Selling on Amazon can be incredibly profitable but growing from a hobby to a full fledged business can be difficult. There are 3 big holdups that slow the growth of Amazon businesses.
- Lack of capital to spend on products
- Lack of products to spend capital on
- Lack of time
Now, the capital part I can’t help you with. At least not directly and immediately. You can build capital slowly or borrow it, that is up to you.
My goal is to help you build it more quickly by improving how your business sources products and how efficiently.
I’m going to help you find more products and save more time by leveraging product sourcing virtual assistants.
“But I can’t afford to hire anyone!” We can fix that. I’m going to show you how to get someone who will deliver real results without costing an arm and a leg.
Let’s begin. Unfortunately, the starting point has to be covering some basic terminology so that everything else I say in this (rather long) guide makes sense.
“VA” = Virtual Assistant. Virtual Assistants can perform many tasks for you, but this article is focused on them solely as product sourcing employees.
“Double Dipping” = Refers to employees who work for you and someone else at the same time. I mention it a few times because it is one of the most common problems I see and a silent killer of product profitability (I will explain more on that later).
“Sourcing” = Refers to the act of finding products that can be bought and then resold for a profit. In this article, I am referring to products that can be purchased online and then sold on Amazon or eBay. My experience is with Amazon, but the same principles apply for eBay as well.
“BOLO” = An abbreviation for “Be On the Look Out.” This product leads that sellers have identified and shared with other sellers. This typically applies to retail arbitrage, but is mentioned sparingly throughout this article.
“Arbitrage” = In its most basic form, purchasing products low and selling high. For this article, we will be discussing arbitrage as it applies to online purchasing.
“ROI” = An abbreviation for Return On Investment. This is the relation between the amount of capital invested and the resulting profits.
ROI = (revenue − cost of goods sold) / cost of goods sold
“Net Profit Margin” = A measure of profitability calculated as net profit as a percentage of revenue.
Net Profit Margin = Net Profit/Revenue
“Net Profit” = The profit after costs. Here is a great article on profit margin and ROI and how they are often messed up.
The Traditional Sourcing Models
There are several ways to source products to sell.
Now, you can source products with any of the methods above yourself or pay someone to help you (or do it all).
The problem? Money!
If you are going to pay someone to do this for you in the US, you would be a cheapskate if you paid less than minimum wage. Also, you’d be breaking the law.
Gross Sales Revenue – (Cost of Goods + Fees + Cost of Labor) > Dollar Value of YourTime, Liability and Energy Spent
So if you are spending 10 hours acting on product leads, corresponding with assistants etc. You need to be earning at least 10 hours worth of your hourly “worth.”
So, making up the margins is difficult if you pay US wages. If you don’t have a large amount of cash flow, it is very difficult.
Losing money may be difficult, but working for less than your time is worth is a cardinal sin in entrepreneurship that happens a lot.
Fortunately, there is a way for you to get quality product leads and keep your overhead costs low, thus improving your chances of creating adequate earnings for your investments (money, time, energy, liability etc.)
This is both nerdy and somewhat obvious, but it deserves to be mentioned because it is surprisingly, often overlooked. Especially since as I said to begin this post, your money is always going to be stretched.
Sales Revenue – (Cost of Goods + Cost of Labor) > Anticipated return of the next best, foregone alternative
So put simply, is this the best use of your time and money?
The profits you generate using the capital for labor must be greater than the potential profit if you spent the money elsewhere (for example investing in niche websites or product development.)
What to Expect
Even if you can’t afford a US based employee you can still get leads from an employee at prices low enough that you can make plenty of profit after paying your wages and other expenses.
I have hired over a dozen product sourcing virtual assistants in the past with various results, but have refined the process into a consistent money making system.
You can find a quality assistant in many countries for around $3.00/hour (the minimum on Upwork, which is where I hire and retain most of my employees).
I have hired sourcing employees in the past from the Philippines, Thailand, Afghanistan, and India.
Filipino VAs (yes, that is how it is spelled when referring to the people of the Philippines) have always performed well for me. Most Filipino’s are bilingual, often speaking Tagalog and English.
This reduced language barrier is very conducive to training new employees and getting them up to speed quickly and easily.
This is a generalization, but it has been my experience.
Is Paying Such Low Rates Overseas Unethical?
This isn’t an ethics class, but I didn’t become an entrepreneur to cheat people.
Pay your employees a fair wage. Fair is relative to the cost of living where they will spend it. $3/hr hour in the United States is unfathomable but in places like the Philippines, that is actually a decent amount of money. To see what “fair” is, you need to know the value of their labor relative to where they live.
