Solving for Logistics Headaches in 2022⎜ First Choice Shipping ⎜ EP 215
Ryan Cramer: What's up everyone, welcome to my corner of the internet. I'm your host, Ryan Cramer. And this is Crossover Commerce presented by PingPong Payments, the leading global Payments provider helping sellers keep more of their hard earned money. Hey everyone, welcome back to another episode of Crossover Commerce. I'm your host Ryan Cramer, and this is my corner of the internet where I bring the best and brightest in the Amazon and eCommerce space. What does that mean to you if you're a first time listener? Well, buckle up, we have lots of great guests that come on the show talking about anything from product ideation, to sourcing and logistics, which we're going to be caveat talking about today. Marketing, advertising, global expansion, whatever that might be, if it applies to your eCommerce or Amazon business, this is the podcast for you. With that being said, every episode in now even 215 episodes in, is presented by PingPong Payments. PingPong Payments is a cross- border payment solution helping sellers keep more of their hard earned money. Would that be sending money to your suppliers, your sourcing agents, your logistics, helpers, your inaudible whomever might be in a different currency, PingPong is going to help you save more time, money and effort. When it comes to receiving funds or sending funds internationally, let us take some of that lift off of your shoulder, and come put that money back to your bottom line so you can grow with different kinds of marketplaces. Or you can put more money into your solutions or your product, whatever that might be to help your business move efficiently forward. Just go ahead and sign up for free at usa. pingpongx. com/ podcast, to catch all of our past episodes but also to sign up for free today. No cost to you to sign up. Check it out. It's free, poke around a little bit, ask questions. Just make sure you mention Crossover Commerce sent you. That being said, as you know, any sort of industry... We're talking about what does 2022 look like? We're still in the beginning part of the year where a lot of people are still planning, prepping, trying to get the year under some sort of plane. Whether that be growing internationally, whether that be growing in a different product, whatever that looks like. All of that kind of comes under one umbrella and it starts from the beginning. Where you get your products if you're an Amazon seller, or if you're a service provider, or even if you're just selling D2C. That all starts with a product that you might be selling in one capacity or another. How do you get that product from point A to point B and point C? And that is the solution that you have to solve for whether it be relying on service providers, have your own solution, or software in- house, or even just relying on partnerships. There's all sorts of different headaches that people have encountered over the past year and a half or so, maybe even two plus years. It's a problem that a lot of people have but there is so many great companies that are helping people relieve those headaches if you will. Call it the aspirin of the logistics or sourcing world. That being said, I wanted to bring over a friend and just overall a great person in a great company if you will. Pearl Ausch of First Choice Shipping, she's going to be talking about her expertise in helping kind of that problem solving nature. That's why we called today solving for our logistics headaches in 2022. So without further ado, Pearl Ausch of First Choice Shipping, welcome to Crossover Commerce. Thanks for joining me today.
Pearl Ausch: Thanks for having me. Thanks for having me. It's been a long time coming. Let's just say that.
Ryan Cramer: Yeah. Well, you're so busy. If you're listening to this or watching this right now, don't talk to Pearl in Q4 because that's kind of a busy time crosstalk.
Pearl Ausch: It's been crazy. It's been crazy.
Ryan Cramer: "Let's talk in 2022." And that was November, October maybe and you're like," We can't talk right now, Ryan. It's going to be awhile." You got a lot going on. There's so much going on company wise but you guys just came off of a I'm assuming pretty stellar and busy, crazy Q4. But if people aren't familiar with you, which they should be, tell me a little bit about yourself, your background and how we got to where we are today?
Pearl Ausch: Sure. So, basically First Choice Shipping, I guess we'll start from the very beginning, right?
Ryan Cramer: Right.
Pearl Ausch: I love telling my story because I want to be able to inspire other people, even my staff that are listening. So I started out here as a customer service rep. Literally entry level position, loved it. I actually really loved it. Talking to the people, there's nothing like it. Started out doing that, slowly transitioned into the sales and marketing director role and very shortly after that ended up becoming promoted to a chief operating officer. This was just after I had one baby, my son, then that I started as a customer service position. And I never thought that I would want to do anything more than that honestly. You were telling me about your wife earlier, that she wants to be at home with the kids. I could so relate to that. But this company was something that was like this little baby that started blossoming, where Amazon heard about our services and they got excited and they wanted to know about what we do. And then things just blew up from there. So I think it just happened naturally. I'm not going to say it was a lot of hard work, but it was just a natural progression. So what do we do? So basically we're an all in solution for Amazon sellers or eCommerce sellers that are looking to expand their businesses out of the US. And they want to get into marketplaces such as Amazon UK, Europe, Canada, Singapore or UAE, et cetera. Anywhere that Amazon has the capabilities of offering their FBA option. We can help you get your product from the US into those locations primarily with small parcel services. That's our specialty, really being able to scale you really quickly. We are Amazon's number one provider for that, where they do recommend us very strongly because they know once we take over you're actually going to get expanded into that market. It's going to happen. That's the nutshell. But everything in between, I said the all in solution, it means the all in solution. So whatever needs to happen we make it happen.
Ryan Cramer: That's amazing. Well, I just like the story. So, what'd you do before First Choice? You said you were a customer service rep. Was there any sort of eCommerce experience or a shipping or logistics kind of background before then? Or it was just kind of I'm going to learn the business and we're going to do everything in our power to grow through this?
