One of the amazing things about selling on Amazon is that there is no one way to do it, whether by yourself or with the help of Amazon virtual
Amazon has changed significantly changed since Nathan’s college days, as has the playing field for dropshippers. However, Nathan remains steadfast that dropshipping is not dying off with the advent of Amazon fulfillment options, but rather is changing to fit the times.
Additionally, Nathan is a great proponent of hiring remote workers because of the advantages sellers can obtain with using freelancers to help with growing an Amazon business. He discusses what sellers should know before hiring remote workers and the lessons he has learned in hiring people in general.
In episode 11 of the Serious Sellers Podcast, Helium 10’s Success Manager Bradley Sutton and Nathan Hirsch discuss:
- 01:10 Nathan Sells Textbooks on Amazon Before the Boom
- 02:25 Nathan’s Beginnings in Dropshipping and Product Experimentation
- 03:12 Making $5 Million a Year Selling Baby Product on Amazon Via Dropshipping
- 04:06 Is Dropshipping and Retail Arbitrage Dwindling on Amazon?
- 05:15 Is There a Need for Warehouses with Dropshipping?
- 06:10 Losing the Entire Business Within a Day
- 08:35 A Hard Lesson Learned in Diversification
- 08:58 What is the Ideal Business Model for Employing Remote Workers?
- 10:30 The Benefits of Hiring Remote Workers
- 11:20 The Top Misconceptions When Hiring Remote Workers as an Amazon Seller
- 13:53 Are There Issues With Hiring Remote Workers Who Speak or Write English as a Second Language?
- 15:23 Is Customer Service the Most Outsourced Task?
- 17:17 Cost of Employing a Full-Time Employee VS. Virtual Assistant
- 20:09 What is the Most Unorthodox Task Given to Remote Worker?
- 21:03 What Are Some Things Sellers Looking to Hire Freelancers Should Consider?
- 22:42 What Can Sellers Do to Protect Themselves from “Bad Apple” Remote Workers?
- 24:50 Nathan’s Experience with People the Philippines
- 27:26 Creating FreeeUp and Contacting Nathan for Freelancers
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Bradley Sutton: From selling textbooks on Amazon in 2008 to selling $25 million via drop shipping. Is that still a viable business model? Today we’re talking with Nathan who’s also going to tell us all we wanted to know about hiring freelancers and VAs.
Bradley Sutton:How’s it going, everybody? Welcome to another episode of the Serious Sellers Podcast. My name is Bradley Sutton, I’ve got with me, Nathan Hirsch today and Nathan, we are going to talk about a lot of cool things. You’re in Florida right now?
Nathan Hirsch:Yeah, I’m in Orlando. It’s bright and sunny; a nice 75.
Bradley Sutton: A little bit better than when I saw you last, which was in the -20 windchill of Brooklyn. Right?
Nathan Hirsch: I couldn’t even stand outside to get my Uber. That’s how bad it was.
Bradley Sutton: Yeah, that was absolutely ridiculous. I used to live in New York and I don’t think it ever had gotten that cold. It was just for us, me being from California now, and you being from Florida, they’re like, okay, We’re gonna give a warm welcome to these sunny guys here, huh?
Nathan Hirsch:And I live in Florida. I have no winter clothes, so I was out there in a sweatshirt.
Bradley Sutton: Oh my goodness. Alright. So I want to talk a little bit–a lot of our listeners are Amazon sellers and you kind of have pivoted a little bit away from that. But you started off as an Amazon seller, did you not?
Nathan Hirsch: Yeah, I started back in 2008 before the Gurus, the courses, the software. I got in right at the beginning.
Bradley Sutton: Oh, okay. And how was that? Were you doing textbooks back then or were you doing private label or wholesale? Well, what was it like back then?
