Jeremy Weisz 9:00
So you mentioned a few things. You mentioned opportunities, but challenges also, how are people? Maybe? What are you hearing as far as people making really hard decisions right now? I mean, we don’t know what’s going to happen in the next few weeks or months or six months. What what tough decisions are you seeing people make now to so they can weather the storm?
James Thomson 9:23
The most important question right now is how do you harvest cash? And how do you prioritize who you pay first? We all have working capital, and we all have bills that have to be paid some of those bills we’re not going to pay right away? Well, some of those relationships with some of those vendors we work with are absolutely critical. And we know that we can’t possibly lose those relationships. And so the conversations happening right now are talking with your vendors and saying, Listen, I need to put off paying for a month I need to put off paying for two months. What’s your ability to Bill me in two months versus one month? What’s your ability to extend The line of credit to me so that I can keep working with you, because we will come out of this. It’s just, we need your inventory. We need your services right now, but I can’t, I can’t actively pay you for it. The other question and certainly, you know, a company like ours as a service organization, people pay us for our services. And so making sure that our clients are still paying us so that we in turn can make pay our bills. You know, those are the kinds of conversations that typically a CFO and a company is keeping an eye on those sorts of things. But during times like this, everybody’s got to be asking the question, are we taking on good business? And is the business that we already have? The kind of businesses is gonna allow us to continue to be able to do what we do?
Jeremy Weisz 10:41
Yeah. I mean, in the CNBC article, they talked about, you know, it’s about how orders are surging. There’s delays and deliveries, it’s threatening to put sellers out of business. Can you expand on that a little bit? You know, is it all are we talking about does this apply to everyone? Just certain people? And how is it gonna put sellers out of business?
James Thomson 11:05
So Amazon is a platform is seeing unprecedented demand for its services. They basically have got themselves in a situation where they can’t get orders out the door fast enough and delivered to consumers fast enough. So think of it as there’s a delivery pipe, and there’s too much being pushed through that delivery pipe. So they’ve announced they’re going to hire 100,000 new people to help in the warehouses and deal with last mile delivery. Obviously, it takes time to hire 100,000 people and train them and get them ready. But But as as you hire, you know, 1000 people in this city 1000 people in that city, you start to expand the capacity of Amazon being able to do things in different cities. We’re seeing right now that depending on where you ship products, the delivery dates can be all over the map, which tells me that Amazon has an issue right now where the local delivery capabilities vary widely. If you want to sell it to ship something in one city, they may have adequate delivery people in another city, they may be way behind for the local demand. Because Amazon fills out some of those needs, they’re going to be in a position where more stuff can go through the pipe, more consumers can get stuff faster. But also consumers can order more of all the stuff that’s otherwise normally available from Amazon and expect to get it within the next three, four or five days versus what we’re seeing with some non essential products. You know, good luck getting it until the end of April or early May.
Jeremy Weisz 12:30
Hmm. I mean, we’re seeing some changes they’re making, right James like not allowing replenishment of certain things.
James Thomson 12:38
Yeah, so non essential products are not being welcomed into Amazon’s warehouses today. Whether those are third party products being sold by third party sellers, or products that Amazon itself is buying from brands putting into its own warehouses, they’re not letting some of those types of products in because they want to focus on what they call essential products, which are products that are deemed To be absolutely critical at this very moment as people move into their homes seven days a week and get used to life at home, whether those are grocery products, whether there’s are certain types of home products, certain types of baby products, these are things that are higher priority than having another pair of Nike running shoes,
Jeremy Weisz 13:17
you know, so if someone can’t, let’s say they’re running out of stock, and they can’t replenish for the next month, and they don’t have enough for the rainy day, you know, then they may have to close the doors.
