What My Day Job Taught Me About Running A High-Ticket Drop Shipping Business
Hey guys, welcome to today's episode.
Today, it's going to be a little bit longer.
I will talk about all the cool ways my day job taught me about eCommerce, running a business, and drop shipping.
I worked as a salesman at a warehouse, a distribution company in Van Nuys, California, just in the north of Los Angeles. This company sold security, hardware, and everything related to that. It's a niche security hardware niches, a complicated niche with lots of different SKU numbers, different colors, and lots of different codes.
When I first started working there, I actually didn't work as a salesman. I work in a warehouse. In the spring of 2008, I answered a Craigslist job posting about a warehouse position. I thought that was perfect for me. I didn't have tons of sales experience or anything like that and I needed something simple and not retail. I wanted to learn more about how a distribution business went and a warehouse job is perfect for me.
I answered the posting. I went in for a job interview, and it worked out really well. The guys liked me. I was all excited, said the right things, and had a good attitude. With 50 to 100 applicants, they hired me and one another guy.
I started at ten dollars an hour. It was on the low end but was still better than the minimum wage. I think the minimum wage in Los Angeles County, California, that time was around eight dollars. It worked out really well. I was super happy about that.
When I first started there, I was learning how the warehouse works. As I said, the niche is very complicated. The partner mentioned the "Newman culture." The part numbers are very complicated. They had to be careful with the organization of their warehouse. It was was all a bunch of bins, mostly for pipes that fit inside of bins. The bins would have a label on them, which would be a three-digit vendor code. They would have the manufacturer number and then the name of the product underneath that so that you could double-check if it's the right product.
The first thing I learned was how to pick products from the warehouse shelves and bring them over to the packing area. I had to match whatever it was on the order slip to the product that was in the bin. And I had to double-check if the product that was with the men was the product that was labeled on the bin. I check the box and check the part number on the box, which of course, isn't is never exactly how it's supposed to be. There are so many different versions of how manufacturers pack their products, package them, and label them that half the time, it would not even make sense. Since the numbers are so complicated, I had to learn, what the color codes meant, and how they correspond to different words and stuff. It was very complicated in the beginning, and it was tough. But I got it pretty quickly, and I worked hard and diligently learning the nomic nature and all the different part numbers.
I advanced pretty quickly. I went from picking to the packing process. I would go out and pick the product on the shelves then I would drop them on to the packing line. Someone else would be there packing like a factory kind of an assembly line. I started doing the packing, and they showed us how to do it. It's pretty simple. You just look at the products that are in the little basket. You would use the same ones to pick your products off the shelves.
I would look at the item and would see what box it would fit in. The first thing I would do is go and see if there's a recycled box I could use. If there are non, then I'll use a brand new box that costs less if you recycle them. I go ahead and put the product in. I'd have to double-check on the order form with the products and make sure that I put in the correct products, like a double-checking process. Then I put the packaging and tape the box. I'd also initial the picking.
The picker initials the slip, and then the packer initials just left. Then he moves the box down the other line to the shipping department, which is just the computer at the end of that line.
I did that for a long time, probably a few months. And I got a really good hang of it. I started understanding things, and then I started pushing my way into the shipping department.
They didn't ask me to get in there. I just wanted to, because I knew that the only way I was going to advance in that company and learn new stuff was by taking on new tasks during the day.
I was really excited about it. I knew that I wanted to learn how business works and how different parts of it worked. It was as fun for me to learn new things and stuff like that. And I really didn't want to be stuck in a job. Being stuck in a job sucks ass, and it just not a way to live life.
I had an old system set up. I remember they would have a separate system for invoicing and for the shipping labels. They used U.P.S. World's ship most of the time and got on the line, and they would look at the invoice and put the box on a scale and then weigh it. If the item was around five or six pounds, they type it to the shipping invoice, and then they'd get the quoted shipping amount from the invoice. The label was slapped on the box, and then with that quoted now, they would go ahead and create an invoice for the order. Their original ordering system back then was really old. It was just text on a screen. It must have been like one of the original programs they had.
