Business Principles For Amazon Growth

Business Principles For Amazon Growth

Section 1

Traits For Success:

1.a “Follow the numbers, not the emotion”

1.b “Practice radical open-mindedness”

1.c “Become specialized  while being open to opportunity”

1.d “Discipline is the bridge to success” 

1.e “Collect Relevant Data Consistently”


Selling highly profitable products (section 2) that churn quickly within a 3-month window to keep cash flow fluid. With an exception made to the category of “books” & media that typically have a very low cost. These will be automatically withdrawn from inventory after 1 year rather than 3 months or the allocated item for “other” items to allow all buying cycles of books. IE holidays, back to school etc. 


This can be broken down into key parts:


  • Understanding Relationships of Sales Rank & Reviews – Become familiar with the relationship between the number of reviews on a product and the sales it produces while also understanding the relationship between sales rank and reviews.


  • Analyzing Keepa Charts – Watching sales rank movements overtime and connecting the available information to it. Look for the seasonality of an item. Which months are the sales ranks the strongest? Look for a pricing relationship. What prices will this item sustain sales? Will these prices allow me to be profitable? Has the “new offer” count gone up and down to indicate sellers are running out of stock? Analyze Amazon inventory patterns. Will Amazon go out of stock fairly often? 


  • Be Mindful of Other Factors – By understanding the variety of reasons a great product may not have a proven sales history. Such as poor ad, poor inventory history & poor price history. 


  • Collect Relevant Data – Document consistently relevant data in a referable document. When learning new categories. Describe the item, sales rank, reviews, category & how long the item took to sell. Collect data on seasonable items to better prepare for future seasons. Document the item, date of sales, and source location & cost and selling price. Note any other information that may have a significant impact on future decisions. 


  • Strategic Buying – Don’t be afraid of experimenting with new products but have safeguards in place by way of buying criteria.


Section 2

Strategic Buying Decisions


Follow a disciplined buying decision. Staying true to our traits for success (1a & 1d). These decisions will be updated on an on-going basis as the business grows. Currently, the business focus is on becoming specialized in “Toys” & “Books”. Testing “Cds”. (1c)

Creating buying rules will help make decisions more effective & efficient. Our buying decisions are programmed into apps we use when scanning products.  We’re also creating a spreadsheet that defines buying decisions by category. It’s important to understand the categories you’re selling in to allow for such documents to be created.

Reviewing Inventory

Removing inventory which isn’t selling to recover costs with store returns within 3 months normally depending on the supply stores policy. If inventory can’t be returned the listing should be evaluated and a decision will be made if eBay is a viable option or local marketplaces. 

Recovering some maximum amount of capital from the initial investment as possible.


  1. Return product to store for full refund
  2. Sell on eBay
  3. Sell on Facebook or Kijiji 
  4. Donate to ValueVillage for discount

An exception is made with book inventory for the following reasons:

Book inventory typically has a low cost of acquisition sourcing single titles. Most titles can’t be returned to the source. Many books have seasonal sales attached and many have been sourced outside of their season. Giving books 1 year will allow them to go through all selling seasons if they have no sold at his time they will be removed from inventory & put through one of the above channels. 

Sourcing Inventory

Sourcing Amazon inventory and the strategies used are constantly evolving. The business has yet to build meaningful relationships with reliable partners. However, the seeds are beginning to be planted.

Building Relationships – Build long-term local relationships with individuals who can provide the company value. 

  • Meeting With local recycler to Source Pallets & Boxes of books
  • Meeting with a local charity who hosts a massive book sale yearly
  • Continous contact with local online auctions 

Building relationships will be foundational in success. 

Getting these costs down is a crucial part of growth to improve margins and profits.

Expanding sourcing stores is something we’re looking at. 


Reducing the costs of the acquisition of products and increasing the volume is at the top of the priority. Sell more, with fewer costs. 


Buying in bulk accomplishes both of these goals. Also, being aware of book sales at the top sourcing locations will be valuable. 

Buying pallets and large boxes of books at a reasonable price is the current strategy and goal of the business. 10/4/2020


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