Pearl Ausch: So, I did have a side hustle. Basically me and my husband created this brand. Shout out to Ephraim also in the industry. He does logistics, warehousing, a little bit different than what we do. So basically what we had was our own private label. It wasn't even that term private label in those days but we decided we want to do gift baskets. And we came up with this brand, it was called Benevolent Gift Baskets and we created for Christmas and for Valentine's, Thanksgiving. Our own little thing and we did it really well. We did seven figures, but the problem was that it was very seasonal and we had this crazy overhead throughout the year. And that time there wasn't this availability of you could just outsource things. Everything was just you had to figure it out yourself. So it wasn't like this warehouse facility that we could have just shipped the chocolates and the nuts, candy to and they would just package it let's say once or four times a year. Which we did well then. Because of that reason we had to get our own warehouse. We had to get our own employees and we couldn't just have seasonal employees, we had to keep on a payroll. At one point it was like we just had to sell the brand and we just weren't covering. So, that's where the eCommerce experience came from and understanding the challenges that people have. We also expanded to the UK because we saw the opportunity then and we did well. But again, now the resources that sellers have is so unbelievable. And I know people selling nut platters now and are killing it. I know one that just got crosstalk.
Ryan Cramer: Nut platter industry is crushing it.
Pearl Ausch: Yes. Especially during the holidays and stuff. But that's the background. We're the eCommerce I guess.
Ryan Cramer: That's super cool.
Pearl Ausch: Yeah. But I was working at a car dealer as well.
Ryan Cramer: You're truly hustling. You're truly hustling crosstalk.
Pearl Ausch: I was selling cars Ryan. I was selling cars.
Ryan Cramer: Oh my gosh. Favorite car that you sold? Real quick.
Pearl Ausch: Well, in those days it was a Lexus GX 460. I loved it. I would still love to drive it. The SUV's perfect for the family and it has that trunk that comes down instead of up so it's very accessible. And then the Lincoln MDX, I like very much.
Ryan Cramer: Man, you like tanks.
Pearl Ausch: Not the Lincoln MDX, the Lincoln MKX. I like.
Ryan Cramer: Right. You like big cars.
Pearl Ausch: Yes, I do. You feel safe around the road.
Ryan Cramer: That's why I figure a lot of people who... I think it's really funny, not that this is bad thing. A lot of people like bigger cars because they like to feel safer even though it takes up more than half the road. But it is what it is.
Pearl Ausch: Exactly.
Ryan Cramer: That's amazing. In terms of selling, like you, I was working... I don't know if I told you this. I actually started selling in the home gift garden decor area. So it was garden gnomes, garden flags. Really 10, 000 skews in the arena where there's a lot of different decorative items. It wasn't truly just functionality, it was just decorations. But seasonality, really big for us too. So anytime a holiday would come up or any sort of Valentines, or Christmas, or things like that, that's when our products were selling quite quickly. So I sympathize with the seasonality of it all. It's an up and down rollercoaster but you just kind of have to figure it out and plan. I can't imagine especially perishable items like you were talking about, that's an easy thing to figure out in that regard. So, obviously transitioning to that, is that where you really pull a lot of your expertise from of," Hey, when I sold X, Y, Z, this is really where I did well and we kind of got your foot into the door in that regards." To kind of work with clients in that regard?
Pearl Ausch: Absolutely. So we struggled through everything that people are struggling with today. PPC was a huge deal for us. Having the proper listings. The images, I remember Amazon changed that you could only have a white background. And obviously having gifts just on a white background for us was like," How do you make this thing pop?" You want to have all the holiday stuff in the back and the snow and the tree and we couldn't do that. So, it was all these things people are struggling with but I'm amazed to see how things have transitioned. People say Amazon is so much harder today, which I totally agree because the rules keep changing. Literally while we're speaking they're probably changing. But the help that's out there, right? Listening to a podcast like yourself and having all these experts get on is something that people could really gain from. But just like an example, I remember when we were selling the gift baskets in the UK, something that I could learn from and teach to other people and I like to bring up this example because it's powerful and it's so trivial. We were selling the gift baskets in the UK and they weren't moving. And we didn't understand why until someone is like," Could you check to see actually what the word basket is in the UK?" I know it's a English market, but you do want to make sure you're actually speaking to the audience with the right messaging. And after speaking to an expert they're like," By the way, baskets are hampers in the UK." And that slight fix in our description was all we needed. That's why I'm so pro telling people use somebody like YLT Translations. Don't work with Google Translate and don't even work with... When Amazon says," Oh, we'll just translate it for you." Don't do that. Get a professional because that mistake costed us so much. Because, like what you said, these things were perishable, right? So all these nuts and chocolates, the time they arrived to people we were getting complaints like,"There are some other things in the packages that we're not very excited with." I don't want to even mention what that was but obviously that was a huge issue for us. So, in the end it just didn't work out. It didn't pan out and it's okay. We're okay saying it didn't work. It failed and we learned from our mistakes and guess what? We're in a position right now where we're helping people based on the mistakes that we made and we're able to educate further and build new businesses based on that.