I think they opened the business back in the 90s or something in the 80s. I think it was even the 70s.
It was really long time ago that they had it in Salt Lake City, Utah, when they first opened a company in the branch. I was working in Los Angeles. It was one of their newest branches. They would invoice it, and they'd be in the shipping amount. They would choose different freight types. I don't even know all the different types. I hadn't worked a lot with freight since then.
Back then, orders that amount more than a hundred dollars would be given free shipping. They wouldn't charge shipping fees for some accounts, especially those they had a long-term relationship with. They'll add it to the fee of those who ordered under a hundred dollar items. Interesting.
I went from picking to packing to shipping invoicing, and they would go out the door. So that was that. And I did that for a long time. And I started getting to the invoicing and stuff like that.
I learned how to correct mistakes and how to issue refunds. And it was a pretty good process. I learned how to handle freight orders. One of the products that company did was safes. Safes can be pretty big. There were all sorts of safes like fire safes. Most of the safes were too big to be put in a box and ship out. I would say that around 99 percent of them would need a little forklift, a three-story high structure, and one of the warehouses where they would hold the safes.
People would order the safes, and we'd have to bring the safe down. We'll invoice the safe, call the freight company, and create a bill of lading. The freight company would come to pick up the safe. We provide them the paperwork and take the safe into their freight truck, and they deliver the safe to the customer.
It's a pretty interesting process. A lot of forklift driving. I had to take a forklift class to get certified to drive the thing. It was good, but I kind of knew that that wasn't really for me. I was really good at solving problems. And you know, what that company did a lot was they would start people in the warehouse and learn the systems and procedures and stuff at the warehouse deals with every day. And that way you kind of feel the products and see the product. When people got really good at it, and they showed any inclination to solve problems, they would move them up the sales. And that's exactly what I started doing.
This was a year and a half. All of a sudden I got the question, "Trevor, we're hiring people for the warehouse, and we'd like to move you up your sales. Would you be interested in taking a position at the front counter?" I was kind of scared at first, but of course, I said yes.
So there wasn't a pay raise right away. But I knew that eventually one would come in and about six months later, I got a pay raise from ten to twelve dollars.
I started at the front counter, and I started by just solving people's problems, interpreting what people would tell me that they thought they needed. Then I would figure it out according to our catalog.
We didn't work directly with the public. The company was a full sale only, which means people had to be actually in the locks. That trade could be like a big box store and buy it from that company. You had actually to be a locksmith or somebody, maybe a security installer, or somebody in the trade that would actually sell to an end consumer. They wanted to protect their dealer base from big box stores or online dealers that would take over. I just started solving problems.
One of the things was the backset of a door lock. Some people don't really know that. You know, commercial doors are thicker doors and bigger doors. They need two and three quarters to inspect it, which is the distance between the latch and the center of the lock. Once you get there to install the lock, if it's wrong, then it's wrong, and the lock won't fit. So I had to help these guys out with stuff like that and help them out with understanding ways and finding replacement locks for like ornate locks and things like that.
My company worked with many different suppliers and brands, particularly manufacturers of products, and have done a lot of different custom orders for them. I did get into solution selling. Solution selling is where you focus on providing solutions for the customer, and you can charge more because you provided that solution. That was one of the biggest things I used to call loosely. Then tell them to go and tell their customer. Then I would have to file with the supplier about a week or two later and make sure everything's on track in the orders. I also make sure the price is still good and everything. They would ship out and receive it two or three weeks later, usually process it, and then call the customer and then tell them it's in stock and ready to be picked up. And they would come out, call their customer, and tell them it's ready. They would set a date and come out, pick up the product, pay for it, and probably gotten paid from their customer, but maybe not. And they would go out and do the work. If they hadn't got paid, they'd ask for payment. And then that was that.
There's a pretty, pretty smooth process and has required me to make sure that everything was done correctly.
It's tough because being at the front counter, I would deal with a lot of blocking traffic, and I would have to be taking phone calls. There's a lot of disorganization along the way. Our sales numbers kind of decreased because a lot of times the phone calls wouldn't get an answer. You could be talking to somebody right there in person. And it's really rude.
