Digital Social Hour - Queen of Amazon Melisa Vong On Making $20M on Amazon, Exiting Her Company & China | DSH #179

Episode Date: December 6, 2023

On today's episode of Digital Social Hour, Melisa Vong reveals how she got to $20M in sales on Amazon, what it was like selling her company, and what it was like visiting suppliers in China. BUSINESS INQUIRIES/SPONSORS: [e-mail] APPLY TO BE ON THE POD: https://forms.gle/qXvENTeurx7Xn8Ci9 SPONSORS: Opus Pro: https://www.opus.pro/?via=DSH HelloFresh: https://www.hellofresh.com/50dsh Deposyt Payment Processing: https://www.deposyt.com/seankelly LISTEN ON: Apple Podcasts: https://podcasts.apple.com/us/podcast/digital-social-hour/id1676846015 Spotify: https://open.spotify.com/show/5Jn7LXarRlI8Hc0GtTn759 Sean Kelly Instagram: https://www.instagram.com/seanmikekelly/ Learn more about your ad choices. Visit megaphone.fm/adchoices Learn more about your ad choices. Visit podcastchoices.com/adchoices

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with a wrench. Like they wanted to talk to a guy because they didn't realize that I actually knew my... So you've done over $20 million in product? Yeah, in revenue, actually actually over 25 million on amazon 25 sorry who's counting right who's counting after a million i don't know the money's just there Welcome back to the Digital Social Hour. I'm your host, Sean Kelly. I'm here with my co-host, Wayne Lewis. What up, what up? And our guest today, Melissa Vong. How's it going? Good. It's good to be here. Good to see you. It's been a hot minute. Been a while. Like what, three years or so? No, actually, we saw each other back in i think it was no oh yeah when we were in town for selling scale yeah that amazon conference and you guys came to the nelly concert not to see nelly bro terrible you don't like him no i'm i have no problem with nelly i'm just not

paying to go see him i didn't pay yeah if it's free i'll go like go network and talk to people i'm not yeah it was more of a just he was there kind of thing i think yeah i mean we hooked you up with some platinum tickets so she did she saved me three thousand dollars so yeah oh for real well it was a networking event so it was for selling scale it was a conference with helium 10 it was their first ever amazon seller focused event and i actually spoke on a panel just before Gary Vaynerchuk. So we got to open up the stage for him. And where was this at?

It was in Vegas. Oh, it was last year. Yeah. I forgot about it. What was it like meeting Gary? It was cool because I was actually backstage after my talk. So I went back and he was waiting there. So he had watched the whole segment and then he actually pulled me aside

and he just basically complimented what i was saying and said hey like that tick tock thing you said was really great it was really raw and like it was yeah it was very surreal it was almost like a full circle moment because he was one of the you know biggest people in the the marketing space i've been following for over 10 years And I saw him speak 10 years prior to that for the first time in Vegas at the Mirage Hotel. And just to, you know, cross paths with him and be able to open up a stage for him, it was just surreal.

Yeah, that is surreal. So you've done over $20 million in product? Yeah, in revenue, actually over 25 million on Amazon. Over 25 million, correct. Sorry, who's counting, right? Who's counting after a million? I don't know. The money's just there.

So, like, what does that feel like? It almost feels unreal. Now, was that $25 in one year or was that over the course? That was over the course of, like, four or five years. That's still good. It's still insane. Five a year. Yeah.

So basically just selling on Amazon, it almost feels like a game at this point. Like you see the score kind of going up, like the sales going up and you wake up and you wake up to sales and it's like this crazy experience just making that residual income. How does that feel? Because do you feel like there's a lot of women in that space that's like dominating the space? Or do you feel like there's a lack there when it comes to Amazon? There's definitely been a lot more women in me selling on Amazon. And I think that small business owners who work from home, it's actually, I believe the status like over 70% of six figure

at home businesses are made by women or run by women. And you can do this from the comfort of your own home. So I think that there's maybe a lack of representation. Yeah, there is because it's more so. I feel like the OnlyHams is like that's what's being recommended. For women? Yeah, versus, Amazon. I mean, you're living, walking proof that, you know, you can make twenty five million dollars and technically not say you don't need a man because I don't like saying that.