EXAMPLE: How Far Does $3/hour Go in the Philippines?
Let’s assume that you’re hiring a virtual assistant who lives in the Philippines and you are paying them $3 USD per hour and are employing them full time (160 hours per month).
That is roughly $5,760 per year or 302,005 Philippine Pisos. The average family income in the Philippines is about 267,000 Philippine Pisos.
Check out this article for a little more on this. You will be shocked
Economic Logical Fallacy: You read blogs to hear opinions right? Well here’s mine on the issue of “fairness” in outsourcing.
I have read multiple articles now condemning those of us who outsource labor overseas at low wages (Here is a particularly misguided one).
- We aren’t paying what these employees are worth
- We are taking American jobs overseas
- We are sending American money overseas and out of circulation.
These statements madden me. Here is why.
The fallacy of, “you aren’t paying what they are worth.”
What does this really mean? If a VA is generating me $20/hour AFTER I pay their labor, should I pay them more than $3/hour?
If they are making me $20/hr, they are worth (relative and highly debatable) perhaps $10/hour or more, depending on how much work is needed by me as well.
Now, let’s say I agree to pay them this…oh! Guess what? I’m not going overseas anymore!
Why? Well, see points 2 and 3 above.
I’m an American, I agree with keeping jobs and money in our country if possible, so why would I pay someone $10/hr overseas which is relatively 3-4x that in value relative to their economy when I can pay someone in the US who will speak English as a first language and keep the money circulating? … (Murica!)
The logic all falls apart now doesn’t it?
From what I have seen, my VAs are more than happy to work for what I pay, and if they aren’t they don’t have to take it! But I’ll tell you this, no offense to them, if they demand $10/hour, I will look back to the US first.
I apologize if this comes off as ethnocentric or even “racist,” but it is coming purely from a business perspective. I assure you it is nothing else.
Before You Hire Anyone
As cool and profitable as a sourcing VA can be, it isn’t feasible for everyone. So, it is absolutely critical that you ask yourself the following questions before hiring anyone.
1. Do you know enough about OA to instruct your VA as needed?
Even if a VA has prior experience, that doesn’t mean their leads will be great. You need to have a strong enough understanding of the OA game to direct your employees as necessary.
If you can’t source at least average levels on your own, you should consider investing in one of more of the following:
2. Do You Have the Time to Act on Leads?
A VA that can actually be trusted to do the buying for you is hard to find.
Some sellers are never going to feel comfortable with this.
If you can’t do this, are you able to commit the time to check the leads each day and act on them?
You should have at least 30 minutes each day you have a list provided to inspect and purchase leads.
3. Do You Have the Money to Buy Enough to Offset Cost of Labor
It doesn’t matter how great your VA is, if you don’t have the money to spend on the leads, you are dead in the water.
Alternatives to Hiring Your Own VA
If you answered the questions above with anything other than “Yes,” you may want to consider an alternative approach before you dive into hiring your own VA.
1. Share a VA
If you have a friend (or a few) who are interested in finding more leads as well, consider asking them to help cover your labor costs for your VA in exchange for the leads.
- Split the cost
- Split the training
- Share the management responsibilities
- More competition on your leads
- Less control over the employee and potential conflict
- Potential tax complications
2. Join a Monthly Sourcing List
- No management, Just leads
- No hiring or firing
- Less commitment required (usually monthly fees)
- Might cost less (depends)
- Might not cost less (depends)
- Saturation (leads seen by entire group)
So if you have read this far and have decided that you have the know how, time and the capital to bring on your own VA, let’s get into where and how you can find one.
Option #1 Hire a Pre-trained VA from a Reference
This is relatively simple. You can post on a social media group (like FBA Today) and ask if anyone has a VA that needs hours.
I have transferred contracts from past VAs to other sellers if I didn’t have enough work for them.
Option #2 Hire an Experienced VA on Upwork or FreeUp
Upwork and FreeUp are awesome sources for overseas talent. Although I’ve worked more with Upwork over the years, FreeUp has been an equally positive experience for me.
The platform isn’t as important as the person and the process of finding and training them, but it’s still important to work with a network that you know has your best interests in mind.
Both FreeUp and Upwork work similarly in how you create a job listing. For this post, I’ll use Upwork as my working example.
First, you should create a job post with your criteria.
Next, you can wait for applicants to apply organically or you can start actively searching the Upwork network and inviting VAs privately.
You can choose from the pool of applicants or invite non-applicants you find via a search or Upwork recommendation.
