Singapore. We actually had to take a lump sum of money to do investment.
There’s always new opportunities coming out, whether in
ecommerce, in brands, and also it’s not just making money from dropshipping.
You take that money, you need to reinvest into new businesses,
into new opportunities for sure. Makes a lot of sense. Angus you want to
add to that? I think that you should highly focus on customer service to make sure your Paypal, whatever payment gateway, that the reserve is keeping it low.
As I said before, the profit margin is like 15-20%. How about just make the Paypal reserve at 5 or 10%? Then you won’t have cashflow problem. True. That’s a very solid point as well. Thank you. I now want to come back to the Facebook question, the bans question right?
We know the official way of doing this, having one business manager,
maybe one account per product, a product line, but obviously that’s not
what you guys do right? Can you share a little bit of your setup and how you
hedge against the risk of Facebook just banning you completely. Go. No, Steve you can start. Alright that’s an awkward smile. Anyways so, I tell all my mastermind students and a lot of my friends, if you only have one store, or one product, or one BM, or one
account, you don’t have a business right? If Facebook is your only
traffic source and one BM, good luck. So I’ve seen people, I mean, there’s definitely – brands aside, when you see questions online in groups like people posting, did your ad account get
banned? There’s always like 50/50. 50% of people said, no I didn’t get affected. I kind of felt sometimes it’s BS because there’s so many people that’s being affected of
course. If you’re a legit brand, it’s different, but our setup is
sometimes to the extreme. We have one pixel, one store, one BM, one ad account. And if it’s done, it’s done. We just move on. To be totally upfront, it’ll be a strange day to wake up with no accounts being banned.
Banning is just like alright time to move on. There’s nothing. It’s
like, all right Facebook doesn’t want this business for this website, let’s move on. We don’t cry, we don’t b*tch around in groups like, hey can I get my account back? Of course we try to appeal it, but it’s on the discretion of Facebook to whether they want to get your account unbanned. So the safest way for us right now is one BM, one site, one pixel, a couple of ad accounts, banned, move on. Next. Cool. That was very concrete. Thank you. Angus? Similar to Steve, I think you just have to have lots of different accounts sources in Facebook. You find the accounts, you buy the accounts, you use agency in China or somewhere else. And then better mix your [inaudible] accounts
that will not be banned together. If you are using the same person attach a VPN. You don’t show your pixel. You don’t show your
admin. Separate everything. Even the URL. This is what I do.
It’s pretty much the norm nowadays. Sh*t happens. Alright I’ll release you guys. Thank you
very much. That’s cool. Let’s move on to our final question that I have for you guys.
I’m not sure, are we actually having a Slido for this session as well?
I know we’re running out of time, if so can you put it on the on the wall now?
No, I don’t think we have. Okay, so I’ll just continue with actually my last question.
We only have two minutes left for this last panel, and actually
since I was nasty in the last one, I want to be nicer in this one. If there’s
anything you wanna offer to our audience to really help them hit it as big
as you guys or at least getting towards that path, what would that be? What should
they do over the next year? Something personal that you want to share with the
audience before we walk off this stage. If you’re new in the space,
I think building relationships properly with Facebook and PayPal is the
standard you have to really build good relationships with them. But if your suppliers or logistics or shipment companies could kind of help you out or build the trust and understanding them, visiting them. It will make a huge difference as well. When
we just got started, it’s because of all the connections we had in the past, like probably ten years, that I’ve tried when I was doing eBay times right?
That’s all the kind of relationships that I built over the years
when I was dead broke. I have less than $100. We were able to get
back into the game and doing over $1 million in sales for the
first month going back into dropshipping right. But that’s not going to be
possible if you don’t have like credits from your suppliers or Facebook.
So I hit up my Facebook reps. I would get you guys on credit.
My logistics and shipping partners to get me $500,000 in credits. Of course that’s not gonna happen in one day. I thought you guys probably could invest more time in terms of
building out the relationships, trust, and everything that’s gonna go a long way.
It’s not just gonna be like the first one or two years but it’s gonna be
very helpful for the next few years. Definitely. And this place here is perfect right.
I mean a lot of people that you need to work with are not gonna be here right, especially like supplier side. But then again, people that you meet here can help you as sh*tload. For sure, even the networks
could give you guys credit that’s gonna help with the cash flow, with the reserve,
with like PayPal and everything. Yeah right perfect. Okay, Evan.