Ryan Cramer: Really quickly to go into that example. Is that something that Amazon did not see as relevant? Or is it the customer that didn't see relevant? The basket versus hamper notion.
Pearl Ausch: Oh, the customer didn't see it as relevant. I'm assuming Amazon too because they're going to recognize whatever the people search by. And the search gift baskets is not something people usually search because they call it hampers there. So in both ways it just wasn't working to our advantage.
Ryan Cramer: Interesting. So probably got surprised you weren't seeing a lot of traffic. And when people did it was not good because it was sitting there for so long probably.
Pearl Ausch: Exactly.
Ryan Cramer: Interesting. Well, I think that's a notion. We've had Yahn on so many times on this show too and I know she's on the Seller Cruise I think right now living it up. But somewhere there and somewhere warm I'm going to say. I don't know exactly where they are at right now, but she brings up so many fascinating points of localization. There's opportunity for growth but you have to really connect with the seller in that regard. It's both on language perspective but on an imagery perspective to what is the expectation? We've talked with a couple sourcing logistics people on this platform, on this podcast, that the expectation of when products are to be delivered to your doorstep. Like in the United States it could be a couple hours, it could be same day, it could be an hour depending on where you're located. Or two days. There's a lot of expectations in what is presented to the customer potentially. And if it doesn't meet those, then all of a sudden by default you become not a relevant topic or relevant buyer or seller in that regards. So, what are the most intriguing changes now that you've been with First Choice for so long, and you're starting to ramp up and you're seeing all these different nuances? I call last year death by a thousand paper cuts. There's all of these little tiny changes. They stung and they're right between your finger. You're like," That's annoying." Can work and move on with it but it's still annoying. What are the ones that really stand out to you and the team there?
Pearl Ausch: So, for us we're really lucky because our services are primarily around air shipping. So, we do small parcel delivery and the whole point is quick turnaround. But even with that, Amazon was extremely backed up especially in Canada. So we've seen from May till September even, a tremendous back up. People weren't able to ship in. Firstly, the restock limits, of course that was a huge deal for a lot of sellers. I've had customers calling me up and they're like," I don't know what to do. Do I have to let go of my people? Do you know more information? Could you answer me?" The desperation was on another level, but we were lucky enough to be able to... Once they got their increases available, we were lucky enough to be able to offer those services that have a quick a turnaround. So, for example, our US to Canada service is two days to most locations except if it's going to Delta which is more north of Canada. But in those cases people were able to turn around their goods really fast. But there were those sellers that weren't for a long period of time able to bring in from overseas. A lot of people are bringing in their product from let's say China, and it was sitting on the water for... I'm not even going to say weeks, months. It's been months and their inventory was tied up and they were like," So, Pearl, I have to make a decision now, which marketplace do I actually fill up first?" And they were like," I don't have an inventory to be able to say we're just going to distribute it to all these marketplaces." Because we have clients that are selling in the US, of course is the biggest market. And they have to decide between the UK, Canada, Singapore, et cetera. So it's been a big deal and honestly we don't really see it changing very soon. But I think what's happening is people are just planning their inventory way more in advance now than they're accustomed to. And things will settle down. You mentioned Q4 being crazy. We've seen January and February, especially now has literally continued with a momentum. It's been unbelievable. It's shocking to see the amount of shipments that are going to these markets. And to me that's a telling sign that hopefully people figured out it is taking long to get their product let's say from overseas. But I think people just figured it out. And they figured out let's do this more in advance even though it's taking longer and getting their product in. So, from our end, definitely data is telling us that people are able to fill up. And I know Amazon also just tripled a lot of people's inventory levels, which is also a factor and why people are able to ship more. But we're definitely seeing record numbers for January and February into these global markets, which obviously we're really excited about.
Ryan Cramer: Yeah, traditionally it's a slow down time for a lot of sellers just because of post Q4 slow down. And whether it be lack of selling or lack of buying from the consumer perspective. But I think it's interesting. I earmark a lot of... Now that Amazon allows you to notify you when there's a stock back in for a certain product, obviously you can earmark it or get notifications for that. For stuff that ran out of inventory in November, I'm all of a sudden now getting a massive upload of," Hey, this is back in stock. This is back in stock." And that three month period of now it's finally here, I think it's certainly catching up. But you bring an interesting point, which I think a lot of people are kind of putting a cold blanket on themselves and they're like," Oh, the inventory will catch back up after Q4." I think certainly what I'm hearing at least is this is going to last through probably, again, majority of this year if not all the way into 2023. Is that your expectation?
Pearl Ausch: Yeah. 100%. Again, I'm associated with a lot of people in the logistics industry and I hear it plenty. So, I could say that there is tremendous backlogs and I don't see it changing till 2023. I hope I'm wrong, but there's been too much of a backlog to say that this is just going to transition quick enough. Because we don't see a difference yet. The only difference we're seeing is that people are being more advanced, but the slow down and delays are just all the same. My brother just launched a brand new business. He's doing these scent machines where these diffusers plug into the wall and you could choose different scents. So, he brought in something from overseas, from China. It took him half a year and his product just came in on Monday. So, we're still seeing all these delays. Nothing changed and again, the only thing that changed is people are being more smarter. And maybe that will help with the supply chain, but for people to have expectations that I'm going to order something and my product will be here... Traditionally it took eight weeks, less. It's not going to happen. It's not going to happen.