You're talking to somebody right in front of you, and then you have to answer the phone right in front of them.
So what the management did was, they created two separate selling environments, one gesture of taking phone calls and one just for dealing with the front counter sales. It was interesting because we realized that when someone focused on taking calls and someone focused on helping people place orders on the website, it was much easier and more efficient than putting clients on hold. We also focused on providing solutions for those who wish that they wouldn't go to the competition. The reason for this was because there was a big competitor in that same city and that they can get stuff overnighted from. With us being service-oriented, we would provide the best solution for them. Quick service, make it easy, make everything fast, efficient, and provide a low price then they would buy from us. I started learning all these different things about sales tactics and unique selling propositions and how to gain customers over the competition.
I actually got a back-office cubicle, and I started making the phone sales. As we're looking at them, I was as good at solving problems over the phone than I was at the front counter. I was great at closing sales and upselling for big clients or big customers. So I started doing that kind of work as well. It's like handling special orders and backorders, which is really important for those people to have over the phone. A custom order is a bit more important than somebody who comes to the front counter.
It's a bigger job usually. I started handling custom orders that were five thousand, ten thousand dollar range as far as order value goes. And those are big orders. So they required more intense quote taking processes. And I started doing more with electronic security outside of just mechanical security.
So there's a lot that had to go into building a system of people. I had to figure out how to build systems for people that would lock up an entire facility so it would lock up the facility and keep track of the people going in and out. Something that's called electronic access control. It was controlled because they would know who's going in and coming out at any time and could control who would have access to billions at any time. That's an exciting industry. It's very complicated systems and very difficult to sell with technical stuff. If you're going to sell it, you're probably going to be a dealer who's working very closely with the consumer. And these consumers are big institutions, big commercial buildings, big schools.
I used to deal with a lot of different types of customers. It wasn't just the big facility. It was also the people that were in charge of running those facilities area. I started doing something called retail arbitrage. It where if I couldn't find a solution to someone's problem, for instance, our company didn't have a connection with certain suppliers, that person wanted. What I did was go to another retailer who has an account and quote 20 to 30 percent.
I did that and used amazon.com a lot. And I would go there, and I had an account with them, and I would look at their prices. They usually have pretty low prices, and whatever the retailers offer, they take that price and put a profit of 20, 30 percent, maybe up to 40 percent sometimes. Though it's a low enough price and they wouldn't mind the difference because they're really working with us and it's convenient. It's one account, one person to call. And they get the price.
And that's just their day job. They don't care about their business.
They're paying money with taxpayer dollars. If that taxpayer dollar is going to support business and someone's life like mine, I would support service, even though it's charging more money. They're paying me for that. And, you know, there's plenty of other companies that do that.
I like travel agencies and stuff that can offer the kind of service where you can research yourself in public direct. But it's such a pain in the ass. You would rather just go and have your agent do the work for you and pay them a little more money. I was taking on that role as well.
I was using my own amazon.com account to buy the products and sell them. The company would take the money in, and they'd have to reimburse me for the products, which was cool because I would get cashback rewards, freezing my credit card, buy those products. I used to take advantage of those as well.
Before I moved into sales, I actually took on a role in the warehouse as a little more than just picking, packing, and shipping. I was receiving and returning, which is a whole other part of the warehouse functions that you don't really think about when you're buying something online.
But like with every warehouse company, like Amazon, they always have to have multiple functions. One of them is taking in and pushing out products.
I used to handle the receiving and returns in the warehouse, and that was a significant function. I would have to be there every day. See a bunch of pallets of products that would come in, and they'd be filled with stock for the warehouse, and they'd be full of special orders. The way that the purchasing department handled the ordering was that they would order big bill amounts of stock from brands like Master Lock or Simplex. They would then mix in special orders with stock orders to get the best pricing and the best deals. They would be very conscious of that. And they would make it so that those custom orders would sometimes actually cost us less and the profit would be more on them in the long run. So it was a smart move.
