By Lesley Hensell and Joe Zalta
Co-founders of Riverbend Consulting
Riverbend Consulting helps sellers and vendors on Amazon, Walmart and other ecommerce marketplaces keep their accounts healthy while solving critical business problems. The company specializes in account and product suspension appeals, account support and reimbursements.
Riverbend also provides sellers with data-driven strategies and best practices for improving revenue and profitability, such as Editorial Recommendations and Amazon Product Videos. Its team of ex-Amazon employees, third-party sellers and business consultants provides the know-how and persistence to help sellers grow.
Planting Roots in Amazon
Joe Zalta and Lesley Hensell are co-founders of Riverbend, and their paths crossed in 2017 to make their consulting company a reality.
Lesley has been an Amazon third-party seller since 2010, developing a successful business as means to support her family as they dealt with multiple hardships, including successful cancer treatments and rehabilitation for one of her sons and special needs schooling for the other.
“Making it through those trials gave me great perspective and allowed me to become a listener,” she said. “They taught me how not to get upset when a problem arises, but to calmly solve problems for our business and for my future clients at Riverbend.”
Both of her boys worked in her fledging Amazon business, packing and shipping orders, and building a good work ethic along the way.
When Lesley first started as a seller, she struggled to figure out what would do well in the marketplace, and there wasn’t a lot of data at the time to help. Because of this, she sometimes bought the wrong products and couldn’t sell them, or she bought the same products as everyone else and ended up with significant competition that led to selling products at a loss.
From this experience, she learned how important it was to buy shallow and wide before determining a winning product. By making small purchases of a lot of products, she could cast a wider net to determine which products worked best in the marketplace. Until she sees evidence of a winning product, she doesn’t buy a lot of any item at the beginning.
This experience gave her an inside view into what sellers face in online marketplaces, including an almost desperate need for help and support in solving urgent problems such as getting suspended accounts and product listings back up and running quickly. So, she decided to become both a seller and a consultant.
For Joe Zalta, he worked 11 years for a big umbrella apparel company in different departments and divisions, being trained in different areas along the way. He started in sales and was then taught merchandising by one of the best merchandisers in the entire industry.
“In the end, I was doing deals with the likes of Macy’s, Dillard’s, TJ Maxx and others, building merchandising groups for Men’s, Big and Tall and Kids clothing lines that I represented,” he said. “I worked with many different brands including the NBA, Lee, True Religion, among others.”
During that time, Joe also became a seller on Amazon, leveraging his background in merchandising and sales to build a health and beauty store in the online marketplace. He also became entrenched in the seller community, making numerous contacts and learning more about the plight of the average third-party seller.
A Partnership that Began with Shampoo
Lesley and Joe’s worlds collided in 2017 when Joe’s Amazon account was suspended by the marketplace for a violation that it calls “condition: used-sold-as-new.” The problem was with a shampoo product that was receiving a lot of returns and complaints.
“Health and beauty is tough and we were selling high-end products. People rightly expect those kinds of items to be perfect,” Joe said. “When my account was shut down, it put me in a real bind because I needed to process orders and my employees were depending on me. I turned to several consultants for help, but they couldn’t get my account reinstated. I was starting to panic.”
By that time, Lesley had branched out and became an industry consultant, while still working her Amazon business. She had recently left a consulting company and word spread quickly around the industry. Joe was referred to Lesley, and he quickly turned to her for help.
After an initial analysis of Joe’s account, Lesley determined that the shampoo product in question was opening and leaking in transit. So, she and Joe wrote a plan of action to correct the situation, sent it to Amazon and got Joe’s account back up and running in a few short days.
Through that experience, they both realized there was a very real, growing need for experts who could help sellers navigate through those types of urgent issues within online marketplaces. They also saw that with Joe’s sales experience, combined with Lesley’s technical and operations expertise, they could offer a unique value proposition to Amazon sellers.
That’s when Riverbend Consulting was formed.
From New Kid to Contender
The first year of business was really challenging for Joe and Lesley because they were entering an industry that already had major players, and they had to convince sellers that Riverbend was the better alternative.
“It was hard to find our sweet spot at first: who our partners were, what our advertising strategy should be with such a super-niche audience,” said Lesley. “We had to build relationships and trust among industry partners, and we had to discover on our own how to make advertising work.”
They also believed that getting the keys to the kingdom, so to speak, was getting Amazon employees on their team. But no start-up was going to attract employees who were used to a huge company with big compensation packages, stability and almost guaranteed growth.