Hack: If you are already an Upwork freelancer, log-in to your freelancing account and search “Amazon Online Sourcing” in the job posting section and view the applicants on that post.
Those people have essentially already applied for you. Obviously, the person posting the job isn’t going to hire them all.
Warning: When you hire someone who has worked as a product sourcer for other employers previously, you run the risk of hiring a “double dipper.” The temptation is there, so when they have the opportunity to work for two (or more) employers at once, earning twice as much for the same amount of work, they may have a difficult time saying no.
So, why does this matter if you are getting the deals anyway?
When multiple employers are having access to the same leads, they will be buying and competing with one another. Competition, will always exist whenever you sell anything, but the problem is that your leads are going to be selling out faster than they should be. Hiring your own VA is all about exclusivity. If you want quantity of leads and are ok with some saturation, consider joining a paid sourcing group instead.
Option #3 Hire an Employee with No Experience and Train Them Yourself.
As odd as it sounds, this is my approach now. Why? Because a VA who is trained from “scratch” has not developed bad habits and, most importantly, is far less likely to be “double dipping.
Exclusivity is very important to me and this model helps me do this.
Making Your Hiring Decision
No matter where you are finding your VA (even if it’s from a reference) you should always do the following things first.
Each employee must agree to the following:
**They will provide the leads they find to only you and that when they work for you, they are not simultaneously working for anyone else.**
Make this absolutely clear from day 1.
Here are the next questions you will need to ask.
- Ask for 8 hours of sample work. Pay upfront $24 and explain that you are expecting (X) leads per hour.
- Ask if they can work the hours you need.
- Explain your criteria: Sales rank, ROI, category, price points, net profits etc (more on that soon) and ask them if they have any questions.
Important: Past reviews are imperative. You can’t expect 5 star work from an employee who has consistently shown 3 star work.
Paying Your VA
There are several ways to pay your VA and disperse the work they perform for you to maximize your revenue.
Option #1 Hourly through 3rd Party Site Like Upwork
- The hourly pay model is predictable and comfortable for VAs.
- A third party processor simplifies the accounting process.
- You do not pay additional fees above the rate promised to your freelancer.
- Upwork and FreeUp do a good job protecting you from scams and poor quality VAs.
- VA will make about 10% less after fees.
The typical rate for an overseas VA is $3-$4 per hour. There are many who pay less, but if your VA needs less than $3/hour to generate you profit, you have the wrong VA. Don’t be a cheapskate. Better wages lead to higher morale and lasting loyalty. That in turn will be reflected in your bottom line. Go cheap and you will spend more time and money hiring a new VA when the one you trained leaves you for another employer.
Upwork TIP: The wage desired on Upwork is very often an exaggerated number much higher than the employee has worked for in the past or is willing to in the future. You should rule out VAs because they want more money than what you will pay, let them decide.
You can see their past jobs here AND their wages. This is a much more accurate reflection of the wages they are currently accepting. Remember, still pay what they are worth, but a VA who does not price their services consistently may not be of the same caliber they appear. A great VA will generally have firm and consistent prices.
Option #2 Piece Work (Pay Per Lead)
- Promotes and rewards production
- Pay for only what you get
- No need to monitor hourly work
- Unpredictable and many VAs aren’t comfortable with this.
- May encourage lead “double dipping” as they aren’t being monitored anymore,
My experience: $1-$1.50 per lead works very well. My assistants will typically find 1-2 quality leads per hour.
My criteria are as followed:
- Min ROI = 25%
- Min Net Profit = $4
- Min sales rank = Top 3% (preferably one sale per week)
- Can be gated (shoes, clothes, etc). Remember, the more items they have to choose from, the better the leads will be and the more they can find. If you need ungated, you can do that yourself or pay someone to do it for you.
- Less than $100 and nothing extremely large (reference point is nothing “bigger than a Tricycle.”)
- Predominately brand new merchandise. No refurbished products.
Option #3 Pay Salary
- Easier accounting and you can pay less overall by giving the assistant “guaranteed money.”
- Requires less work from a payroll perspective (1-2 payments per month).
- VAs feel secure and as if they are a part of the business’s long term plan.
- Makes assistants feel more like part of the team.
- Requires trust that your employee will continue to provide quality work.
- A larger commitment.
If you pay an assistant $4/hour normally, that would equal $640/month in a standard month (roughly 20 working days full time). However, it is reasonable to pay something roughly 85-90% of that total if you pay upfront. Discuss this with your VA.
Scheduling Your VAs Hours
There are many factors to consider when scheduling your VA’s work hours.
Whatever you do, I highly recommend that you have some sort of consistent, set schedule for your employees.
