How to Plan Aggressively, Scale Confidently: Tips from ECommerce Experts
February 2, 2022
ECommerce is a dynamic industry and the past few years have been full of unexpected challenges and opportunities, such as supply chain shortages and exponential consumer demand.
If you’re an online seller hoping to achieve big revenue on platforms like Amazon and Shopify, it takes a lot more than luck to get you there. We sat down with experts Brandon Young of Seller Systems, Tyler Jefcoat of Seller Accountant, and Liran Hirschkorn of Incrementum Digital to gather insights on what it takes to plan aggressively and scale confidently to unlock uncapped growth.
In this blog we’ll cover how to:
- Shift your mindset
- Plan to your potential
- Mitigate risk with data
- Maintain healthy cash flow
- Expand with confidence
Watch the full webinar by clicking here or keep reading to learn more!
1. Shift to a Growth Mindset
You’re an 8-figure seller in the making. But first, you’ve got to start thinking like one. By shifting from a short-term survival mindset to a long-term growth mindset, you’ll learn how to see new challenges as opportunities.
Stand out from your competitors by developing these attributes of a growth mindset:
- Tenacity, or an unwillingness to give up, sets successful sellers apart from the rest. Failure comes with the territory but if you can apply learnings to future products or projects, you’ll eventually succeed.
- A willingness to learn, or a desire to constantly better yourself and keep up with the latest insights, will help you make data-backed decisions and become a better leader.
- Intentions, or knowing what you want and what success looks like to you, helps you set big goals and build an actionable plan you can work backward from.
2. Plan to Your Potential
Now that you’re thinking with a growth mindset, it’s time to build your online business plan. Scaling your online store means thinking beyond current demand and forecasting multiple orders and quarters ahead. Name your goal, and build a plan to work backward from that goal.
It also means harnessing your growth mindset to execute an aggressive strategy. Brandon Young advises asking yourself: What are the specific and measurable activities that you’re doing on a regular basis that are moving you towards that goal? And what are the resources you need to do it, whether it’s human capital or real capital?
8fig helps you plan to your potential and ask yourself: if money wasn’t an object, how much could I sell? Map out your supply chain strategy and build an aggressive path to growth using our free tool.
You should also evaluate the opportunity costs of the choices you’re making and the odds of success. For example, if you choose to expand internationally this year, you may also be choosing not to expand to another platform, so you’ll want to look at the ROI of a decision like that. If an activity doesn’t help you reach that goal, why are you doing it?
3. Validate Your Plan and Mitigate Risk with Data
Place bigger bets with confidence by knowing your numbers. Empirical data helps validate your growth trajectory and allows you to make less risky decisions as you scale. Liran Hirschkorn points out that his most successful clients at Incrementum Digital are the ones who have a handle on their data. Do you know the macro numbers of your business, or what keywords your products are ranking for?
Calculating your true landed costs of goods (COGS) should be a top priority. In eCommerce, COG changes with each batch since supply chain costs are constantly changing. Plus, your refund rates need to be accounted for.
Tyler Jefcoat of Sellers Accountant also stresses the importance of being honest with yourself about your revenue. Is your product actually profitable once you’ve calculated your COGS and ad spend ratio?
“Let’s go take a look at your bookkeeping or your dashboards so that we can have an intellectually honest discussion about your strategy and your products,” Tyler advises. “[Say] your products have a 30% margin after ads. Ooh, boy, this is looking good. Now, let’s take a look at what the keyword research tells us might be the demand of the market and now let’s raise the right capital to scale the business.”
If costs of goods and marketing spend is less than 45%, you’ve found a product that can scale if there is sufficient keyword demand. As that ratio percentage decreases, you’ll have more opportunities to generate high revenue and get to 8-figures.
An 8fig Growth Plan allows you to look at all of the costs it will take you to reach your goal, across every stage of the supply chain.
4. Maintain Healthy Cash Flow
Hard truth: it takes a lot of money to scale an eCommerce business to 8-figures. What got you here isn’t going to get you where you want to go, and you likely can’t fund a multi-figure eCommerce business on lines of credit and family and friend loans.
Healthy cash flow keeps your business and supply chain moving even when disruptions like what we saw last year occur. As Tyler Jefcoat puts it, “yes it’s scary to take on capital, but it’s even scarier to not have capital when your business is tumultuous.”
Don’t wait until a black swan event happens to secure capital because by then, it might be too late. Your supply chain needs to be continuously funded, and that capital needs to be adaptable to adjust to real-time demands – whether it’s an increase in demand, a manufacturing delay, or the global repercussion of a pandemic.
The good news? You can get ahead of potential curveballs without giving up equity or putting personal collateral on the line.
“When you’re borrowing money from a hard money lender, and every week they’re taking money out, your APR is astronomical and it’s not the same as having a partner that vested in helping you with your business the way that 8fig has taken the approach which is helping you with your planning, education, understanding the entire process of driving a product from launch and everything that you guys do with cash flow,” Brandon Young shared. “It’s phenomenal.”
5. Expand with Confidence
It’s time to get out of draft mode and ignite your path to unlimited growth. If you want to scale your online sales to 8-figures, you’ll need a real and tangible plan in place, and partners to help you reach your full potential.
The tips above outline the importance of shifting your mindset to growth, making an aggressive plan, reducing risk as you grow, knowing your numbers, and understanding and maintaining healthy cash flow to run your business and scale with confidence. Our panelists all offer services that help you achieve these objectives: Seller Systems for data tools, Seller Accountant for bookkeeping, and Incrementum Digital for Amazon advertising plans.
Here at 8fig, we live and breathe growth capital and love working with sellers who are serious about scaling their stores to new heights. If you can plan your demand and map out your path to growth, we want to fund it.
Sign up for a Growth Plan today submit your plan for a funding offer. Once accepted, you’ll start receiving continuous cash disbursements aligned with your supply chain needs.
Hit a delay or need more inventory fast? Use our change request feature to adapt constantly at no extra cost.
Not ready to sign up for continuous capital just yet? Make a free 8fig account and use our free supply chain planner.
Erika is Head of Brand and Community at 8fig. She's passionate about empowering eCommerce founders with the resources and tools they need to compete in dynamic marketplaces.