Ben Leonard’s Business Advice
Building a business to be sold is a long-term and gradual process. It does not happen overnight. In this video, Ben shares some tips to ensure that you’re on the right path towards a sellable brand. Including:
- Protect and improve your business’s valuation – consult a broker, lawyer, accountant, insurance agent, and other professionals
- Optimize your listings and bring down your advertising costs
- Build a suite of related products under your brand
- Niche down to only 5-20 skus
- Avoid any blackhat procedure
- Develop systems and SOPs as early as possible
- Take advantage of automations and tools
Build A Brand You Want To Buy
All of Ben’s advice stems from one main idea – like any other brand, your business must entice the buyer. Always consider things from the buyer’s perspective. What value will they get from buying your business? Ask yourself these questions on building a sellable brand:
- How far has your business grown and can you prove it?
- Does your business have potential for more growth?
- Did you put systems in place and are they easily scalable under new management?
- Have you connected with a solid customer base?
- How complex is your supply chain? Have you done your best to optimize and simplify every step in the process?
- Do you have a deep understanding of mergers, acquisitions, eCommerce, and accounts?
- Are all your intellectual properties – trademarks, patents, copyright, etc. – in order?
Essentially, the first step is knowledge. Know what you don’t know. Ben insists for you to consult a broker to find out your business’s valuation. Know that some aggregators may discourage you from getting a broker. The truth is most of them are just looking at lowering buying cost by cutting the middle man. But you must remember that a good broker will protect you and help you negotiate a deal that is fair to all parties.
Also remember that your business’s valuation at any given time is not the end-all and be-all. Meaning that if it is not within the range of value that you’re aiming, you can work at it to get to that range. Again, go through the questions mentioned here and ask yourself: what else would an aggregator look for when buying your business?
The bottomline is: plan your exit. You may just be starting and you may not know where your business will be in a year, a few months, or even a week from today. But plotting your steps will help you better envision where you want to take your business and also help you make the right decisions along the way.
Amy Wees: In fact, this week, I had at least three or four listing reviews, I do free listing reviews for people and I have at least three or four that people are still launching products like that today. And it’s just, it’s if you can make money doing it, more power to you. But if you’re trying to start a business with an exit in mind, you do want to be serving a customer and help them to see value in what they’re buying from you. Right. And because ultimately, a buyer isn’t necessarily going to be interested in something that’s very easy for them to copy themselves. Am I on the right track there?
Ben Leonard: Yeah, absolutely. I mean, there’s nothing wrong with the approach people took back in, you know, say 2014- 2015, we why wouldn’t you? Right? Yeah, it’s very quick money. Precisely. But now really, we need to be thinking about the longer game, having a bit more patience and building something into a valuable asset that a potential buyer is going to look at and say, Yes, I would like to take that off your hands, please, for quite a lot of money. And the way to do that is to create something that has value to a particular group of people and to get in front of them.
Actually, there’s a great book on this, if anyone’s interested. It’s called 12 months to a million dollars by Ryan, Daniel Moran. It’s a pretty, you know, I don’t like the title that much, it reminds me a little bit of The Four Hour Workweek by Tim Ferriss, it makes it sound a lot easier than it is. But you know, sometimes you got to have a snappy title to get something to move. It’s a good book, breaks it down into a pretty simple process, create a gateway product, build a suite of products around that, get in front of your customer, define who your customer is, figure out their pain points, their challenges, make sure that your products are effectively the medicine for their pain points to the solution to their problem. Find out where they hang out and get in front of them. And create a a group of raving fans, it makes it you know, I’m making it sound a hell of a lot easier than it is right? There’s a lot of hard work in there. But that’s the straightforward process. You know, going to the moon is straightforward you get into rocket you blast off you go to the moon. That’s not to say it’s not incredibly technical and difficult. You know, I’m sure Elon Musk if he was listening to this would be screaming about how how complex it is. But you get the idea. Right? It’s straightforward, but there’s a lot of hard work
Amy: Still working on getting Elon on the podcast. Yeah, I know. Right. Or catching on clubhouse. I think you know the other confusion that’s happened in this space between the all the different types of buyers, the aggregators, everything else is when you’re going to build your brand. And in your, you know, in your doing this amazing job. How do you go to sell and get the best multiplier for your business? Like, are you should you be looking at aggregators for the best multiplayer? Should you just be casting a wide net? Like, what is the strategy there when you’re looking for buyers to get the best possible multiplier?
Ben: Okay, so before we touch on that, let’s talk about what the multiple is. Because different people will have a different definition of what a multiple is. And that can make things a little bit overwhelming when people are researching this stuff.