Ryan Cramer: I was going to say when you talk smarter, I just kind of want to break down a little bit more. Obviously, a lot of people think they have it figured out. Or cyclical, there's a scheduling nature of it used to be on... The phrasing I'm going to butcher. But I think it's just in time shipping of if I'm about ready to get inventory, it's going to be here in less than a month and I can plan for that. Kind of forecast it out with math and my velocity and everything like that. When you say smarter I just want to break that down a little bit more. Is that more investment into larger quantities? Or what does it look like to be smarter in this regards?
Pearl Ausch: Yes. Larger quantities and months in advance. Not by order. I've run out of stock, place order, it's going to be here in four to six weeks depending which port you're shipping it to. People are ordering literally half a year in advance now.
Ryan Cramer: That sounds like almost a disadvantage to new sellers because I honestly don't know how much you're going to need to forecast for. Maybe more for seasoned veterans or somebody who has more equity or can have more capital to invest in a larger order. That sounds like a disadvantage for new and beginning sellers. Is that crosstalk.
Pearl Ausch: 100% agree. 100% agree. And when there are these trends, trends run out really quickly. There's this TikTok that comes out, goes viral and everybody's like... Silly example, the fidget spinners, right?
Ryan Cramer: Right.
Pearl Ausch: So many people when they got in and then there wasn't even the supply chain issue. But when they got the fidget spinners in it was like," Oh, it's out already. Nobody's buying that anymore, you're too late." So, these type of things it's almost impossible to keep up with the hype. Remember when... What's that show? The Squid Game came out, right? Everybody's like," I can't buy any squid game costumes online. How is that even possible?"
Ryan Cramer: Yeah. I see people turned it on and they were crosstalk.
Pearl Ausch: Yeah. That's your example, of literally there's a fad right now, it's going to be out in no time and nobody was able to figure it out. Couldn't happen.
Ryan Cramer: I was going to say I assume the winners are in the customized approach of print on demand. More of those customization shops that you can have inventory on hand, but then either screen print t- shirts or anything like that. Have you guys seen an uptick in those kind of industries because of that?
Pearl Ausch: I've seen just an uptick in general where people are like," We need a source here in the US."
Ryan Cramer: Okay. So you're talking about just entirely different crosstalk.
Pearl Ausch: Entirely different mindset. And for a lot it's impossible because of cost. And also a lot of the machinery that is available overseas is not available here just because manufacturing... I don't remember the year, but it completely moved overseas. It wasn't even an interest here and now there's sort of this idea of let's figure it out over here. But they can't figure it out because they don't have the right people, the right engineers, or the right machinery for it. I just heard that Mercedes put their G- wagons on hold for three years now. You cannot even pre- order it because it's been so backlogged. Just to give you an understanding of what's backlogged is literally the chip, the computer.
Ryan Cramer: Right. The computer chip or the processor.
Pearl Ausch: It's unbelievable. It's unbelievable but that's what's happening. So, I agree with you that it's a disadvantage but that's what's going to happen. A lot of these aggregators are the ones that are owning quite a few brands and have the cashflow to be able to order in advance and also to be able to predict what's going to be. Because it is very difficult to predict what are people going to be interested in? And let's say toys for next year, right? But that's what people have to do now in order for them to be ready.
Ryan Cramer: So, what does that look like where are customers starting to turn towards... You mentioned everyone can't go into the United States or they can't go to Mexico or Canada. And if you're located here in this marketplace, is there industries that certainly can happen? Or what are the ones that are most prominent that are almost completely abandoning overseas shipping? It can be from anywhere and they're really primed to kind of take on closer shipping even though it might be a little bit more expensive. But the cost to sit on water, the cost of shipping containers are probably 10 times, 14 times what they were two years ago. What are those ones that are primed to really bring over their more North American centralized warehouses and production? Who are those industries that you think?
Pearl Ausch: So, the only company that comes to mind... I'm sure there's many more. I know of a very large furniture manufacturer that moved completely their operations from China to the States. It was between closing shop and moving their operation. We're talking about a very large manufacturer. One of the biggest in the States but they moved completely. They bought a brand new facility, obviously tremendous facility and they had to hire a lot of people. But that's great for the economy and they made it work. Now, what I did see at shift in is a lot of people shipping by air depending obviously on the product. So, right before the winter, fall season now, we had a lot of people shipping by air from China their clothing. These brands that we're typically bringing in by sea were like," There is no way I'm going to make my season if I don't actually bring this in by air." And obviously with clothing, it's a lot more compact and there is very nice margins when it comes to clothing so they're able to do it. Now, for others to be able to say they could do the same, it's pretty difficult for them to be able to do the same. But that's the shift that we've seen with a lot of people where they were like," We don't have a choice. There might be just some product that we'll have at a lower margin. Ship it in by air so we have it in stock. We don't lose our BSR." And all that stuff. So people are doing that. That's the shift we've seen. To say confidently that you could start manufacturing in the US, I won't be the one that could say that.
Ryan Cramer: Just depends.
Pearl Ausch: It really depends.