Nathan Hirsch: Yeah, so I started off with books and textbooks. I was in college and I wanted to make some extra money on the side. So I took some money that I made from my summer jobs and I bought people books, competing with my school bookstore. And I started listening to the products that on different websites, distributors, and I came across Amazon and I started to sell more and more books there. And, I mean, this was 2008 no one knew what Amazon was. It was a bookstore. People didn’t understand it, no one was doing it. And I saw that they were just starting to sell some other stuff. So I kind of had this concept where I wouldn’t have to warehouse anything, that I could sell products that I didn’t really have, that I could build a relationship with a supplier, or vendor, or distributor. They would ship that product to the end consumer, and I would make whatever the difference was. And I would handle the customer service. And it wasn’t until years later that I knew it was called drop shipping, but that was the basic concepts. So, I was selling these books and I started to experiment with computer games, video games, DVDs, foreign equipment, stuff that a typical college guy likes and knows about. And I just failed over and over again. And it wasn’t until I found the baby product industry that my business really took off. So if you can imagine me as a 20 year old single, college guy selling baby products on Amazon, that was me.
Bradley Sutton: Wow. So, was that wholesale or do you actually make your own products for baby?
Nathan Hirsch: No, it’s dropshipping. So we were buying wholesale prices but
Bradley Sutton: Okay. And like how high did you build that business model out ’til like what was your peak? What were you doing?
Nathan Hirsch:We were doing over $5 million a year peak. We ended up selling over $25 million.
Bradley Sutton:Oh my goodness. And this is all dropshipping.
Nathan Hirsch: All dropshipping.
Bradley Sutton: Wow, that’s crazy. So when did that go until?
Nathan Hirsch: So, I actually ran it through the beginning of January last year. So, the first few years, I mean, we were doubling every year. It was great there. I mean, it was literally me and two other people on every listing and we’re selling pretty good brands. I mean, no one cared about that kind of stuff back then. And yeah, I mean, as we kept going, I mean, we were still making money, but the business wasn’t doubling every year. We weren’t selling our own products, we weren’t growing our own brand. And at the end of the day, we weren’t very passionate about baby products. So once I started Freee Up, which I’m sure we’ll talk about it and that sure passed our Amazon sales and I got to go on podcasts and speak at conferences. We made the decision to move the business to one of my business partners and Connor and I moved over to Free Up.
Bradley Sutton: Now was that business model, you know, maybe seeing it decline and viability to, you know, brand gating and you know, counterfeit claims that people are doing a lot to–do you see a decline in the dropshipping or wholesale or online arbitrage, niche, on Amazon?
Nathan Hirsch: It’s funny because it’s not like it was before
Bradley Sutton: Ah, okay. So did you ever like even have to have your own warehouse or anything or throughout the time that you were doing this business model since it was dropshipping, you just did it like out of your office or house?
Nathan Hirsch: So it was entirely–we never had a warehouse, but we did it entirely remote for the first 4 years or so. I actually moved down to Florida, opened up an office, took all these remote people and put them into an office and I thought it would be great. I would–we would have a better culture and we’d be more productive. And I actually found that it led to more drama and I created a 9-5 job for myself, which I hated. I kinda lost the freedom and flexibility of being entrepreneurial, which is why I did it to begin with. So we got rid of that and we went back to remote again and Free Ups entirely remote as well. So we ran the entire business remote without warehousing at all. I mean, the only time we use FBA was when we would get random returns that were still sellable.
Bradley Sutton: Oh, okay. You had a good–well looks like 8, 9 years selling on Amazon. What’s a funny story that you could tell us or something really amazing that happened, or really terrible that happened, or something that we can learn from, or at least get a kick out of?
Nathan Hirsch: Yeah. So, I’m 20 years old. I am making more money than I ever should. No one really understands Amazon. People think I’m running a scam and I’m finally–I’m hiring people. I learn a little bit and I realize that I’m just super stressed. I’m doing every part of the business. I mean with dropshipping and there was no software back then either. There’s just so much going on from listing products that changing every price to every customer service email cause it’s not FBA. So I said, you know what, I’m going to train a manager of the day. So I hired someone and I spend–I must have spent 6 months training this person and I taught him how to do emails, listings, every part of the business, every system in process. Well, on the flip side, I also had this really good vendor supplier that I would say 90% plus of our sales were from them. So I decided to stop focusing our efforts on any other suppliers, let’s just work with them, let’s maximize them. And it was great. When I set it up, the business was running without me. We were crushing it and I mean the profit margin was really nice. It was just no overhead. So I kept this business in a great place. I’m 21 now, I’m on top of the world and it’s time to take a much needed vacation. So I take a trip out to Myrtle Beach with a bunch of my friends and I kid you not. On the first day of that vacation, I get three phone calls. The first call was from the manager of the day telling me he can no longer work for me. His parents wanted him to focus on school. A quick lesson on hiring college kids. The second was from the supplier telling you that they no longer wanted to work with me. And then the third just to top it off was from my accounting telling me that someone had filed a fake tax return in my name and got him a $40,000 tax return from the government. So in the process of a day, I went from this unbelievable high too, man, I just lost everything and I need to start all over again.
