Is Money Preventing You From Growing Your Amazon Business?

We work with a lot of Amazon sellers and they run into the issue of not having enough money to buy more inventory to then grow by selling more products. However, in this video, Matt talks about how this is a tricky situation. Watch this video to hear Matt’s tips on how to overcome it.

There are tons of people out on social media giving business advice. Some of it is good advice, but most of it isn’t good. In this series watch CapForge’s owner react to different advice videos. He’s an expert in all things business and has 20+ years of experience under his belt. Some of the things he reacts to might even surprise you!

Video Transcript: 

Business Advice Video:

This is the one thing you need to scale your Amazon business. Money. A lot of people hit a roadblock in their journey selling on Amazon, where they run out of money for inventory. But it actually can be a very simple fix. The SBA offers plenty of loans. You can actually get a loan from a friend or a family member and Amazon lending is always a great option.

Matt’s Review:

Okay, yes. I mean there’s never enough money in the whole world to buy enough products to sell on Amazon. That is definitely the constraint that most of our clients who are Amazon sellers run into, as there’s not enough capital to keep buying and expanding. But this is tricky. You have to make sure that what you are selling is profitable. And that you can afford to borrow money. And after you pay the interest and pay the money back there’s still money left. Where gets people in trouble is they run out of money and they figure “Okay, I need to borrow to keep growing”. But the business isn’t really working. Running out of money isn’t a sign that you need more money necessarily. It can mean different things. And you have to make sure you understand that borrowing money, and buying more inventory, and selling more inventory is still gonna be a good move for your business. So that’s why I advocate anybody in the Amazon, or e-commerce business, or any business really, understands their numbers and is making good data-driven decisions. Not just thinking “Well I ran out of money. I sold everything I had. So the answer must be more money.” Because that’s a great way, if you’re not sure, you’re not profitable, you’re not selling what the way you thought, to get yourself in a huge debt hole that you will never be able to dig out of other than by declaring bankruptcy. And that’s not a great way to end the business. So borrowing can be helpful but make sure you understand the costs and implications before you just jump into signing up for a bunch of loans.