James Thomson 13:32
The choices become less and less obvious, in terms of ways out of the system. I think that if we can look forward 60 days, 70 days as people start to take disposable income and spend it on things that make them happy versus things they need to keep surviving. Many of these companies that are seeing very slow sales right now. They may start to see better sales in the future, but they’re gonna have this huge backlog of Have expenses and unpaid bills, whether they can make it through whether they can whether through the next 60 to 90 days. That that that is the question. We are seeing some good news out of China, both in terms of warehouses or excuse me, manufacturing is backup pretty much where it needs to be. ships are completely full coming to North America. Some of the Chinese manufacturers, we’ve heard, some of them have been talking to companies that we deal with basically extending more better payment terms so that companies in the US who know that they’re going to have a problem replenishing inventory because they don’t have enough cash coming in to buy the inventory can at least get the opportunity to wait another 60 days or 90 days before making payment to some of these Chinese manufacturers. Again, everybody in the value chain is impacted. If the consumer doesn’t have a job and doesn’t have cash to spend on stuff. The seller doesn’t have demand. The manufacturer doesn’t have demand and all the way back as far back to the The raw material providers,
Jeremy Weisz 15:02
so it’s gonna have that trickle effect over the next few months.
James Thomson 15:06
Yes, yes. And then even even once we are told, hey, it’s safe, we can go back to society in the way that we thought it was. You’re going to find a bunch of retail stores that are either unstaffed because they had to lay everybody off, or people have adjusted to buying things online are not likely going to return us foot traffic to the stores will last two or three years look at how many traditional brick and mortar retailers have failed. That is only going to accelerate because consumer preferences have been fast forwarded here by five years. Just in the last couple months. Consumers have said, You know what, actually I can buy a lot of stuff. Yes available. It’s dropped off at my house. It costs about the same amount as me going to the store unless I enjoy shopping versus just getting stuff I need to consume. The just getting stuff I need to consume part of my exercise totally online. thing you know, I can do the online thing just fine. Yeah, personal example, I had never used Amazon Fresh until last week. I used Amazon Fresh to get some groceries. Not only was everything I wanted in stock, most of it was cheaper than the local grocery store. And oh, by the way, the fact that it was in stock is a big difference from what I saw when I went to the grocery store we can half ago. So I don’t know that I will forego bow James and
Jeremy Weisz 16:26
you save two hours of your life. Right, going to the store and back and maybe you don’t have to push the kids around. They’re grabbing stuff off the shelf. I mean, in a reality based situation, that is huge, right?
James Thomson 16:45
All this to say, consumer preferences in terms of where they shop and how they shop. A lot of that’s going to be evolving very, very quickly here. And I would not want to be in the business of trying to rebuild a retail store. Post us re engaging as a society.
Jeremy Weisz 17:03
Yeah, I totally Yeah, it what you’re saying is we are drastically what’s happening is, you know, be hit, you know, buying behavior is drastically changing right now. And it’s accelerating like before maybe like you said, maybe it would take five or seven years for this to happen. Now it’s taken weeks. And the same thing happened to me, James is what’s his instacart thing? Okay, and what instacart like, why do I ever go to the grocery store like now I don’t ever want to go back to the grocery store again, ever. Personally. Like, I can click a button and instacart and shop, you know, like, and it shows my door that night. Why? Why would I ever go back to the grocery store? I don’t know. Give me a reason to go back.
James Thomson 17:47
I don’t know all those investments that Amazon has been making over the last 15 to 18 years, building expensive warehouses building transportation between the net between the different warehouses That is a humongous investment that Amazon’s made. It is paying dividends. So many times over right now. And quite frankly, there is no other retailer out there online or offline that Pete with this. In fact, I would argue there’s no government organization that can compete with this either. Amazon has better distribution tentacles of more products to more people right now than anybody in this country. Not even the National Guard can do this. Right now Amazon is is the be all end all when it comes to the ability to push everything in anything that consumers need into their homes as quickly as possible. With with some call out to walmart.com can do as well.