Bradley Sutton: Have you ever been to Myrtle Beach again since then or it’s too bad memories?
Nathan Hirsch: I actually had that in one of my Webinar PowerPoint of why I will never go back to Myrtle Beach. I have no plans.
Bradley Sutton: I’ll be triggered by that. That would be terrible. Oh my goodness.
Nathan Hirsch: Yeah. And I want to wrap up my story real quick. I mean I learned a very big lesson on diversification and when I built the business back up I made sure I had lots of suppliers and I departmentalize my hiring and it wouldn’t be the last person that quit on me or the last supplier that dropped me. But
Bradley Sutton: Alright, so you’re now an expert about like having freelancers and remote workers, but you know, before we even get to that part. Like what–obviously both models work. You know,
Nathan Hirsch: You’re right there. There is no right or wrong. I have clients that are 100% remote. Like I have people that have an office. I had people that did what I did when I had an office, which was, have office people and also have remote teammates that support them. So for me, we just live it in an unbelievable time. I mean, the Gig economy is booming over the next 10 years. They predict that over 50% of the workforce is going to be remote. And before, if you go back 10, 20 years ago, I mean, you had to hire people in your town or the towns around you. You got to hire people full time. You didn’t have a lot of flexibility as an entrepreneur. And now where you can start a business with $5000, $10,000, $20,000. Sometimes you got less, you don’t necessarily have to hire people full time. You can hire a VA for 20 hours a week or a graph designer to do projects here and there. So for me, and the reason that I love high remote is the flexibility it allows. I mean we’ve all heard that, “Oh, if you have someone in the office that yes, there’ll be more productive or you’d be able to build a culture, or the easier to manage. Well, I kind of had the opposite experience, running a office. So for me, I know that my team is pretty close. I know they’re super productive. I know that I trust them and that they’re very scalable. I have a 40 person remote team now. So for me, the pros heavily go in the remote direction because anything that you can do in the office outside of your warehouse staff, or a janitor, or a cashier, or stuff like that, ain’t your typical brick and mortar, can get done remote and you just get access to all this different talent at different price points from all over the globe when you go to the remote route.
Bradley Sutton: Interesting. Okay, so what would you say, I know there’s people who have misconceptions, you know about it, or big time fears, you know, like whether it’s English speaking ability, if they’re trying to hire somebody with customer service or whether it’s security issues, or how do I know if they’re really working? But you know, those are just things that come off the top of my head. I’m sure you’ve heard about. What would you say–let’s say top 3 or top 5 fears and/or misconceptions that people have when considering hiring or outsourcing to a remote workers?
Nathan Hirsch: So, number 1 is that big fear that Amazon’s gonna close your account if you have someone that logs into yours that they’re logged into another. And I’m sure at some point it’s happened. I have yet to see it. I mean with my Amazon business, I hired hundreds of people that all work another people’s accounts. Never had an issue. Thousands of clients that hire freelancers from us and other places that they go on multiple accounts, never seen it. So that risk, I’m sure it’s there, we all hear people getting shut down for random reasons, but it’s a lot smaller than you think. I think Amazon expects you at some point to hire people and grow your business. I think it’s just security in your businesses. Number 2, I’m speaking for people on the free of platform, which is the only people I can speak for, they care a lot more about growing their freelance business and getting a new client, and pay, and providing for their family than they do about jeopardizing or hurting your business in any way. It’s just not their top priority. So that percentage is just a lot lower than people think. Number 3, it just that you can’t get high level work. I think a lot of people are used to outsourcing with data entry projects or hey follow my process here and there. I mean I have a bookkeeper that–I have a billing guy, I guess he runs my accounting team, he’s not really an accountant but I would put him against any bookkeeper out there. US or
Bradley Sutton: Okay. Speaking of issues, what about the language barrier? I know a lot of people do go– you mentioned the Philippines because you know since English is kind of, you know, a second language over there, we have a lot of English speaking people, but for written English, do you see issues with outsourcing to like say the Philippines or other countries where people might–you know how American sometimes are, if they, you know see somebody who might not speak great English, they get like a bad impression or something. But do you see that as much of a problem or written English? The quality of written English by the VA’s are pretty strong usually. Is that accurate, would you say?
