The Side Hustle Show - Full Episodes - Amazon FBA Retail Arbitrage at Kohl's: Banking on Bras and Reselling Clothes for Cash

Hey, I'm Nate from House of Bodies. And I'm Alicia from House of Bodies. And cumulatively, we've sold more money in bras than our entire house is worth. You guys are known as the bra guys, the bra people in the Amazon FBA world.

Why this product? Why? We'll cut you into this in the first place. We sell a lot of different things.

And back when we were first starting Amazon FBA, one of the big challenges was spending all of our budget. I know initially people sort of struggle with how to do Amazon. But once we figured everything out, well, we were public school teachers at the time. And I just didn't have enough time to spend all of my budget.

And so once we started finding clothing and then bras from places like Coles, it just exploded because now instead of spending $100 at a Walmart, if I was lucky, now I'm spending $1,000, $10,000 at Coles in a single day. And that just was completely game changing to our business. Is it the Amazon business is all about how do you multiply money quickly doing some ROI math in your head? Incloading was a category when I was doing this a few years ago was one that I didn't really touch.

I think I sold a few like, forget even the brand, like real tree, like fishing or something like that. And it was from Walmart. You're saying, this is a cool category. And I sold a lot of toys and tools from home and random stuff and like light bulbs, which was kind of a- That was actually our very first sale was a light bulb.

Yeah. Okay. And which are like, okay, the clothing stuff, I would never even thought to scan really, because I don't know anything about- The nice thing about clothing is that a lot of people aren't gated in that in the beginning. So if you tried to sell on Amazon, you probably noticed that you restricted to sell a lot of different brands, a lot of different categories.

Clothing is pretty much open. So we were able to- There's specific brands that are locked off, but as a category as a whole, it's very open. Yeah, exactly. So that makes a little bit easier for people to find.

And the thing is too that people in more clothing is, because it requires a little bit more preparation to send it in, you have to like bag it. Yeah, you have to use poly bags, you have to sort of fold it nicely and all of that. You can't just slap a sticker on and send it on its way. Yeah.

Yeah, that was me. It was like, if there was ever an option for Amazon to do it for you, it was like click that button, and then send it off. So you guys are doing a little bit more prep in terms of the labeling, in terms of the packaging on the front end. And that makes it less competitive as a seller.

Yeah, yeah, I would say so. There's rarely- And also because of just the sheer amount of different pieces of clothing, we're not ever really going too deep on one thing. I'm not buying like 100 of the exact same size and color and style, but if I get one of 100 different colors and styles and things like that, there's not a whole lot of competition. Usually at most, there's maybe three or four other sellers on any exact variation that I'm trying to sell.

So I mean, if we just stay on there and reprise accordingly, they usually sell pretty cool. Yeah. All right, tell me about a sourcing trip. We're dropping a thousand bucks on bras and clothes and I have a lot of questions related to that, but I'll let you start that off from the moment you walk in the store.

We'll start it with a funny story. Our favorite bra story. So we said we were teachers before and I taught first grade and he taught music. And so we were in the store and it was a huge sale.

And so we had what, like six cards? Yeah, we had six cartfuls of just bras at Coles. At this point, like we were shopping together, but I had kind of wandered off over here to this, but he was kind of by himself surrounded by like five or six carts of giant bra. Just mounted.

Yeah. Yeah, you can take it from there. Yeah, so in the process of literally clearing a shelf, like I'll scan a few things and I'm taking it, at this point, all of it, because Coles usually doesn't hold more than two or three of any exact size. So sure, I can clear a shelf and I'm getting a multitude of different sizes.

So I'm in the process of clearing a shelf. And from the corner of my eye, I see this little human and then I hear Mr. Jackson. It's one of our first grade students and her mom and the mom is super apologetic.

I'm so sorry, I feel so awkward. I should have said hi. But as far as like the actual process goes, I mean, like we're in the store, we're in Coles. And initially, obviously like it felt awkward, like that situation was awkward, but once you sort of realize just how much money you're making, you sort of get over that.

So we're in the store, we'll have like the Amazon seller app on our phone. We're scanning the barcode, we're comparing all of the math. We do a lot of like discount stacking. I think that's sort of really what sets us apart from some other sellers or what sets Coles apart from some other stores is the discount stacking.