Nights or Mornings?
This is relative to where you live and where your VA lives. For me, my Filipino VAs are 12 hours ahead of me.
There are dozens of different ways to find the time difference between you and your VA, but here is an easy link for you to understand the difference.
You can take advantage of this time difference and create an around the clock sourcing system.
For example, if you live on the east coast like me and your VA is in the Philippines, you can source while they sleep and they source well you sleep!
It is an awesome feeling to wake up to profitable leads.
Weekends or Weekdays?
This depends on you and when you can most effectively act on your leads.
My take on this, there are likely fewer buyers on the weekends so working them may be beneficial. For the record, I have not noticed anything beneficial in this directly, in my own experience, but it may be worth some experimentation on your part.
How Many Days Per Week?
I have found a traditional Monday through Friday work schedule was best for me and my VAs. No one wants to work 7 days a week. If they do want to work 7 days a week and you or someone in your business can act on the leads, go for it.
You would be better off having multiple VAs if you need 7 days of work. You can then spread their hours as you need.
Scheduling Multiple VAs
When you have multiple employees you can have them work in two ways:
- Simultaneously. Like traditional 9-5 jobs where they have an “office” type environment with each other.
- Distribute the hours evenly over the week. This may allow you to capitalize on flash sales, new leads before they are sold out and increase your overall chances of not missing something “big.”
Scheduling is a matter of efficiency. A big factor in this is how you delegate what stores your VAs will source.
So, I hate to bounce around, but we need to briefly discuss delegation and specialization, we will come back to scheduling and it will be clearer how you should approach it.
Training and Communicating
There are many ways to go about training your virtual team.
Here are the three basic models.
#1 Provide Live 1 on 1 Training
Making literal face-time with your virtual staff is a great way to boost output and team cohesiveness.
If you know how to source online well enough to run a 30-45 minute training session with your new VA, you should make that happen.
Remember, there will be a serious time zone difference so plan accordingly.
#2 Fund Their Private Training (Preliminary and Ongoing)
I have mentioned how I provide all of my VAs with a copy of Chris Green’s Online Arbitrage and have them read it and watch all accompanying videos.
I pay for up to a week of time (40 hours) for the VA to go through this material and I believe that it pays itself off many times over.
To be sure they are actually viewing the material and learning something, I have my new hires write chapter and video summaries as they work through the content.
#3 Provide Ongoing Feedback
This is perhaps the most important aspect of quality training.
Remember, even a trained VA with thousands of hours of experience will still not know your business as well as you do.
On your daily sourcing finds, be sure to be very specific about which deals you act on (buy) and which ones don’t. Do this for each lead you get if you have the time. The more information your VA has, the better their leads will become.
Without feedback, your VA will never improve because they won’t even know there is a reason to!
Your VAs cannot read your mind. They want to make a good impression on you and they may be afraid to ask a lot of questions.
Assume if you don’t say it, they don’t know it. This isn’t to belittle them or make them feel “talked down to,” but it is the safest way to ensure no stone is left unturned.
Let your VA know from the start that you will be treating their training as if they know nothing, so they shouldn’t be offended.
Further Consideration for Your Training Methods
The best training approach is a combination of the three approaches mentioned above.
Consider the Edgar Dale model below when deciding how to train your virtual team. Not all methods are created equal! A combination of teaching approaches will have the most lasting impact.
Note that “teaching others” has the highest rate of long term retention. So, to take advantage of this, let your VAs know that you plan on using them to teach future new hires and they should learn accordingly.
Important Guidelines for Teaching Your VA
There are several key principles to teaching employees correctly. There are a lot of ways to mess up your training so be careful!
I am not a world-leading expert in these things, but I do have experience with what has worked best and has created my best VAs.
#1 Be Patient
Don’t make your VA(s) feel like they are always on the verge of being fired.
Fear is not a good teacher. The lessons of fear are quickly forgotten. -Mary Catherine Bateson
#2 Be Clear
The key to explaining your expectations is two-fold:
- Document them so they are not forgotten and can be referenced by your team going forward.
- Create instructions assuming the VA knows nothing about what you do.
Remember, what may seem simple and common knowledge to you may be confusing to your VA who has never done it before.
Setting the Parameters for your VAs is critical.
Here is what you should be sharing with your new virtual assistant(s):
#3 Encourage Constant Improvement
My goal is to create an employee who is better at sourcing products than I am.
I tell them from day one that they should continue to learn as much as possible and that I will make it worth their time. I do make it worth their time in the form of bonuses and raises if they continue to grow and exceed expectations.
