Author of “The Million-Dollar, One-Person Business” and independent journalist, Elaine Pofeldt joins today’s Lunch with Norm to discuss trends on one-person businesses, and habits and best practices for high revenue entrepreneurs. As an independent journalist and speaker she specializes in careers and entrepreneurship. She is the senior editor at Fortune Small Business magazine, and was twice nominated for the National Magazine Award for her feature stories. Her work has appeared in many business publications and she is a contributor to the Economist Intelligence Unit.
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Episode: 190
Title: Norman Farrar Introduces Elaine Pofeldt – Fortune Small Business senior editor
Subtitle: “Scaling Strategies for Entrepreneurs”
Final Show Link: https://www.youtube.com/watch?v=eUnJ_en7D-E
Back on Lunch with Norm…Elaine Pofeldt joins today’s show to talk about one-person business model and, examples of the habits or best practices to follow for high revenue entrepreneurs. Elaine is author of the new book The Million-Dollar, One-Person Business. As a journalist and speaker she is also available to help clients with writing projects. Her work has appeared in many publications such as FORTUNE, Money, CNBC, Inc and many others.
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In this episode, we mentioned the following resources:
Quit repeating yourself https://www.chapters.indigo.ca/en-ca/books/quit-repeating-yourself/9781637304785-item.html
Million Dollar one person business
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Norman Ferrar 0:02
Hey everyone, it’s Norman Farrar, aka the beard guy here and welcome to another lunch with Norm the Amazon FBA and E commerce podcast. All right, so on today’s show, we’re going to be talking about scaling strategies for entrepreneurs. The million dollar one person business. Our guest today is an independent journalist and speaker who specializes in careers and entrepreneurship. She is an author of the book The million dollar one person business, where she looks at how entrepreneurs are scaling to 1 million in revenue prior to hiring employees. That’ll be interesting. As the senior editor at Fortune, Fortune Small Business Magazine, she was twice nominated for the National Magazine Award for her feature stories. First time guest. We’re looking forward to speaking with Elaine Pofeldt. And I hope I said that right, Elaine? Anyways, before we get into it, I do want to thank our sponsor H refs. If you’re looking to become more than an Amazon seller, start increasing sales with your own website with the help of H refs. With their very advanced and free SEO tool Atrus can help you launch inbound sales from your very own website with ease all while you sit back, relax and enjoy this podcast. So take control of your business check out h ref web webmaster tools at hrefs.com/awt. That’s hrdfs.com/aw. where the boy wonder.
Kelsey
Happy labor day
Norman Ferrar
Happy Labor day.
Kelsey 1:47
Can’t wait for today’s show. It’s gonna be good. And hello. Hello beard nation.
Norman Ferrar
We got a look at these diehards.
Norman Ferrar 2:04
Slavery weekend and they’re on that’s great.
Kelsey 2:07
Great. So welcome everyone to the show. If you haven’t yet, please smash those buttons, get those thumbs up and go in. And of course, if you haven’t subscribed to us on our YouTube channel, hit that subscribe button ring that bell lets you know to get all the notifications when we go live. And if you’re new to the community, if you’re looking to engage with us, ask questions. Learn more about Dr. Caz, And Andy, you can go over to our Facebook group lunch with Norm Amazon FBA and E commerce collective you can be part of the beard nation as we like to call it. And yeah, just be a member of our community. And let me see if you’re looking for highlights or full videos, go over to our YouTube channel. And we’ll just keep it short and simple today. And we can just jump into it.
Norman Ferrar 2:56
You know, you were going to start your own Facebook community, right? But it was yeah, it wasn’t you couldn’t grow a beard. It was just the whisker. Ah ha ha ha ha I’m okay. Okay. All right. Well, you get on with it. Ah, I Okay,
Kelsey
A couple years ago.
Norman Ferrar
I don’t think so. Alright. So if you have any questions, please put them over in the comment section. And other than that, let’s sit back, relax, grab a cup of coffee and enjoy this episode. Welcome, Elaine.
Elaine Pofeldt 3:31
Thank you so much norm and Kelsey, it’s great to be here from my car in New Jersey after our recent floods. I apologize for the noise. I’m happy to join you and happy to have a wireless hotspot.
Norma Ferrar 3:43
Now that’s a real trooper, you’re actually in your car on a hotspot in New Jersey after got hit with that horrible storm. So no, thank you for being on board with us today.
Elaine Pofeldt 3:54
I wouldn’t miss it.
Norman Ferrar 3:57
I did tell I got into a little bit of detail. But it for those of us who don’t know you could you just dig a little bit more into your background?
Elaine Pofeldt 4:05
Sure. Well, I’m a journalist, I’ve been a journalist my whole career. And you mentioned I was a senior editor at Fortune Small Business Magazine for eight years. And then I went freelance in 2007. So I have my own business. I’ve run it since then. And I came across the topic for my book, The million dollar one person business as a journalist, it actually came out of some blogs I had done for Forbes, where I write about one person businesses. We can get into that a little bit more. But mostly I specialize in entrepreneurship and careers, especially entrepreneurship. And that’s why I’m so excited to be on this show I a lot of the entrepreneurs I write about are in E commerce and it’s such a hot area right now not only in terms of people getting into the field, but with businesses being acquired. There, there’s a lot to talk about.
Norman Ferrar 5:03
And especially just talking about your, your book, or the what I was talking about prior to getting on to the podcast, is it’s that million dollar, it’s not impossible to do. There are so many EECOM people who are getting that million dollars in revenue. And they all have similar traits, at least the ones that I talked to when I talked to a lot of Amazon, people about, you know, how did they get on board? What drove them to, you know, get on to e commerce and start selling? I, I’m gonna kick off with just a very quick question. And that’s, you know, What trends are you seeing in the growth of, of million dollar one person businesses?