So I'll be standing there and I'm doing my mental math. I go, okay, this says it's marked for $18, but really it's this must percent off. So I'm actually paying like $8 for this bra. But they price their things up because they assume there's a lot of savvy shoppers that are gonna stack all these two.

Okay, okay. So that's really the key. I feel like with getting tons of stuff at Coles. How do you, I mean, is it just like you sign up for their email newsletters and you get notified of those deals?

Yeah, you can sign up for like an email newsletter. I actually, I joined a bunch of Facebook groups for Coles couponing. I had nothing to do with flipping or reselling, but I joined those groups. And then my page will just be filled.

Like my newsfeed is just filled. As soon as there's like a 30% off sale, or a Coles cash thing, my newsfeed is just, oh my gosh, who has the 30% off code, or does that mean other? We actually made like a Coles discount calculator, a little download thing, but then I'll come back to think. Yeah, it's on our website, but you can like stack.

There's at least eight different layers of discounts that you can stack on almost every purchase that you make at Coles. Wow, yeah, there's the even credit card rewards and discount gift cards and... Exactly, gift cards. Oh, that stuff.

But when you're in the store scanning and you've got the Amazon seller app and it tells you, okay, this is how much you stand to make. You know, here's what it's going for in Amazon. Here's how much you stand to make after fees. And you can kind of compare with the price that's on the tag in front of you.

So you kind of have to do some work in your head. Well, I know it's gonna be 30% off, plus or minus whatever sales tax that I have to pay, minus this other thing. Like do you have a quick way, or is it just like through practice of, you know, going up to the register and being like, well, this is what I was out the door for. Yeah, it's a little bit of both.

So I mean, at this point, it's been practiced. Like I, I, I sort of go in the head of time with a couple different like price point criteria. Yeah. And I'll sort of like run some calculations ahead of time.

So let's say there's like $20 items, $15 items, and $10 items. Well, I'll do the mental math ahead of time. So I know if something is priced at $18, it's like, okay, well, this is a little bit less than what my total calculations were for the 20. So like, let's just pretend that it's like a 61% off or something like that.

And so I'll do all the calculations for a $20 item. It's like, okay, I'm really paying like $8.49. So if it's marked at 18, I'm probably paying like 8.54. And so I'll do some of that mental math.

A lot of it, yeah, but percent off can be calculated ahead of time. So that they might say 30% off, but with all the discounts, it's more like 60% off. And then you can use that mental math as well. Yeah.

So I would say at this point, it's practiced, but we have actually in the past when we were teachers, eventually I, I still ran out of time. Like I still couldn't spend my budget, even sourcing bras and coals and things like that. And so we actually hired on people to shop for us. And I would just give them very strict criteria.

So like when we were working with people and we hired that out, we would say like, okay, if it's under this certain rank, so let's say if it's ranked under like 100,000, then we want 100% ROI after all the discounts. If it's ranked under 50,000, then we want like 75% ROI. And if it's ranked under 20,000, we want like 30, 40% ROI. So we would have some like general guidelines for that that were sort of, I mean, we could teach anybody that.

Sure. But then as you practice, obviously, you can work outside those confines. Right. And that's because the lower the sales rank, the faster it's going to turn once it hits Amazon, like a sales rank of one, is the best selling item in the clothing category.

Yes. For the sales rank 100,000, 150,000, might sit in the warehouse for a little bit. So I'm going to make sure that I double my money when it does so. Exactly.

Exactly. Now you roll up to the cash register with six carts full of bras. You've cleaned off the shelves. Did they call the store manager over?

Like, what's this guy's deal? Is that even like? The only time manager is really called is if, well, one time we, the machines broke because we bought so much. Yeah, probably.

You can only actually check out 200 items at Coles. That's a good time. And then you'll have to do a different transaction. Yeah, we broke the machines on Black Friday.

Well, I've seen some of your pictures with like the receipts like the stretch of glass all around. Yeah, I think our record was 130 feet long with one single receipt. Yeah. Yeah.

So usually managers don't get involved unless there's an issue. For the most part, managers are really happy that you're shopping there because you're clearing out all the clearance they cannot get rid of. So as a corporation, Coles is not. They're not reseller friendly as a corporation.

But if you're a manager at a store and someone's coming and clearing out all your clearance and getting rid of a lot of stuff and losing your sales, you're not going to ask about the questions. Yeah. So we don't usually have a whole lot of interactions with managers as far as like them coming to us to ask us what we're doing. Yeah.