Ryan Cramer: Really depends on the industry, the product, whatever the hell. Its like we're even getting your products and having them assembled here. Something along those lines where it's going to depend on product to product I'm assuming. I've always thought air shipping, the logistics of it, how much different is that from freight by water? Walk me through because I haven't made a purchase order yet from China personally. When I'm looking at costs comparisons and I'm looking at one versus the other, what are the drastic differences in terms of either price, or timeline, or just the multiple steps you might have to add on additional from freight or water or by air?
Pearl Ausch: Right. So, great question. So it's typically 40% more but really depends on the dimensions. If somebody's shipping a pillow or a mattress, that would be totally insane to ship it by air unless you're this millionaire that needs the mattress tomorrow. But it's something that would have to make sense. But like you mentioned, let's say something like cards, stationary, things like that would make total sense to ship by air. You obviously are going to be able to ship few hundred in a box so something like that would be really cheap. And the process is so much easier than shipping by sea. Way easier. So, you have the same person with our service. You have the same person picking it up, same person delivering it. And all it is a simple labels and the commercial invoice, which is the customs document attached to the boxes. And of course, obviously time transit is super fast so it's two to four days from China. Right now most couriers even lifted their limit that they had. A lot of them had a capacity limit where they said you could only have a certain amount of packages picked up a day from China, because they couldn't keep up. Because here became unfortunately the biggest in- demand service because people were very desperate. So, just to give you an understanding of who I'm talking about for couriers, I mean, DHL, UPS and FedEx. So, we work with these couriers. The reason why they're okay with that, because they don't like the term resellers. Some people might think we are resellers but it's not the case. The point of why we're able to be a partner of theirs is because we're able to help you with every single detail in order to make the shipment successful. So, let's say making sure with the compliance you're able to ship the product that's not hazmat. If it does need special labeling to guide you on that and the couriers don't want to get involved with that. They're too busy for that. So our solution is really just to make sure that from beginning to end until you're actually shipping, you're doing it the right way.
Ryan Cramer: Yeah. I mean, that makes a lot of sense too, because I mean, same way in the payment processing world. Something that Amazon does on a day to day basis, they can't make that process in the conversion. But when it comes to prices and anything like that they don't want to have to deal with it consistently, which is why they charge more. It's just an easy notion to kind of wonder one doesn't always equal two if you're adding them together. Their business is logistics and getting it from point A to point B. Yours is to make sure all the boxes are checked. So it's just helping them become more efficient and they reward that through I'm assuming rates and things like that. It's also fascinating to think that... Water and freight, you can only send it to so many different ports because of either size of container or anything like that. Air freight has to be almost this wide open field of it doesn't matter. Am I wrong in that?
Pearl Ausch: No. You're 100% right.
Ryan Cramer: Or you have to have certain destinations crosstalk.
Pearl Ausch: 100% right and that's the exact reason why it's so much simpler to ship by air. By sea basically it gets to the port. Firstly, you have to get a truck to get it to the port. And then once it arrives to the port where your destination's at, you have to have another trucker pick it up and figure out how to get it to where you want to get it to. Versus let's say DHL, FedEx, UPS, it's the same person picking it up, the same courier picking it up. Imagine it was the same person. But picking it up and the final delivery which makes it obviously simpler and easier. But for the seller there's way less steps involved. Also, when you're using a forwarder you want to make sure you're using someone that's giving you the all in solution for the sea freight. Again, we don't do sea freight, but that's the reason why it's so important for someone to have a good forwarder because of all those steps involved. It's very complicated. And I do want to mention one more thing that with using our services, people will get between 60% to 80% off the retail rates from the couriers, versus going directly to them because of the volume. We do the same ideas like what Amazon offers. Really cheap rates with the couriers when you're buying through Seller Central. And then for international selling would be the same concept.
Ryan Cramer: Right. You guys are more obviously in that trucking and that kind of courier ecosystem too.
Pearl Ausch: Right.
Ryan Cramer: So, with that, what are those markets that people are kind of missing in that capacity? Is it something that's all inclusive that's point A to point Z if you will of the in consumer or to an FBA warehouse? Or what are those missing components that you guys are trying to innovate and to kind of help people move along in a more innovative way? In a more cost effective way?