But you can have the same success, you know, as, you know, certain men or, you know, whoever you're going after. And it's very well possible for you. You know, so i think that you kind of breaks that i would say that whatever stigma around that that you know women aren't getting their just due they just have to hustle harder right absolutely i mean that's with anything i won't sit here and pretend that you know it's harder being a woman because it's harder in some areas but oftentimes there's a lot of doors open because I'm a woman like I get the opportunity to speak on stages because they need to fill you know the slots and

they need to have more representation whether it's someone who's a minority or a woman or whatever it is I do get a lot more opportunities because of it and I'm gonna take advantage of it. So there's perks of being a woman right advantage of it so yeah 100 there's always a conversation of lack right of lack this is what we don't have this what we don't make blah blah blah you didn't get into business to run payroll did you that's okay i didn't either now there's gusto gusto not only offers payroll but also benefits onboarding and hr all in one place to more than 300 000 businesses maybe you Maybe you want federal, state, and local payroll taxes to be filed automatically no matter where your employers work, or maybe you want to offer

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also maybe don't think that you have what it takes as a woman in certain industries. So I actually used to work in the car industry, which was heavily dominated by men. And, you know, when I would pick up the phone, make sales calls, people would literally tell me, they'd say, hey, I'd like you to pass the phone to someone with a wrench. Like they wanted to talk to a guy because they didn't realize that I actually knew my. So I actually had to work harder and study the stats a lot more than maybe the next guy, but at least I can blow them away with my knowledge. And that's what I had to keep me competitive in the space

and make it happen for me as a female in cars. Nice. So how did you get into Amazon? Were you profiting from the first year or did it take some time to build up? So it was just right out of university. I basically was already in the car industry, came out of university with a bunch of student debt, moved to the big city and thought that there was more opportunity working for a higher level,, luxury car brand. I started with Nissan and then I got a job in Toronto and I was like, okay, the clientele has deeper pockets. Maybe I'll make more money working at a luxury dealership. And basically my, my living expenses dramatically increased

because you're living in the core city. For those of you who don't know, like Toronto is the most expensive city to live in Canada or one of the most expensive city to live in canada or one of the most expensive next to like vancouver so basically had to find a way to supplement my income because i was barely able to pay my rent and i have expensive taste like i love food like that that's what i mean when i like expensive things is i like to spend on food like literally i can live with that yeah i don't usually spend a whole lot of money on like you know shoes and like purses or heels or anything like that i like to spend it on experiences and food so for me i had to find a way to make extra money otherwise i wasn't going to be able to stay in the city right so i was looking at different you know options to make money online because i'd

experienced you know i made my first dollar in affiliate marketing online. I was like, you know, this is so cool. I got hooked and I just tried to find different ways that I could make money using the internet with the tools that we have available to us. And what was that first product that sort of started everything for you? So we sold an organic castor oil and it's basically a, it's an oil that's sourced from castor beans and it's cold pressed. Did you make it? So we actually sourced it from overseas. We would buy the oil.

White label? It was private label. Yeah. Private label is a fantastic model because you don't have to purchase, you know, machinery, manufacture your own products or print your own labels. Usually you work with a contract manufacturer who is able to put your branding on the product and they can even pass down organic certification as well which is nice so we did also take that extra step because

amazon's gonna require you to submit some kind of proof that everything is everything so do they submit that too yeah so certificates of analysis is usually what they ask for. Anything that goes on your body or in your body. Because we also sell supplements as well. They've actually gotten a lot more strict with those regulations. So you now need what's called an ISO certified certificate of analysis. So that way they know that everything matches the supplement fact panel. People are faking it. Oh, yeah.

Well, no. It's too much of a risk i mean you got lawsuits so if she's selling something and i break out that falls on her and which falls on amazon yeah so amazon is even requiring insurance now too really yeah yeah if you make over ten thousand dollars a month consecutively for three months they'll ask you to provide proof of insurance so you want to open up your store with that because it's kind of a plus right yeah you need liability insurance either way yeah it's not that yeah i made sure i got it on the pod we say some pretty crazy stuff

don't want anyone suing us for it that's hilarious um so after the first year like what were the numbers like were you doing a million the first year or did that take some time yeah so i actually cracked a million in my first year and then by the second year i'd made a million dollars in profit i know a lot of people talk about you know revenue numbers but literally castor oil alone made me a million dollars in profit wow but then we expanded the catalog so we went into natural skincare products like serums uh we did moisturizers, body oils, that type of thing. Nice. And you eventually sold one of the brands, right? We actually sold two of our brands to date. So the first one was the Botanical Skincare Company. And then we started a supplement brand called Orphic Nutrition. I co-founded it with my

partner, Bryce Alderson, who used to play soccer for the Vancouver Whitecaps. Nice. So with his knowledge in sports nutrition and then my Amazon knowledge, we had like basically a business baby. Amazing. And yeah, so then we sold that company. It got acquired two years ago by an aggregator in this space. Nice. Yeah, it was a wild journey.