Also, encourage your VA’s to be leaders and let them know you always have room for a VA who can manage other VAs. Again, I do this because I always have room for VAs who can manage others. I don’t mind paying them upwards of 2x-3x their initial wages if they can replace me going forward and develop future product sourcing employees.
The Tools for Success
If you are experienced with online sourcing, you can hire a VA and provide them with the tools you know work. If you want to know what I use, I am sharing them here.
Before we get into the tools, it is important that you and your team are using the appropriate browser for online sourcing. That browser is Google Chrome.
Google Chrome is the only browser I know to recommend. If you are using Firefox or safari, I strongly suggest that you switch to Google Chrome when you source.
Top 5 Product Sourcing Tool Recommendations
The gold standard of online arbitrage. Tactical Arbitrage is like a team of VAs on its own. Hiring a VA to work with it will put more fuel on the fire!
Amazingly handy Chrome extension that brings the most important information you need for product sourcing front and center. Use code FBAT25 for $25 off your first year.
Make sure that your VA doesn’t accidentally purchase items that you can’t sell or that will get you suspended!
Powerful Tactical Arbitrage add-on that helps you spy on your competitors or perform large bulk exports for reverse searching in Tactical Arbitrage.
Powerful insights into what is selling on Amazon. Free and paid plans available.
Tools for Communication and Deal Sharing
Once you have a VA you will need a common, shared place to exchange leads. There are multiple options for this, but I am going to share with you what I use and then provide a few extra mediums you can consider.
My preferred medium is a combination of Google Sheets and a private FaceBook group.
Sharing Google Sheets via Google Drive is my highest recommendation for lead sharing because it allows multiple users to view and edit the same spreadsheet in real time.
Google Sheets is like Microsoft Excel, except web based.
While you can still download any of your sheets as .xlsx files if you’d like, the beauty of Google Sheets is that you and your team (whoever you choose to add to the document) can see the spreadsheet in real time.
If someone is working on the document, you will see the entries as they are typed.
No waiting or downloading necessary. It is fantastic.
I have a simple, but effective spreadsheet template that I used with my VAs when I started out.
Also, if you are not familiar with Google Sheets, you will want to learn how to share a Google sheet so you can give access to all of your team members.
The Group Aspect
It is important that you communicate with your team regularly and freely. They should be able to contact you quickly and easily and vice versa.
You should also have your assistants creating bulleted summaries of the work they have completed each day. It is a great way to keep everyone accountable and for you to spot inefficiencies in your processes.
Facebook groups are great because they are easy to start and can be made private so no one else can even see they exist.
I am not sure how long Facebook is going to allow groups for businesses for free, but as of right now, they are good to go. Check out Facebook’s own instructions on how to create a Facebook group.
If Facebook isn’t your thing, you can also consider any of the following for communicating within your team.
Slack – Share documents, message your team, and perform a laundry list of other custom integrations and tasks.
Trello – A task managing/group collaborating tool that is very popular because of its customizability and value (free!)
Is Your VA Ready to Grow?
You can’t add more VAs until your first VA is performing at a level at or above the level you will need future hires to perform.
There are multiple reasons you don’t want to add until you have a great VA.
First, there may be an underlying problem with your training methods. The VAs poor performance may be because you aren’t training them correctly and you wouldn’t likely have much better luck adding another VA just yet.
Also, when you add more VAs, you should be able to count on your first VA to help train them and organize their work.
Your new VA should be able to at the very least:
1. Answer basic questions about your business model.
Your lead (original) VA should be able to answer basic questions future trainees may have so that they don’t have to come to you.
2. Review the work of new VAs.
Your lead VA should be able to provide feedback on the work your new VAs submit. If you are still constantly correcting your current VA and rejecting their leads, they aren’t ready.
Also, most importantly, your VA needs to be trustworthy and committed.
Basically, your first VA should be an extension of you.
This is why your first hiring is so critical. This goes all the way back to job posting, interviewing and training. The first VA should know almost everything there is to know about your sourcing model.
“What gets measured gets managed.”
It is important that you can reference some concrete numbers. This means assessing the work of the VA after you have started to earn profits.
How to Generate Quantifiable Numbers for Your VAs Production Quality
1. On all leads that you purchased from your VA, you should create a unique SKU that identifies the products as being from them.
You can make your SKUs unique and add short tags to associate them with the VA who sourced them. You will then be able to filter these in seller central so you can have more actionable insight. 3rd party profit tracking tools are helpful here
2. Assess if the product leads sold as quickly as expected, at the same prices and with no other issues.
This is important so you can get a good idea as to where the VA is sourcing and ensure that they are not sharing leads. If all of your products are tanking when they reach the warehouse, you may be dealing with a double dipper. Keep in mind, there is always going to be some bit of price tanking when performing online arbitrage.