Elaine Pofeldt 5:46
Well, I’m just to your point, there are a lot of E commerce businesses that are getting to this level. And your questions about the traits of the of the Yeah, the trends, they Well, definitely, ecommerce is one of the trends, there are some industries where there weren’t single person businesses before that are really growing. One example is manufacturing because of the growth of outsource manufacturing. So if you, for instance, came up with this great invention, and wanted to make it in the past, you maybe have to own the factory, right to make it. Now, it’s really easy to find a product designer on Upwork, or somewhere like that, find a manufacturer through Alibaba overseas, and maybe outsource the fulfillment and warehousing and be a one person, manufacturer of that product and even have your own store somewhere on Amazon or somewhere else. That that’s a really interesting trend to me, because it means that it’s a much more accessible industry, to all other other areas that were really hot in the book, professional services, which is kind of interesting, because people talk about trading time for dollars, and, and there are people that are optimizing that they’re not billing themselves out hourly, they’re finding other ways. Same with personal services, like being a fitness trainer, nutrition coach, that sort of thing. This real estate rental and leasing was another area where you could do this on the side, no matter what career you have. And then informational marketing is one that didn’t even use to exist, it’s people you know, who are Instagram influencers, could be people in a seemingly boring field, like accounting, who do webinars about some niche area of accounting, but basically, there’s they’re productizing information, and they’re finding a way to sell it in, in a very profitable way. I remember, for one article I wrote for credit cards, that calm there was a change in credit card law and two attorneys in Washington, DC, we’re experts in this very, very niche specific area of the law. And they had a webinar that I needed to attend for the article. And I had to pay either it was 250, or $300. And I get on the webinar, and there are 600 people on it, who will pay that $250. And they were airing it several times. And I thought wow, compare that to them sitting in their office advising a single client for that one hour, or even maybe there was 10 hours of prep work. Very, very profitable way to scale the sharing of your knowledge. And that’s really what they all have in common is that they’re leveraging what one person can do using all the best tools that we have right now that are available to the average person.
Norman Ferrar 8:50
Yeah, and you know, one of the other things that, especially for Amazon, you talked about, you know, you’re able to do this, with all these other tools, you can have access, you can access manufacturers and do private label. But Amazon even and not a lot of people know about this. But if you go to amazon.com/exploreyoucanhaveyourownvirtualstoreso, it’s a one way video, where you can set this up in your garage, if you’re selling shoes, show the shoes, and it looks like it’s a retail store. And when you hover over it or when the salesperson hovers over it, you can see the information and you can buy it immediately. It’s so cool with some of this technology that they’ve got to really allow you to be much bigger and have much more authority than what you could ever have a few years ago, which is and the other thing is we always talk about people that are leaning up against Lamborghini, you know, flashing money, and that’s not the way it is but you can you can I don’t want to say with ease, but hitting a million dollars in revenue is a very, very achievable target when you’re selling on Amazon, if you’re in it with two feet, and if you have the proper if you have the proper knowledge and education,
Elaine Pofeldt 10:13
I think you’re absolutely right about that, I think it will only get easier too, because now you have practitioners who maybe have built one store and sold it successfully, they go into another store, and they pick up different bits of knowledge because they’re selling something different. And as they build up that body of knowledge, it’s a relatively new field, I don’t think it could be older than 20 years old, right? When you think back to when e commerce started. And all that collective knowledge gets shared, you know, when a person has a store, and they tell someone about an app that helped them, that spreads around the industry, then someone comes out with a better version of that app. And it keeps on making the stores more efficient. And, and better. Plus, there are different platforms that open up, it isn’t only Amazon that exists, Amazon is the biggest, but there are plenty of other ones where people build a presence. And so it’s very possible to amplify what one person can do, in ways that we never dreamed of. When ecommerce first started, I remember when it first started. And venture capitalists were just throwing so much money into each each e commerce Store. It costs a lot of money to play them, it really doesn’t write the trick, though norm with, you know, as you know, as a business person, yourself. 1 million in revenue might be $0 in profit, or negative. Or it could be a 50% profit, right or in my experience, usually the E commerce stores that are bringing in 1 million in revenue. Maybe they bring in 200,000 to 300,000 USD in profit. If they’re run well, that seems to be the better ones. I mean, they’re I know that I know of some that are higher than that I know of a lot that are lower. So it doesn’t matter so much what the revenue is, it matters what the profit is. But you won’t have enough of a profit if the revenue doesn’t go high enough. Right? If you want 200k, then how can you profit be more than 200k.
Norman Ferrar 12:28
And I know a lot of people here are going to roll their eyes when I say this, but you’ve got to really know your numbers, if you’re going to go out. And one of the things is education, you’ll get the education on the platform, if you’re doing a Shopify store, if you’re doing whatever your businesses, whatever your econ businesses make sure you understand. So you can optimize the sales out of that store. But what’s really interesting too, is how either EECOM, or services or your professional services, these one person operations have to leverage other one person operations that leverage other one person operations. And it’s a whole new business landscape out there, where you’re really focusing on, oh, this person can help me with my email marketing, this person can help me with this, this person can help me with public relations or press releases. And it’s really incredible how we have to leverage where you used to go, let’s say public relations, for example, you’d have to go to this firm, and it would cost you a ton of money. content writing would cost you a ton of money web design, when I started. It was it was six figures, you know, to get a nice website up there, at the very beginning and back in 1995 9697. It was crazy when it first got launched. Now, it’s it’s very easy. And if you get in touch with the right network, then this will help you build your business. But you’re absolutely right. If you don’t know your numbers, you could sell a million dollars, you could you could have $10,000 Negative. And I’ve had a client like that, by the way. $10 million dollar company losing $100,000.
Elaine Pofeldt 14:12
It’s very common. I think sometimes they learn from their mistakes with that. And usually the cost that is eating up all the profits is advertising. So they what I found is with a lot of the entrepreneurs I’ve interviewed for for this book, and for my next book, tiny business big money, which looks at businesses slightly larger in size. They start outsourcing the management of their Facebook ads and their Instagram ads because at first people think they can handle it themselves. But then they realize it’s not just a matter of knowing how to do it, but it’s having the time to do it in a way where you are maximizing your profits and now wasting money because he didn’t pay attention to which ad was performing or you didn’t even have time to track it. Because you were so Caught up in operating the business. Okay, unfortunately, someone’s gunning their engine next to me. No problem, no problem. You only notice that how many people run their engines when you’re trying not to? Yeah, it cracks me up. I think after COVID A lot of people just wanted to get out in their cars and just drive around. And so we just have so many more cars on the road here. Now then, I don’t know how it is in Canada, by comparison, people are kind of out in New Jersey, we were pretty locked down for a long time. And now a lot of the state is vaccinated. So it’s going back to its old noisy crowd itself.