For me, I think, I would say we’re all entrepreneurs,
so for entrepreneurs have a bad habit of not wanting to hire people
sometimes, not trusting people to do your job well. I think a lot of us need to
have to unlock that mental block. You need to hire people to do your job
or else you can’t grow personally and you can’t grow the company as a whole as well if you don’t want to hire the right people to grow your company. So people. People around your business
and building those relationships and people within your company to help you get sh*t done.
Angus, what will be your one point that you want to share with the audience? First, I think it is still people. I
think you have you need to have a mindset that you try to help your staff
to success. You try to make them work comfortably. If they make a lot of money
and you will make a lot of money. I mean the media buyers, you need to train them up,
you need to copy the mindset. The whole company has to have a very
hardworking or has a”can do” culture so that even if it is a new hire, they can just copy
the right mindset. Because in Facebook, in affiliate marketing, everything keeps on
changing. But the right mindset can solve the problems.
That’s a very wise answer. Alright, cool. Thank you very much for that. You guys are getting an
affiliate crowd to actually cheer you up and applaud you and actually engage with
you that’s amazing. Alright, thank you for that gentlemen and
ladies. We do have some exceptional women entrepreneurs here, not that many though.
Okay, I’ve just learned that we actually will take some more questions, so that’s amazing. I’ll just have you stick around here. I
know that’s a scary part. So my job is just to take your questions now right. Open the Slido app, vote up what you want me to ask, and we’ll have you guys go through those questions. Alright, I’m old. I gotta check this out here.
Alright let’s go into action here. So what are the hottest niches for 2020?
Evan. I wouldn’t say niches but I would say 2020 is a huge year for user-generated content. Brands going for very content-related kind of niches. Things where you can actually showcase really well on Facebook, Instagram. Those will be hot items for sharing in 2020. Cool. Angus what do you think? 2020?
What’s coming up? I think it is still women-related products.
Still the hottest niche in Facebook. And it is easy to scale. You don’t need to target interest. Just a broad targeting for all women. It is of course, the niche
that is the hottest niche every year. And I don’t think it will change. Alright, that’s interesting. Okay cool. Can you tell us about infrastructure and
how you set up your infrastructure? I’m not exactly sure is meant by
infrastructure. Do you guys know? I think they’re referring to team structure.
I don’t think we can cover this like in like one two minutes
because like the entire team structure is actually quite big. I think we did
cover this in one of our past few years, AWA presentation about team structure, so I
think you guys could base it off that. Nothing’s changed a lot but it’s
probably a bigger team, more systemised, more structured compared to what I shared before. Okay, fair enough. Next question. Angus,
so if we’re speaking about 9-figures, how many stores or niches do you spread that across?
How many stores? I think usually we have like 20 to 25 really active stores but if it is autumn,
I think we got hundreds. Hundreds. Hundreds of stores. Because when
Facebook don’t like your store, don’t like your page, you need to have a new store right. Alright. Okay, super interesting. So advice for newbies
to start dropshipping in 2020. We kind of covered that already, but so let’s say
somebody’s in here has never done any dropshopping, has never
done any dropshipping, never done anything in your space, what’s the first
thing they should do? Huh? Sorry? I didn’t get the question.
Sorry I zoned out for a bit. I thought yo were going to ask them. I’m used to the audience falling asleep
when I talk. Come on. I’ve pitched my product now you can go back to sleep. Advice for newbies to start dropshipping or? Yes sir. One thing. I’ll ask all three of you. The one thing
somebody should do right after this panel. I think it’s still very important to know
like how to drive traffic properly. I mean besides accounts, you need to know
how to drive traffic. I think that’s still one of the most important things.
It’s a skill set that’s gonna stick with you no matter which industry you go,
so I think it’s still one of the most important thing that newbies should focus
on learning first, then you consider all the other problems.
Do you think somebody should know how to run traffic himself or herself or just
partner up or hire somebody? I would prefer to know how to do it
myself because if not there’s so much BS that people could do.
I’m sure there’s, especially media buyers, the good and bad ones, they always like
to BS you, that they know a lot of things, but when you really have them run whether they can hit
KPIs, it’s very obvious. I think it’s good to at least know the fundamentals yourself, if not, working with
someone else it’s gonna be hard. I think you should know at least the
basics so you can judge their work about this. Last time I did SEO myself before, so when was interacting with agencies and everything, at least I know the lingo a little bit.