So, they started planting seeds with certain employees in Amazon. It took eight months to get that first ex-Amazon employee on board, and it was a huge leap of faith for them.
“Once we had some of these key players on board, we became a trusted place of business for Amazon sellers,” said Joe. “Today, we have 16, which is amazing. We’ve become a known entity inside of Amazon, and our competitors have nothing like this capability in house.”
Early on, Riverbend also expanded its employee base internationally, creating a team in the Philippines to ensure global reach and the ability to assist Amazon sellers 24/7, anywhere in the world.
Challenges in the Market Today
There are a lot of problems in the Amazon world right now, with expenses rising significantly between freight costs rising through the roof and inflation skyrocketing. And due to price-control policies, it’s very difficult today for sellers to raise their prices on Amazon without the marketplace taking those product listings down.
Amazon is even raising its fees right now, which is understandable. It’s a fuel surcharge essentially, which is reasonable in this economic environment. But there’s a lot of pressure right now on sellers in general and their profits are being squeezed.
Unfortunately, it may not get better anytime soon. Inflation appears to be here to stay for the time being, at least through the end of the year. Once Amazon does allow sellers to raise prices, consumers in the marketplace are going to be struggling to buy the things that they’ve always bought on Amazon.
Amazon isn’t a place to buy luxuries anymore. It’s a place to buy the things you need every day. The prices are generally competitive with retail stores. So just like when you go to the grocery store and you see that the milk you usually buy is up by 25%, you’re also seeing the same thing with necessity-type items on Amazon.
The bottom line – soon consumers are not going to be able to buy the quantity of goods they would have a year or two ago, because they’re going to run out of cash faster.
The Opportunities the Market is Facing
That said, there are plenty of opportunities as well. One is for private label sellers who manage to find product or contract manufacturers closer to home. Today, there are people trying to find contract manufacturers or sources here in the United States or in Mexico to make products — places where they are not going to pay a premium to ship their inventory. This way, they can restock in a timely and more profitable manner.
“If demand is going to slow down, then running out of stock and having a bunch on its way from overseas is a sure formula for going out of business,” says Lesley. “Sellers must have their products available, so for people who can source locally, they will have a leg up. I think there are also going to be more manufacturing facilities willing to make deals because they’re going to need the business moving forward.”
Another opportunity on Amazon is the ample room for sellers who provide specialty goods. There are certain products that only a small segment of the population wants to buy. Consumers are not going to find those items in retail stores, especially in a sluggish economy. Retail stores will primarily focus on their bread-and-butter items that everyone needs.
If sellers have specialty goods that fill a market niche, online is the place to be. People who continue to find those needs and meet the demand will do great on Amazon.
Finally, it’s important to diversify and have products available on more than just one marketplace. One can’t assume they can be in only one place and be successful.
Advice to Others and Best Practices
For people who want to create, build and grow a successful Amazon business, Lesley and Joe have several tips and best practices to keep in mind.
- Build good infrastructure processes and habits from the beginning so you don’t have to adapt as you go. With that said, it’s also important to review your processes from time to time and adjust, expand or change as needed, based on your company’s growth.
- Hire the best people you can. If the right candidate comes along, don’t hesitate to bring them on board, or your competitor just might. Also, be sure you continually create a great space for your employees to work and grow. This will help minimize turnover.
- Pay attention to your expenses and always keep a handle on them. If you are not aware of your P&L at least as a high level, then you need to get better acquainted with your own books and understand your cash flow.
- Be prepared to work like you’ve never worked before. Being successful in business is harder than ever, and there will always be competition. If you’re not willing to put in the time and sweat equity, it won’t pay off in the end,
- Don’t just sell one way on Amazon. Don’t just be a reseller or a sales rep or a private-label seller. You should be doing at least two of these methods because if things dry up in one area, you still have the other to support you.
- If you’re selling your own products on Amazon, prioritize risk management first. That means having liability and umbrella insurance policies, conducting all relevant testing for your products, and being able to provide all that information to Amazon.
- If you’re launching products on Amazon, be prepared to develop an exciting brand. There is intense competition today so you must have money to invest in A+ content, video ads, a website, all the traditional things that brands have used in the past. You don’t need a huge budget, but you need to look attractive and credible to buyers.
Lesley Hensell and Joe Zalta are co-founders of Riverbend Consulting. Learn more about the company at riverbendconsulting.com.