Norman Ferrar 15:41
Well, I know in Canada, if somebody pulled up and rev their engine, and they were annoying, they would apologize. So
Elaine Pofeldt 15:49
don’t do that. You got a problem with that, that Apollo I think ours is really, maybe the first or second toughest city in America. But that’s okay. It’s definitely lively. So in turn, in terms of the E commerce, sellers and profit, you made another point that I think is really important, which is knowing your numbers. I think the folks who are most successful at this are almost spreadsheet geeks, you know, they track everything in their business. And they keep really good books, whether they’re good at bookkeeping or not, they if they’re not good, they get it bookkeeper. But they really know where they stand pretty much on a weekly basis. They know how their products are performing, they’re tracking it. And they use all kinds of interesting souped up methods for pricing. Because of the dynamic pricing on Amazon and other things to stay competitive. They give a lot of thought to what niches they should and shouldn’t be in, where they can be competitive, where there’s too much competition, where the cost of ads is going up. New places they can put up ads there on top of that stuff, I don’t think you can really be a successful seller. Without that today. But if you’re like that you’re kind of mathematical, I think we are you bring in somebody mathematical to help you, I think you can really excel at this and it doesn’t take that much money. One of the nice thing is, is it’s so easy to experiment, right? You can put up a small quantity of a product, test it and then liquidate it basically if it doesn’t sell.
Norman Ferrar 17:36
Right, and it is a testing ground, every product that you have you and it always is everybody says is the Pareto Principle 8020. But you know, stick with the 20% that sell, you’re gonna have to pay your Amazon tax, there is a learning curve, Amazon’s going to be sending you out emails, and you know, these are might they might not seem to be fair, you have to get around them, and then you move on. And then while you’re doing this, I think that as an entrepreneur, in the beauty of being an entrepreneur is you can move on a dime, you don’t have to be that big whale, you know, in the in the corporate world, something’s not working, change it, you know, or test that, like you said. And one other thing that you were talking about with with your next book. What we’ve done is we’ve hired vas, but we haven’t hired. And I think this is a big mistake for a lot of people. They hire one VA that they think can do it all. And they’re an expert in PPC. And they’re an expert here, and they’re an expert over there, when they know nothing. They have to be trained, or they know something a little bit about Amazon, but they’re not everything. So what we’ve done is a little bit different. We’ll go out and we’ll hire an expert that can do PPC, an expert that might be able to do Facebook ads. And there’s a lot of them. But they’re not all full time we bring them on as project we do have full time project managers. But then we have experts in in their field and we find out that they should be training us, not us training them with the limited knowledge that we know.
Elaine Pofeldt 19:20
It’s funny that you bring this up because I just wrote an article about Jamie Jay who runs bottleneck distance assistance. And he is a million dollar one person business he he I remember interviewing him for Forbes and he was at about 300,000 in revenue. And he had that agency with the virtual assistants. And another one that was it was called slapshot studios. It was a creative agency that did website design and that sort of thing. And he got very good at using the virtual assistants in his own in the slapshot studios business and he picked up a lot of it ideas about, you know how to document your processes, how to set it up so that clients have a single point of contact, he would have one VA, manage the project, and then decide which virtual assistants should get certain legs of the project. So maybe one VA handles graphic design, another one handles, SEO, etc. But the client would only deal with the one person who was like the front man or woman for the band. And, and he just wrote a book called quit repeating yourself where he documented what he does exactly. It just came out, it’s on Amazon. And it’s very good. It really, it shows exactly how to do that, because it’s not uncommon to not know how to do it and to just hire that single one. But a lot of times, it’s you really do you need a team, but you might need more of a fractional team, you don’t need everybody to be full time, because you can then end up with like $30,000 a month in costs, if you have all these people on retainer, or they’re all on payroll, and then your business will be unsustainable. So it’s figuring out through experimenting through assigning projects, how much time you actually need with them. Maybe a lot of them will work ala carte on just what what you need at first, and then you’ll say, hey, you know, I’m working with Elaine at least 10 hours every week. So maybe it makes sense to create a more formal arrangement, that in tiny business big money, what I looked at is businesses that either have formed a more extended permanent team of freelancers, or they have hired people like traditional employees who are on payroll, because that’s really hard for people, I think, who have been in a one person business, how do you manage them? How do you hold on to all the freedoms of being in a one person business, when you now have a team that’s waiting to get instructions from you. And you know, you want to be a digital nomad, and just cut out and do your thing. And so it was really, really interesting to talk to the entrepreneurs in the book about how they put the systems in place. And I, I think there’s a progression where, first they start with automation, because it’s easier somehow to give up certain tasks to a Calendly app or schedule once than to an assistant sometimes if you’re if you’re used to doing everything yourself, you know, and then maybe they’ll outsource to like a bench accounting or somewhere like that, their bookkeeping, something that kind of takes time and has to be maintained. And there’s sort of a price if you don’t do it, where tax time comes in your books are in disarray. Now, what do you do, and then they’ll finally reach a point where they say, I have to bring in a person, you know, who’s more of a team member. And, and often it is a VA, at first, you know, sometimes it’s customer service with E commerce, I found in terms of the first people that they hire. And then they figure out how to meet, really, and in the old school ways, having some sort of a team meeting every week, you know, maybe it’s a Zoom meeting now in the pandemic, or maybe it was standing in person meeting, that kind of thing. What I found was, some of them don’t have meetings, they manage everybody on Slack. And they might have some core people that they communicate with very frequently. And then if there’s a sort of one off freelancer, you know, writing one article for the company website, or something, maybe that would be handled by email, or phone call, or what’s up call or whatever tools they use
Elaine Pofeldt 23:39
on an ad hoc basis, and that seems to work for them. They like it, they’re able to manage million dollar businesses. That way, everybody in the new book is a million dollar business, that they that they have teams. And that’s the difference. Because there just are some businesses that they don’t, they can’t be optimized with just one person. The first book, by the way, has teams too, but they’re a little looser. It was a little earlier in the trend. And my thinking about this evolved that there’s sort of a dividing line with these businesses where they decided I’m going to stay very boutique II and small. And I really don’t want to go above a certain number of people. It’s, you know, it’s not a magic number, but they just sort of know the feel of the business that they want. And then others reach an inflection point where they say, Alright, I want to take this thing as far as it can go. Or maybe as far as it can go before I sell it at the five year mark, right, whatever Mark they’ve set. And, and that’s the book. The second book is more about those businesses, the ones that really committed to more of a scaling, but not the Full Tilt scaling that you’d see in a traditional scale up. You know, that’s gonna be a middle market size company.