So here’s what the definition should be. It should be a multiple of your trailing 12 month sellers, discretionary earnings, which is basically your net input income plus add backs. So people listening are probably like what what’s an add back? An add back is essentially a cost on your profit and loss sheet, which you can add back, because the new owner is not going to have to pay for it. So anything, so that includes the income that the owner is taking, for instance, but also includes things that have been done once or never need to be do again. So all the photography associated with a particular product, when you’ve done it, you want to it’s not going to have to do it. Any consulting you’ve had done. If done, you’re not gonna have to do it, video, trademarks, all that stuff. Are you putting your your phone through your business, you’re just not going to have to do it. So that’s add back. So the multiples apply to your trailing 12 month sellers discretionary earnings. So suppose you’ve got a business that’s doing? Sellers, discretionary earnings, trailing 12 months is 100 grand. And it’s two years old. It’s reasonably diversified. And it’s growing. Probably going to get about three, a little bit more 3x Right, three times. But if you’re doing 500k sales discretionary earnings, you’ve got massive off of Amazon sales, lots of intellectual property, huge growth in the businesses five years old, could be much higher four or five even slightly higher. Now. Some people in this space some brokers in particular, they won’t be talking about a 3x or 4x or 5x, because they’ll talk about monthly. So when I say 3x, there’ll be saying 36x. Does that make sense? So you just divide that by 12? Do you follow that?
Amy: Yeah. So instead of a 3x, you’re just getting a monthly payment, I guess on it. Am I understood?
Ben: Like two? So it’s three times when I’m saying 3x, I’m talking about three times your 12 monthly sales, discretionary earnings, whereas what they will be saying is, is 36 months, average monthly across the trailing 12 months? That makes sense? It boils down to the same thing?
Amy: Yeah, it’s either about calculating it annually or monthly.
Ben: Exactly. Okay. So traditionally, when we’re selling a business, and multiple, forgetting ecommerce for a moment, or multiple might be something like, anywhere between five, five and 8x, six or seven was about right. In E commerce, particularly because of all the risk tied up in businesses selling through a marketplace like Amazon, where you don’t own the customer journey, you can easily be suspended, just because it’s so new to people this concept of buying an E commerce business, the multiples have been kept a lot lower. So until recently, three experts about right standard, pretty good. But now multiples are going higher. And the reason they’re going higher as we’re seeing so many more people coming into this space, so many aggregators, raising all that money, just pushing multiples out. So I’ve moved away from your original question, which was, how do you get a good multiple, lots of ways. First of all, going back to what we said before, you have to build a brand, you can’t just be selling stuff, nobody’s going to want to buy a business, it’s just selling a collection of stuff. Because there’s nothing there for them. Right? You need to have a growing business, which is still got some meat on the bone, which allows the potential buyer to recognize that you’re going in the right direction. But there’s still some growth there for them to realize. An efficient well automated business is going to push your multiple up. Age of the business is important. Geography, where are you selling? What Mark marketplaces you’re selling it? So I’m going to be more attractive than others? How many SKUs Have you got? How complex is your supply chain? How complex are your products? How risky are your products? All of these things matter
Amy: And Katie wants to know, should suite of products be all related in some way?
Ben: Ideally, yes.
Amy: I mean, you don’t want to be selling dog toys and kitchen faucets, right?