3. After you have assessed the profit/loss of your VA, communicate the results with them.
Explain what seems to be working and what is not. The goal is not to just earn your money back (duh), but it seems a lot of sellers who use VAs only notice low production once they start losing money. Don’t be that person. Understand what you should be expecting.
A good VA should be generating you at least an amount of profit each week equal to their weekly wage. This is profit after cost of goods and labor (their wage), not just gross sales or gross profits. So, if your VA makes $120 per week, you should have $120 in your pocket (will show as a larger payout of course in your sellers account, but keep the fees and wages in mind.)
Are You Ready to Expand?
When you hired your first VA, you didn’t have much to work with as far as past experience and existing systems.
As the VA developed, they should have been asking questions and you should have been improving your systems each day through trial and error.
This should provide a solid base for you to expand from.
By now you should have:
1. A consistent schedule set for your current VA.
This will be used to schedule your new VAs hours (whether you run them simultaneously or have new VAs fill hours that your current VA is off.)
2. An efficient means of communication and deal sharing.
You should have more than a plain excel spreadsheet you recycle each day through email.
There should be a system in place (with Google Sheets preferably) that will allow all of your VAs to share leads in one simple medium. There should also be a way for you to provide feedback quickly and easily (again, Google Sheets does this).
You should have the spreadsheet above converted into a shareable document. If you aren’t sold on Google Sheets you can also try other tools like Quip or any other medium that allows multiple users to access and edit the same document.
3. Developed trust with your first VA
Whether you trust the VA enough to make purchases for you, you should get to that point eventually. You also need to trust that your VA is going to show up to work without excuses and not share leads with other employers.
If you catch a VA sharing leads, they should be fired immediately. It is one of the “mortal sins” of their job. Hopefully, you made this very clear from the start.
4. Prepared your first VA to train and manage new team members
Hopefully, you set a good example for your VA when you trained him or her and they know what good training looks like.
Finding Multiple VAs
As far as hiring goes, not much changes from the processes we discussed in section II as far as finding, interviewing and hiring new employees.
The big difference is you now have a potential head start towards finding your next good VA.
One of my preferred methods is finding my new employees through referrals from my current VA(s).
If you have a great employee, ask them if they have friends or family who need work. I have found many of my best VAs as references from past VAs. The original VA will already have a comfortable level of communication with the new hire and they will also be personally invested in making sure that the new hire does not fail and make them look bad!
Just as with deal sharing, you should be aware of potential opportunities for family and friends to game the job. Basically, one works and they split the leads or something to that effect. You know what to expect from your first VA. If their production drops when you bring a family member on (with the exception of training time) discuss it with them. If a pair of friends or a family is gaming the system, they will all need to be let go. Be sure that they are hyper-aware of this fact.
Delegation and Specialization
Short backstory, I spent 7 years in college studying economics and the biggest thing I learned (well second biggest behind “college tuition is for chumps”) was that specialization is almost always the most efficient thing you can do for your business.
Hell, even if I didn’t major in economics, colleges basically hammer home this fact by making you choose a major your freshman year.
The days of the “super employee” are gone. One VA doesn’t need to know how to do every single aspect of your business. This may have the opposite effect and your VA is now just average or below average at all things instead of great at any.
Side note: If you want to learn more about “the myth of the super employee” check out Virtual Freedom by Chris Ducker. It is like the outsourcing bible. He articulated a lot of what I was experiencing with my VAs and did it long before I wrote this series, so check it out. It will be in the resources section as well.
In economics, we explain why specialization is important with nerdy graphs and figures
Here is the short and sweet synopsis, leaving out the technical details (if you want those, I have included some in the resources page.)
So here it goes…We are all faced with the constraint of time.
Even if you have your VAs working full-time, you can only add so many hours. What we do have control over is optimizing the efficiency of this limited time we have.
To do this, we have employees focus on what they do best. Also, we put them in situations that allow them to get better (specialize) with the focused time they spend.
So, here are the types of specialization you can implement. You can pick from any of the points below.
#1 3rd party online arbitrage.
The most basic form of online arbitrage.
a. Standard methods (using the basic extensions and resources available)
i. Focusing on all stores
ii. Focusing on specific stores
c. Advanced methods (using tools like Tactical Arbitrage)
i. Focusing on all stores
ii. Focusing on specific stores daily.