But when it does happen, we are completely honest because like we're helping them. They're helping us. I want to build that relationship. So at this point, I have multiple phone numbers of managers in my phone.

And I'll get texts and Coles. Like, hey, Nate, we just got this new shipment. Or hey, Nate, we're just putting a ton of stuff on clearance. We know it's like this brand that you like.

Do you want us to set some aside for you? OK. So yeah. So we developed this reputation and not trying to be all like sneaky about it.

Exactly. Yeah. No, I always like, hey, I'm flipping these. I was wondering if you have any more of this or like one of your sales goals for the day.

Can I help you hit that? Or do you have any Z-Rack? That's like the big rack in the back. So I'm not taking up six shopping carts.

Yeah. Things like that. So we're all asking, hey, is there any stuff that you just can't clear out? That's maybe sitting to the side somewhere that I can look at.

So I'm always trying to figure out ways that I can help them. And then obviously, they repay the favor. Those. 95% of the time, they're really happy that you're there.

Oh, yeah. Well, Coles, I've never had a negative manager reaction from a single Coles that I've been to. Yeah. In the big data era, they've got to know what the stuff is going for online.

So why haven't they made it part of their process to just cut you out? Or is that a fear that like eventually you could be cut out as they figure this out and get smarter on the e-commerce side or just send it into Amazon themselves? They don't want to deal with it. Yeah.

I think there's a lot of market discrepancies definitely. But then there's also like big logistics and small logistics are drastically different. And so like, yes, these items could be profitable if they listed them online themselves. But that would mean that each individual store would have to have a dedicated Amazon seller who's constantly checking their own inventory, things like that.

So I could see it happening at like a corporate level, like their online stuff. I could see going down and I will still shop online, like that discrepancy does currently exist. If they outsource that, I could see it happening online, but I don't see it feasibly happening in store just because every store has different prices on different items. And so each store would have to have like their own dedicated flipper sort of.

And I don't really see that happening as a whole. Yeah, that was something that didn't, on the surface, didn't make sense to me. It's like Walmart is like the king of big data. Like they're super smart, logistic systems.

How is it that they have profitable items for me to flip on their clearance shows? Like you just didn't register until I went out and did it and was like, oh, okay, like it's so weird. Like how the Walmart employees not cotton onto this. It's another explanation for that.

Just with ourselves, like we have overflow inventory, we have bad buys, we have things that we have to liquidate or donate things like that. And so like if we have that and we're resellers, if it's more profitable for me to like sell to a liquidation company, their the liquidation company is still making money on my stuff. If I did something better, I could fill that inequality, but it's more efficient for me to do more of what I'm good at and more of what my employees do and things like that. Then it is for me to try and dive into that space of like liquidation or things like that.

When you were hiring people to go sourcing for you, was that just an hourly part-time job or did you pay them like performance basis on what they found? They got paid a percentage of whatever it sold for. That would go back into their pocket. So that also helped encourage like really good sourcing as well when they went out because they wouldn't define these really amazing buys because that would increase how much they got paid.

Yeah. But they would get also paid I think per hour for prepping. Yeah, so sort of how we managed it is usually we would pull a person on as a prepper so they could see sort of the back inside of things where they're taking like clearance stickers off, they're folding, they're bagging, all of that stuff. So that they understand that and we pay them hourly for that.

Yes. Then we would sort of upgrade them. They would start to shadow me in the store and we might do hourly while they are just like shadowing me and sort of learning the roads. And then we would switch over to like a commission percent profit base.

Okay. Yeah, I'm always curious how people have it set up because on the surface it's like, well, now that I kind of know how the sausage is made, I could just do this myself. Like okay, this one's going in my cart. This seems like a really good buy.

Yeah. But no, if you can set it up as a win-win, we're they're not taking that, that inventory risk, they're not taking, you know, they're not in there. Well, not in front of cash. Most of people who worked for us started their own Amazon businesses and there wasn't like a conflict of interest because they only had so much budget.

And so if they found two of these items, well, one for them, one for me. And that's totally fine. And we understood like, I mean, we're sort of competing, but not really. There's so much to go around.

That's what people don't understand. People ask us why you teach people how to do Amazon. The thing is, like, there's so much out there that it's not hurting our business at all to do that. Is the price in store, like, is there an, is there a big enough discrepancy between Amazon?