Pearl Ausch: Yeah. So, basically when it comes to global selling, international selling, the whole idea of it is sort of scary to people. I just traveled to Cancun several weeks ago. Vacation, totally forgot about it. Just by the way. You come back from vacation you need another vacation. But getting there, you're waiting online, you got to fill out the paperwork. It's scary. There's the dogs around smelling if everything you have is kosher and you're a good person. That's sort of the idea people have when it comes to global selling. They're like,"I want to sell in the UK or I want to sell in Canada." And these markets are huge. We have sellers that are doing... Right now in Canada, just to give you an example, before COVID people were doing 10% of sales of what they were doing in the US. We have sellers doing 30% which is an astronomical number based on the population that they have in Canada. It's a very big piece of land but not that many people. And for the UK, people are doing about 25% or more. 25% usually is the minimum people see. So when it comes to selling in these places, people really want to but they don't know how to because of all the red tapes. So they're afraid of compliance, they're afraid of the customs clearance, the brokerage, the tax registrations, things like that. Where do I begin? What we designed was a service that you come to us and we guide you with all this. Sort of like a consultant, right? A global expansion consultant. Where would you like to expand to? Is it the UK? Sure, send me a link to your product, let me take a look. Is it something that's ingestible? Something that touches the body? Most probably we'll have to see if you need special licensing or special labeling. Is it an electronic device? Is the adapter able to plug into the wall? Maybe you have to add another adapter because this is something inaudible. Things like that and we guide sellers properly. Or even clothing, the guide on how to wash your clothing has to be in different languages. So, simple ways of doing it like you could just have your manufacturer add another label with that language. Doesn't need to be like," We're going to make a new run right now, we design a new product." Use the existing items that you have but find somebody that could actually guide you. This is the reason why people feel comfortable. So, we come in, we look at the item, we tell them exactly what needs to happen. Let's talk about Canada for a minute. Canada is so simple. We register for them in- house with something called the Canadian business number. And once they have a Canadian business number we get them a brokerage account as well, which is for customs clearance so we can make sure all the taxes and everything gets billed to them. Because when you're shipping into Amazon... The reason why Amazon doesn't provide shipping is because they don't want to pay your taxes. They don't want to act as your importer of record. They don't want to deal with anything. You just deliver it and it's fine. We make sure that we're setting you up with that so when it does get actually delivered there's no taxes. They know they're not liable for the security of the shipment, which is the importer of record. And it gets delivered and then the fund begins because you're able to actually see results and it's not painful. I just had Scott from SmartScout, he had me on his podcast. Why? Because he had a shipment that was actually stuck in customs. He tried doing this himself and he tried shipping into Canada and he's like," What am I doing? What am I doing? The shipment is stuck, I don't know who to talk to." And there isn't anybody to talk to because any rep you're going to call at UPS is going to give you a different answer. Versus we could take a look at the shipment and say,"Based on our experience and based on customers that have had this issue, this and this needs to happen." And we got it resolved for him. And guess what? If he would've shipped it with us it would've been even cheaper. Like I said, because of our volume we could get him way cheaper rates. So it's really a no brainer. Somebody wants to expand, you've come to this one place, they take care of you from A through Z. And we have our software that basically get you to create these shipments very easily instead of going through the couriers websites and that's a pain in the neck. Let me tell you, I tried it myself and I like to consider myself a little tech savvy and I couldn't figure it out. I just couldn't figure it out. That's basically what needs to happen when somebody needs to expand. And then the same for the UK, that registration compliance. I'll make it sound very easy because that's the whole reason of why we're in business. Is really to make it easy and people focus on the selling.
Ryan Cramer: Well, you guys are taking the lift off of the seller if you will, of trying to figure out and walking through the process. You're the guy and they're the ones who are taking the pictures along the way. And you're just the ones cutting down the forest if you will, and paving the path. Very bad analogy, we're eco friendly.
Pearl Ausch: It's good. And you know we're going through a rebrand, right?
Ryan Cramer: Right.
Pearl Ausch: I'm not going to name the name now. I'm not going to name it, but I crosstalk think you get the name. I think you get the name now. Once you describe and you really know what we do, that's the point of it. Is just being able to make this thing as simple and as easy and as calming for the seller. That somebody's really holding your hand.
Ryan Cramer: Maybe what's the thing that you wish you guys were better at? Is that a fair question to ask?
Pearl Ausch: Yeah. It's a great question.
Ryan Cramer: What's the thing where you guys feel like you're struggling, but that's the thing that can put you over the top?
Pearl Ausch: So what we're struggling right now is with our technology. We tried offering sea services about a year ago, but our technology only enabled our small parcel delivery and our trucking services. The struggle became when this whole thing had to be such a manual process. It was like," We're not doing this any more." Way too many following up, way too many tickets, way too much back and forth. What we try to be really focused on is equally SaaS and service. And when we realized this is not happening we just suspended that service. I had a call with Amazon, was it Monday or last week Thursday? And they're like,"So, when are you doing sea again?" And I'm like," We're not doing sea until our technology is able to do that." We launched a brand new software two weeks ago and we're going to implement the sea factor. But it's going to take some time but that was a struggle. For us to say that there isn't a technology for it was enough to say we're not going to offer it, and I think that's so important for anybody. If you don't have the right automation for it and there's so much back and forth on labor involved, you're just going to get annoyed customer that way. It's not even worth it. So we're trying to take the industry that's so old fashioned and make it more technology advanced. And we'll get there.
Ryan Cramer: So, will this technology empower a seller to do this all themselves?
Pearl Ausch: Yes. Exactly. All themselves and really just automate the process from when they're out of stock, to placing an order, to then replenishing with getting the shipment out directly from our software. So we're going to bring the whole ecosystem in there.
Ryan Cramer: But you still will have that implementation of that international expansion? You're still going to have that step by step service aspect as a component?