Now, as a receiver, I had to make sure that I would get all the packing slips correct. And then I had to look through the packing slips into them, into the system, make sure that we received the correct products. I'd check the packets on the products. And then I check the packing slip in. I would scan the packing slip and send it all in one package to the receiver who works in Salt Lake City, the management for Los Angeles. The manager was actually in Salt Lake City, and I would send it to them, and they would handle that.
It worked pretty smoothly. All I had to do is check and make sure we receive them correctly and then send it over to them, and they would make sure everything was invoiced correctly on their end. And then they will check it into the system.
It was my job to either have someone put it away or put it away myself to the shelves. I learned a lot about receiving end and all that in that process as well. The next thing I did was handling the returns, which meant somebody brought something back to the company.
I had to see whether it was returned because of a defect. If it were, I would have to put it into a list and send it to the returns department. The returns department would send it to the manufacturer. They would get back to me and let me know if I would just dump the product there in a trash bin or if I would send it back for a refund.
A lot of times these manufacturers are so big that they don't even want products to be sent back. It's not worth the time and effort. So I did a little bit of eBay on the side to make a little extra money because many of these products they got thrown away were actually fairly good products in great condition.
I was able to take those products and sell on eBay because their management didn't want anybody doing anything with those products. They didn't want them to be sold. Sometimes I'd throw them in the trash bin so that they would see me throwing them in the trash then during my off hours I will pick them up and take them home. I would check if they're good and put it on eBay.
I could just sell it for 100 or 200 bucks per product. They are products that we're returned like bags. Maybe they claimed it was defective or I don't know, but they are in fairly good condition upon checking. So I just put it on there.
You just never know. One man's trash is another man's treasure.
I got paid a couple of thousand bucks a month. And in Los Angeles, that is not enough to live on by any means. And yes, I had to have a side hustle to pay for my skateboarding and pay for taking my girlfriend out. It all worked out when I was in sales.
I would spend some time trying to diagnose the situation and make sure that the product was actually defective or if it actually worked. Still, no other sign the product did not work. They just didn't know how to use it. And that is my job to help people there. In dealing with that, I really learn people skills and how to deal with upset customers. It's like e-mail and phone support.
Sometimes you have to be the person that says, "No, it's not defective. There is just something wrong with the set up". Unfortunately, the person isn't there, you know, in-person to talk to you. But that's a good thing because they can't bother you.
One of the most important things I learned at my day job that I took to eCommerce was how to close sales and use negotiation tactics to get more for your money. Simply put, stacking your value. You have to make sure that you're telling that customer that it is worth the price. It's probably because they do not see the value is equal to that price. So you've got to reset reinstate the values that you're offering to that person into your unique value proposition, the same value you stay on your about page.
What I do now is put every single product page. I put my unique value proposition into that product page. And it's a big deal because that stuff does help raise your perceived value. And it does get you sales. It does. Use value stacking and close sales by just doing trial closes like "Hey, are you ready to buy?" And you want to get it right away. "Would you like to pay with your Visa or American Express?" Use all these different trial closes just to get "Yes. Yes. Yes. Yes. Yes." Because you just want to get people saying yes. And then you can close them be, "okay, let's ship this out to you."
That's how you do it. I went head of sales, and it came in handy with eCommerce because I would be able to put that into my copywriting. All these different questions and answers and sale closes. And it really does help push sales online.
After I learned all these different things, I started talking to some of the customers that I wanted to start online businesses. And they were thinking, "you know, we could use the company that you work for as our distribution center to dropship directly to our customers." And I thought, "what is this? What are you talking about? Dropship and stuff?" And I thought, "you know, it's not a bad idea. You know, we can work together."
I was thinking about partnering with a guy one time, but he was too distracted. He had too much going on. So it never worked out.
There are so many different products. And one little mistake and the customer would want to return it and get on a good return.
The lock industry is not a simple industry, and it's not what I wanted to get into as a business. So I found a different niche, but I did learn how it works.
Starting a business as a retail store, as an online retailer, only online storefront, you can utilize the services of a distributor like I used to work for. And they'll drop ship directly to customers without the invoice on it, without even their name on the package. So they think it came directly from you as an online retailer and that customer will get back to you and be perfectly happy with it.