Jeremy Weisz 18:41
So I want to talk about the challenges we should be on the lookout for because some of them you know, we sometimes only see what’s right in front of us not what’s in the distance. Before we talk about that. Are there any challenges that we should talk about that people are facing now? that we haven’t disgusts as far as Amazon sellers,
James Thomson 19:04
the reality as well, prime customers, as on average are higher household incomes. The reality is there’s a significant amount of unemployment that is either already started or is about to get accelerated as service companies and retailers and restaurants no longer can make payroll and have to start laying people off. When people don’t have money coming in. Then they stop buying not only the stuff that they like, but also the stuff that they need. And so even if the federal bailout provides homes with two or $3,000, that’s not going to last very long. And so we’re going to see a much bigger split between the haves and the have nots, who’s got disposable income and savings, who doesn’t. And I’m a social democrat from Canada, and I’m used to having Some sort of a safety net. And unfortunately, the form of capitalism we have in this country doesn’t doesn’t provide much safety net for large portions of the population. And so we’re going to see a lot of ugliness that follows. If this situation continues for another two to three months, because it doesn’t just end at two to three months it ends at, okay, you can re engage with society. Now you’re going to go find a job. Now you’re going to figure out how to make enough money to pay all the bills that you’ve been accumulating. That’s where the ugliness really becomes apparent for everyone.
Jeremy Weisz 20:34
Yeah, I mean, just in the past two days, James, I’ve talked to just a few people, just not even a large number of people, a few people who have been forced to laugh over an excess of 450 people. And that’s just a few conversations I’ve had so I can’t even imagine what that looks like. Across everyone.
James Thomson 20:57
You know, it’s Thursday night we’ll see the federal unemployment number And I, I’m afraid they’re going to be a complete, you know, total bloodbath. And when when we see just how many people now don’t have jobs but also don’t have the prospects of getting a job until this whole thing settles down. Goodness me. That’s Yeah.
Jeremy Weisz 21:20
What do you think? I mean, as a broader level we’ll bring back to Amazon in a second, what do you think
Unknown Speaker 21:26
should be, should be done or can be done in general?
Jeremy Weisz 21:33
I mean, I know like the government has offered like these SBA loans, but that I don’t really know if that’s gonna stop any bleeding necessarily.
James Thomson 21:43
So maybe a little bit, I certainly encourage anyone listening who is in a position to qualify for an SBA loan. The emergency SBA loan program is much less hurdle some than the traditional SBA loan process. We’ve applied for one, I don’t know if we’re going to get it. But you know, there are lots of folks out there that will likely qualify that didn’t realize they would qualify, it doesn’t take long to fill out the paperwork and see what you can do. This is also a time where you basically say, what are all the trees I can shake? To figure out how to get more cash or how to delay paying. So just as we talked earlier, around, have those conversations with your vendors and say, Can you give me better terms? Can you delay payment? versus go find your rich uncle and say, Hey, man, now’s the time I need $100,000. Just because the reality is the factor we need beyond keeping ourselves healthy. The factor we have to be focused on primarily as entrepreneurs right now is how to manage and hoard cash. When I say hoard, I don’t mean to hoard the way we hoard or the paper. I mean, you got to have more cash on hand than you normally would, because the level of uncertainty we’re dealing with right now is so scary. I don’t know what’s right. around the next corner in terms of what additional unexpected cost, I might incur, like, Oh my gosh, I got huge medical expenses because someone got sick or, oh my gosh, you know, a local disaster happened. One of my company has an office in Salt Lake City. And a day after we sent everybody home, there was an earthquake in Salt Lake City. Now, fortunately, the earthquake didn’t cause a lot of harm, because the buildings were set up properly. But these kinds of additional crazy things that happened on top of everything else, we need cash to be able to cover that. Because if you have cash, you’re in control. If you don’t have cash, then somebody else has to help you. And everybody right now needs some type of help. So the more you can help yourself because you’ve got cash to enable that a better position we’re all in.