Exactly. They’ll tell you all this lingo and you feel like they’re like god
and all that kind of thing. I think having some foundations is very typical. By the way, often when you speak to somebody, and they’re using all those fancy terms, they
don’t really know what they’re talking about. The real experts they just know like,
I don’t know. They just use regular words to express themselves right.
What is that, simplicity is the ultimate form of sophistication
Me trying to be smart. Okay let’s move on. What’s the one thing somebody should do
once they walk out here if they’re just getting started? I would say in 2020,
definitely learn from the right people because like dropshipping has been
around for at least four years right now. And there are way too many
gurus in the market. Some people they just have 3 months of dropshipping,
they got some results, and they just start posting YouTube
videos and like trying to maybe be gurus. I’m not trying to say, but I mean the industry. I’m not just saying who, but learning from the right people. Of course avoid scams out there.
Having the right foundation in the whole dropshipping industry,
whether it’s Facebook knowledge, whether it’s you’re managing your
suppliers, managing your inventory orders, foundational knowledge is
really important. Learning from the right people I say it’s a good start you
know to dropshipping. Cool. It’s funny you say four years because I I think you’re right.
Four years ago it became really easy to get started. And now it’s becoming more competitive. I
remember reading about dropshipping the first time, I think in 2002.
But there was no support, so I tried, I failed. Even in my eBay days, we were
dropshipping but I mean, four years is kind of when it got really super popular.
Everyone’s pushing it and everything. I’m glad, it’s it’s still a good industry for a
lot of newbies who doesn’t have a lot of money. I mean I’ve done a lot of brands in the past. My startups, it failed and all that kind of stuff. I know how hard it is for people that has
no money to want to start something big and great right. I think dropshipping is
a good place to generate cash flow, earn some money, and then you know pursue bigger dreams like the unicorn and all the kind of stuff. Angus, if I don’t have 500
people working for me yet but I’m like a lone soldier. I walk out this room what’s
the first thing I should do? I think you should find a wise partner, because it is not like — I think a lot people here is doing affiliate marketing only. They think just one people be a team to do great number, but for dropshipping you handle the logistics, the customer service, the dispute, the charge back, everything. I think find one or two partners to start with, who could handle everything. Even if you can drive traffic, Paypal will shut down your account if you are not taking other paths. It will make everything go smoothly to making money.
Alright, so we have an opinion here. We have a slightly different opinion here.
That’s amazing, that’s great. Thank you. Okay we have 7 minutes and 29 seconds left until I have to close this floor, and we have a sh*tload of questions here. Let’s speed up a little bit.
Accounts are king, what is queen? Traffic. Product, traffic. Product, accounts.
Everything is king, queen, jack. Pretty much.
Alright so just do everything right? Okay, so how do you get all your Facebook accounts? Alright just very brief one. I gotta ask you, come on. I’ll start with Steve because he doesn’t like
those questions. We farm it. We farm it and use agency accounts well.
Okay agency. What country? Oh mostly China. Still China. Alright. Cool alright. That was an honest answer, thanks for that. Do you guys prefer building brand or just dropshipping businesses? For me, for the past few years, definitely yes dropshipping because like I have been burned by brands, like putting all your effort, all your money into building a brand and it didn’t work. Brands have a little bit more risk but there’s so many ways to test or validate your product before scaling up big. I think for me, probably next year, would be a big time to focus
more on building big brands instead of smaller brands. Smaller brands, we
do have some small ones. It’s nothing significant. Sometimes it affects
our morale because we’re putting in resources, time, and it generates
only a fraction of the dropshipping stores. And the money. I think for longevity-wise, for exit, and everything — You’re thinking long game.
Yes, the best thing is to have both right. This is something I always tell like my students and if you could do both by all
means go for it. But if you only have like a certain amount of resource, I
would put it on that whatever that’s generating you the money then use that to invest in other brands or something. Because you shouldn’t be juggling both because like
one of my students, he was doing about probably $500k on his dropshipping
store, but he’s putting 80% of his time in the brand. And the sales for his dropshipping store is going down day- by-day, and he’s using
that to fund his brand, which is dangerous. He’s fallen in love. That’s what love is all about. I think he should invest more in building people, team, and everything,
so that he could probably juggle better between this two. Cool amazing. Let’s move on to the next question.
Angus, what are your main traffic sources? We’ve perfectly covered that but maybe you can. My main traffic source is Facebook. It’s like 80% something is Facebook.