Yeah, I went to an Amazon conference a few months ago. They were basically saying there's aggregators that just buy up successful amazon stores doing like one to five million right and they just combine them all yeah exactly they're picking up they get so much funding so they now have all this excess money where they want to put it into acquiring brands and then being able to scale them up and basically become a digital proctor and gamble, right? Like the e-commerce giant of all these different- Like JP Morgan. Yeah.

Yeah. Because there's cashflow every month for them. Yeah, yeah, for sure. So they're just stacking it. That's a dope business model though. It is. It is, but isn't it? But you're seeing that a lot of them are failing now too.

So a lot of them are actually getting acquired by some of the bigger aggregators. So the ones that got a lot of funding, they just, all they knew how to do is buy businesses but they didn't know how to scale them they didn't have the infrastructure they did have the money not the business yeah I was just gonna say it seems risky if you don't know the marketing side well you're supposed to buy it but then I feel like you're supposed to put her on some kind of payroll yeah run it for a couple years

after did they do that to you I'm keeping her on board i'm buying keeping her on payroll she knows because she's the business yeah exactly yeah so with the second exit we actually did have to stay on for two years so we structured it as an earn out yeah so we got a percentage of the revenue uh and it's based on the performance and the growth of the business smart i like that because the incentives are aligned there for every party. Did you make more on an earn out? Would you feel or would you think a buyout you actually make more? It depends. So my first company was straight cash buyout.

And it was nice because then I didn't really have to stick around. And I was maybe only helping with the due diligence and the transfer of all the assets and maybe just you know showing them how to do a couple things but we had all of the SOPs so standard operating procedures in place so it made it very easy to hand off the business and basically within maybe two to four weeks I was basically done with the business and they took it over and didn't have to think about it. So just that mentally, like that little mental, you know, back in the head, Hey, like I have to focus on this. It's no longer there. But with the second company, we basically stayed on for two years afterwards. And it depends,

it can be a good thing or a bad thing. It just depends how it performs over the next two years, because if it's the bed, because they don't have the operations to be able to continue growing the company you're not going to see as much of a an earn out or payout over those next two years it makes sense how do you find trending products are you going to the canton fair and other conferences pre and we did go to the canton fair and it was second person i went bro i still haven't i'm jealous i want to go it sounds fun china's fun i mean like there's so many cool things it's like walking through alibaba in person yeah everything is everything even the new stuff is like yo this is gonna be a hit yeah they'll tell you like yo this this is gonna be a hit right yeah so you found some cool stuff there well we even saw things before they came to north america so it's almost like seeing into the future

when you go to canton fair because you know before the Theragun was big we saw all these massage guns and was like that would be a really cool product and then someone obviously saw it and they ran with it and they brought it over and made it a multi-million dollar business yeah that company blew up Theragun Theragun blew up the hoverboards blew up in China of course yeah didn't Dan Fleshman do something with hoverboards yeah up from China of course yeah didn't Dan fleshman do something with hoverboards he brought it over and yeah there's a lot of products I feel like China just has so many winning products for some reason well they're forward they're they're the innovators

yeah that's where everything's made so you go straight to the source yeah you go straight to the source and then you set up shop out there yeah having that streamlined that those relationships out there are way more powerful. Especially when you're talking about products and selling in retail. So do you speak Mandarin? I don't. See, that's one thing I wish that my parents had taught me

because it would be so much more helpful. Oh yeah, they would fall in love with you because then you're both, you're best at both worlds. So how did you communicate when you went there? So you speak in English and most of them actually do speak decent English. So yeah, as long as you speak clearly and slowly and you don't overcomplicate everything. And usually if you have a spec sheet, if you know exactly what you want, you can communicate pictures.

They're very, you know, they want to see the product. You can also bring a translator with you if you want to take it to the next level. Like if you're doing factory tours, sometimes like the owner of the manufacturing plant doesn't speak English, but it's all the salespeople that you're usually talking to and they do speak English. But if you bring a translator with you when you're viewing facilities, they're going to take you a little bit more seriously, too, because like you're willing to spend money to have a proper conversation with them. Have you ever gone on a factory tour and it was just really weird?

You didn't like it? I've been on not a really bad factory tour. We've actually been on some really interesting factory tours, but it was more in a group setting, so it wasn't awkward or anything. We actually went to a packaging facility in China, in Guangzhou, and basically they took us around showed us the you know the printing press and all the machinery and they actually print for walmart so to be able to see like all of walmart's packaging literally being printed in front of you

like you know that they're obviously a reliable manufacturer because you're seeing some of the biggest names i've seen some weird ones i just asked because of sweatshops and i've seen some bad ones, bro. We went into it. We thought it was a warehouse. It was in, like, an apartment complex. The way they were making the stuff, it was kids running around. I'm like, no.