Or is it like, when I was sourcing, it was more, it felt like very needle in the haystack where like it's scanned a bunch of stuff and you know, maybe find a couple things or that's been 45 minutes in the store and then walk out empty handed. It's like, this is kind of frustrating. Yes. Yeah.

A lot in the beginning, I think that's the biggest barrier for a lot of new sellers. Is that you spend so much time sourcing and is either hit or miss, you either like hit a jackpot where you come out with nothing. I don't mean that for the first like few months as well. The longer you go on, the more you learn where to source, how to source, kind of be efficient and it really speeds things up.

Yeah, but there definitely is still that, that initial barrier to enter because if it really was like, oh yeah, just go to Coles and scan any aisle and it's gonna be profitable. Well, it's not gonna be profitable for long. Like, yeah, there are some. They're Amazon or Coles or the million other sellers are going to find that inequality.

And so for us, what we tell people is like, focus on the clearance sections first, there can be profit in other areas. It's not as common, especially with clothing. Yeah. And the first six months, we really tell people to wear just for learning, like don't have something like, we always wanna clarify, it's not fast money or easy money and it's telling you differently it's by selling your scam.

Yeah, it's work. It's not faster easy, but it is simple. Like, yeah, it's a very repeatable process. Yeah.

I mean, it's by low sell high. I mean, it's probably one of the business models around just kind of adding a layer of technology to it. Right. When you guys were still working full time, what was your schedule like for, what was it like?

Once a week sourcing trip, was it, you know, every afternoon after work? What was it like? That was crazy. We should clarify those before kids.

It was before kids. So, we were working every weekend. That's an advantage. Yeah, yeah, it definitely had more time.

So, we were working every weekend, every vacation, every day off after school, the fourth school. Yeah, so, I mean, again, we were teachers. So, we would be at school from like eight to four. I was, hopefully our principal is not watching this video, but I was sourcing like during my lunch breaks, during like, if I had a study hall period where I didn't have any students, I was out the door, I was sourcing stuff.

Every day after school, I was sourcing. Usually I would do a big sourcing trip on like a Saturday, I'd go all around, we're from Orlando. So, I'd do a big Orlando trip all around the area. And then Sunday, I mean, like eight in the morning until midnight, we'd just be packing and shipping stuff.

It was a lot of work. I kind of went back to that past year and think, oh my gosh, you were working constantly in that first year. Yeah, and we actually didn't pay ourselves anything. Like, we're doing this for zero money.

The entire first year, we were rolling 100% of the profits back in. So, we were able to clear our jobs. Yeah, we could. We could put our jobs after that.

But, I mean, it's kind of crazy to think, we actually started the whole thing with 100 bucks. I actually, I think I read one of your blog posts about FBA. This is back like almost four years ago. Yeah.

And I was reading about like, how to do FBA. And it's like, okay, let's try this. And Alicia wasn't really sold on. I thought he was crazy.

But I convinced her like, let me just use 100 bucks. And if I can flip 100 bucks into something great. And if I can't, we're out of 100 bucks. We have finally got into a point.

So, we both had jobs finally. We finally had a point where we were like somewhat stable financially. And then he's like, he went into adventure. So, we thought, okay, we can give you 100 dollars.

And I thought, well, we'll see where this goes. Yeah. So, I took a hundred dollars and I just flipped it and flipped it and flipped it. And every two weeks or month or so, it was- Yeah, overall, the name is all crazy.

Yeah. So, after the first 12 months, we actually did, it was 180,000 in total revenue in the first year. Yeah. And that was starting with a hundred dollars.

Yeah. We always kind of joke, like if it all crashed and burned, we'd be out of 100 dollars. Yeah. If our business goes bankrupt tomorrow, well, I'm at 100 bucks.

That's an interesting way to talk to it. Yeah. It'll sneak a better. Yeah.

That's crazy. 180 grand in revenue off of a hundred dollar. Yeah. That was the first year.

I mean, since then, we've done well over a million dollars in total sales. But yeah, 180 in the very first year. Yeah. And we've been working for different margins based on sales velocity or projected sales velocity.

Is there an overall metric that you're shooting for after accounting for shipping and sales tax and, you know, the poly bags and the printers and the labels and all the software and stuff that goes into it? Yeah. What I usually tell people is as far as like the sourcing end of things, it's hard to calculate all of that on each individual buy. So on an individual buy, look at just your ROI or like the money returns.