Jeremy Weisz 23:53
So I guess we can point people towards if you go to sba.gov and there is some tab where it goes to disaster assistance. There’s SBA provides low interest disaster loans. And so you can go to sba.gov and find that it’s under a couple tabs like funding programs. So you can
James Thomson 24:10
and these are, these are 30 year loans at very low interest rates. Yeah. So certainly something to explore if you’re anticipating a cascading negative effect of not being paid or not being able to pay others. If you’re able to support alone, you can be a hero in your value chain by either making sure that everybody gets paid, making sure that you’re in a position that you can offer better terms to people downstream who need your services. That’s all good stuff. And if you can, if you can support better terms of people that owe you money, you know, they’ll remember that when when things get better on the other side.
Jeremy Weisz 24:50
Any other resources you think would be important to point people towards or is that the main one
James Thomson 24:57
when my world of Amazon sellers is not a group that traditionally gets traditional lending from banks. They’re having to use alternative sources for lending as it is I’m not talking, you know, Tony down at the end of the bar is going to lend money. But you know, the reality is a lot of it is angel investors and family and bootstrapping everything to keep growing. bootstrapping is great. But when when you don’t have the money to support the fact that somebody can’t pay you, and now you’ve got to come up with more money to keep the lights on. You know, you have to get creative about where where do you shake the trees to find additional capital? Or where do you go have hard conversations with people around, I can’t pay, you still want to work with you. You’re going to need to give me 60 days to come up with funds to pay for this.
Jeremy Weisz 25:47
James, are there any other lending institutions people should look at? You know, obviously, SBA? I think I interviewed the people at cabbage actually If we didn’t mention the beginning, James and Joe, founded the prosper show is one of the leading conferences for e commerce. And so for Amazon sellers, and I believe I met the cabbage people at one of the prosper shows as well. What other lending institutions maybe traditional or not should people look at?
James Thomson 26:28
So there there are companies that will help finance alone based on your FBA inventory if you’re an Amazon seller. I know I’ve heard of this company called pay ability. There are other companies like that out there that will again, give you some factor of the level of inventory you have based on the expected sell through rate and so on. I have no financial interest in these companies. I just know that they exist. And there are ways that Amazon sellers can get some funding but the challenge is you do don’t have a lot of cash on hand right now. And unless you know that you’re going to start getting cash by selling products that become popular again, the terms that you’re going to get on a loan, like that may not necessarily be ideal. But the question is, I’m not optimizing for long term right now. I am off to optimizing for short term survival. The dinghy has a hole in it, and I’m starting to sink. How do I plug the dinghy? That’s what I got to do right now.
Jeremy Weisz 27:24
Yeah. So thanks for pointing that out, too, by the way with some of those lending and resources, and you know, again, we’re not endorsing any of them, but you just got to do your own due diligence on the ones that are out there. The other piece that we’re going to chat about the challenges people should be on the lookout for in the future.
James Thomson 27:50
So I can speak as someone working with third party sellers on Amazon. The marketplace has encouraged a lot of people to double Down growth every single day. And the double down philosophy is wonderful when the wave keeps going up. But when you start to have variants like this, that we can’t control external factors we can’t control ourselves. That’s where you realize doubling down every time and not holding back cash and saying, Do we have alternative channels to sell in? Do we have suppliers in more than one country? Do we have the ability to have extra inventory sitting in a super secret location so that on the rainy day, we can pull it out and use it if necessary. All of these are different forms of contingency, that for many companies that are born on Amazon resellers, a lot of them have not been in a position or chosen not to take that sort of contingency this direction, because they’re trying to grow as fast as they possibly can right here and now, which obviously has its risks when there’s variability like not even like what we’re dealing now. We think think to a worlds six months ago, if Amazon suspends your account for two weeks, and you have no capital coming in for two weeks, what do you do? Well, I better have some cash available to keep the lights on. Okay, well what happens now Coronavirus comes along and now it’s a six week eight week 16 week situation where I’ve got to keep the lights on, I’ve got to make some very hard choices. But what I do and don’t do in the short term, but I also need to make sure that I’ve got some working capital that said to me that one of the bigger problems here, Jeremy is that let’s let’s fast forward to a point where we’re back in a situation where, no, we’re all interacting with each other in society. What what’s going to happen in terms of companies going back to the behaviors they had before versus companies realizing I’m okay, not growing as fast, because I’d rather have a cushion at all times. That allows me to be in a position where if there’s a little bump in the road, it’s not a devastating impact on my overall business. This is not just, you know, this is not a job, or job for us. This is our livelihoods. So if it’s our livelihoods, think of what do we do today? Buy a house. Yeah. But you also buy insurance for the house. And you also cut down the branch that’s hanging over your house, you do those types of things. And yet for many sellers on Amazon, they didn’t do those types of things to say, this is actually the golden goose, and I need to protect the golden goose, I need to make sure it’s well fed. But also, if something goes wrong, I’m in a position to be able to keep things going forward. And so that willingness to say, you know what, I may have some irrational competitors. And I’m okay letting them continue to be rational, because I have to control my own desire to continue to exist when the next rainstorm comes along.