Norman Ferrar 24:52
So before we go any further, I want to talk about the giveaway because very unique, we’ve never really offered we haven’t offered anything like this before, do you want to just talk a little bit about that? The the giveaway for today?
Elaine Pofeldt 25:06
Sure, well, in the work that I do, I’m a journalist, but I’m also a ghostwriter. And I’ve helped a lot of people write entrepreneurship books. A lot of people reach out to me on LinkedIn and asked me, with my idea, be a good book, you know, how would I turn it into a book. And so what I’m offering is a free one hour session with me to talk about your book idea in confidence and help you assess whether or not you should go ahead with your book idea. And then tell you a little bit about the different ways that you can actually write a book, there’s not one method for it. But you know, there are several depending on whether you want to self publish, or commercially published, and I can take you through that as well.
Norman Ferrar 25:47
But that’s so unique. And it’s so important, because if you talk to a lot of really well known Amazon sellers, they’ve got book books published. And what’s the first thing about a book, you’re in authority? I love talking about authority equals trust equals sales. And by having a book on Amazon, you know, and you’re selling a product, and you’re the go to person, what a really great idea. So thank you for that. So anybody who’s interested in this giveaway, it’s hashtag, we’ll have Kelsey, and if you’d like to get a second entry in it would be just tag two people. We’re also going to be giving away a North America mug. So one of our lunch with lunch, we should get one with lunch with Kelsey with one whisker, but, but it’s a lunch with Norm mug. So if you’re interested, just mug club, I think that’s what we were using hashtag mug club,
Kelsey 26:45
hashtag my club norm, you can show it off a little bit. So I think you’re using it today.
Norman Ferrar 26:50
Sorry, there we go. There we go the mug like it. So that’s what you’ll be receiving. So anybody who’s interested in that hashtag mug club. And like I see there’s a lot of people on here. So Andy, Dr. Cars, rad Jessica mirror. Anybody who’s listening today, Cindy, Elaine, just, you know, if you have questions about this, it’s so important. We’ve talked about this a lot. I’m usually talking about more of what your second book is out of work with VAs or multiple teams. But you know, you’re if you’re a one person, you know, entrepreneur, ask those questions. And if you’re having problems, if you’re having problems with expanding, if you’re not doing something, right, if you’re making mistakes, put it in there, and we’ll get to those questions. And that actually is my next question. So in your book, you know, the the one the million dollar, one person business? Are there mistakes that you see people doing that? They I mean, just general mistakes? And are there things that people are doing? Right?
Elaine Pofeldt 28:01
Well, I think the mistakes people make often are choosing a type of business that they they aren’t that interested in. Some people are agnostic, they feel like I could run any business, I’m primarily a business person. But I would say the majority of people are not like that. And they have to have some passion about the topic. So if you’re selling something on Amazon, you could do well with selling something you don’t care that much about, but you’re going to be thinking about it, talking about it, breathing it talking to other people in the industry a lot, you know, for all the years that you run it. So it’s better if you pick something that you like thinking about, I think that’s one area where people are just like, you know, I just don’t like cameras, you know, whatever it is, and, and so they start to dread the business. Whereas if you’re really passionate about it, you’ll never get tired of talking
Norman Ferrar 28:58
about it. Right, having that passion.
Elaine Pofeldt 29:02
Yeah. And I mean, it’s kind of a delicate balancing act, because there’s certain things you could be passionate about, that you really don’t want to commercialize that that’s like your thing that you do for yourself just for your personal fulfillment. That might not be what you want to monetize. So it’s finding that thing that you can let go of enough that it can do business, but you’re also passionate enough about to have sustained interest in it. You know, and I’ll tell you a couple of other things that I found interesting. For the new book. I did a survey of I think it was 49 entrepreneurs who are seven figures, and these were the tiny businesses and I think about close to 20% of them were still non employer firms. But one of the most interesting things I found out was that was like 80% of them exercise that was one of the number one things that they have in common, right and think about starting a business. You have no time you’re working 24/7 The day is just flown by, right? You were going to go to the gym, you’re going to do yoga. Now the day went by, but the ones who are successful take that time. And the number one exercise was yoga, which was really interesting. Meaning, yeah, and, and then walking, which I mean, I can’t give you an explanation for why that is. But I thought, if you want to be successful, it’s kind of like you’re a food truck as an owner of a very small business, right? If the food truck breaks down as it goes, gets put in the shop, it can’t sell the food. So I think it has something to do with that just you know, you you got to keep the organism healthy, or, or the organism of your business will not, will not thrive. Couple of other interesting things that I found were, they stay nonemployer businesses for an average of four years before they start adding payroll. And they tend to hit $1 million in four years on average, which I thought was also really interesting. Now, they’re not all ecommerce, they’re all different kinds of businesses. But some four
Norman Ferrar 31:10
years cycle, yeah, cycle, they get to a million dollars. Okay.
Elaine Pofeldt 31:14
Yeah. And it seems so it may be that when they get to a million dollars, they feel they have enough money to sustain a regular team. Or it might mean that they have so much business coming in that they have to have a team I don’t, I don’t really know why that is I just have my intuition based on having interviewed them, and heard their whole stories for the book. That to me is very interesting. So what I think they’re doing is going as long as they can with a very lean operation to stay profitable, then they build up some cash reserves and can grow the business.
Norman Ferrar 31:50
And I wonder how many of those are in the in the black?
Elaine Pofeldt 31:54
I think that if I remember correctly, everybody in the book was profitable? No, I usually don’t in these books. I don’t write about unprofitable businesses. I’m the one thing with profit, as you know, is with these high net worth people. at tax time, they have good accountants. Right. And so when people tell me their profits, I, I often wonder if they’re understating them a little bit, because they’re using every possible tax break they can to minimize their profits and keep it as close to zero as possible. So that’s the tricky part. Because people have said, Why don’t you read the million dollar profit business, because I never really get the true story. It’s not that the nobody is lying. It’s just that with accounting the way it is, if you have a good accountant, there’s a lot of things they can legally do in any country to minimize your taxes. So So that’s, that’s the hard part because taxes are based on profit. But generally, the leaner you keep the operation, the better, without killing yourself and running yourself into the ground.
Norman Ferrar 33:03
Right? We’ve talked about this with, again, going back to Amazon, having all these paid services, all the paid apps that you probably don’t use, you might use one or two, but you don’t need them all. Listening to, you know, 10 gurus at, you know, 99 to five or $600 a month. You don’t need I heard this. Sorry, I’ve got to tell you this story. So I was in Las Vegas at a show. And it was very expensive. It was it was was $12,000 It was a $12,000 app, and the Vegas thing was thrown in. So I was there I was listening to the speakers. And I got to talk to a few people afterwards. And one person was had $3,400 in recurring revenue, I sorry, expenses. And their product hadn’t even hit the the Amazon warehouse yet. And they were attending this, which you really needed a ton of product to make sense. And so they spent $12,000 on that $3,000 Almost $4,000 on recurring revenue, and their product had not arrived.
Elaine Pofeldt 34:22
That’s scary. But you know what, it is a correctable mistake. All you need to do is sit down with somebody who can help you went down the list if me because there probably are people listening to this who they might have run away expenses right now, it’s very fixable. You just take inventory of what you’re using. look at whether you’re performing the task in the most cost effective way possible whether you even need to do it. That’s the other thing. A lot of times people in newer businesses tend to think they need to do things that they end up discovering, they don’t need even a website sometimes. Sometimes you’ll see very Strong businesses with crappy websites, because it’s not worth it, they get enough business, they’re flooded with business already. Because it’s no one’s hiring them because of their website. So that’s one of those things that you won’t really know until you’re a year or two into the business. And then you reevaluate and say like, oh, you know, I really, you know, hired, I didn’t really need to VAs yet. So, you know, maybe I could go back to just one or I, you know, maybe I don’t need someone managing my Facebook ads yet, or whatever it is, but you do need someone to keep you honest. And sometimes people will do things like for their own sanity, like renting space in a co working space, and then maybe the pandemic has showed them what you know what I ran the business anyway, from my house, maybe, maybe I don’t need all that space in the co working space. Or maybe I could work from a cafe for free or other things to keep their costs down until they get their profits up. And then when the profits are up, then you have different options.
Norman Ferrar 36:01
Right, but don’t waste your money when the profits are up either.
Elaine Pofeldt 36:04
No, that’s true.
Norman Ferrar 36:06
And also, one of the things I’d like to add is about surrounding yourself with really good people. So I was earlier today I was on the phone with the my bookkeeper, awesome person who keeps I mean, just just keeping the book straight is one thing, but then being able to go to a really good accountant, but you can go to these very inexpensive tax or accounting services. And yeah, pay a few $100. Or you can pay a few, depending on what it is 1000, few 1000. And have, you can get probably 10 times more that value, and even working with a tax consultant. So all those write offs that you’re talking about, or the way that you’re structuring your business. One thing, one, it could be just something simple by going to, and spending a few dollars on a tax consultant can change, you change the way add an extra zero. And this happened to me. I did not set up a business properly early. And I had a very large company come in and want to buy my business. And it was cash and stock swap. So for them in the US stock swap washes, it’s zero tax in Canada, it’s 50. Or it is immediate tax. So I would have had to pay more than that. They were offering me for the business and tax. Oh, gosh, that’s terrible. So I had to turn the offer down. But I learned from that and started working with tax consultants when I doing business in the States, and in Canada, as well. Well worth it spend the money guys?