Pearl Ausch: Yes. And we're going to bring in that process as well. Instead of it being a manual paperwork back and forth we're implementing a new feature, probably Q3, where you're going to be able to register directly from the portal as well. You'll be able to pick up the phone anytime and we encourage that. If I could say myself probably the best service in the shipping industry, in the logistics industry. It's very important to me being that I started there and I know what it feels like to be really cared for. So that's something we will never ever shy away from or discourage. But at the same time people love doing things themselves and they hate the back and forth. Could you give me an update? Or even if I send you an update, why can't I just look that up myself? We're living in this world where everything needs to be so quick. I had someone the other day that showed me a Coca- Cola ad, what was 20 years ago, versus what a Coca- Cola ad is like today. I had such a good laugh. The Coca- Cola ad from 20 years ago was like I'm looking at something and then 20 seconds later I'm looking at something else. Versus today's ad it's boom, boom, boom, boom. That's how we are today. We're just a different world. I see how my kids are, they're quicker than me and I think I'm quick. People think I don't have... I can't even sit straight for a second and my kids are quicker than me. We're in a different world where people want to have this feeling of I could do things myself. And we're going to definitely get there and our plan is in the next year to have all this implemented. But the technology's out. It's in beta and we're going to be launching in April for the public and I'm really excited for everybody to see it.
Ryan Cramer: That's amazing. Well, and to kind of piggy back off of that in terms of today's society, where you probably have clients all over the world. You're located on the East Coast of the United States. If it's happening when you're asleep, again, people have to sleep too. It's not like a 4: 00 AM call they can pick up and talked with you. You need to have something that helps you enable them to make those decisions without waiting for six hours before you walk in, drink your coffee and you're like," Now I have to email them back." And everything like that. Time is money and as you know in the industry, if it's something that they can be empowered right then and there and make those decisions quickly, then that's an empowering feeling as an entrepreneur too. So that makes a lot of sense in that capacity.
Pearl Ausch: Yes. Empowering, I love that. That's a good word.
Ryan Cramer: Take it from me.
Pearl Ausch: That's good.
Ryan Cramer: That's what I'm saying. Empowering sellers internationally. There you go.
Pearl Ausch: Love it. Thank you, Ryan. We might use it.
Ryan Cramer: Put it on my notes. Put it on my notes crosstalk send back to you. Exactly.
Pearl Ausch: Love it.
Ryan Cramer: Well, Pearl, I know we talked about software. We're looking at 2022, what other things are you guys tackling this year that are obviously the biggest pain points, the headaches, the migraines of our community that you guys really want to take on?
Pearl Ausch: So we want to expand out of Amazon. That's the biggest goal we have right now.
Ryan Cramer: Is that marketplace or is that D2C?
Pearl Ausch: Marketplaces that do D2C. Exactly. So that's our target for this year. So right now it's business FBA. This probably is the biggest request we've ever gotten. Even more than sea, there other people that do sea. But this solution where people could come in, bring their orders into our software, plug it out with the best options out there for direct- to- consumer globally. That's something that people really need. Especially, we get it from Amazon a lot. It's like," When are you going to do it? When is it happening?" So we're going to hopefully launch that, also I would say Q3. That will be a huge game changer because it's not just going to be something that people can use for Amazon. We want to expand into Walmart, Shopify, eBay, and be that solution where people could log in and be able to ship to any marketplace directly to the consumer. And the beauty for that is that people could actually test out a new market instead of registering for that and getting all incorporated to be able to ship to FBA. Because those are the requirements to ship FBA, they could test the market out first and see these are my top five products. Now let me ship it into FBA because there is clearly an 80% conversion from when people do merchant fulfilled to FBA. We see that clearly when it comes to global selling. For example, there's the NAF program. Are you familiar with the NAF program?
Ryan Cramer: The North American Remote Fulfillment program.
Pearl Ausch: Right, exactly. So, basically that's the Canadian program for people listening, that Amazon will take inventory you have in the US and then fulfill it to sellers or buyers rather in Canada. And you don't have to do anything.
Ryan Cramer: Great. Taking it from Amazon warehouses in the United States and then shipping it via Prime up to Canada or into Mexico.
Pearl Ausch: Right. Exactly. Now, it's a great feature that they have or a great service they have but the problem is, firstly, it's very expensive. It's really expensive. The fulfillment fees are really high. But the whole reason they designed it was for people to then convert to FBA.
Ryan Cramer: Great.
Pearl Ausch: And they want you to just get excited, get your feet wet. So that's really where the direct- to- consumer option that we're going to have. Of course there's going to be sellers that that's just going to be good enough for them and that's fantastic. But for a lot of sellers it's going to be just this awakening where this market overseas is a killer. Like UK, Canada, Singapore, the UAE is pretty hot. Now Australia's also really hot. People will start realizing there are other options. Australia is great for people that sell seasonal items. Their summer is when it's our winter and vice versa. So there are people that miss their season, they didn't sell out. Unfortunately their goods got held up on the water. If they have an option of shipping it to Australia, it's unbelievably amazing for them because the styles might be out next year. So instead of having that inventory and cash flow held up, they could try that out. So, we hope to launch that on time and hopefully I'll be able to make that announcement with you in Q3. Who knows?
Ryan Cramer: You never know. Well, that's amazing. I guess in the other realms, Pearl, what are the things that people are curious and this is the year that they're looking for expansion? I firmly believe and have heard it from my end that a lot of people's plans from 2019 going into 2020 where that global expansion focused, but they had to kind of reel back in a couple different things of go omnichannel, go more focused. And inventory was last year the big focus. I think a lot of 2022 looks like, how do we broaden our horizons? Whether it be marketplace approach or internationally approach. If they're looking for those kinds of solutions, what's the best way to approach you or connect with you in that regard?