#2 Amazon to Amazon flips.
In its essence, you find products that are priced abnormally low on Amazon and buy them to sell right back on Amazon. Tools like Keepa make this possible.
a. Standard and Advanced Methods (There is no need to have AZ to AZ flip sourcing employees not using all tools available)
i. Focus on all types of products
ii. Focus on specific product types
iii. Focus on daily deals
iv. Focus on Keepa and Camelcamelcamel drops
v. Focus on price alerts
#3 Setting price alerts.
Tools like Keepa and Camelcamelcamel allow you to set price alerts so you can jump on products right when they reach a price you can profit at. This takes practice, but having a VA add dozens of these each day will eventually lead to a stream of leads sent to your inbox each day.
a. 3rd party price watching
b. Amazon to Amazon price watching (mentioned above)
#4 Wholesale/Private Analysis.
I mentioned earlier that this is something that you should be doing, but if you have a VA, who is capable, go for it. This should; however, be the least of your sourcing priorities as far as VAs go. You should be a better fit for this sort of work.
a. Site Specific (Alibaba, thomasnet.com etc)
b. Finding and contacting suppliers.
c. Bulk uploading ASINs for analysis.
d. Keyword research and competition monitoring
Retaining Your VAs
The worst thing that you can have happen is to lose one of your employees because you don’t pay them what they’re worth.
Here are the six ways I have found to keep VAs on my team long-term and keep them happy while they are working for me.
1. Pay them what they are worth.
This comes in the form of raises and bonuses.
2. Don’t be rude to them
They work for low wages, but they are no different than you and I, so don’t treat them like they are.
3. Show appreciation for the work they do.
We may all work for money, but that doesn’t mean we can’t enjoy what we do for other reasons. We all like to hear that we are doing a good job. Your VAs are no different. Show them you appreciate them and they will appreciate you. It goes a long way.
4. Pay them on time.
Many virtual employees are not just working for extra income, they are supporting families. Often, large, extended families. When you don’t pay them on time, you are likely hurting them far more than you think. Keep this in mind.
5. Give them paid time off.
This is up to you and not a normal procedure for most virtual employment arrangements but if you have a VA who has provided you with 6-12 months of fantastic work and hasn’t missed a lot of time, consider rewarding them with some paid time off. Anything will be appreciated here.
6. Respect their cultural norms.
A good example of this is the 13th month in the Philippines
I want you to get as much value from this as possible, so I want to share with you everything I do, not just the things I recommend you do.
So, I am not directly recommending that you do either of the two things I am about to mention, but I do and they work for me.
Allowing Your VA to Make Purchases on Your Behalf
This may sound like absolute insanity, but if you can make it work, your life will be infinitely easier. I am not going to advise that everyone does this, but if you think you want to try it, there are some ways to make sure you don’t get burnt (or at least not burnt as badly).
You should delegate, but you may or may not want to delegate payment of goods…
#1 Use gift cards or re-fillable Visa cards with limits under $500 (or whatever you feel comfortable with).
You can still get burnt this way, but not by a whole lot when compared to say a Visa card or PayPal access that could be in the tens of thousands of dollars.
I am not a financial advisor or attorney of course, but the laws regarding the use of your credit card by employees who then steal from you are foggy. You aren’t as protected as you may think. It is generally against your credit card company’s policy to allow others to use your card in your name, so you may not get very much sympathy if you get scammed.
While we are on the subject of gift cards, try and encourage your VA to check for deals on gift cards at sites like Card Cash and Gift Card Granny. You can often save a good percentage off each purchase if you buy gift cards in advance.
#2 Leverage a portion of your VA’s pay contingent on them not running with your money. This sounds bad, but many companies do this sort of thing. This will help your peace of mind more than anything. If you have $500 at the beginning of the year to hold for your VA as a bonus for next year as long as they follow all of your rules, they are not as likely to take your small, pre-paid card information and hit the bricks.
Another thing that can be helpful when allowing your VA to make purchases for you is that they can utilize cashback sites like ebates for you, saving you even more time.
Additional Tasks You Can Outsource
During the first days and weeks of expanding your team, you are going to have your hands full keeping your new VA(s) working at optimal levels.
You will be answering questions, reviewing their work and making sure they develop their skills correctly.
Once you get that aspect under control and you’re beginning to reap the rewards, you may be interested in outsourcing even more of your Amazon business.
Here is a short list of other tasks you can outsource to your VA.
#1 Feedback Removal
There are various methods to remove negative feedback. This task is relatively easy to outsource thanks to the rather cut and dry nature of feedback removal. Once a VA has the concepts down and understands what constitutes “removable feedback” and how to address it, you shouldn’t need to follow up too much.
