In this guide, we're going to share our key takeaways on how to scale an Amazon business through outsourcing and who to hire for your growing Amazon FBA business, directly from serving literally thousands of Amazon sellers daily. We'll also talk about the pros and cons of outsourcing for Amazon sellers and when is the right time to hire a virtual assistant for your Amazon FBA business?
Most people who own an Amazon business fall into one of two buckets.
a) Are entrepreneurial control freaks
b) Struggle to complete the myriad of tasks involved in becoming a successful Amazon seller
Either way, completing low value tasks limits scale potential within your Amazon business. Outsourcing for many sellers is the most obvious answer.
We'll showcase some of the strategies and resources that successful Amazon sellers use, including our own clients, to scale their business with effective outsourcing.
Table of Contents
- Amazon seller tasks to outsource
- Choosing between contractors and employees
- How to effectively hire the right staff
- Challenges with outsourcing an Amazon business
- 💲💲💲 Costs of outsourcing (Infographic)
- Supply chain management of products and suppliers
There are also tasks that probably shouldn't be outsourced to a human, but rather to software that can monitor your account 24/7. Particularly for suppressed SKUs, hijackers and account suspensions. Bindwise is currently assisting thousands of Amazon sellers right now, in real time, without the significantly higher cost of staff.
Previously we've discussed why growth can be stagnant through manual order fulfillment within eCommerce in general. When writing this, we're addressing the Amazon seller who's already utilizing the Fulfillment by Amazon platform. Ideally - the seller who's ready to move to their next stage of growth.
Amazon seller tasks to outsource
What is Outsourcing? If you hire an outside consultant, service provider, or agency to manage a portion of your business, that is outsourcing.
There are plenty of tasks here that the average Amazon seller can delegate to outsource freelancer/VA/agency. We'll cover what we believe is the Top 6.
#1 Product listing optimization
Most sellers struggle with keywords and aren't being found organically. This leads to increased PPC expenses to maintain their targeted sell-through rate. The most obvious solution is a freelance Amazon PPC expert who can be hired one-time or ongoing, depending on the volume of SKUs that need optimizing.
#2 Amazon PPC campaigns
There's both an art and a skill to creating a positive ROI with PPC campaigns. Beginners often struggle to at least break even. After you've set an ad-spend budget, the campaign setup, testing and monitoring can all be outsourced so you can focus on scaling your Amazon business.
#3 Graphic design
Let's face it - most of us are not graphic designers. Commonly we think of graphic design for product packaging and logo design, however there's a much greater scope that a designer can assist with. This includes website graphics, business card design and offline ad content for those who also sell in brick-and-mortar. The charges for a graphic designer is one time, yet the graphics can be used again and again for years.
#4 Customer service
One of the biggest advantages of Amazon which draws many new sellers is the customer service. In most cases, it's handled by Amazon. Yet there are customers that will contact you regularly the further you scale your Amazon business towards hundreds of sales daily. A virtual assistant can respond almost instantly to direct messages, and this recommended as Amazon measures your response speed.
#5 Video and photography services
Amazon, unlike other platforms, sets a very rigid and high standard for photography and video. For most newer sellers reserving capital to scale their Amazon business, the pricing for world-class photography seems excessive. However, it's wise to remember that photography is the #1 conversion metric on Amazon. The high cost of these services can be recovered through improved monthly sales volume.
#6 Social media management
Whilst not particularly relevant to selling on Amazon's platform, the majority of clients here at Bindwise do sell outside of the platform (although Amazon is the dominant marketplace, more than half of sellers are on eBay and over one-third (35%) are on Walmart).
If you're focusing to scale your Amazon business for a 7 figure exit, then there are greater brand assets that can increase your multiple. Social media channels can be handled by an agency and pricing is quite reasonable compared to other Amazon tasks to outsource.
Choosing between outsourcing eCommerce professionals and permanent staff
This is a choice depending on the type of business and volume of sales.
A contractor generally works at a slightly higher hourly rate but often won't perform 40 hours per week. They may have another Amazon client or two, and work between several accounts.
Often a contractor is ideal for the person who's starting to outsource elements of their Amazon business for the first time.
Keep in mind that contractors are usually more experienced in performing specific tasks, as they only focus on these tasks and can gain more practical knowledge by working with several clients.
Here are some more reasons to outsource tasks to a freelancer/VA/agency.
- Specialized skills or specialized equipment. Running a retail business usually means knowing a bit about everything, and definitely doing a lot of everything. But some tasks are highly specialized and requires expert skills or systems. Fulfillment operations are frequently outsourced because of the need to stock large amounts inventory and manage it efficiently.
- Seasonal needs, temporary or half-time. The task is seasonal or may need to scale up or down quickly. Customer service is frequently outsourced because those providers are better equipped to handle high volumes of calls on demand. The cost of hiring in-house is prohibitive for the amount of work. This is usually because the task is not fulltime and you simply can’t afford to hire a highly skilled person for a part time position. We found this to be true with graphic design. You may also realize that some tasks need to be done for the short term, such as seasonal fulfillment, tax preparation, a website redesign, upgrading your infrastructure.