This is in the U.S. or China? No, this is China. I'm like, no, that's not it. I don't want to do business with them. Yeah, definitely. Well, that's a good thing that you went, so you can see, like, the conditions that they're working in. Yeah, it was just.

And choose to work with the partners that they're working yeah it was just and choose to work with the partners that obviously don't rely on sweatshops well a lot of don't a lot of the big brands use sweatshops or is that a myth um some of them do i feel like some of them maybe they're not aware or they are aware and they're kind of just brushing it under the carpet because obviously margins yeah the margins china has grown so much it's kind of hard to find well what we perceive as a sweatshop over there is basically legal well it's not it's actually really nice some of those warehouses are really nice and we will sell this is a sweatshop but bro everything's efficient yeah most people are happy it's music playing like but it's a ton of people in there working.

Getting the task done. Like, you're being done. It's getting done. The workforce over there is, to me, amazing. And Chinese people are some of the hardest working people I know. For sure. I'm half Chinese. And my mom's half Chinese. And she's the hardest working person in my life.

And she's basically what inspired me to go out there and do better for our family. And she gave us the opportunity by coming all the way from Vietnam, actually, because she's half Viet, half Chinese during the Vietnam war, our family had to leave and came to Canada to seek refuge. Wow.

So what's, what's next for you? You know, granted you've had a ton of success when amazon is your plan and just keep scaling up like what's it's 100 million the next go yeah over the next five absolutely yeah i mean we're still very much actively selling on amazon also on our own websites so we've launched a couple of new brands actually just launched a new pet brand i brought you some products so you can give it to your dog let's go i'm all about my dog's health man that's a good niche for you especially like everyone got a

pandemic pup yeah i got two i got one too yeah yeah you got lonely yeah i didn't get lonely i just i wanted to have a kid yeah at that. And obviously, I didn't have one. I just went on a crack list and was like, well, I'm going to go find a dog. Dogs are pretty much kids. Yeah. You know? Yeah. How do you do quality control?

Because I've heard nightmare stories about this. And at your volume, like one bad order could be a six-figure loss. Yeah. And she's doing skincare, too. That QC has to be crazy. So with skincare, we actually source most of our products and ingredients and work with manufacturers in the U.S. We don't typically go overseas unless it's for packaging, because obviously it's a lot easier to scale packaging orders overseas. It's just it was cheaper. Now it is a lot more expensive with shipping container prices that have gone up so we work with both us and overseas suppliers but with quality control you always want to do like a pre delivery inspection with anything you buy like it's very similar to when you buy a pre-construction

home or you buy a car you always want to do a pre-delivery inspection to make sure there's nothing wrong with it so you can actually outsource and hire companies like keema to do those pre-delivery inspection to make sure there's nothing wrong with it so you can actually outsource and hire companies like keema to do those pre-delivery inspections for you and they'll send you a full report it'll literally test you know the viscosity the color the they'll do drop tests they'll you know they'll test basically everything that needs to be tested under the sun and actually we ran into a really huge problem with one of our shipments and we had been working with this supplier for years so obviously you gain that trust and you think oh like they're gonna take care of me they're not gonna but unfortunately there was this one order where the droppers were slightly too long where

when you screwed it into the glass bottle it like basically was it was just touching the bottom of the bottle. So when you're shipping it and you know, Amazon delivery people, they don't care. They're like playing frizzy with your packages. And then basically it would shatter the glass dropper. And that was a huge liability, right? So we're getting people calling us, emailing us saying, Hey, like this is broken. broken um we want a refund or we're going to take action or whatever so we had to recall all of those bottles that were made in that batch no so they were refunds so anyone yeah because amazon deals with all the processing

so they basically do the refund amazon probably was like all right cool yeah but thankfully we didn't sell too too too many of those. So they weren't in the stream of commerce. Like as soon as we got our first complaint, we're like, OK, we got to pull this. And I remember we had all these extra droppers that we had ordered because we ordered like maybe ten thousand of them and for that specific shipment. So we had thousands of these droppers that we couldn't use.