So I tell people try to get like either a five dollar return with like a hundred percent ROI. And if you stick with that, you should be pretty good because on average, Amazon will take about a third of your budget. And so there's something they call it like the 3x rule of a 30% rule where it's like my cost of goods is about 30%. Amazon's fees and everything is about 30% and then my profit is about 30%.

When you're skinning with app 2, it tells you in the, I mean, as you know, it tells you in the app what the fees are. So if not like you have to guess what the Amazon fees are shipping is, it'll tell you you're writing the app so you can see if it's a good buy or not. Yeah. So for our business, like after everything is said and done, our net profit on our gross usually hovers around 25%.

And that's pretty good. I mean, if we're shooting for like a 333 split and then we take some out for like the cost of the account, the cost of paying employees, all of that. And we're still at like that 25% and we're doing the great. Yeah, that's pretty, it's pretty healthy margin for something that anybody could theoretically go through.

Yeah, we're not geniuses. We're pretty average people. Do you do any sourcing online? Like if I don't have a coals near me or maybe the, the Nate of Livermore has already gone and cleaned out the coals nearby?

Yeah, yeah, we do a lot of sourcing online. And again, I mean, we'll source from other places besides coals. Coals is, and clothing in general is definitely our largest category. When I look, we use a program called inventory lab to track like all of our sales metrics and all of that.

So when we're looking at inventory lab, we can see actually 70% of all of our sales come from the clothing category. So it's most of it, but it's definitely not all of it. But yeah, we definitely do online arbitrage like coals.com, Walmart.com, target.com, all of those places are great. For online arbitrage, we use something called tactical arbitrage.

That's like our main tool that we like for online arbitrage. It's really, we find it to be like the golden standard pretty much everyone I talk to who does online arbitrage or OA on a large scale. They always tactical arbitrage. So it's kind of the golden standard for that.

And if I like, that's another one that doesn't quite register. Like if everybody is usually the same tools for the same stores, it's like, doesn't that inventory get snatched up instantly in like markets because you have to be a lot faster and we usually find like the margins are not as big. If we find something using tactical arbitrage, usually the margins are not as big and there is more competition later on because obviously more people found it. Okay.

Any bad buys you mentioned having to liquidate some inventory and any stuff, just like, oh, I really went big on this brand or this product and it was a flop. Yeah, there's definitely some bad buys. Our first one that I would say is the biggest one is where our advice comes from to new sellers is to go wide not deep, don't buy a bunch of one thing came from its experience. I think we were a few months in.

We actually had a wholesale account with someone and we bought like a test run of some of their products and they sold really well. They're just diffusers oil diffusers. They sold really, really well for our first big purchase and then we were like, okay, we'll let's do some research. They're all really, really good.

We thought we'd sell it really quick. So we purchased like our entire budget. We purchased a bunch of diffusers to sell on Amazon. We thought it'd be a home run and the next day, after we sent them in, someone came on a listing and tanked the price.

It was actually the brand themselves. It came on to Amazon and instead of they were listed at $70 and we're buying them for 35. Yeah. Well, they now listed it for 35 on Amazon.

And we still understand why because it could have just priced matched and still sold out. Yeah, these things are flying off the shelf for $70. At 70, yeah. So it's like over there.

It's hard. You just hurt yourself here. It was disheartening. It really was.

But we kind of just had to think, well, we'll try to recover our money as long as we can and then just keep going from there. But yeah, we wonder what lessons for that one. Yeah. So we definitely make bad buys but that's again why we say go wide not deep by one of 100 different things.

And if 20 of them end up being bad buys, well, the 80 other ones were all bad buys. And the more that you do it, the less that will happen. So currently, I mean, between like returns and bad buys, things like that, usually only five to maybe 10% max of our products are bad buys that eventually will get liquidators something like that. Okay.

Versus going all in on like this one particular brand because you know, you're all your eggs are in one basket. Right. Yeah. What can I do as a new seller when it seems like everything I'm scanning says, restricted, restricted, restricted.

And it's like, well, come on. What can I, can I sell something? I want to test my, I want to test this out. That's the hard part.

We tell people that it's actually a positive thing when it's like that in the beginning because if anyone who sell anything, then it'd be so oversaturated. A lot of people quit in the first few months for that reason. And so we tell people who know it's so frustrating really hard is actually good because that means once you get past that point, there's not going to be a lot of people saturating it. Yeah.