Jeremy Weisz 30:49
So James, that being said, you know, there’s lots and lots and a long list of challenges now and probably in the future. And you mentioned there is a difference. Bunch of opportunities in this climate also, what are some of those opportunities people should be on the lookout for?
James Thomson 31:08
So as I think about as an entrepreneur, the first opportunity is to look at where am I not diversified or spread risk around as much as I should have? Am I selling in in two or three other channels where I should be selling? Do I sell too many products in only one category where consumer preference swings one way or the other are going to greatly impact my ability to continue to have revenue? looking at all these decisions you’ve often unknowingly or implicitly made and challenging yourself on? How do I how do I spread the risk around a little bit more and spreading a risk amount round means you’re not going to make as much money. Just like if you don’t put all your money on the same number in the casino, you’re not going to win as much money but you’re also not going to lose as much money and So, being willing to say willing to go in for, you know, 10% year over year growth rather than trying to double down in 30% growth year over year 30% growth is wonderful. But it also comes with that risk of, if you can’t sustain a proper cushion to protect you against three in a situation, you’re going to be in trouble. So for companies that still have capital, and are still at least above above water, and are able to keep going during this time of uncertainty, there will be opportunity for them to say, listen, there’s share for US market share that we can go after, because right now is the time for companies that have cash, they should still be spending money on advertising, they should still be able to get out there and get their brand name in front of as many people as possible because, you know, as you build brand, if you build now, you’re going to be in a much better position when many of your competitors are having to cut back completely. Just kind of like we’re in a you know, the Indy 500 And the safety flag is waving, we all have to slow down. But slowing down doesn’t mean that I actually want to fall behind everybody else, it means that I’ve still got my foot on the pedal and I am ready to go. And as soon as we can all keep moving, every advantage I can create for myself, I need to continue to create for myself. So let’s say you have enough money right now to keep going, let’s say have enough inventory to keep selling. This is a time to be asking yourself is the strategy I have for growth, too focused on too few products, too few categories, too few suppliers, too few sales channels, if it is start to look at what those alternatives are. It doesn’t mean you implement things right now, because implementing right now can be very, very risky, even riskier than ever. And consumer preferences are so hyper focused on certain things, that even if the long term plan involves diversifying outside of what’s popular right now, it’s good to at least know where you need to be going. So that you You can act on it when things start to become a little bit more stable. So I feel a little bit like a broken record here, because so much of what can be done right now is really around accepting, slightly less growth, but having more, more safety around our business, and also be willing to say, you know what, I don’t need to grow at the highest rate possible. In order to maximize my ego. I actually need to look at multiple things that I’m trying to prioritize, to balance those multiple things. It’s not just the fastest growth possible. The number of Amazon sellers that I’ve dealt with in the last 11 or 12 years, want to tell me that they grow so fast year over year over year, top line growth, bottom line growth hasn’t grown as fast. No, I don’t really care about the ego components of growth, but I care about is have you built something that is sustainable, through variance, not necessarily as big Right now, but can your business continue to grow? if you’re if you’re throwing a curveball here, here and here that caused you to have to change direction a little bit? Yeah.
