Annual sales of over 100 million! Amazon mom-and-pop stores are really popular

In the industry, top sellers such as Tongtuo Technology and Jiazhilian were all started by couples, and the e-commerce giant Amazon was originally founded by Bezos and his ex-wife MacKenzie . Couple-run stores have become a survival model for the cross-border e-commerce industry with their stable relationships and higher profits.

Yien.com visited several mom-and-pop stores, which are our peers. Their annual sales range from tens of millions to hundreds of millions of yuan, and they are still able to handle the fierce competition with ease. This time, they showed the outside world their business operations.

Sales in 2020 will exceed 100 million yuan. Wang Yun: The company does not need to grow too big

In the first year of the epidemic, many cross-border sellers saw their performance soar and earned profits far beyond their expectations. Zhengzhou seller Wang Yun was one of them. This year, his company's sales exceeded 100 million yuan, reaching a small peak since he entered the industry.

Before he got involved in cross-border e-commerce, Wang Yun worked in a factory for several years. In 2017, the local postal industrial park held a cross-border e-commerce conference. Wang Yun had no work experience in this field, but he went to see it when he had nothing to do. After that, he gradually learned more industry information. After confirming the potential of cross-border e-commerce, he quickly took action.

At that time, cross-border e-commerce was in a period of great success, and business on third-party platforms was booming. In April 2017, Wang Yun started his own business on Wish, focusing on clothing products, and found a Hubei factory on 1688 to supply the products.

"At that time, the platform had a large traffic and sales were also very good. We were selling clothes, and three months after the start, we had more than 1,000 orders a day, with an average order value of about US$30. The refund rate was relatively high, but the gross profit was 25%." Before the second half of 2020, about 80% of Wang Yun's company's sales came from the Wish channel.

Having tasted the sweetness, Wang Yun’s company registered an Amazon account at the end of 2018. The store began operating in January of the following year. At the end of January, near the Spring Festival, the first batch of goods arrived at the warehouse and orders began to be placed.

In 2019, Wang Yun's company already had 20 to 30 people. His wife Zhang Yuan wanted to go out to work after giving birth, but both of their parents were not local. If Zhang Yuan went to work somewhere else, the couple would not be able to pick up and drop off the child from school. After comprehensive consideration, Wang Yun proposed that his wife come to the company to work on cross-border business together.

Compared with other employees, Zhang Yuan is naturally more dedicated to the company's business. The two have a clear division of labor. Zhang Yuan is responsible for procurement and operations, managing accounts, prices, production cycles, product selection and operations, while Wang Yun is responsible for logistics and warehousing.

Before Zhang Yuan participated in purchasing, many new products developed by the company's employees could not be sold and all rotted in overseas warehouses. Wang Yun then handed over all the purchasing control to his wife. Whether it was purchasing or developing new products, Zhang Yuan's operations were relatively cautious and meticulous, which made Wang Yun very relieved. At present, there are basically no unsaleable products purchased by Zhang Yuan. Occasionally, it is a small batch, with a value of about two to three thousand yuan.

He does not interfere with the business and decisions that his wife Zhang Yuan is in charge of, which greatly avoids disputes caused by differences in opinions in the operation of the husband-and-wife store model.

"She does a pretty good job in this category, which saves me a lot of time to do other things, such as other e-commerce businesses, overseas warehouse docking, and customer service." Wang Yun said, "The pros and cons of a husband-and-wife store depend on the individual. For example, there must be a clear division of labor. Some couples may haggle over every penny, but we are not that serious. You just make your products well, and I will check mine."

In 2020, the COVID-19 pandemic broke out around the world, and cross-border e-commerce experienced explosive growth. Wang Yun's company's sales also exceeded 100 million yuan for the first time. But after this peak period, the industry entered a correction period.

In the second half of 2020, Wang Yun's company's Wish business began to shrink. Now its daily sales on the platform are only a few hundred US dollars. The Amazon channel has taken on the main responsibility, mainly operating in three categories: beauty, furniture, and outdoor. Not long ago, the company also deployed the Walmart platform.

Wang Yun estimated that the company's operating income this year is about 50 to 60 million yuan, which is not as good as in previous years, and the situation in the future may be worse. In such an industry environment, his company has reduced its staff from 30 to 18 this year, and may further reduce to 15 in the future.