Because it has that larger barrier to entry, my grandma isn't doing it. And if there wasn't that barrier, entry, then my grandma could do it. And if she was doing it, it would not be profitable. Yeah.

So yeah, so that's sort of what we tell people as far as like don't get discouraged. For some specifics, like to give you some like meaty details, look for clothing. Clothing as a category is not restricted. That's why we talk about it so much.

So like going to coals and scanning bras or scanning pants or whatever else. Like the stuff for the most part is not restricted. Yeah, you're going to be restricted from like Nike and underarmament. But the everyday brands for clothing is pretty wide open.

That's where we like to tell people to start. Books is also another great place. Like if you're feeling discouraged and you feel like everything is restricted, go to your local like Goodwill or Salvation Army or something and start scanning the books. Books are virtually unrestricted.

Yeah, yeah. That's a good place to start. Books are restricted. But yeah, that's a great place to start.

And the bookseller that we talked to recently had a specialized book scanning. I want to say like a Bluetooth app where it's like I'm going to download the database. So we don't have to like use your cell data and like you know ping Amazon every time I want to price check something is the is it just the Amazon seller app that you're using in the store or is there something that's faster to go through like hundreds of items I want. Yeah, we don't do so that program is pretty specific to booksellers where you're really like beep beep beep beep beep beep beep beep.

Like you're really it's really a numbers game with clothing. There's a little more analysis. So that type of like downloadable archive program. I don't find super helpful for our business.

We do use the scanning app called Scoutify to a lot. And that's actually it's made by the same company who makes inventory labs. So we mentioned like using inventory lab for our bookkeeping. It covers everything.

So it has a bookkeeping in our scanning. Okay. So what I like the most about Scoutify to is it puts all the data in a much easier to reformat. It integrates with some other systems like keep is a site where you can see that historical like price history and sales rank history and things like that.

So I'm going to integrate with that. And then what what I like the most about Scoutify to is actually one of the under under promoted pieces of it. But it's actually there's a little tab where you can see history because we've been doing this such a long time and I'm going to the same stores and buying the same types of things. So I can click on history to see if I've ever purchased this item in the past.

If I have any in stock right now what I sold it for in the past and all of that. And so that came in handy when we had like multiple people who were buying stuff for us because they might go out on the same weekend. And if this person purchases five of an exact color and size, well, we don't want the other person to also buy that exact color and size. And so they could pull that up in the app like, oh, we already have five of these listed.

We're not going to get any more for now. Or maybe you would pull up, oh, you you sold ten of these last week. Just get them all now. We don't need to play it safe anymore.

At what point in terms of, well, you weren't pulling any profit out of the business. But at what point in terms of sales and margin, did you feel comfortable giving notice at work? We waited a long time just because I'm more of a closet pessimist as well. But yeah, we waited a long time.

We actually talked for two years or a year and a half. Well, you're in a half. You're in a half. Yeah, well, sourcing.

And then we quit the end of the school year. But we made sure there is well, like within our actual profit, we made sure that there was a huge gap between what we needed to live and what we were making. And so once we quit our jobs, we only, as well, like paid ourselves what we made as teachers. So no matter how our business is growing, we are keeping our pay roll the same as it was this entire time.

Just because our business needs to carry over that. Yeah. And it was actually like when I was running the numbers for myself, it was costing me money to go to my job. And it was like, if I'm not working on my business, if I'm not sourcing, I'm not hacking things.

I know what my hourly range is for my business, based on my numbers. So then I was going to work. Like, okay, well, I'm making like 25 bucks an hour at work. I'm making 100 bucks an hour working on my business, but 200 bucks an hour.

Like, I need to stop going to work because this is costing me a lot of money. Yeah. That's awesome. I think it could have point.

Like we mentioned a little bit before we started this that we were foster parents and then we just adopted our two kids. We wanted to have an opportunity to like one of us to like be able to focus on them and be home with them. And so that wasn't feasible as teachers. And so once we kind of were close to the point of growing our family and through that, then we decided to quit.

Yeah. Yeah. I like it. I like it.

It's very much, it sounds like it's very much a volume game if you're making five bucks an item, ten bucks an item. And you know, just the brute force of like going to the stores and scanning the stuff and then uploading it to Amazon and shipping it in. And there is definitely labor involved. Now once it is in the warehouse's hands, that's when the passive, you know, the quote passive income part comes in where it's like, hey, you know, I sold, you know, 100 items today and I didn't have to touch anything.