The biggest benefit of short term outsourcing is that you are able to bring in an expert for a defined period of time to perform a task without committing to them long term.
There are several drawbacks to outsourcing your ecommerce tasks.
- Finding a high-quality service provider is time-consuming.
- Another challenge is that good freelancer tends to be very busy.
- A virtual assistant will generally cost more per hour than someone you hire in-house.
In-house employees typically are for the larger Amazon seller whose cashflow can justify the expense of a full time staff member or team. These employees are likely to remain within the company for a longer period of time and may seek higher positions as time goes on. Consider first if you can get a greater return on investment from a full time employee before committing to the hiring stage.
The greatest benefit of hiring a new team member or a permanent staff is that you control the provider's time, activity, and quality.
Either option still requires input from the Amazon business owner, especially in the early stages. A full induction process should occur regardless of the employment situation of the employee. Further still, the creation of Standard Operating Procedures is going to help alleviate interactions between staff and business owner, and also reduce the length of the on-boarding process for future employees. This may seem slightly over the top, but as we've said prior on our blog, treat your Amazon business like a real business.
How to effectively hire the right staff
TLDR: Hiring means we failed to execute and need help.
The first thing you'd want to ask yourself when hiring staff to scale your Amazon business is "What don't I do well?" and we recommend writing down a list.
To begin with, let me dispel the myth. Outsourcing/hiring isn't an outcome of success. Revenue and clients are. Outsourcing/hiring is a result of our inability to create enough leverage to grow on our own. It means we need outside help.
So you should figure out what tasks are the most important use of your time.
From here you can create a plan to hire the right staff to take the Amazon tasks you wish to outsource. Whilst at the same time, there are tasks that many sellers do excel at, and we also recommend keeping the best part for yourself.
We would recommend the following approach:
- Decide if you wish to hire for the role locally or virtually
- Attract the right people through a thorough job listing
- Choose the right person based on real Amazon experience
- Set firm expectations and guidelines with an induction
- Have weekly progress phone calls with your team members
- Set Key Performance Indicators for 3, 6, 9 and 12 months
- Ensure that employee remains within their scope of work
Employees that help scale an Amazon business are commonly found on Upwork.com and other freelance websites. It's our recommendation that you perform a vetting process to validate the past experience.
Also, it is important to answer the following question:
When is the right time to hire a virtual assistant/freelancer/employee for my Amazon business?
The best time to hire is when you are already using just about all of the time that you have allotted to your business.
Challenges with outsourcing an Amazon business
Whilst outsourcing many aspects of an Amazon FBA business is fundamental for growth and scale, having a team isn't without its inherit challenges.
Commonly, these issues arise particularly for Amazon sellers:
- Lack of direction for new employees, often solved with SOP's and Inductions
- Cashflow management issues as the business owner has over-hired for scale
- Product concept theft - easily mitigated through non-disclosure agreements
- Excessive owner involvement as a lack of trust is placed on employee skill-sets
That said, don't let these challenges discourage you. These challenges are often below the advantages which come with hiring the right team to scale an Amazon business, provided its done properly.
How much should you expect to pay for outsourced workers?
What you might pay for an Amazon worker varies depending on several factors.
Supply chain management of products and suppliers
The larger Amazon sellers move towards total supply chain management, including products and suppliers. This includes:
- Full exclusivity of products from factories, and in some cases, factory ownership
- Comprehensive product & factory inspections completed on every product order
- Trademarks and patents lodged in both China, United States & all other markets
- Hiring of a single employee or team that resides in China for sourcing & auditing
- Frequent supplier visits by the Amazon FBA business owner to maintain Guanxi
- Selecting more than one factory for each product so production isn't constrained
This may seem a little complex at first, especially for the beginner. Those that are approaching the 8 figure range should consider full supply management with an experienced team, and this is certainly one Amazon task that should be outsourced.
Summary of Amazon business outsourcing
Amazon provides a platform where many tasks such as logistics are already outsourced. This has created unprecedented opportunity for new sellers to launch their new business on Amazon's platform, all without the restrictions of traditional eCommerce businesses.
That said, there's always a limit to growth on Amazon, with plenty of tasks that can be easily outsource. Some are easier than others, and is commonly justified with owner business cashflow.
A critical element is the protection of your Amazon seller account. Your staff member can simply be added as a general user and comes without access to bank accounts and supplier information.
There's one thing that a staff member can never protect against - hijackers. Especially in real time. Here at Bindwise, we've spent thousands of hours to perfect our tool which is now trusted by thousands of FBA sellers globally, for a very minimal price. In addition, we can notify you or your new staff member towards suppressed SKUs, plus numerous other key features for Amazon sellers.
This guide we hope has provided insights for those looking to reclaim hours in their days, to focus on product line expansion and other growth prospects. Scaling any type of eCommerce business has its challenges, but there's plenty of Amazon tasks to outsource, even to a part-time contractor.