"In fact, when we had more than 30 people, there were many ineffective people who could not be led at all, so we kept eliminating them. For example, everyone originally had a product, and now I eliminated one person and gave you this product. If you still can't do it well, I will eliminate you again. In this way, we can reduce the number of people and push the profitable product to one person, so this person will definitely make money."

Having worked in cross-border e-commerce for six years, he is somewhat worried about the current state of the industry.

"The platform has been too harsh in banning sellers in the past two years, shutting down stores for no apparent reason. Look at what Wish is like now. The previous fines have driven many people away. Amazon is shutting down stores so aggressively now that so many people have collapsed. New accounts are registered but somehow trigger a second review, and even regular items cannot pass the review. I don't understand all this."

But the business has to go on. Being in an inland city, Wang Yun often travels to Shenzhen, Yiwu and other places to synchronize industry information. Next, he hopes that the company will continue to be small but fine. "The company does not need to grow too big. It is actually very tiring to grow too big. We just do a good job of the existing customized products. It will be easier if we don't need so many people. The more people we have, the heavier the burden."

Li Juan: Husband and wife disagree and often quarrel

Unlike most husband-and-wife shops, where the husband is the breadwinner and the wife is the homemaker, Li Juan founded her cross-border e-commerce business herself. When a couple runs a business together, it is inevitable that they will have disagreements and quarrels.

After graduating from university, Li Juan worked in a foreign trade company doing B2B business. Later, due to problems such as slow orders and difficulty in getting commissions, she left home to try to make a name for herself in the B2C market. In 2015, she joined the AliExpress platform and started a cross-border e-commerce business, selling home crafts on the platform.

In the early days of starting their business, Li Juan and her brother shared the pressure and worked hard. They basically did all the packing themselves and often worked until the early morning. After the business picked up, they expanded to Alibaba International Station.

From 2015 to 2017, Li Juan's cross-border e-commerce business has been moving forward steadily, thanks to her control over product selection. Li Juan said that product selection is the most important thing. Consumers in each country like different styles. Often, styles and colors need to be tested, and then the data is presented. Product selection is also a long-term observation process. It is not easy to make a hit product, and it requires long-term observation and testing.

When the business was developing well, Li Juan had to temporarily leave the company due to fertility issues. At this time, Li Juan's husband joined the company to take over some affairs. During this period, the company also experienced personnel changes. After Li Juan returned to the company after her vacation, the couple started to work together on cross-border e-commerce.

"The advantage of two people working together is that it saves labor costs, and each of us is more dedicated. The relationship between husband and wife is the most stable relationship in entrepreneurship. But we will quarrel because of work. However, we each have our own areas of responsibility. I am responsible for the product and overall operations, and my husband is responsible for the store's customer service and handling of negative reviews. When there is a conflict, we discuss it together and finally decide on a solution." Li Juan introduced.

In 2018, Li Juan heard from a friend in Shanghai that the Amazon platform was growing rapidly, so she quickly opened an account and asked her husband to test the waters. However, because he was not familiar with the platform, her husband was unable to start after watching it for a few days. Later, Li Juan's company hired people to try to operate an Amazon store, but because the staff had no experience, there was no result. Li Juan was busy with her second child, so the store was put on hold.

At the beginning of this year, Li Juan was personally responsible for the operation of the Amazon store. After operating it for about half a year, it has now started to make a profit.

The couple is involved in several aspects of the company's business. "My husband has a good temper. He is a science and engineering man. He works seriously and meticulously and does not allow mistakes. However, business itself is a process of trial and error. I come from a sales background and I am willing to rush to the front when encountering problems. We both think that having a career is good. It doesn't matter how much money you make, as long as it is enough to spend."

When talking about future development, Li Juan said that she is willing to focus more on products and truly start from the needs of consumers. In the future, she will only focus on a few products and build a niche brand. She has never thought about making AliExpress and Amazon stores very big. Her ideal business is a team of three to five people, with sales of tens of millions on Amazon a year and stable profits.

Along the way, Li Juan is very grateful for the cross-border e-commerce industry. She believes that if it were not for this industry, she might have gone to graduate school or joined a foreign company, but neither of these is easy. For an ordinary person, having such an online channel is enough for the couple to have a stable career together.

When starting a business, I often work overtime until the early hours of the morning, and sometimes I can catch up with others for breakfast.