Yeah. Awesome stuff. Have you run into the bottleneck of like while I, I cleared out Orlando this weekend and now it's like, I would spend more if I could, but I'm just out of available inventory. Not really.

I mean, it's what's crazy is that we haven't always a new place to find. I mean, he might drive to Tampa. Yeah, I might drive to Tampa or one of the coasts, like maybe an hour or two away, but there's always more stuff now. We are a little bit, I guess, lucky in the sense of we live in Orlando.

It's sort of like the shopping mecca of America. I mean, we typed in, like there was a deal at Barnes and Nobles last year. I typed in Barnes and Nobles and I did like a 45 minute drive from my house. The door was 18 Barnes and Nobles within a 45 minute drive from my house.

Wow. So yeah, it's, I haven't really hit that bottleneck. We have people doing it in Indiana too, like a, a, a, a, a, a, and they're doing really wonderful as well. And I think is like, there's always more stores.

Yes, eventually, like I've cleared out the coals for my area and they're not going to have more clearance for another couple of weeks, but then you go to a different store. Maybe I go to like the Nike outlet store. Maybe I start hitting Walmart. It's now, and there's hundreds of Walmart.

Yeah. So there's always other stores to try, always other niches to get into. So like if, if we have bought seemingly all the clothing that we can find, well, now I'm going to look for groceries or now I'm going to look for this or that or the other. Or we can pivot more into online sales or I mean, at this point, like getting into wholesale.

So there's always something that you can spend your money on. So wholesale is an avenue. Do you see yourself going down the private label route or is like, look, we have, there's still plenty of room to conquest here on the. We're talking about that last night.

We'd like to because it is definitely a more passive model. We don't like it for beginners because like it, there's so much up front cost. I mean, you got to spend like $5,000, $10,000 to rank it and all of that. At this point, that's a feasible thing for us.

So we'll probably look more into that this year. That's sort of one of our goals for 2020 is just, yeah, starts shifting. We're going to be more passive so that we can just spend even more time with the kids. But I mean, in all honesty, retail advertisers work.

But once you've grown to a certain point and you've automated things like we have people who are packing and taking labels off and prepping and shipping. After Nate shops, like we're done with. Yeah, I'll spend maybe like three days a week shopping. Maybe.

Okay. And then I'm done. And so it's like, I'm working 15 hours or so a week and we're making like what we're paying ourselves what we both made as teachers, but the business is booming. Right.

So I mean, there's ways to automate it. That's just sort of taking up the next level of like front loading all of the work to something like private label. Yeah. But it's still, it becomes relatively passive the more you do arbitrage.

Yeah. Yeah. And there's a practice or there's a rhythm to shopping trips or you kind of know what to look for and everything. It becomes a little bit more, it becomes more efficient over time with.

Yeah. But yeah, I appreciate you sharing that three days a week of shopping, maybe 15 hours a week of sourcing and then other people now are helping with the other logistics stuff. Exactly. And healing all like what we said before that's not at all how we started like we're working 40 hours at a job and then probably 40 hours on Amazon and not paying ourselves.

But because we put in all that hard work up front, that's why it sort of becomes passive. I think a lot of people go like watch YouTube videos and things like, oh, they make it look so easy. I mean, at a certain point it becomes easy. Like we're just sort of coasting.

It's a difficult process to learn, but a very easy and simple process to just coast. We try to be transparent with that too in our Facebook group. Because if you go in and if you take a look at someone who's been doing it for two years, it does look pretty easy. But that's not the reality of just starting out.

So yeah. Have you found that you almost have to operate at a pretty serious volume because of the labor involved in the packaging and the sort and like the software tools you mentioned in the lab and some of these other ones. There's definitely like different stages as far as like, I mean, you probably can't like you, for example, tactical arbitrage. It's a fantastic tool, but it costs like a hundred bucks a month.

So that's not something you should buy right at the beginning because yeah, probably don't have very much budget. If that's like a large portion of your budget, well, that's stupid to buy a tool to do a job when your job is to find inventory. We tell people again and again and again, don't purchase a ton of tools right in the beginning. Focus on inventory.

Keep it simple. We might have put in some elbow grease and then you'll grow faster. But then for our business, obviously, yeah, like the more tools we have, the more numbers we have to do in order to pay for those tools. So they definitely goes hand in hand.

