There is such a thing as entrepreneur porn and I’m pretty sure orgazming over failure and obstacles is the same thing. BUT, that said, I also think there is more to be learned from failure than success in most cases.
You see, I don’t necessarily care about the 1 million dollars in 3 minutes success story because of three things: 1 – this is the exception, not the rule, 2: this is survivorship bias and 3: people always overestimate their ability and downplay luck and timing.
The road to success is far more chaotic, whereas with failures, I feel you get a road map of things to avoid. And after all, the process of private labelling taught is pretty much the same from any 'guru', and yet, it’s impossible for everyone to succeed.
So, with that in mind, let’s look at what happens when your nuts get put through the failure grinder, or more specifically, my nuts.
A while back I went into detail about my first product and why I decided to kill it (you can check that out here).
Since then, I’ve had another few failures, much worse than the first one and so, I’m going to tell you what those products were and why exactly they failed and, I hope, it might be of value to you.
My second failed product: chalk pens
Yup, chalk pens. The kind of weird shitty product that makes your family look at you sideways when you tell them you will be selling it.
I saw from the Jungle Scout web app that chalk pens looked like they were doing OK on the US market (apart from the millions of competitors and probably 300% acos). So naturally I took a look at the UK solid (considering the average UK depth issues).
Check it out
I figured since most were selling 8 packs, I would do a 10 pack and keep the pricing tight and have a shot at being legitimate chalk pen pimp.
I added the main guys into AMZ Tracker and kept an eye on their sales volume over a few weeks and pulled the trigger.
But here’s the thing I ignored, or was just blind to (even though I shouldn’t have been)
There are basically only 3 chalk pen guys actually making the money – the delicious chalk pie is simply way to small.
As you can see, Stationary Island are pretty much everywhere, Super Chalks have a nicely established listing and Chalkola have a main image that looks so damn good that it’s impossible not to notice them.
It’s a good reminder that your main image is super important.
The other guys, Chalktastic, have been about for a few months, and, looks to me like their over-inflated number is probably because of running hundreds of giveaways. I get the impression someone with deep pockets is pouring in a lot of money (although their listing and images are good).
My offer, apart from getting hijacked, was selling a couple of unites every other day at best, I had to drop the price to break even just to get rid of them (listing was decent, images decent and 40 reviews).
Alas, the competition was just too strong, so I cashed out, turned in my flamboyant pimp hat and cane and moved on.
My third semi failed product: aroma therapy / massage oils
I call this a semi failure because, the product and potential were both good, but the problem was getting my product flagged as hazmat.
Because the product involved oils, I knew it might be a problem, so I tested 20 units, figuring that, if they were accepted, I was good to go.
They were - I sold them fast and then spent ages finding a supplier to accommodate a low moq (this was pre-sourcing agent days).
(on a little aside, aroma diffusers are crazy over-saturated with PL sellers now all across Europe)
I eventually found someone, but because the moq was so low, they totally raped me on unit cost and on air express costs ($7 per kg for air courier – ouch!), still, I knew I could sell for an OK margin since the product design was differentiated enough. Plus, when testing, it's important not to over analyse, so I took the hit.
Everything was good until I tried to replenish the inventory – that was when I got the hazmat block (even though I had FBAd the same thing before).
I tried multiple appeals, provided all the MSDS certificates and still couldn’t FBA them. When I asked how the other sellers were FBAing them, the rep told me they either had special permission or would eventually get shut down.
After that I decided to try and merchant fulfil them, but after waiting 2 weeks to hear back from the prep and shipper I was using (I’ve since stopped using them because of terrible communication), I decided to sell them all off wholesale (a buyer via a facebook group).
And then I got busy and kind of put it off and then, long story short, only ended up selling months later after losing probably at least 1000 dollars, but hey, at least I got something back.
Failure 4 – The washing/laundry nets
So this item was a set of 3 mesh washing nets and the root cause of my flop was my lazy research and impatience.
You see, on amazon UK I noticed that a big brand set of three wash nets was doing ok numbers and thought, hey, I can probably grab a slice of that – plus the item is super small and super light, so perfect for FBA.
Almost without thinking I had my sourcing agent go out and find me a 3 pack (small, medium, large) and get a price – since it was cheap, I just pulled the trigger instantly.
Some people have a problem with taking action whereas I have the opposite problem – I have a private label hair trigger and my sourcing agent makes it so easy that I get a bit lax at times.
Of course, once I already had the order completed and it was too late. I ran the item through JS (which is what I should have done from the outset) and I saw an explosion of private label seller, traces of a private label arms race and depth more shallow than my two year old's paddling pool.
So I was putting out a 3 pack when the market had evolved from 3 into 5 and then 5 +a little shoe bag and more. As a bonus, the price point had also been whittled down to micro penis levels.
Hot damn, 5 nets, and 3 shoe bags for £8.99...
So basically, as soon as I launched I had to lower my price to break even to shift my 3 packs!
The lesson here, as usual, is patience and due diligence!
Failure 5 - the one that got burned in an FBA fire
This one, I have to say, was by far my worst yet, it sold maybe one or two per week and no amount of price wiggling was enough to make it sell, even putting it down to like £2 pounds didn’t help (even though the images were nice).
It was a kind of novelty type of phone holder and right from the start I knew it had potential to bomb. However, it was small and light and only cost one dollar to source so I figured hey, worth a shot on a small moq since the downside was minimal.
As I talk about in this post, the risk and reward were in line.
As a 'bonus', it also gets the perverse award of giving my worst EU acos ever for any product
Check it out
But then one day I sold the final100 units
Or had I?
When I saw my inventory drop from 100 to 2, i realised something must be up and a quick check of the facebook UK seller group revealed that a massive fire had broken out at one of the FBA warehouses and, by the looks of it, took my shitty phone holder with it!
So perversely, this black-swan fire saved me from long term storage and, will probably see an reimbursement from Amazon coming my way - ca-ching!
Wins and Future failures
Now, in among those misadventures, I have had some products that meet my criteria for success,so it’s not like I'm Gil from the Simpsons or anything (yet!)
I don't expect home runs, I just keep trying new products and seeing what sticks.
I have had, what I would call 4 successful products in the UK (one of which I would call very successful by UK standards), plus one at 10-15 per day in the US. Then I have another which which is just ok and only sells on Europe
And then I have like 6 failed ones.
Not all the successes are still selling though - one was shut down by the supplier jumping in and undercutting me and another was very successful to begin with, but by the time I got around to reordering + the two month lead time + the general time to get it from China to FBA – the market had changed again much like the wash nets, and it’s hard to make a good margin.
So that leaves me with three keeps in the UK and I’ve got a new item coming in before Xmas to test, I’ll probably just land it in time.
Product research is something you get a feel for over time, but it’s a numbers game in the end because, even if you have a success now, things can flip in a matter of months.
Wrapping up, I hope dissecting some of my less than stellar products has been of some use to you. Remember, despite what some private label course sellers tell you, this isn’t some guaranteed, fail proof business and if you do launch and feel it’s a flop, don’t beat yourself up, just get back on the horse!