Ben: A business, which sells dog toys, and kitchen products, that’s fine, provided they’re two separate brands. And then I will be making the argument in favor of actually those brands being in separate business entities, because it gets very, very messy. When you if you want to sell the business entity, if you want to sell the assets, it’s not quite so bad. But even so your accounts are going to need to be very clear as to what’s the dog stuff, and what’s the kitchen stuff. I like to keep things neat and tidy and separate businesses. So well, a potential buyer
Amy: Got it. So in terms of getting the best multiplier, you want to make sure that you’re building a really awesome suite of products that you’re you’re watching you what your sellers, discretionary earnings are going to be so if your advertising is really really costly, you might want to you know, really take a look at optimizing that and bringing that down, because those things are not going to include those those add backs, right. So you really want to make sure that your your earnings at the end of the day are looking really good and that you’re seeing growth over time. I know we were talking about this, we’ve had a couple people on recently, as you said, this space is growing. So we’ve had a lot of guests recently talking about this very subject. And I think it’s important, you know, and you’ve brought up a lot of points here that we we haven’t really touched on. So yeah,
Ben: It’s, it’s a complex one. Again, I keep I use this word a couple of times already. It’s one that people can get really overwhelmed in because there’s so much information available on the internet. Now. There’s so many Facebook groups, some YouTube channels, so many podcasts, it can be very difficult to know what to do. There’s a great book another I love book recommendations, if I may I get nothing for recommending these. But there’s a great book called Built to Sell. And I read that book before I sold my business and it helped me to get everything nice and neat and tidy and properly organized. And this bill to sell is a great book. It’s a little bit like the E Myth. by Michael Gerber in that it follows the fictional story of a mentor, and a business owner. So the business owner, wished to sell his business and the mentor guided him through it. And eventually he went to a broker. And the worst thing you could possibly do is just decide I want to sell my business, because you’re not ready to sell it. And that is the mistake that the character in this book made. He went to his mentor and said, I want to sell my business. And the vendor said, no, no, you can’t just sell your business, you have to plan to sell your business. And so you get need to get your business. Even if you’re not interested in selling your business now, probably one day you’re gonna be. So what makes a lot of sense to get your business valued. Now, somebody qualified to do that. Because then you know what you want, you have a reference point. Otherwise, you’re trekking through the jungle with No Map. And then you can say, okay, great, my business is worth 50, grand, 500, grand, 5 million doesn’t matter. And I will be willing to sell it for x. From there, you can reverse engineer it when you work with somebody to reverse engineer it, and say, what are the things I need to do to get there, you stack them up like dominoes, and you start knocking them down to a make the business an attractive proposition for someone to buy? and B make it valuable? To reach that target?
Amy: How do people find someone who can value an E commerce business properly?
Ben: Well, it needs to be what for starters, there’s ecom brokers, that’s us, a little plug there, it needs to be somebody who’s qualified on multiple aspects. So they need to have a deep understanding of E commerce, they need to have a deep understanding of accounts. And they need to have a deep understanding of E commerce accounts, we have a deep understanding of mergers and acquisitions. So those three things put together make somebody highly qualified to do this, as an E commerce broker, which is what else in my business partner brings to the table. She’s got 20 plus years experience in mergers and acquisitions. And she’s a specialist ecommerce accountant. So once you get that valuation, you know, where you are you not reaching in the dark.
Amy: Yeah, that’s exactly what we’re doing right now. Or we’re having our business valued, so that we can prepare to sell it. And, and it’s so important to, to know what you don’t know, I have the pleasure of being able to interview people like you all the time and learn these things. But that doesn’t mean that I know what I’m missing, or what I need to work on in order to be able to sell my business. And there’s no better time than now. Because you know, everything is really picking up on the buyer side, like you said, you know, it’s really, really crazy. So I love that exactly how you put it out there. It’s like get it valued first. You know, if we were talking to an aggregator right now, they might say, well just send it over to us. And we’ll we’ll let you know, right. But yeah, you’re coming from that broker side where you’re like, Okay, know your value first or what you can do to prepare for that, and then go from there.
Ben: Yeah, that’s the problem of with a lot of these aggregators, you know, good people, I speak to them every day. But ultimately, naturally, businesses business, they’re going to want to get your business off your hands for as little as possible. And that probably means we’ll sell two tours now and avoid the broker fee. Avoid the broker fee is basically them saying please don’t go to a competent broker who is going to properly value your business and ascertain what your real sellers discretionary earnings are, and your real on backs, because then we’re not going to get it from you for as cheap as we possibly can.
Amy: Right. Yeah, that’s great advice. So I think you’ve kind of answered all my questions. But let’s talk about red flags. So of course, there’s there’s always going to be bumps and bruises in any business, there’s going to be things that that every business has that they kind of need to overcome, but or not overcome when they go to sell. But what are the big red flags? So let’s say I’ve built a brand. Everything looks pretty good on the surface. Is there anything that people are going to sell that a buyer will look at and go oh, my gosh, red flag?
Ben: The answer is it depends. There is certainly when this kicked off a couple of years ago, buyers were a lot less agnostic and very, very frightened of certain categories. So supplements was a big nono. However, some buyers now are find that they actually have the capability to handle that, particularly if the supplements are more on the foodstuffs side. So for instance, turmeric, turmeric supplements, well really, it’s just food. It’s just ground up turmeric in a capsule, right? So that’s one aspect electronics, right? Many buyers are not too keen on electronics, or anything that may become technologically obsolete. So if you are selling something like something like that, I’m not saying you’re not gonna be able to sell it, but it’s gonna be about finding the right buyer. And for that, using a broker is key. other red flags, age of the business. So we are seeing again, because more money is coming to the space, there’s more competition. People, buyers are willing to take on a little bit more risk. But generally speaking, businesses that are less than a year older are less sellable. But we are seeing very young businesses 910 months old now being sold. So it’s not to say that you can’t get it done. But age of a business is important. And in any case, you can even sell your business for more if you’ve got a little bit more trading history. So those are those or to straight off the bat. Your accounts, your terms have got to be in order. So if you’ve got cash accounts and non accrual, get that organized. Now apart from anything else, you’re not going to really realize the full value for your business, if they’re not done appropriately. There’s nothing an aggregator likes more than seeing cash based accounts rather than accrual because they know they can almost pull the wool over your eyes, if you like in terms of, of, of the offer, especially if they know you’re not working with a competent accountant. So that’s
Amy: the difference between a cash based account versus an accrual based account.
Ben: Yep. So suppose you’ve got a growing business, and you’re constantly using cash to buy more inventory. So you’ve got half a million dollars of inventory on hand, your profit and loss statement is going to say that that 500k venturi is depressing your net income, but it’s on hand, right. So it should be outside of the profit and loss sheet. But if your profit and loss sheet, so if your profit and loss sheet has your 500k net income, really, it’s a million when you consider the 500k stock on hand, right? So when a buyer comes to you direct and pitches, you will buy your business for 30 days, with no broker fee, and you have cash accounts, you’re going to undervalue your business by a lot. Or when an incompetent broker just refers you to an aggregator it doesn’t actually do any work, the same thing is gonna happen. Because you haven’t thought about the fact that that 500k of inventory was on hand. So that makes sense.
Amy: Yes, yes, exactly. Yep. You got to make sure that your accounts are in order, and that you’re working with an accountant who understands where your inventory should be placed when it comes to relative
Ben: to Profit and Loss sheet. And I’ve, you know, I’ve done I think I’ve done a reasonable job of explaining that. But this is precisely why say an econ brokers, me on the E commerce side partners with Allison, who is the absolute BrainBox on the number crunching side. So it’s important that you work with somebody, whoever that is, has experience on all sides of the equation.
Andy Arnott: Now, that brings me perfectly into into my next question, in terms of your getting a little bit into accounting, and things like that, you know, what things should brands have in place before they approach a brokered aggregator in terms of like, you know, no past due taxes, you know, good books, insurance, you know, what are some of the things that you guys are looking at, you know, to make sure that when you package that up and go to look for a buyer, that there’s not going to be any, you know, anything that’s gonna fall through the wayside and maybe blow up the deal?
Ben: Yeah. So when you sell your business, quite rightly, the buyer is going to do some really, really thorough due diligence, right, they’re going to part with a lot of money in order to buy your business, hopefully. And therefore, it only makes complete sense that they’re going to look under every nook and cranny of your business. It’s important, therefore, that you get a head start on that process to make it as painless as possible for you and as smooth as possible for them so that they don’t come back and say, Oh, well, actually, we’re undervalued, you’re gonna want to discount for this, this isn’t this. So things to think about intellectual property. Make sure your trademarks are in order. Do you require patents? Or registered designs? What about copyright? Have all of these things looked at by a really, really good attorney? I’m all for bootstrapping your business and saving money. But when it comes to intellectual property, get it done by a pro. I mean, ideally, get it done by a pro right off the bat when you’re starting. But if you didn’t do it now. Those I mean, those are the main ones that will kill a deal is, you know, you are infringing on some intellectual property. It’s it’s very rare.
Andy: Interesting, if you’re good, no, go ahead.
Ben: If you’re doing anything Blackhat, stop immediately. Don’t do it again. And keep records and you really ought to if you’re asked about that type of thing during due diligence you bear all because the guys that are buying these businesses know what they’re what this industry is like, they know some of this stuff goes on. And with any luck, they’re going to be transferring what they buy into their own. Let’s we’re talking about Amazon for a moment, their own accounts anyway. So any history, you may have heard of anything, if you’ve done some review, manipulation, that type of thing that you shouldn’t have been doing, even if it was a few years ago. Tell the truth about it. Maybe you’ve got some back and forth correspondence with Amazon when you got suspended, keep records of all of that provide that. Because if you don’t, and then they find out, then you haven’t been honest with them, that could kill the deal.
Andy: Some of the things that I assume that if sellers have in place will get them more money in terms of multiples would be you know, systems or maybe staff or, you know, maybe something proprietary like some software that they built to manage inventory. You know, anything like that, I assume, you know, is that when you’re shopping, that’s, that’s like a huge value value add for those those people looking to buy.
Ben: Yep, all extremely important. If you’ve got systems, standard operating procedures in place, automations in place, perhaps you’ve come up with your own processes, for things, for getting reviews through social media, you know, anything that you do that I like to talk about it, I call it micro agility, anything special and nimble that you do that is created the success of your brand provided result within Terms of Service. Keep records of that this is going to a boost your valuation and be when you’re having these conversations with a potential buyer, you can show off, show them all this fantastic stuff. Here’s all the great stuff I’ve done to build my brand. Here’s what my brand can bring to you. Because remember, this buyer can potentially roll out all this neat stuff you’ve done to the other brands that they’re buying, potentially, you could even charge them a consultancy fee to teach them all this stuff. launch new products for your brand and their other brands, brands. Lots of things you can think about.
Andy: Yeah, it’s interesting one thing that, you know, because a while back, when Thrasher was pretty early on, I approached them, because I was thinking about selling my business, my Amazon business. And the one thing that stopped me was is they wanted and I totally get this for like due diligence, but like really early on in the process not to talk crap, I’m me, I’m just sharing my experience. And you might be okay with it. So I’m just saying my, my own trepidation was they wanted full access to my account, like, like, really early on. And, you know, I was like, Well, wait a minute, so I could give you full access to my account, you could pull all my data and my data and see all my tips and tricks. And you know, I’ve been doing this for a lot of years. So I have some stuff that probably, you know, a lot of people don’t know how to do or, or do it differently. You know, like you said, kind of some secret sauce. And that took me aback because I’m like, Alright, there’s this giant company that could easily take this data. I mean, of course, they would say they wouldn’t, but you know, human nature, and you know, they might say, you know, have some kind of NDA or whatever. But once that information is in your brain, it’s it can marinate into, you know, ideas that are maybe an iteration, but it’s still, you know, originating from my, you know, what I was doing? So that was kind of scary for me. So, I mean, do you guys, how do you protect the sellers in terms of kind of their IP and you know, kind of like what they’re doing, if it’s unique, you know, when you’re shopping these deals.
Ben: So one thing I would say is that this space has come a long way, in the couple short years that this has been happening. And that type of thing doesn’t happen too much. Generally speaking, a potential buyer should only get access to your accounts, and it should be read only access, once you’re in the due diligence phase, and the A’s have been signed letter of intent signed, etc, etc. At that point, they’re going to have to have access because they can’t buy your business. If they can’t, they haven’t seen it. You can’t you’re not going to buy a house if you haven’t been to see it. No, you haven’t seen the report. So unfortunately, it is true that they will see the details of a business that they may then not go on to buy and as you say, they may see some stuff in there that merits in their brain, as you say, but they’re seeing so many potential businesses, I really don’t think it’s that big of a deal. Because if they did see stuff they liked, chances are they’re going to like it enough to buy your business, if that makes sense.
Andy: Yeah, no, that’s a great that’s it.
Ben: Yeah, we protect sellers is when we’re presenting a potential business to a potential buyer. It’s anonymized. So they see the the high level broad information. If they want to see more, they need to pay a fee for us to unlock that information. Now, there are some buyers that we’ve built a relationship over time and we know that they’re serious, vetted buyers, but if it’s somebody new to us, say it’s a competitor rather than a big aggregator or it’s a private individual, for instance, they’re going to have to pay a fee to unlock that data. And whoever it is, they’re going to have to sign an NDA. And so nobody gets to see any specific data, until we’ve ascertained that they’re not a tire kicker, and they’re serious, seriously, potential potentially going to buy this thing. And you’ve signed an NDA.
Andy: Awesome, that makes a lot of sense. Yeah. Like I said, this was a while ago, and I can’t remember the exact terms, but I just remember, like, and I, you know, I’m pretty experienced in the space just being a little bit taken aback by like, wow, you want this all this stuff this early on, like it was, it was a little bit sketchy for me, like you said, though, it’s matured quickly, so I’m sure they might have some, some other, you know, things in place to kind of protect IP and systems and things like that. Are there any, you know, I’m sure that you get a lot of brands that come to you that are, you know, you talked about this a little bit before, kind of meet you products, you know, you know, opportunistic, things like that not really a lot of IP or, or things to, you know, to protect. So like, you know, we have a lot, we have a wide range of audience here, right, we have people just starting out, we have experienced people. So, like, I always like to ask, you know, if somebody who’s starting out today and their end goal, you know, they like Amazon, but they’re like, you know, what, I’m, I don’t want to do this forever, I want to, you know, build a decent sized business, sell it and go do something else. You know, what would you somebody just starting out today, kind of what would you tell them to craft a business from the beginning, that would be easier to sell, you know, maybe a year from now.
Ben: I think it goes back to what I said before is to build a brand, right? build a brand around a particular group of people, ideally, something you’re interested in, you need to have patience, and be prepared to play the long game. And think about this in terms of, well, if I was buying a business, or what I wanted to look like, right, is the same thing as if I was going to buy a house, right. So understand things from the buyers point of view, try and get into the mindset of the buyer, one thing that you could do is you could actually go and do some research, pretend for a moment that you are a buyer, and go and start doing some research into buying ecommerce businesses and think about things from their point of view. And that will help you to reverse engineer what you’re going to do. Again, I would recommend the book Built to Sell once you’re decently established, your business’s, you know, ticking over, get it valued. And then think about okay, it’s worth X, what would I be willing to walk away from? Well, I like to think about it with that is, suppose you are drawing down a salary or you’re taking business money out of the business in whatever form you are, whether it’s dividends, or salary, or whatever. Find out what the business is worth and what you’d be willing to sell it for. and think to yourself, Okay, it’s worth X, how many years would I have to work drawing down this amount that I’m drawing down to make the same amount of money. And it’s probably going to be a long time. If you have a gut feeling that you want to sell, it probably means it’s time to start planning to sell. But the key is, like I said before, is you can’t just wake up and say, I want to tell you to plan. That’s the key thing.
Andy: Yeah. For me, you know, if I, if I, if I went back to 2012, when I started on Amazon, there are a lot of things that I would have done differently. One of the, you know, I’ve shared this before, but I think it’s very relevant in terms of, you know, I’ve made the mistakes so that you guys don’t have to. So some of the things that I would say, on that same kind of token would be get an accountant super early on, and don’t just go you know, the other mistake we made is we got an accountant, but we got some, you know, Guy locally in our small town in California, who wasn’t an expert in E commerce, you know, for for a long time, like completely led us astray on what we you know, formation wise, and, you know, how we’re our how we were doing things. So go out, find somebody special who specializes in E commerce accounting, that would be one thing super early on. And the other things you talked about is trademark, you know, get it getting the trademark up, you know, ASAP niching, down to, you know, not a ton, like, you know, we had at 1.8 100 skews, I was trying to launch a SKU a week, you know, it got to the point where the account was unmanageable, you know, 8020 Even at that point doesn’t work because you just, there’s just so much to manage. So, you know, keep focused, you know, I would say anywhere from five to 20 products, probably no more than that. I mean, if you have variations, things like that, you know, you know, that can grow but just management wise, you know, you want to try to keep the business as tight as possible in terms of the more products you have now it’s like you know, instead of having to manage three listings and make sure that they’re Perfect and photography’s perfect and you’re just pushing those products now you got, you know, 3050, whatever, and you’re trying to push all these different products, you’re just gonna get spread way too thin. So really stay focused, build the brand, make sure you got the insurance in place, make sure you know if you if you’ve got products that maybe are a little bit more risky, make sure that you you know, you do your due diligence there. If it’s something that’s consumable, or something that’s got batteries, etc, etc. Those are all a lot of things that you guys want to think about if you’re just starting out now.
Ben: Yeah, I agree on on all of that. And a couple of things you raised me maybe think of a couple of things. So I see it all the time in the Facebook groups, people will say, where can I get a trademark? And somebody will will chime in? Well, you can do it yourself, you know, for a few 100 pounds or a few $100, just head over here and go and do it. And then somebody will chime in. Yeah, I did that. And I got my trademark. It’s like, well, yes, you did. It’s very easy to go and do it yourself. But the trademarks barely gonna be worth the paper it’s written on, until you’ve actually had it done by a professional who has been able to get you a trademark, which has an extremely broad scope for anything and everything you may ever possibly sell your trademark is not worth very much I made this exact mistake myself, I recorded a screencast of it a little while ago where I compared the trademarks I originally applied for myself, and I thought I was fantastic. I’ve done it with the trademarks I did a year later after I realized my mistake, exact same trademark, right same name, same logo, but one was done by me and one was done by a professional, guess which one had the broadest scope of protection and added the most value to my business, right? Same goes for insurance, don’t scrimp on insurance and think that you can just fill in some form online, talk to an experienced insurance broker, make sure you have the right coverage. Insurance is one of those things where you know, you get the building, you think I’m never going to need this and then one day, you need it. And if you’ve, if you’ve been in a pickle without the right insurance, well, that’s one way to make your business not sellable. Right. So make sure that you’re covered from that point of view, especially if you’re thinking of selling your your business entity which a lot of people in the UK want to do, because we have something called entrepreneurs relief, which is a tax relief, we sell the business entity rather than the assets. Because of course, when you sell the business entity, the buyer is taking on the risk, and the liability associated with that business. So you need to make sure you’ve always had the right insurance right from the very start. But somebody buying it now will now be liable for something that the business did two years ago, if you didn’t, you know, you’ve got to make sure that you’ve got everything covered.