Creating canned responses for various types of feedback removal will make this process much easier. Check out a tool like Text Expander for storing commonly used responses and share this with your VA.
Feedback Genius will help you gather more positive feedback to help offset negative ones.
Repricing is important and the responsibility shouldn’t be given to just anyone. If you do outsource Repricing, you need to be extremely clear on your criteria. You should have basic, repeatable procedures for your VA to follow.
These should be “idiot-proof” guidelines.
Check out this list of the biggest name repricers on the market.
#3 Private label product research
This is what I consider a higher level task. There is no harm however in letting your VA do some of the leg work for you, but this is obviously a bigger deal than basic online sourcing.
Tools to Supplement or Replace: There isn’t a tool to automate this but tools to speed up and improve the process include:
#4 Locating and Contacting Wholesalers
Sometimes landing solid wholesale deals is a matter of persistence. Providing a VA with a template for contacting wholesalers expressing your interest in working with them may result in solid contacts for you.
Be sure to verify that the VA is using proper grammar and spelling. Canned responses are important for minimizing the opportunity for these sorts of mistakes.
Here is a blog post I wrote on negotiating profitable wholesale deals.
Tools to Supplement or Replace: There is not a tool or service for recommending and researching wholesalers that I am comfortable sharing here.
#5 Listing creation and Optimization
If you need bulk listings created, outsourcing this on Upwork or a similar medium will not be difficult.
Now, listing accuracy is critically important. Don’t adopt an “out of sight, out of mind” approach with your listing process because it is your account that is at risk. If you create inaccurate listings for your products, you run the risk of having your seller’s account suspended.
#6 PPC campaigns and Keyword Research
This is a task you can outsource quite easily to someone on. Use a tool like Merchant Words for Amazon keyword research by the way.
#7 FBA Reimbursements
Most Amazon sellers have money they’re owed by Amazon. Hiring someone to find reimbursements you deserve is a very high ROI investment.
#8 Image Editing
A very simple, on call type task. You can use a service like Fancy Hands for this if you don’t need someone fulltime (you probably do not.)
Tools to Supplement or Replace:
#9 Data Entry
The most basic of all tasks, you can outsource this on a per-task basis. If you have multiple VAs, you can have one of them do this periodically instead of sourcing.
Tools to Supplement or Replace:
#10 Multi-Channel Fulfillment
Amazon is not the only channel you can sell on. You can sell on: eBay, Etsy, Facebook Marketplace and others. There are hundreds of VAs who can do this sort of work for you for the same wage you would pay for your sourcing VAs.
If you are curious, Amazon is totally ok with you using them as a “drop shipper” for other mediums.
Tools to Supplement or Replace:
- Shopify – Easily create your own storefront.
- JoeLister– Sell products on Amazon and eBay simultaneously. You will use Amazon FBA to fulfill eBay orders.
- Auto MCF – Fulfill products from Amazon to eBay, Rakuten, Sears and Newegg.
Outsourcing Prepping and Shipping
So far, you have taken strides to gathering more leads, there is one more aspect that needs handled and that is product handling, receiving and shipping.The standard process is to have the products shipped to your location where you receive, label (if applicable), package and ship to the Amazon fulfillment centers.Remember what we discussed about doing high level tasks that you are uniquely fit for?
Does this sound like something you should be messing with?
So, you have 3 options here:
1. Do it yourself. (FBA and/or MF)
- Control over quality
- Hand on the “pulse of your business”
- Some people enjoy this part…(weird to me!)
- No labor fees (you are spending time, which can be worse than spending money!)
- Time consuming. You are forgoing other tasks in the meantime.
- Not scalable
2. Pay someone local to do it. (FBA and/or MF)
- Saves you time
- Some control over quality, but not complete control.
- You are now a “job creator”
- Highest cost of labor (typically)
- Accounting hassles of adding employees
- Risk of poor quality
- Risk of theft
- Employee may not care as much as you do about the process.
- You buy or reimburse for supplies
3. Use a pre-fulfillment center (FBA only)
- You don’t see products at all.
- Tax free options like Prime Zero Prep
- More reliable and trustworthy (my experience)
- VA can now do the process in its entirety and the transition is smooth from OA list to prep sheet.
- Less control and requires serious trust.
- Shipping damages and other various issues.
Here is the complete list of prep and ship companies. VIA Reddit
Here’s a quick recap of the most important tools, resources and additional readings shared in this article. Click the box for each resource to be redirected to the page.