Jeremy Weisz 35:10
Yeah, from what I hear from you, James is like the two big things are diversification and redundancy. You know, if you have one supplier, how do you get three? You know, how do you put those redundancies in place and diversification if you have, you know, two products, maybe not necessarily you implement now but you think about how you diversify so all your eggs aren’t in one basket,
James Thomson 35:32
is that those are both miserables accurate. It’s important understand that there’s a there’s a third component to that, which is you need to explicitly accept the fact that diversification probably means lower returns lower growth, and you have to be willing to live with that. Because it’s important to have safety. You can’t just have growth. And so you need to be willing to say it’s not a bad thing that I had 40% growth last year. But this year, I’m only going to have 10% growth. And that’s okay. Because I have reinforced parts of my business to be able to protect against the next tidal wave that hits me.
Jeremy Weisz 36:10
Right. So, James, I’m curious of what your thoughts are on. You know, as you see companies go out of business, what do you think’s going to happen with consolidation or companies, you know, buying other companies that you know, they do survive? And then once they’re distressed, what, what do you how do you see the consolidation
James Thomson 36:29
going? So there’s different types of companies, as you know, on Amazon, if you are reselling someone else’s product, and you go out of business, then you will basically cease to exist and nobody will notice because your products are going to be sold by a bunch of other people anyways. There are also a whole class of Born on Amazon brands, companies that exist to sell private label products on Amazon. For many of them, they don’t really have a brand per se in the sense that someone would say Your brand means something I want to buy it from you. Because the brand means something, not the cash flow that comes from the brand. But the actual brand means something. And for all those companies that are basically just cash flows on sales, as opposed to a well deserved premium that you’ve developed through building your brand. If those companies go out of business, no one’s going to notice, there may be a few cases of inventory sitting around that somebody buys and just liquidates. But those brands basically cease to exist. And nobody will be the wiser in six months from now, for large brands that are well established that have high brand recognition. If those starts, companies start to fall, then somebody will come along and say, You know what, this brand stands for something, I’m going to buy it and while I may not sell anything against that brand anytime soon, that brand is worth something in consumers minds and I’m prepared to pay something for it. There are companies no private equity and PE companies that are VCP companies that specialize in buying up old brands that don’t really have any sales or don’t have as well established a current short term track record. But if reinvigorated could mean something and some of those companies if they become available for no because of financial hardship, somebody will snap them up and say, okay, yep, I can now take my widget, put that brand name on it, sell it, and people may in fact, be inspired by that and be prepared to pay a premium.
Jeremy Weisz 38:30
So you don’t think like let’s say you’re in the example of someone selling a brand, their own brand, but it’s not. There’s not really a brand recognition. Let’s say I’m selling an apron like I don’t really shop. I own this brand. I need to buy this brand, buy an apron or something like that. Do you think there’s an opportunity for them if they’re going out of business to somehow sell their company which may be just their listing space to a branded company that can start their brand on it because they’ve seen a certain velocity of sales over the past five or six years. But that person can’t maintain that account.
James Thomson 39:10
Or Not really. If we’re talking about the Amazon platform, Amazon, the marketplace has devalued brand equity significantly. It’s less about, hey, my brand’s 100 year old brands, you know, generate all these sales or over the lifetime of the brand. And more about, you know, how to optimize your listing. Do you know how to spend money on advertising to drive traffic to your listings, those are the things that matter and turns out all sorts of people who have very little experience of building a actual brand business, they can win on Amazon because they have good enough margins to invest in traffic generating exercises and they have pretty decent listings. So when the time comes to that brand falls apart, or disappears because of cashflow issues. If there isn’t really a way brand, meaning consumers saying oh my gosh, this brand doesn’t exist anymore. That’s horrible. I was prepared to pay this premium to buy it. What am I going to do? That’s not the typical customer behavior on Amazon. typical customer behavior on Amazon is I need to buy vitamins. What’s on the first page of search? Oh, let’s buy this one. That looks like a pretty good price. Look at the listing. Yep, looks great add to my cart. When that listing is not there, most consumers don’t even remember that it was there last time they checked, because there’s still another 500 pretty good listings that are on the first 10 pages of search. So it becomes this challenge where there’s there’s not a lot of branding, per se in terms of efficiency, branding. There’s not a lot of brand building per se, across most of these boards on Amazon brands.