Nathan Hirsch: Yeah, I mean I can only speak for the Free Up platform. If they don’t speak English at a high level, they don’t get a foot into our interview process. So it’s usually not an option, or not really a big deal. I mean we’ve got lots of clients who will hire someone in the Philippines do voice support. I use them for email support it, and they’ll actually do calls with clients that are scheduled. They don’t answer the phones, but you can book a call with them. So for me that–yes there isn’t a 100% perfect, probably not, but the pro and con. The pro being a cheaper price point and sometimes a lot more dedicated people outweighs it. And it also depends on the person. You can get someone who’s a 9.9 on a 10 you get someone who’s a 7.8, so I know that you can hire
Bradley Sutton: Would customer service be kind of like the number, like the first thing or the number one thing that people usually start with when they’re talking about outsourcing labor?
Nathan Hirsch: Maybe it’s kind of my–the funny question I get asked like what should I hire first? And the way that I like to approach it is there’s 3 different levels of people. You got the basic level, the followers. They might have years of experience, but they’re there to follow your systems, your process. The way that you do customer service is probably different than the way that I do. So customer service, data entry, maybe your sourcing process, things that you actually have a system in process for fall under the basic. So if you’re someone that’s stuck in the day to day operation, and you’re trying to get hours in your day back, that’s where you start. The lower basic level freelancer. The
Bradley Sutton: Yeah. Okay. I like that. So then what, like just just for an apples to apples comparison, let’s say we were going to hire a general employee over here, he or she would be in charge of customer service, you know, answering emails. You know, maybe just checking up on listings, doing some research here or there, and if you were to hire somebody full time at the very bottom, it would probably be like, I don’t know, 12 to $15 an hour. So for that level of employee, for the same kind of quality of work that you would get from a 12 to $15 an hour employee here in the states, what would that cost say? Let’s just use Philippines. I don’t know if you knew this. I’m actually half Filipino myself, but let’s use the Philippines is an example for the same level of quality of worker. What would we be paying full time per hour?
Nathan Hirsch: I would say the market rate is probably in that 5 to $10 an hour range. Are there people cheaper? Of course. Are there people more expensive? Yes. The other thing to remember in that scenario is, okay, you’ve hired a US employee for, let’s say 15 bucks an hour, decent pay, depending on where you live, but how long is that person gonna really work for $15 an hour. Are they gonna work for the next 20 years at $15 an hour? Probably not. And with customer service, it takes a lot of on boarding. It takes a lot of training to get them to where they want to be. So all of a sudden you’ve got someone that’s in a low price point, that you’ve invested a lot into. And the situation that comes up all the time is, okay, I can’t live off $15 an hour. Actually I need 18. Actually I need 20. Actually, I eventually I need 25. And at some point, are you really gonna spend $25 an hour on a customer service person? And some businesses can and do, and that’s great. But for a lot of eCommerce entrepreneurs, that doesn’t make a lot of sense. You want to take that money and invested elsewhere. So that’s why with customer service in particular, I always recommend at least trying someone in the Philippines, you can always say, no, no, that’s not for me. I’m gonna go pay more and go in US. But the
Bradley Sutton: Okay so for a lot of people who are just starting, let’s say there are newer sellers, they can’t afford even somebody in the Philippines to hire full time, but I assumed that there was like project based, or part time work as well, right?
Nathan Hirsch: Yeah. I mean we have freelancers from 5 to
Bradley Sutton:Okay. What is something interesting that like no average person would not think of hiring a freelancer for that you’ve seen either through your platform or through others? I think the, you know, the standard that everybody thinks about is customer service. Maybe graphic design, maybe listing, but is there anything really unique where you’re like, what? They hired this person for this? Well, that’s interesting. Yeah.