Pearl Ausch: Yeah. So, there's sort of a mad rush now for global expansion. And maybe that's the reason why there was such a huge increase in the number of shipments we've seen now, January, February compared to let's say last year. But what we've realized is that people realized that let's say their inventory limits were capped in the US. But they were able to then tap into other markets that tell them you know what, you could send 1500 units to the UK. You could send 1500 units to Canada and spread that out. And I think the best way for people to expand is for people know you don't need to come up with a new product. You don't need to add a new skew, you don't need to invest. It is so simple for you to just ship product to a new market because the cultures are so similar. There're English markets, the ones that I mentioned. And then there are those markets like Japan that have this absolute obsession with organization stuff, kitchen stuff. They're very into that and there's so much untapped potential in these markets for you to simply just send inventory. Don't do anything else. You don't have to come up with any brilliant new idea. There's this thing like I'm selling my business now and then it'll let me come up with this brand new concept. That's great. But you could make your existing business even more powerful and get your value up. And for these aggregators to take a look and say," Wow, they have a global presence?" That will add on a lot of dollars for you.
Ryan Cramer: I agree. I think there's a lot of major opportunity. And like you said, it's how you do the math and how you stack it up. A lot of people have to have that one-on- one. I had this conversation, I feel like last week with another logistics company of when you talk about expansion and where you make the numbers work. There might not be buying power. You said United States is the number one marketplace. But when stack on Japan or UK on top of Germany, on top of Australia, on top of these, these numbers start to quickly become very favorable into your pocketbook and opportunity to grow. So they all add on top of each other too and maybe even equal if not surpass a market like the United States in dot com obviously. But a lot of different people are starting to see the math works out in our favor of there's a 10% lift, or there's a 5% lift, or a 20%. You said 30% lift for even some in Canada. That really just depends on the product but you don't have to do one- to- one right away. You can crosstalk.
Pearl Ausch: That's sales. That's sales. Now lets talk about profit for a minute. They're way more profitable in these global markets because first, less competition. And people are willing to pay way more for an American product. Or even if it's not an American product, but something that's not readily available within that country so they're paying way more. And people are shocked at their numbers. We have sellers doing better globally than they're doing in the US, because they're putting up with a lot of other situations where they're not able to be profitable. So, that 30% could mean more profit than what they're doing in the US.
Ryan Cramer: You just got to dip your toes and find out. You got to do the testing.
Pearl Ausch: That's it.
Ryan Cramer: Exactly.
Pearl Ausch: That's it.
Ryan Cramer: Well, Pearl, if people have questions or if they want to get in touch with you, obviously what's that best way to do that? Is that through your website? Is that connect with you individually? What's that way to do that?
Pearl Ausch: So, they could email me PA, P for Peter A for apple, at first choice ship, S- H- I- P, dot com. Or they could just check out our website, firstchoiceshipping.com, but they should definitely feel free to reach out to me. They could reach out to me on LinkedIn. They could reach out to me on Facebook or my email, and I'll make sure that they get the right help. But let's make global expansion happen people. It's real. It's real.
Ryan Cramer: I love to hear that this year. I think that's on our podium as well. Global expansion is the year for 2022 for a lot of brands and let's be a part of it. So, that being said, we also had Nia actually pop in and say hi. Great to hear from both of you. So, again, thanks for everyone who's-
Pearl Ausch: Hey Nia.
Ryan Cramer: ...watching on Facebook, LinkedIn, YouTube and Twitter. Thanks so much Pearl. I say friend in real life. Friend of the show now because it's taken this long to get you crosstalk.
Pearl Ausch: Oh yes. And I'm looking forward to prosper to meet you in person. And I'm going to do a session as well. I'm going to be moderating a panel on global expansion so I would love for whoever wants to join and learn more.
Ryan Cramer: That's amazing. I know Kevin Sanderson's also doing something of the global expansion too.
Pearl Ausch: Right.
Ryan Cramer: Man, the global expansion is really prominent here and crosstalk this year. That's amazing. Well, thank you so much for hopping on today. I know we'll be in touch here shortly but thanks so much for hopping on today. Now a friend of the show, Pearl Ausch, of First Choice Shipping.
Pearl Ausch: Thank you, Ryan.
Ryan Cramer: No problem. And thank you everyone for watching on Facebook, LinkedIn, YouTube, or Twitter. I didn't even mention that if you're watching us live you can ask your questions. But we had so many people probably taking so many notes. No problem whatsoever. But if you're listening to us on your favorite podcast destination, go ahead and just rate the episode, rate the show. Let us know what you think. Obviously you can get in touch with us on social media. Just follow us for future episodes when we do go live so you don't miss great guests like Pearl. Thank you so much for everyone who hopped in today. There are questions, just so much things going on for 2022. I think, again, international expansion, a lot of people are just talking about it. Both customers of PingPong but also just in the seller community. What does it look like to build that brand to the next level? Adding incremental value to your brand? How do you get expansion? How do you readily get into those markets quickly, efficiently, without any sort of hurdles? This is the podcast and episodes, quite frankly that tell you how to do it. So those are our service providers you should check out. Again, Pearl, go to pa @ firstchoiceship. com for her email. Or you can just go to First Choice Shipping. