Emanuel Ruiz, an Amazon FBA seller, shares how rapid growth nearly destroyed his business. In one month he hit $425,000 revenue with $90,000 profit, but stockouts on bestsellers and supply-chain delays cost him thousands in lost sales and forced him to slow down.
Last month I did over $425,000 in revenue for my Amazon FBA private label brand, and I spent over $90,000 in ads, and I still made $90,000 in net profit, which is obviously fantastic news. But when you're in the growth phase of your business like I am with my brand right now, the hardest part isn't running ads or trying to get new customers and making that revenue number go up. It is actually staying in stock because sometimes it's very hard to anticipate this type of growth. Like I had all these numbers projected as far as how many, how much inventory we needed for certain SKUs this year. And January was a great month. February was better than that. March, we started opening up the floodgates and I was going ahead and just anticipating ordering more and more inventory. We're now in June. I've been out of stock on the top selling items, which hurts, right? Like we're going to go ahead and do over $350,000 in revenue still, but our profit's going to go ahead and take a hit, right? Like we could have made even more money if we had the supply chain in order. And the thing is there's been delays everywhere, right? There's been delays on Amazon checking in our inventory. There have been delays with our manufacturer producing these items and getting to our freight forwarder. There have been delays where customs actually went ahead and inspected our goods. So a lot of our goods have been stuck in US Customs right now waiting for approval to go ahead and get through. But these are things that happen in business, right? So again, it's just going through growth pains right now. It's a fantastic position to be in, but scaling is very, very hard for any type of business because there's so many moving parts to a business that you don't have control of.