One thing I did learn eventually, is that you can't use distributors for drop shipping because distributors take a chunk on dropship. You have to work directly with brands that will drop ship for you because brands will be able to import the products from China. Those are the only ones that can give me the best margins that 20 or 30 percent. You need to be successful online and make a profitable business, right?
And you'll have run paid ads and pay more to acquire customers. So that's important. You have to learn which business model works the best and then work in that direction only and not work distribution work with brands.
I really did understand that after a while, and it worked out. Those are the things that, you know, my day job really did teach me how to do eCommerce dropship. In a way, I learned it from the inside out. I learned about how all these industries work, how they're fulfillment works, and how the supply chain works from the inside out. And it's really a great experience. I got paid along the way to meet a lot of good people. I get to learn all about an industry along the way. Unfortunately, it wasn't anything that I was super passionate about. Still, I was smart enough to grasp it and understand it all. And I was able to sell it.
Even if you're not passionate about bottling, you can still sell it just because you simply understand the basics behind it. I was actually getting myself into certain trade shows, and I was representing my company to big brands and stuff like that. And it was really incredible that I was able to get myself into it without even not being that advanced skills in electronics. I was able to be pretty much the electronic access control person for my branch, the representative there because I just understood the basics.
All you need to know in life are the basics. You can pretend like a super-advanced person by just knowing the basics, and it can get you far. Eventually, you do want to push the direction of learning all the advanced stuff if you want to.
But I knew that I want to start my own company with a different niche. So I started taking business classes at night. I learned more about business, and then I was able to start my own Internet business by signing up with eBay.
I was actually getting traffic to those listings through Google AdWords and then selling those products and fulfilling the orders. My supplier fulfilled them for me.
It started just by opening my eyes and opening my mind, to different things that I could be doing instead of just wasting my time watching skate videos all day. I was then spending my time creating product listings and finding new traffic sources and creating content. I was working in the mornings and in the evenings. I was working on my lunch break. I was working on 15-minute breaks at work. I was working. I had been working in between breaks at college and even during a college class.
I mean, it was just literally like putting the site together in this business. And a lot of it was shooting in the dark.
But I learned a lot. It was totally worth it because now I'm able to spend every day doing whatever I want to travel the world. Whereas back then, if I was going to travel the world, I probably completely broke and be scrambling to find money all the time by doing odd jobs.
And that's just not something I like to do. I like to build businesses and have cash flowing and use credit cards to buy stuff. A nice, comfortable life. You always have a place to set. It's comfortable. I can have a family and can travel and people stuff.
And I'm an entrepreneur at heart, so I like to build projects, build little businesses here and there, and then build an eCommerce Paradise right now so I can help others build their businesses.
Being a teacher is one of the biggest passions I have in life. I want to teach you guys to build businesses. That is one of the most appealing things in my life.
I hope you guys learn something from this. And if you're working a day job right now, definitely don't look at it like you're not going to learn anything from it, because you definitely can.
Learn everything you can.
The more you learn while you work, the better you can apply it to your own future business and find a way to true freedom.
Well, I hope you enjoyed the podcast.
Subscribe to the podcast on my YouTube channel and join the Facebook group.
eCommerce Paradise was created by Trevor Fenner of Seattle, Washington in 2015 to help you, the entrepreneur, to start and scale your own eCommerce business selling high-ticket products online with the drop shipping fulfillment method so you can make more profit per sale, have a sustainable and evergreen online business, get started with very little upfront investment, and live a location independent lifestyle. Trevor owns multiple 7-figure High-Ticket Drop Shipping eCommerce stores and is a digital nomad, traveling the world while working remotely with the help of his team of over 10 virtual assistants from around the world. Trevor is currently located in Bali, Indonesia. Trevor is also a passionate skateboarder, surfer, scuba diver, photographer, environmentalist, outdoorsman, fitness and tattoo enthusiast.
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Step-By-Step Training for High-Ticket Drop Shipping
Here are the next steps you'll need to take to start your high-ticket dropshipping business:
Resources for Starting A High-Ticket Drop Shipping eCommerce Store
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