Jeremy Weisz 40:52
Yeah, that makes sense. James, first of all, thank you. Thanks for your expertise. Thanks for taking the time. I have one last question but I’m Just want to point people to buy box experts. And check out what they’re doing check out their podcast, you can go to buy box experts calm and everything they do. And the last question kind of relates to that James, which is right now in today’s climate, you know people are realizing or they are going to or should realize that they need to have an online presence, they need to have an Amazon presence. Because that’s where people are going, you know, that’s just where what the buyer behavior is. You just go with the buyer behavior, don’t go against it. Who are ideal clients to engage with buybacks, experts.
James Thomson 41:38
We work with brands that realize that they don’t know everything they need to know about Amazon. The Amazon sandbox is not like any other retail sandbox out there. And so we work with brands to educate them on how to think about not only selling on Amazon, but more importantly, how does Amazon fit in with all the other channel management decisions? You Make in other parts of your distribution strategy. So we like brands that are pretty much any kind of widget that can be sold on Amazon. And we’re not we’re not specific to any type of product. Amazon doesn’t treat one type of widget different from another relative services. Amazon is a huge transactional marketplace of widgets. And so how do you as a brand, get at least decent transactions out of the exercise, you may not get brand building out of it, but at least get customers out of it and get transactions out of it. And we help clients to think about these big difficult questions of how do you make sure Amazon fits into what you’re doing everywhere else? How do you make sure that what you’re doing everywhere else doesn’t create problems for you on Amazon. At the end of the day, a brand has to be a set of consistent promises delivered to customers and every channel and for so many companies that we’ve started working with. They want to have one type of exercise in place on Amazon and another one in another channel and very quickly They realize that they’re not in control of what happens on Amazon because they’re not in control of what’s actually happening in these other channels. So we help companies think these problems through, they’re complicated problems. They’re the kinds of problems that cause executives to have to scratch their head and realize they have to evolve. But the reality is consumers move to places like Amazon brands need to figure out how to incorporate Amazon to their travel channel strategy. And we’re there to help the executive team make make those tough decisions. James, what are some of the big pain points these people come to you with? Is it because their brand they need to monitor who’s selling their stuff? What are some of the pain points? Usually, these clients come with? The single biggest pain point that brands have is they are used to selling product in a variety of retail channels. And they don’t understand how all that product ended up on Amazon, or at least how some of it ended up on Amazon. It’s usually sold by companies they can’t they don’t recognize, it’s usually sold at prices below what the brands would like to see the products being sold at. And so you end up creating conflict with the other traditional retail channels who say, why is the product always cheaper on Amazon? The brand new says we don’t know who these people are, we understand how to control distribution across all channels. That’s the first problem to solve. And that’s the hardest problem for companies to solve when they’re typically driven by short term sales numbers. If you’re telling your sales team just keep going out there and selling so that we can hit this quarter’s numbers, but at the same time, go ahead and sell to whoever comes along with a purchase order and cash may result in products being diverted and creating this problem that you have on Amazon today. Those are issues that a lot of brand leadership teams haven’t thought through carefully enough to understand that they’re unknowingly encouraging the wrong kind of behavior from their sales teams or their distributors or their retailers to create Eat this problem on Amazon that while Amazon may not be a big channel in terms of total sales, it’s a highly visible channel that anybody in any other channel could see. And you can create a lot of strife a lot of frustration by your longtime retailers and distributors who realize that you the brand, you’re not actually driving the plane, somebody else’s and it’s it’s usually a bunch of unauthorized sellers having fun at your expense.
Jeremy Weisz 45:24
Nice. James, thank you again check out buybacks, experts calm and listen to this one again because there’s some some real gems there. So, first want to thank you. Thanks, James.
James Thomson 45:37
Thanks very much for having me on. Jeremy. Take care and take stay safe.