The average income of February and March 2015 across Ryan’s businesses was about $350K, which is a significant pullback from earlier this year. In this episode of Freedom Fast Lane Ryan Daniel Moran shares the highs and the lows, as well as updates you on what is and isn’t working.
Men’s Fitness Company
The pullback was mostly due to inventory restrictions on the physical products brands. There was a big spike in sales and income a few months ago, and this spike messed with the projections on how much inventory to keep. Because sales increased so much, inventory depleted faster than was projected and more than two products were out of stock for several weeks.
The men’s fitness company was down 20% due to the loss of the two products for a few weeks. This business keeps an emergency fund but used some of that money to make a ‘supply’ emergency fund. So, instead of having the fund in cash, a significant portion of the emergency fund was allocated to inventory that would last a full month. This investment in a large purchase of inventory allows the business to have a months worth of stock on hand at all times. When the supply hits 30 days of inventory, then that is considered ‘out of stock.’ When projections are being made, the emergency fund is not included, so the business stays at least four weeks ahead of the current projections.
This has been a rough few months and it has been a struggle to get this business moving. Supplements is a huge space, so there is a lot of competition in the market as well as high volume but the business has been stuck at the $25-30K per month mark. Nothing that was tried was able to move it to the next level of $100K per month in sales. This position forced Ryan to reassess how he thinks about how the Amazon algorithm works and how to stand out amongst competition. There was, however, a breakthrough a few weeks ago which led to sales more than doubling.
In the past two months, a couple of things were tried that had mixed results. The price drop provided a slight bump in sales and was a way of trying to stimulate sales as quickly as possible, which Ryan recommends to his tribe members. If you have a product that is stubborn then grease the wheels with as many sales as possible, even if that means dropping the price.
Ryan isn’t a fan of reducing the price on products and prefers to create premium products and focus on the high end of the market. However, he recognizes that there is a need to do whatever it takes to get sales flowing such as doing ZonBlasts, launches, and giveaways. Once things are moving, there is time to adjust prices but it’s hard to get something moving without momentum. Even though the price was dropped on the product, a profit was still made. The product listing was also tweaked to get more conversions.
In the next income report, Ryan will share what changed to finally get the business over the hump.
Ryan has found there to be more reliability and better service in the lesser-known suppliers. This could either be because they are eager to please or are smaller companies that deal more intimately with their customers. Ryan’s recommendation is to always keep a lookout for new suppliers, additional suppliers, and better pricing or products.
Freedom Fast Lane Personal Brand
Ryan more than doubled his consulting client’s business by using his email sequence and a few other tweaks. He poses the question, “What can you do now to have a regular predictable consistent cash flow in your business that you don’t have to work for?”
Amazon is beneficial, because once you figure out working the channel, you basically have cash flow forever as long as you maintain it. Ryan also asks, “What would you do in business if you didn’t care about money, and what businesses would you keep if you weren’t concerned about the result?” This is a way to be honest with yourself about what is not serving you and what you aren’t really excited about. Once you are at a level where your bills are paid, Ryan encourages you to play with these questions and scenarios to see what comes up.
Stocks and Real Estate
There are currently five single-family houses in Ryan’s portfolio and he has been looking into buying 50 unit apartment buildings. A lot of money has also gone into retirement accounts and cash flowing stocks such as real estate investment trusts and dividend paying stock.
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Links to Resources Mentioned
Losing My Religion