When talking about the husband-and-wife shop, everyone said that Liang Sixing and Zhou Yun were the best in the city, with "annual sales of hundreds of millions". Zhou Yun smiled and said: "They are joking, it's only a few tens of millions."

After graduating from university, Zhou Yun worked in foreign trade in machinery, and later the couple started a domestic e-commerce business together. In 2017, the cross-border e-commerce wave emerged, and publicity about cross-border platforms was everywhere. The two took the opportunity to expand their business into the cross-border field, just as an additional sales channel.

With the e-commerce experience of Alibaba platform in China, the two chose AliExpress as their entry point, and opened Wish and Amazon stores in the same year. "It was difficult to open a store at that time, because you couldn't apply online by yourself, you had to find an investment manager. I heard that there was an investment conference in Xiamen, so I went to Xiamen with my suitcase to listen and understand what it was about." Zhou Yun said.

When the business was just starting, they did everything by themselves, including packing and shipping. It was normal for the two of them to work until two or three in the morning, sometimes even later, when others were out for breakfast. Zhou Yun said that although it was hard work at that time, she was very happy in her heart, because there were fewer people and less things to do, and there was not much to worry about except orders.

During this period, the husband-wife relationship gave them great support. "It was definitely very hard back then, but we didn't ask for a salary and were not afraid of hard work," she said. "The stage from 0 to 1 was the most difficult, but the gaps from 1 to 10 and from 10 to 100 were not that difficult. Based on the husband-wife relationship, the other person supports you unconditionally and will not complain no matter how hard it is, because the two of us have the same beliefs."

Zhou Yun was in charge of store operations in the early days and was known as a "store management expert" in the circle. She described the company's growth at a "snail-like" pace when it first started on Amazon, and the development was very slow. Because all orders must be real, and there can be no idea of ​​fake orders and reviews, and the same is true for other platforms, it took several years for a store to pick up. This also saved Zhou Yun from worrying about store closures in the future, "I'm not afraid of any inspections."

In the next two years, the number of employees increased, and various sectors gradually took shape. The operation of stores such as Amazon was also handed over to suitable personnel. At present, the company has 40 to 50 employees, including more than 20 people in the business team. It has laid out third-party platforms such as Amazon, AliExpress, eBay, Shopee and independent station channels, focusing on outdoor products.

The ongoing epidemic did not cause a significant decline in the company's sales, but due to the local epidemic, Zhou Yun's company was closed for two months last year and another month in the first half of this year, and the operating rhythm was inevitably disrupted.

The company's business is currently deployed in Europe, North America and Southeast Asia. Europe originally had the largest share, but after the tax reform was implemented last year, all e-commerce platforms began to withhold VAT, canceled the VAT exemption for orders below 22 euros, and restricted the sales of products above 150 euros. As a result, its single-store sales were once reduced to 1/10, and it was not until the first half of this year that it was alleviated.

After this incident, sales in Europe declined significantly, while sales in North America continued to grow. In the first half of this year, North America's share has basically caught up with the European market.

In addition, the policies of some countries have imposed great restrictions on the sales of its products, and the performance problems caused by poor logistics timeliness have also had a significant impact on the business. Affected by these factors, Zhou Yun admitted that the company's sales have dropped significantly compared to the first half of last year.

Whether it was the wave of account bans last year, or the decline in profits and frequent bankruptcies in the industry this year, they have greatly affected the mentality of sellers, but Zhou Yun did not listen to the "sound of leaves being blown through the forest."

"We have a clear idea of ​​who we are and what we want to do. So whether others are building tall buildings or their buildings are collapsing, we may just take a look and turn around to do what we should do. The same is true for the management team. We often tell everyone not to belittle themselves when they hit the bottom, and not to get carried away when they reach the top. We must always know who we are, so that the probability of going astray will be reduced."

Now, Liang Sixing is in charge of products and supply chain, while Zhou Yun handles some daily operations. As a seller who came out of the husband-and-wife store model, Zhou Yun is also worried that this relationship will in turn limit the company's development. She said that her role has become smaller and smaller, and she will consider withdrawing if necessary in the future.

Zhou Yun is designing the company's equity structure. "We definitely want to make it better, bigger, and more efficient. The company has just optimized an organizational framework, and we also want the team to build the system later to see if we can enable more young people to start their own businesses within the company."