Nathan Hirsch: Do you know Will Mitchell from StartUp Bros?
Bradley Sutton: I’ve never talked to him, but I know who he is. Yes.
Nathan Hirsch: He’s a good guy. He’s a client of ours. He once hired a virtual assistant to–and the only reason, I normally wouldn’t say clients names, but I know he’s chill with that–he hired a freelancer to run his fantasy football team on.
Bradley Sutton: How did that team do?
Nathan Hirsch: I don’t think they finished in first, but they weren’t in last.
Bradley Sutton: You know what, that’s even better. I was wondering what you would come up with for this, but that’s–I might have to hit you up because I’m a big fantasy football person, so, I might need to hire somebody for that. That is great, that is great. Alright. What else do people need to know that, you know, before they jump in, they’re like, they might be listening to this and be like, oh, this sounds great. You know, I’m going to save some money. But what are some things that people should think about before diving into hiring a freelancer?
Nathan Hirsch: What are the things that I do, and I do this every quarter with my business partner is we look at how much we’re making. What does our profit at the end of the day? And then what kind of growth strategy do we want? Do we want to get aggressive? And, usually aggressive means you’ll invest 30 to 50% of that back into hiring people, whether it’s internal employees or freelancers, virtual assistant. Are you more conservative? Maybe you’re in that 10 to 25%. There’s no necessary–there’s not necessarily a right or wrong. It depends on your business philosophy, but really figuring out what your budget is. That’s the important part. If you say, Hey, I want to invest 20% of what I made back in, then you can look and say, you know what? Okay, I can afford someone to run my PPC or to do the Amazon listing or maybe I can only afford a 20-hour week VA in the Philippines. The last thing you want to do is hire someone, have a bad month, which we all know on Amazon that can just randomly happen and all that time and energy you put into on boarding and getting someone set up, you have to let them go, so make sure that before you add someone on, that you can actually afford it, and that your budget makes sense, and you’ve really thought it out. Or if you can’t afford it, focus a little bit more on project-based one time stuff. Hey, let’s have someone optimize my best listing or do this graph design project; stuff that you know is going to be that one time set price that you can afford it, so you don’t over commit yourself down the line.
Bradley Sutton: Okay. Now what else should people be aware of that they could–that could help them protect themselves? I mean, no matter where we get employees, whether it’s in our own hometown or a virtual assistant, there’s bad apples out there of course. So what can entrepreneurs do in order to best protect themselves? You know, there’s no foolproof way. I would assume, just thinking off the top of my head, like one thing is, hey, don’t give them the admin access to your seller central account, you know, make a
Nathan Hirsch: Yeah, and you should never give someone the main access to your seller account. This is kind of my stance on risk. There’s always going to be a risk. Hiring is no different than any other part of the riskiness of being an entrepreneur and even if you hire your best friend to sit right next to, there’s always a chance that they do something stupid or jeopardize your business in some way. I kind of mentioned what I said before about how they care a lot more about they’re providing for their family and they do about hurting your business, but yes, there are things that you can do to protect yourself. You can use LastPass for example, so you can take away their passwords quickly if you let them go. You can do sub-permissions in Amazon or even if it’s a bookkeeper for credit card statements or PayPal. You can do it, they are now too. Yes, you can have them sign an NDA, but are you really going to chase someone across the US or across the Philippines over an NDA? Maybe? Probably not. The real way to protect yourself that I’ve found is to actually build relationships with the people that you’re working with. There’s really no substitute for that. I’ve had people that I fired. I’ve had people that have quit on me, but they didn’t want to hurt me. I didn’t want to hurt them because we just built a relationship. It’s–a lot of times it’s the clients that don’t build that relationship and stuff. Something goes haywire. That’s when they run into issues. If you can build a relationship and treat people respectfully, 9x out of 10 or way more, you’re not going to run into those issues.
Bradley Sutton: Awesome. Now you said a lot of your workforce and those who you hook up with people are from the Philippines. Have you been to the Philippines yourself?