Elaine Pofeldt 37:49
Oh, yeah, that’s one of the number one things people tell me is the best decision they ever made was to invest in a good accountant. It seems I think, in the beginning of a business, people feel like they have to DIY everything. And that’s one thing where they so many things changed from year to year, especially if you’re doing cross border stuff, you have to that has to be your first investment really, as soon as you start making more than $100,000. Under $100,000, you’re not talking about such big numbers in terms of what could be wasted or lost. But you know, as you as you build the business, it will become more and more important, especially things like business structure to you, you know, maybe you set up as an LLC, but maybe at a certain point, you should convert over to an S corp or an LLC that pays taxes as an S corp. It’s probably a little different in Canada. But in terms of the traits of entrepreneurs, I would say the number one most important thing across industries is discipline. They show up, they treat their business like a practice, they show up on the days when they don’t feel like it. They don’t necessarily work obsessively. They a lot of them have rhythms built in like you know, Fridays, daddy daughter day or whatever. But, but when they’re supposed to be there, they are there. I don’t mean physically going into an office. I mean, they work on the business. And I think it’s very similar. If you do like I do do yoga every day, I’m really into it. And I do martial arts to taekwondo. And they’re both very similar in that like you show up every day and certain things are really hard for you and you have no hope you just feel you’ll never be able to do these things. Then one day you go like you somehow can do it and you have no idea how you can do it. You just learned how to do it after a zillion repetitions. And I think that’s how businesses you know you’re working at it working at it and then you’ll have like an insight that suddenly makes it all easy, but you will never get the insight if your brain hasn’t been working on it every single day consistently and you haven’t been showing up. And I There are a lot of entrepreneurs who are visionary types. And they, they really can’t make themselves show up as easily. Those folks need a partner. Because if you’re not good on execution and the discipline of actually doing the thing, whatever the business does, then you’ll have no business like it’s no good idea if it’s unrealized will make you money. So it’s partly self awareness to is recognizing what type of entrepreneur you are, there can be people who are hybrids, they, you know, they’re pretty creative about their business. But they also show up, and they work on in and they don’t have a real struggle with that. If it’s like 10pm, at night, when you show up, by the way, I am sorry, I didn’t mean to cut you Oh,
Norman Ferrar 40:45
no, no problem at all. I do that all the time to other people. Well, what was I gonna say, oh, partners. So I’m very experienced with partners. And again, early on, I was hiring people that were partnering with people that were very similar to my personality, which didn’t really work out. Because I needed somebody that it was the end my Yang, exactly like you’re talking about, you have to find or not have to. But it’s probably best in a partnership, where you can fill in, you know, the blanks with somebody. I don’t particularly like accounting. I hate it there. I
Elaine Pofeldt 41:30
hate it. You know, I’m
Norman Ferrar 41:31
on the creative side, I understand accounting, but I hate it. If I had a partner that understood that, okay, I’m much better, they can be the COO of the company, I you know, or CFO, or whatever you want to call them, but they they can run the company. And that would be a great partnership, possibly, a partnering. Partnering is, it’s like a rock band, you know, it’s staying power, you’re gonna have fights, you’re gonna have arguments, and how you settle it, and how you resolve things will either make or break a partnership.
Elaine Pofeldt 42:06
You can also have accountability partner, sometimes people feel like, they don’t have a big enough business, you really weren’t having a partner. I know, like a substantial portion, it was under 50%. But it was substantial for the tiny business big money, but it had either a mastermind group or a business coach. And that’s something I think is very personal. Some people just, they don’t take well to those types of things. It’s just not their cup of tea. But other people seem to do much better if they have somebody they have to check in with every week. I think a lot depends on how much peer support you have around you. Because some people are really isolated from other entrepreneurs. You know, they really don’t get a lot of good feedback for being an entrepreneur. They’re seen as weirdos, you know, for being entrepreneur, other people, you know, if you’re like in Palo Alto or somewhere like that New York, where there’s a lot of startups and think people get what you’re doing. They don’t think you’re some weird flunky or anything. They understand that you can, you’re doing your thing and you’re successful at it, you might not need it because the spirit of friendly competition might drive you on. But that that I mean, sometimes competition is motivating for some people, they see their friends, thriving doing something and then that gets their creative juices going. And they don’t want to be left behind whatever it is, you know, if you’re in it to have a successful business, you kind of have to know yourself and figure out what motivates you. It’s similar to fitness. Some people have a personal trainer and they get really fit. Other people will just get up at five in the morning and work out on their own and run 10 miles a day, you know, and they don’t need anybody to come after them. You have to sort of and they’ll both be exactly as fit. So it doesn’t really matter how you get there as long as you do it, honestly.
Norman Ferrar 44:02
Okay. I don’t have I got a fruit fly running around here. I
Elaine Pofeldt 44:07
don’t like why don’t you like where’s
Norman Ferrar 44:13
anyway, um, last question. Oh, before, before I get to that question. If you’re are interested in a consultation, hashtag, we’ll have Kelsey, we’re also giving away a mug today hashtag mug club. We talked a bit about best practices. Are there any other best practices that you can think of? For the single entrepreneurs that are at a million dollars?
Elaine Pofeldt 44:42
Oh, definitely. Well always think about the possibility that you might sell the business because right now there are a lot of funds that want to buy single practitioner Amazon businesses that are run well. So keeping good books is one part of this keeping them up to date is really critical because you never know if somebody is going to spot your business and make you a really great offer where you could suddenly retire for the rest of your life. So you want to always be ready for that. Another part of that is making sure it’s set up. So someone else could step in and run it, it’s not so in your head that no one else could possibly figure out how to do the things that you did, like, where did you source your supplies from? And how did you manage your ads? And how did you how did you do everything in the business, you should have that in writing, it’s so boring to write it down. But that’s something where you could hire somebody, and, you know, just talk about it, have them, transcribe it, and then have them turn it into sort of a series of worksheets that you keep in a binder or a digital binder, somewhere, that really helps a lot. And if you as you’re getting closer to selling, one of the things Danfa Gela did, interestingly, a martial arts teacher who started science of skill, which was a martial art supply store online, and then he got into home safety and all these other areas that were related. But he ran it solo. And then when he knew he wanted to sell it, he hired somebody to run it. And he kind of stepped aside to prove to the buyers that a whole new person could do it. It was that well organized. And he kept his books clean as a whistle. He had meetings every week with his bookkeeper. And then he went on to do what he really loved. He had studied AI and he started a tech consultancy. On the west coast. Now he’s back in Boston. And with the he, I remember, he had sold that for a seven figure amount as a solo business, so high multiple of what his revenue was. And I think that was because of the organization. So sometimes you feel like you can’t, you don’t have the time to do these things. But don’t forget, you’re not just bringing in income and serving customers. You’re building an asset if you make it one, but only only if you do the things that allow someone else to evaluate how much it’s worth.
Norman Ferrar 47:03
Good point. Yep. Okay, so Kelsey, Do we have questions?
Kelsey 47:10
Oh, come in. Yeah. So one was from Jessica Rabbit, aka Rosalyn. So she says, you interview people very well, in your work? Do you have any tips for client interviews or questions lives in surveys for endorsements or praise? That I’d be able to post on social media? So she was asking, how do you go about doing customer interviews or surveys? Do you have any tips about that?
Elaine Pofeldt 47:39
Is that a question for newer more for me?