That's, you know, a waste of money. And then I reached out to my manufacturer and they wouldn't send us new ones. They just sent us new stems. They didn't send like the dropper part of it. So, I'm literally sitting in my living room with my fiance and we're manually replacing all of the pipettes ourselves. So, yeah, it was a bit of a sweatshop in our living room so did you guys get it done we got it done and then we were yeah so you guys pulled them off with the nose how many i don't know it was i blacked out by like this dedication right there man wow yeah it's tough when it comes from china i mean you're kind of hoping well it's it's tough when it comes from China. I mean, you're kind of hoping. Well, it's, I mean, I think they pretty much do their best.

But, I mean, it happens. You got to pivot. You got to be an entrepreneur at that point. Like, you got to think like one. So what's the next one? You got to get to work. The most successful people, I think, are the ones that are able to pivot. They're flexible and they're resourceful.

You know, whenever I've talked to people or when I hire people even, the people that do the best are usually the most resourceful. Whenever I've talked to people or when I hire people even, the people that do the best are usually the most resourceful and they're not going to ask me questions for every single little thing. They're going to go and find the answer, but if they can't, then they're going to come to me. Yeah, I love that. Do you see Amazon getting saturated? I think there's always going to be competition no matter what niche you're in, what space you sell on or what marketplace you sell on. You could sell on your own website, Shopify, but the traffic's not going to be there. You have to pay to send traffic to your own website.

With Amazon, they provide the traffic for you. So obviously there is an appeal to that. There's going to be competitors. I specifically sell in the consumable space. So it is filled with a lot more experienced sellers, but I wouldn't say that it's like hyper saturated certain products. Sure. Like there's products like the garlic press, for example, that's over saturated avocado one. Yeah. The avocado smasher thing. Like there's so many oversaturated products, but if you can find a way to differentiate your products,

marketed it a little bit different, maybe you have different causes that you you know that your customers are gonna gonna resonate with for us we we find different ways we can make our products either more potent we're going to be very competitive with our pricing so we work with manufacturers that can accommodate that yeah um and you know we're provide, since we are cutting out the middleman, we can remain very competitive. Now, I've heard the margins are slim on e-commerce. Is that true with Amazon products? Compared to maybe some other industries,

I'd say, you know, our average margins were about 30 to 35%. Some products had way higher margins. Some of them even had less. But we were basically banking on – 35% would be the margin. For Amazon? Yeah.

For Amazon, yeah. Because Amazon takes a fee too, right? They do. That's after Amazon takes their fees and everything. So 30% was our average after our cost of goods, after Amazon fees and shipping costs. That's pretty good. Not bad at all. For Amazon.

We wouldn't sell in volume, obviously. Her volume is good. 35% is not bad at all. Yeah. I mean, that's six mil profit off 25, right? Easy. Nice. For Amazon. One selling volume, obviously, but. Her volume is good. 35% is not bad at all. Yeah. I mean, that's six mil profit off 25, right? Easy. Nice. All right.

Quick math. It's the Asian in me. What's next for you? I am diversifying a little bit. So Amazon's great, obviously. It's what I know. So it's hard to get out of the space when that's basically where all of my expertise lies.

But I've diversified into real estate. So I bought some rental properties. Most recently, actually opening up a escape room. So I don't know if you guys have ever been to one. Yes. In Canada. You guys got to come and visit once for a little bit. I do those monthly.

I'm not even kidding. I love escape rooms. I feel like entrepreneurs love escape rooms because it's just the problem solving, you know? Okay, escape rooms. Love it. So you're going to open up your first or you plan on opening up a lot of those? We have exclusivity for, so we're doing a franchise, which is nice because you're buying the rights to the branding already. The name.

Exactly. The process is already in place. They actually will build out the games for us. We just have to pay for the construction. So it's basically you pay, you know, X amount of dollars to make the room. And it cash flows really, really well. So it's just another way to diversify. Is this Escapology or a different one?

No, it's actually called Trapped. So they're mainly in Canada, but they are also expanding to the US. So if you guys want to open one in Vegas, let me are also expanding to the U.S. Nice. So if you guys want to open one in Vegas, let me know. Is this the one with live actors? You can have live actors, but you don't always have to because then it's just another person you have to staff, and some people don't like live actors. I haven't done an escape room yet.

You would like it. For real? You got to think outside the box. We should go do one later. Yeah, I might be down after dinner, actually. After dinner, yeah. All right. Wayne, you got to think outside the box i should go do one later yeah i might be down after dinner all right wayne you got anything no um i definitely uh appreciate i appreciate you for coming on i definitely like your drive i think they're uh you guys uh more women need that spotlight on them because uh we need more we need better role models love that thanks for coming on Melissa thanks for watching guys

and I'll see you next time peace