There is like a larger quota that we sort of have to do to keep the lights on. And our margins like the larger a seller gets, the smaller their margins are. So when people are showing their sales screenshots, like, oh, I sold a hundred thousand dollars this month. That's awesome.

But they probably margin they probably did like 10% margin, which is great. I mean, like that's still awesome money. But you could probably sell half of that and yeah, 20% margin. So there's a give and take.

That's right. Any other must have tools for folks starting out aside from the pro level Amazon seller accounts 40 bucks a month. I don't think so. There's something called a Scotty Pillar that you it's like two bucks.

You have to get it to go stickers. I'm just we just like use your fingernails for like finger nails. It was the worst. So we highly recommend just get a Scotty Pillar.

Yeah, it's like two bucks. Yeah. But I mean other than that, there's there's not like required tools. Yeah, like you said, the professional Amazon selling account.

That's the first thing that you should get. I mean, unless you're really just barely dabbling in this, you can get an individual account for free. But that's just a devil. Yeah, that's just a devil.

Before you get any tools get the Amazon pro account. But you can do most of what we do with just a pro account. So we will say to the UPC scanner would be really helpful. We may have been a long time for that.

We've been too long for that. But it does help in a little bit faster. They're like $15 every. Yeah, yeah.

There's definitely useful tools UPC scanner, Scotty Pillar, Thermal printer. Yeah. If you're selling clothing, you will need to be like poly bagging things. So you need poly bags.

Say inventory lab. Inventory labs is useful. Those are all great things. There's not necessarily like must have things.

There's there's always a freeway or always the hard way to do something. Yeah. It just has a priority. Yeah.

Some people that we know had a little bit more bigger budget than we started out with. And so they want to buy the label printer right away. And that's great. And they have success with that.

So it really depends on if you have more time or more money to shift around. Yeah, I remember punching in. Because I have the scanner like punching in the barcode. It's like zero by number and look at over my shoulder.

Yeah. Yeah. So yeah, it comes down to. And you learn how it works.

Invest in tools where it makes sense where it can make it more efficient. Because like you said, at a certain point, I'm losing money going to my job. It's like, that's a fantastic place to be in. And Alicia really much.

Very much appreciate you joining me sharing me sharing with me the inside scoop on how the Braflipping Empire works. We've got two calls within 10 minutes a year. So we may make a scouting trip by this afternoon. We've got a different route to go on.

Right now they're actually doing like a bonus. It's like 80% off of clearance stuff. Plus you can stack everything. Like there's never been a better time to check the clearance area.

Oh, gosh. I'm ready. You go today. Here we go.

This will be my afternoon activity. Mass time activity over here. hustlebuddiesofficial.com. Check him out over there.

Anything that people should know about the hustle buddies Facebook group. What else is going on? Yeah, and if you want to check us out on Facebook. Facebook is the great place to start with a group.

It's a big community of just Amazon sellers. I'm somebody. Yeah, you look at Pussleboides on Facebook, or if you want to check this out on YouTube, we do a bunch of videos just sharing like tools, tips, and advice specific to Amazon sellers. All right, we'll link up all of those resources for this video.

Let's wrap this thing up with a number one tip for side hustle nation. Does that have to be arbitrage related, whatever entrepreneurial wisdom you'd like to impart? For me, like what I would identify as the number one differentiator between someone who has success and failure, is the person who can take 100% of the responsibility for both the successes and the failures. So like specific to Amazon, someone who's complaining like, oh, Amazon takes too many fees, it doesn't work, or oh, everything's gated, it doesn't work.

That's all blaming and outside source. If you can become the person that says, everything is restricted, let me find the thing that's not. Or like, let me, let me scan this entire aisle. If the person who like takes 100% responsibility, and then when they do find it, like yes, I found it.

I didn't get lucky that I built a seven figure business on Amazon, like it was very methodical. I follow the process. When I speak bumps, I we want to speed bumps, but we overcame them all. So I take 100% responsibility for the success.

And I also take 100% responsibility for all of the failures. I try not to blame outside sources. There's always something that I can do better. And I think that translates into, I mean, really any business.

I like that. At least you had anything to add there. No. No.

Well, that was good, guys. Again, hustlebodiesofficial.com. Thank you so much for joining me. And we'll catch up with you soon.

Awesome. Thanks, Nate.