Kelsey 47:42
I believe you know, for me,
Elaine Pofeldt 47:45
yeah, I always look for things that wouldn’t be obvious, the counter intuitive tip, things that they haven’t already said. So you want to think about who your audience is, and then think about what do they know. And it might be different for each audience. Like if I’m speaking in front of an audience, that is people who don’t run a business yet, but are aspiring business owners, they might have different things they need to know then a group of seasoned ecommerce sellers who are in a very specific industry. So you think about what they don’t know. And how you can draw out of someone information that will really be useful. I always try to look for one takeaway. Like if there was one thing they came away with from this program that they’ll remember, and that would be possibly life changing for them. You don’t always get that. But that’s what I’m aiming for. I learned this from when I was writing for Money Magazine, a lot. They really push the counterintuitive information there. They don’t want anything obvious in the magazine. So sometimes I’d interview 40 people, and only five would make it into the article. It was a lot of work to get those people that said something nobody else had said before. No. But the other thing to think about is each person has a unique pocket of genius. So part of, of interviewing successfully is getting to know the person a little bit and figuring out where that pocket is. And then asking questions that speak to what they really know about better than anyone else. And everybody from all walks of life always has this. It’s just figuring out using your intuitive people skills, what that is. All right.
Norman Ferrar 49:33
I can’t read the what did Jessica come back with?
Kelsey 49:37
Oh, she said, So you listen to what’s not being said. Then,
Elaine Pofeldt 49:41
yeah, reading between the lines is a big part of it. And part of that comes out of pattern matching because when you interview people for a living like I do, I’ve interviewed 1000s of people I probably interviewed 1000s every year because I sometimes i The number of articles I write in books and things like that, and so on. You start to recognize certain when people start trailing off or skipping over things. You say, Wait a minute, let’s slow down. Or let’s, let’s back up. One thing that you said. And that’s often where the most interesting things come out, like you look for emotion to positive or negative. Because usually, if there’s an emotion, everybody else in that audience will feel that at some point to the exact same situation. And they can really help somebody if, if they can speak to that. And if they had a problem, how did they overcome it? Or even simply to let people know, they’re not alone, because entrepreneurship, I’m very bullish about it, and excited about it. But it’s really hard at times, it can really it can bring you to your knees, when you have a cash flow problem or a person problem at your business, you know, where you can’t solve it. It’s really, it’s not for the faint of heart at all. So So hearing from other people who are successful that they have these problems, too, I think, is also very helpful.
Norman Ferrar 51:02
It’s, it’s a lonely profession.
Elaine Pofeldt 51:06
It is, but it doesn’t have to be I mean, I think the work that you’re doing here makes it a lot less lonely, because people can hear from other people who are doing the same thing in their house somewhere and possibly under lockdown, or I talk to people all over the world. And there are people still in lockdown, where they can’t leave their house after 6pm. And you know, it was it wasn’t quite as intense here in the New York area. But it was, it was close to a certain points. And so you think man, it’s like they need to connect with other people. We all need each other. And it’s not. I mean, that’s the interesting thing is people think when I write about solo entrepreneurs, I’m encouraging something that’s like selfish, or you know, just about one person. But it’s such a collective thing. You can’t do these businesses in a vacuum. It’s never about just one person you have your customers you have, there’s always a team, whether they’re paid or not. There’s always a team, there’s always other people involved. And I think it’s actually a magnet that brings people into someone’s life.
Norman Ferrar 52:05
And, you know, building up going out and finding a good mastermind finding community, like you said, like this, going out and networking going to when we can going to events. And then you can start meeting people that are all like minded, you know, trying to reach the same goal. But yeah, it is, it is lonely, I guess I what I meant by that is, you know, with the discipline, you’ve got to get up, you’ve got to do your thing. And if you don’t have employees, you really have to, you know, just do it yourself. But having the ability to reach out to a mastermind or network and talk and ask questions and get answers. That always helps.
Elaine Pofeldt 52:48
Oh, I think so. Yeah, the emotional support that comes with just just being in a room full of other people who are kind of on the same march in their business every day is so helpful. It’s so helpful.
Norman Ferrar 53:02
Okay, Kelsey, next question.
Kelsey 53:09
What is your advice to an old schooler that needs to come on board with econ marketing and associated strategies to enable their new business, which I see is the largest bottleneck to scaling?
Elaine Pofeldt 53:22
Well, it’s something like this, it’s pretty easy to find a consultant at all price points. If you really don’t know it. I think you need to find somebody if you feel like it depends. If you’re somebody who uses tech in some other type of work, and you’re pretty good at picking it up. You might be able to self teach by listening to podcasts and YouTube videos. I think YouTube is very helpful for Tech because you can see it on the screen. If not, I would say find a consultant who’s very patient, know who will take you through things that maybe might seem basic to someone else’s, that Saturday Night Live skit with the IT guy, I don’t know if you’ve ever seen it, but it’s like he’s losing patience with everybody. He makes everyone feel really stupid. Like that’s, we’re not talking about it with this. But with technology, sometimes you’ll get somebody like that, you know, whose their social skills are not so good. They’re not very empathetic. So it’s asking around for someone who works with people your skill level with it, so that you can feel comfortable enough to ask the questions you need. Also, sometimes you having your kids involved, or grandchildren, depending on who’s around you. A lot of times, I have kids ages 11 through 17. And my son especially, you know, was really born with technology. So sometimes I ask my daughter’s for help and they’re they’re very tech savvy, but they can’t solve and I call him in and he like, use a voice command or something, you know, that they don’t do, because they didn’t grow up with that. And you realize sometimes like an 11 year old kid might be best friend with some of this stuff.
Norman Ferrar 54:57
What happens if Your son might not be very good.
Elaine Pofeldt 55:04
Well, then you might want to have a consultant on Jack. No, no, no,
Norman Ferrar 55:09
I’m talking about Kelsey. Oh. Sorry, Kelsey, I just had to put that in there
Kelsey 55:18
to deal with Oh.
Norman Ferrar 55:23
Okay, next question.
Kelsey 55:25
Okay. We just have one more question from rad. I think it’s more towards you nor him. But I, can you suggest a company that can run PPC efficiently?
Elaine Pofeldt 55:38
You know, I would hesitate to make endorsements on that. I think maybe, Norm and company can. Maybe you have recommended providers?