Andy: I love that. So one of the one of the things that, you know, we’d love to ask people, even if it’s not, you know, ecommerce, you know, related in terms of you know, you’re no longer ecommerce, you’re more of a service based business now. But, you know, when you started the business with running the businesses, what are some, like really big challenges that you faced in your own business? And what did you do to push through those challenges?
Ben: Yeah, so there’s one springs to mind. And it’s a learning that I’ve taken to the I’m still building brands, actually. And the reason for that is I love it. But I also I need to still be like on the ground and have an understanding of it. I’m going to advise people in this way. And one of the learnings I took from the first business, which was being scared was to jump through hoops. So for instance, I remember I was selling in the UK, and I wanted to join the pan EU program, which was going to allow me to fulfill my products pretty easily right across Europe. But I needed to so this was about 2017. So it’s a bit more difficult than I needed just for VAT in France, Germany, Italy, Spain, Poland and the Czech Republic. And it was not an easy process, all sorts of forms to fill out. I remember I think for Spain, I could only get documents translated by certain select group of translators on their registry, and I had to get the some of my documents physically stamped with a wax seal by a registered notary all sorts of crap that I had to do took weeks. But after I did it, I pretty much doubled my sales overnight. Now, how many people looked at that process and just thought, Nah, not gonna bother too much hard work, not for me and quite happy just ticking over as I am. Well, that’s fine, because for all the people can’t be bothered to jump through the hoop. When I jumped through the hoops I emerged on the other side without competition. So when I see a barrier, I think, Well, that’s wonderful. So for instance, look at all this stuff. Now with inventory limits. People are frantically thinking about third party warehouses. It is a massive headache. But if you can get yourself sorted, get your ducks in a row and get on top of it better than anyone else. It’s actually an opportunity for you. Because it’s a barrier. It’s a hoop that you have to jump through. So when you see hoops in the road, it’s very tempting just turn around or take an easier path. Now I’m not saying we don’t want the path of least resistance in your business. But what I am saying is, hoops are transparent. Sonic the Hedgehog could see through them before he got to them. Look through the hoop. Think about what’s on the other side. And if it’s worth it, do it. That was a big lesson.
Andy: That’s, that’s great advice. And I feel like with Amazon, that’s more true every day. I mean, there’s they’re constantly throwing up roadblocks for running your account, right? I mean, you got, you know, products being taken down for like safety issues and all these FDA things and like they, you know, update their AI bots. And then they release them every three to six months, and you get, you know, products taken down, you get, you know, incompetent Seller Support, you get all this all these major issues where, yeah, a lot of people when I’ve been there, I’ve been there where I’m just like, Screw this, I’m done with Amazon, because there’s so many roadblocks that are thrown up. But I agree with you in terms of, if you have the grit and the wherewithal to kind of step back from it and be like, okay, yeah, this sucks. But if I get through this, you know, there’s a lot of opportunity there. It’s a long game. And if you can look at it like that, you know, those are the people that are still around who are still selling on Amazon, who are still making the money are the ones who are, you know, I’ve always said that my dad gave me advice, you know, a long time ago, it was in regards to marriage, but it completely applies to business. He’s like, you know, you’re gonna have to eat a shit sandwich, right? It’s like, what should SHIT sandwich Are you going to eat? And if you eat that, then you know, it’s, it doesn’t matter where, you know, if you’re working a nine to five job, you hate your commute, or you you know what I mean? It’s so like, you have to step back and look at Amazon and be like, Okay, it’s a different shit sandwich, but like, I’m gonna eat it so that I can, you know, I can progress and choose, you know, choose the the choose to eat it. It’s a terrible analogy, now that I’m thinking about it in terms of gross Ness, but you get the point in terms of,
Ben: You know, good analogy, I’m going to use it more if
Andy: you do, please do you know, and I love when people with Scottish accents, cos it’s, it’s absolutely stunning. I love it. But, but yeah, I mean, I think that, you know, stepping back from it, is, you know, the the grit, the the determination to whatever it is, is to get to the next level, you know, it’s like at the gym or whatever, you know, so many different ways to to use that analogy. But yeah, that’s completely great advice. Anybody who’s here in the Zoom meeting, if you have any further questions for Ben, please drop them right now. While we’re doing that, I’m going to ask Ben, we always like to ask this of our guests because, you know, we’re one of those people, if you’re if you’re a real entrepreneur, and you’re not, you know, learning every single day, you’re gonna, you’re gonna lose because your competitors are there learning, new tricks, new tactics, new personal development, all those kinds of things. So you mentioned a few books banned. But anything else you listened to watch that kind of pushes you through eating that shit sandwich?