Nathan Hirsch: I did, so when we first started FreeeUp, we set a goal. “Hey, if we bill over 5,000 hours in one week,” and now we’re over 14,000 hours. A few years ago we said, hey, we’ll go to the Philippines and we hit it and we flew. Connor and I flew out there and we put on our bag and we said, “Hey, there’s gonna be food, there’s gonna be drinks, no obligation. You don’t have to come. If you want to, this is where it is.” And it was pretty cool. We had over a hundred people show up. FreeeUp was a lot smaller back then. But yeah, it was great. We got to meet a lot of the people on our platform. We got to take pictures and give out gifts and eat a lot of really awesome, interesting food.
Bradley Sutton: What’s your favorite Filipino food?
Nathan Hirsch: Oh man, I’m not gonna remember anything.
Bradley Sutton: Lumpia?
Nathan Hirsch: I don’t, you know the Balut. Is that what the egg….
Bradley Sutton: Oh, my goodness. Don’t talk to me about that. I don’t want to, that’s the next level. That’s the next level right there.
Nathan Hirsch: I know. My girlfriend’s actually Vietnamese. Everyone thinks that she’s Filipino cause she looks like on FreeeUp. But they actually have that. Not often, but once in a while. So I actually experienced that before.
Bradley Sutton: Everybody out there who does not know a Balut is. Why don’t you explain it? Because that’s, I’m going to cover my ears right now because it turns my insides even listening to it. But go ahead.
Nathan Hirsch: I believe it’s chicken and might be another bird, but it’s chicken, right?
Bradley Sutton: Yes. But what–at what stage?
Nathan Hirsch: You normally would eat an egg or a chicken. And this is the in between. It’s the egg that the chicken is half alive inside the egg. It’s a delicacy.
Bradley Sutton: Oh yeah. Ah, it’s a delicacy–I tell people, yeah, I’m Filipino, but I’m not that Filipino. I don’t eat that stuff. Speaking of food though, something I like to ask my guests, you know, you’d be near Orlando now. Me, I actually, I am in Orlando all the time. I already have a couple of places I liked to go out there that I don’t have here in California. For example, Bahama Breeze, they got some really great drinks there. And then I also go to Miller’s Ale House and I have their Zingers and a couple of cool things. We don’t have that out here in California, but for the next time I go out to Orlando, where are you going to take me? What is a place that only Orlando has or that’s kind of like something you would see on diners
Nathan Hirsch: If you like Thai food? There’s this place, Royal Thai, which is 5 minutes from my house. It is the best Thai food I’ve ever had in my life. It’s a little hole in the wall. They’ve won a ton of awards. They’ve had a bunch of famous people there and it’ll blow your mind. If you like Thai food.
Bradley Sutton: I do, I do. Alright, we’re going to go there next time. Now you had been mentioning about a FreeeUp your company, so can you tell us a little bit how people can find more information about FreeeUp or contact you with more information on hiring VA’s?
Nathan Hirsch: Yeah, so I mentioned I run an eCommerce business and I hired a lot of freelancers. I used UpWork, Fiber, and I didn’t just wanted a better, faster way and when I couldn’t find it, I built it myself. We get thousands of applicants every week, virtual assistance, freelancers, agencies to get on our platform. We get them for skill, attitude, communication. Take the top 1%, let them in. Make them available to quickly whenever you need them. With 24/7 support and a no turnover guarantee. If they quit for any reason, we cover replacement costs and get you a new person right away. So that’s what we’re all about. Mentioned this podcast. Get a $50 credit to try us out. It’s freeeup.com with 3 e’s. My calendar is also right at the top of the website. If you want to book a time with me and it’s free to sign up, there’s no monthly fee, no minimums, no obligation, and you can also check out the Freee Up blog or the Freee Up YouTube channel. We post a lot of content to help you hire and scale your eCommerce business.
Bradley Sutton: Awesome. Awesome, Nate. Thank you for your time. Again, that’s a freeeup.com with 3 e’s, so it’s kind of like freeeup.com, I guess you could say. Right?
Nathan Hirsch: Yeah, Yeah.
Bradley Sutton: Alright, cool. Alright, Nathan we’re going to that Thai food as soon as I go to Orlando, which actually might be in about 3 or 4 weeks. So I’ll hit you up once we go there, and thank you very much for your time and amazing insight that you’ve given us about hiring freelancers.
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Cerebro is Jonathan's favorite Helium 10 tool because of it's versatility and value for FBA sellers.