Wang Jinghao returned to his hometown from Shenzhen to start a business: Husband-and-wife shops were born to meet the market demand

Compared with many Zhengzhou sellers, Wang Jinghao entered the industry earlier, and he had started a business in Shenzhen, so he had a good foundation. After moving his cross-border e-commerce business from Shenzhen to Zhengzhou, Wang Jinghao experienced three stages of ups and downs in performance, and each stage was related to his wife.

Wang Jinghao clearly remembers March 6, 2010, the day he entered the cross-border e-commerce industry in Shenzhen. Three years later, having accumulated a certain amount of experience, he started working alone. By 2012, in Wang Jinghao's words, the cross-border e-commerce industry was a blue ocean, with relatively low investment costs but high profit margins.

Three years after starting his business , Wang Jinghao married his wife. After having a wife and children, he realized that he had the responsibility of taking care of the whole family, so he decided to return to his hometown in Henan from Shenzhen.

After returning home, Wang Jinghao continued to do cross-border e-commerce business in Zhengzhou. The employees he brought back from Shenzhen left one after another, and finally only the couple were left to support the company. Wang Jinghao fell into a trough, which was also the most difficult period for the company. At that time, he operated multiple e-commerce platforms such as Wish and Dunhuang.com, and the problem he was most worried about was insufficient manpower.

Wang Jinghao made a lot of sacrifices because he wanted to make cross-border e-commerce his lifelong career. He said: "At that time, my life was irregular. I almost stayed up until 2 or 3 in the morning, sometimes even 3 or 4 in the morning. My wife and I did the packing alone."

Hard work pays off. After the efforts of Wang Jinghao and his wife, his cross-border e-commerce business gradually improved. Later, they moved to Henan Postal Industrial Park, got a new office location, and gradually recruited employees, solving the problems they were worried about.

After someone took care of the business, Wang Jinghao's wife left the company to go home and take care of the children, and the company entered the second stage of development. At this stage, the company entered the fast lane of development under the leadership of Wang Jinghao. In 2019, the company began to operate Amazon. This platform, together with other platforms previously operated, contributed to the overall revenue. 2019 and 2020 were also the times when the company's performance was good.

When the company's performance improved and the children grew up, Wang Jinghao's wife returned to the company to continue the couple's cross-border e-commerce business. Wang Jinghao said this was the third stage of the company's development. At this time, the company's business was relatively stable, and the e-commerce team of about 50 people was basically managed by his wife, so he could free up his hands to do other things.

Talking about the experience of husband-and-wife entrepreneurship, Wang Jinghao believes that this model actually has both advantages and disadvantages. In the early stage, husband-and-wife shops have certain advantages, because they work from home and do not need to hire employees, saving rent and labor, and the cost is definitely lower. However, the disadvantages of husband-and-wife shops are also obvious. When husband and wife work together, the problems they encounter will also affect their relationship. And at a certain stage of development, this model is not conducive to continued growth.

In Wang Jinghao's opinion, if a mom-and-pop store wants to run well, it must adapt to the overall market environment of cross-border e-commerce.

Affected by the epidemic and inflation in Europe and the United States, online consumer demand has shrunk overall, and the overall market outlook for the cross-border e-commerce market is not optimistic. Especially after Amazon's platform rectification of violations last year, sellers' advertising costs have soared, coupled with factors such as rising raw material prices and freight prices, sellers' profits have been hit. In such a market environment, many companies are losing money, but mom-and-pop stores have relatively considerable profits.

The business models of cross-border sellers are all born out of necessity. Taking the Amazon platform as an example, sellers must also follow the general direction of the platform. This year, Amazon is doing four things: first, branding, requiring sellers to operate in a refined manner; second, upgrading system services; third, diversion; and fourth, encouraging sellers to divert traffic outside the platform.

After Amazon's rapid development reached a certain stage, the distribution model of the past few years is no longer feasible. Now the platform will give traffic to whoever can provide customers with a better experience. The barbaric growth of distribution and the vicious competition without regard for consequences will damage the consumer experience.

In order to develop itself, Amazon is constantly rectifying the behaviors of stock distribution, malicious follow-selling, and fake orders to clean up the market. In this process, the internal competition among sellers has intensified, and some people are even willing to sacrifice profits for rankings and sales. At this time, mom-and-pop stores or smaller partnerships can guarantee profits and survive better in the competition because of their lower costs and higher labor efficiency.

(All characters in this article are pseudonyms)

Mom and Pop Shop

Amazon

Cross-border e-commerce