Ben: Yes, I’ll give you a fun. I’ll give you a serious one. And then a fun one. So serious book, I’ve got a bookshelf behind me, I’m just going to turn right and have a quick look. Start with Why by Simon Sinek is an absolutely amazing book, which is pushed me to constantly think about, you know, both in terms of brand. So I spoke before about how important building a valuable brand was, in order to build a valuable brand, you have to think about the marketing of that brand. And start with Y is a great book for thinking about how do you market your brand. There’s some great examples in there from like Apple and all sorts of stuff. But also, you can take a slight, slight sidestep from that. Because think about what is your why, like, why are you doing this? And for me, when I began to think about the fact that my business might have some decent potential and some potential to become something valuable that I could sell and make my family secure. Well, that was my y right? My family. So that’s a that’s a serious one. And then a fun one is so we have a two year old daughter, and I watch a lot of kids cartoons. And I suppose I’m guessing you guys don’t have this over there. We have a cartoon called Peppa Pig. You guys are gonna have to look it up. I’ve heard I’ve
Amy: heard of it. But Peppa Pig My kids love Peppa
Ben: Pig. Peppa Pig is awesome, because I’m so glad you like it. Otherwise no one on this call everyone’s and he was just like what the hell has been talking about Peppa Pig I just frickin hilarious because it’s I don’t know if you find this any but the writing I think is written for the parents and not the kids. It’s so funny. Like the adult humor that runs through that. It’s just incredible. So I watch a lot of kids cartoons at the moment and I just Peppa Pig. You’re having a bad day. You put on some Peppa Pig and you’re saying you’re like it’s an excuse. You’re like I say to my daughter Scott is about it is about you want to watch some Peppa Pig and she’s like, Yeah, really? It’s me that wants to watch Peppa Pig right so I’m like, I’ve had a bad day.
Amy: I just love their accents. Mommy take daddy cake. Yeah, awesome.
Andy: Yeah, no, we’re those evil parents that you know, don’t let our kids watch much TV and you know, make them not eat gluten and dairy and You know where those where those people were when we when the server comes to our table at the restaurant, they’re like, Oh, these people really but no, I’m one of those to pick.
All right, good. You gotta have your you gotta have your cheese right to our kids watch. We like I said, we rarely let them watch TV but they watch what is it? It’s a it’s an Amazon Prime like thing and I can’t think of it. Anyway. It’s like this, you know, animated computer generated kid show that yeah, they get to watch once in a while, but that’s about it. So were those mean? You know, evil mean parents that make them go play outside like it’s running outside? Go outside? Leave us alone. So Ben, let people know how they can get in touch with you.
Ben: Absolutely. So I’m on on pretty much all the main social media channels. My handle is at Ben Leonard Pro. For instance, on Instagram. I’m on LinkedIn, just search for Ben Leonard. It’s Elio ner, D like the golfer Justin Leonard. Econ broker is Dakota, UK. Head over there, click on sell your business. Even if you don’t want to sell your business, just click on that putting some numbers we can get back to you with a rough idea of what your business is worth, no hard sell. We don’t necessarily sell somebody’s business straight away. We’ll work with them over a period of time that’s right to you know, hold their hand through the process almost manage their route to an exit to to you know, achieve what they want to achieve. Or you could head over to Ben Leonard dot Pro which is my website if you want to benefit from some of my experience in E commerce and see how I can help you.
Andy: Awesome thank you so much for Ben for being on. If you guys haven’t joined us live remember we do this every Tuesday at 1pm Pacific Time seller roundtable.com forward slash live you get to come into the Zoom meeting Ask the Experts like Ben questions on the spot. You know without without having to fill out that email form you can just jump in here live talk to him, you know face to face and and get your questions answered. So yeah, thank you guys so much for joining us live the people that join us live in the Zoom meeting. We’re going to end live right now. And then we do kind of a little q&a after the fact that does not get broadcast does not get recorded. So if you guys want it on that you gotta go so roundtable.com forward slash live and join us in the meeting. We love having you guys it really ups the game in terms of content because we get to ask, you know, our guests questions that we may not have thought of. So thank you guys so much. The podcast continues to grow and if you haven’t yet, please rate review subscribe. And yeah, we’ll see you. We’ll see you guys next time on the seller roundtable.