Norman Ferrar 55:49
Yeah, read, why don’t you just message me later. There’s a few different places that we could talk about, depending on the volume that you’re going through. Yeah, there’s a few places. So just you know how to get a hold of me so we could talk about that.
Kelsey 56:10
And that’s it for questions. So, head on over to the wheel.
Norman Ferrar 56:14
Okay, Elaine, you’ve never seen this. Here we go.
Kelsey 56:21
Okay. Alright, so this is, uh, here we go. Alright, so this one is just for the mugs. So thank you. Just grab it and read. We’ll pull these up. And 321 So if you’re the winner of the mugs, just email me K at lunch with Norm calm. Alright, rad gets it and read. Okay, and our next one. Just a second. Here we go. Okay, so shuffle these up. 321. All right. And if you are the winner, please email me at K at lunch with Norm calm. And it looks like it’s Andy Sandy.
Norman Ferrar 57:37
Congrats. Okay,
Kelsey 57:41
so we’ll get you the information for your consultation with Elaine. And congratulations.
Elaine Pofeldt 57:47
Looking forward to Andy.
Norman Ferrar 57:50
Okay, Elena, how do people get a hold of a copy of your book, if they’re interested?
Elaine Pofeldt 57:55
They could get it on Amazon or any any major online store. The new book is available for pre order on Amazon now. And it’ll be coming out in February of 2022. So not too far off.
Norman Ferrar 58:12
Okay, very good. And if people want to get ahold of you, how do they do that?
Elaine Pofeldt 58:17
The easiest way would be either from LinkedIn, Twitter, or Facebook. I’m on all of those platforms under my full name. Okay. million dollar, one person business.
Norman Ferrar 58:30
million dollar one person business if you’d like to get a hold of Elaine. So thank you so much for coming on today and sitting in your car, in the heat in the middle of New Jersey with all these repairs going on. And Labor Day. So thank you so much, Elaine.
Elaine Pofeldt 58:45
Oh, it was fun. I really appreciate it. Norman. Kelsey, this was a lot of fun. And I think you do great work. I’m really, really honored to be on the show.
Norman Ferrar 58:54
Oh, well, thank you. And we’ll talk to you soon.
Elaine Pofeldt 58:56
Okay, talk soon. Bye. Bye.
Norman Ferrar 59:00
Alright, everybody, I hope you enjoyed that special podcast today. It is something that is was is very unique. And I really love the giveaway. So Andy, you mean you nailed it? That’s going to be a really great consults. Okay, so let me see you here. We have got on Wednesday, my partner in crime over a private label Legion and Macau Chapnick are going to be on talking about Walmart. So McKell Tim and I there saw this huge explosion with Walmart and selling on Walmart over the last six months or so. So, Tim McCallum myself, we’re going to be talking about huge mistakes people make when they want to go and sell on Walmart. How do you fix them? How do you get on there? How do you optimize your listings properly? So please tune in on Wednesday we’ll be talking about selling on Walmart Also, I want to just give a big shout out to our sponsor, global wired Advisors, a leading digital investment bank focused on optimizing the business sales process. For more information, please visit Chris and his team over at global wired. advisors.com. All right, Kelsey, you know what you haven’t said in a long time. What? What, subscribe to our newsletter newsletter? That’s because yeah, it’s your job, the newsletter that doesn’t suck, right? Yes. Okay, so it’s all full of content. And you can get it at lunch with norm.com or Norman farrar.com. And you just have to add your information. And there’s literally there’s tons of content in there about some videos, mostly blog articles, articles that we’re releasing curated articles all about the industry.
Kelsey 1:00:52
greats. And if you haven’t yet done it, please smash those Like buttons. If you enjoyed today’s episode, please share it out to your friends, any entrepreneurs, ecommerce sellers, who might need a little help with the scaling strategies, or just a place to listen for some advice. I know, Elaine has talked to so many different entrepreneurs. So I really enjoyed today’s episode, I thought it was really interesting getting all the different perspectives from the different people she’s talked to in the past. And yeah, tomorrow, actually, we have a guest lesson for our Patreon, which actually, I haven’t said anything, not even to our Patreon group. So if they’re listening, they’re going to be finding out right now who the guest is. So it’s Brian Johnson. So tomorrow, Brian Johnson is going to be talking to our small group of Patreon members, and we’re going to be talking about I’m sure, Amazon PPC and other things. So looking forward to that,
Norman Ferrar 1:01:55
that’s gonna be great. So like to get Brian in a small room, and you can have time with them. That’s great. He is one of the leaders in the field of PPC, and just Amazon optimization. So that’s, that’s it, that’ll be good. I didn’t even know Kelsey. Thanks for telling me
Kelsey 1:02:11
like, surprise. But yeah, follow us on Facebook and Instagram, also YouTube and have a fantastic Labor Day weekend. Thank you. For everyone who joined in, we didn’t know what the turnout was going to be. But we’re glad to see that. We had lots of people join us on this holiday.
Norman Ferrar 1:02:29
Okay, and so one other thing I want to talk about before I get into the closing. Kevin King is having the billion dollar seller summit in a couple of weeks as less than a couple of weeks now. And he’s got a few tickets left. He I don’t have an affiliate code. I have nothing to do with it. I’m speaking there. But if you’re interested, and you put down the referral as lunch with Norm, you’ll have a bonus for the following. I think he has another one in six months. And there’s a bonus that you’ll get for that. So anyways, I can’t give a discount. He’s giving zero discounts. It’s full price for everybody. But if you do you get a bonus a discount off of the next event. Okay, so anyways, check it out. It is one of the top events that I go to every year and you’ll learn a lot 3 million to $4 million is the average Amazon seller who attends not speaking who attends Okay, so also so join us every Monday, Wednesday, Friday noon, Eastern Standard Time. I really appreciate everybody joining us this Labor Day weekend and you know spending your time with us. It just shows you how much you know we love this community. And I mean we really couldn’t do that without you guys. So enjoy the rest of your day your holiday and we will talk to you Wednesday entre entre
Transcribed by https://otter.ai