Some Google and emails, and I will explore more on SMS after the show.
I heard a lot of people are doing really great in SMS. I’m not yet doing any.
It’s gone big over the last couple of months. Next is too small for me to read. How
many stories does it take to hit a $100 million plus? We have covered that I think. Okay so you do
run hundreds of stores but dozens are doing well right? Is that a good summary?
So you have dozens of stores that are doing well? For Angus, yeah. Okay cool.
If PayPal reserves 25% of your funds, how can you resolve this? I think first, you try to ship faster because most of the dispute is because of your
low delivery speeds. And then you need your customer service to reply in
the dispute platform promptly everyday. After a few months you can negotiate
with your Paypal rep again for a lower reserve rate. Usually I think getting below 15% is pretty easy. If you are getting a reserve rate of 25%, I think you’re doing something very wrong,
either logistics or customer service. Alright yeah.
Paypal can be quite a pain you’re right. There’s no good way to skip it. It takes time.
But you think with a good relationship it gets better or it doesn’t really help? Because
with Facebook relationships in the end don’t really matter. It’s the same.
Because they have security team. The rep has a relationship with you but the security team is an internal team, we don’t know them. For PayPal, I think the risk team has
the highest authority. All these super senior account managers can’t dispute or help you out too much when you kind of violate something risk-related or they think they have to put a huge reserve on you. But I think one thing that you guys could
try is have multiple different companies. Sometimes it’s luck as well. If one store
gets hit, one company gets hit with 30%, but the other same store, different store, different company, might be only be hit with only a 20% or 15%. If you wanna scale up things fast try to
diversify to a few stores, a few PayPals because PayPal hates super fast influx of money right. That’s the risk for them. But if you
put yourself in their shoes, it’s a risk. I was approached a lot going, Steve could I rent your PayPal account? I was like hell no. What if you run away?
Who am I gonna fine right? If you put yourself in PayPal’s shoes,
he’s processing all this money and he’s giving it to you in advance right?
What if you just run away? He has to refund everyone. I think two years ago, I met someone in an event.
I think they’ve run a bunch of transactions through PayPal, and they
shut off the store, and they didn’t shut the store, they put find PayPal on the store. Find PayPal for refund. And these guys just ran away or something. And PayPal has to refund everyone.
So just be more careful. Alright, that’s interesting. Also regarding company set up, we don’t have time to go into that but that would be an interesting question for another panel.
That’s cool. I’ll take a last question right. What does your daily routine look like?
Angus, when you wake up in the morning what’s the first thing you do? Usually I go online to the the office to speak to every media buyer to see what is happening in Facebook. Because Facebook is a b*tch. Okay, no Facebook rep here. I want to know what is happening in Facebook.
I talk to my internal team and I try to talk to my friends in this industry as well first.
And then I will try to think what I can do to make some extra money.
For example, in my business what is lacking? How can I improve the AOV? How can I put the conversion rate? I try to build some program. I got a telecom team behind. That’s my daily routine. Cool thank you. Steve? I have a lot of partners.
I spend most of my time dealing with partners so I follow up on how everything’s doing.
Evan is also my partner. He handles all the ecom side of things.
I don’t have to speak to all my media buyers because I’ll just ask him how’s everything doing.
I speak to my project managers, head of media, and all these kind of guys, and I’ll spend time understanding different strategic business that could benefit the overall group that
we’re building. I mean exploring new opportunities is kind of like one of my
biggest focus right now. For me, I think it’s similar to
Angus because I’m more running the operations manager for the ecommerce.
Basically, I would wake up, I look at Facebook, and I look at the performance, I talk to people, see what could be done and what could be improved, what are you lacking, and you know maybe plan out some of the things definitely we
could improve over the next week. What are the immediate things that we can implement and know what are some of the things
that we could definitely plan out over the weeks and months, you
know to definitely tackle some of the issues and plan out the processes as well. That was amazing. So I would love to
compare your routines to these guys’ routines. Maybe you can go into the
direction that those guys have been taken. I would love to see some of you
here next time, not just sitting and listening and asking great questions.
Thank you for that, but also up here onstage. You’re a great inspiration. That’s
what I’m trying to say. Thank you so much for sharing that knowledge. I think some of
the questions have been tough, you have been honest. I appreciate that and well, let’s end this with
a very very very big round of applause for those guys.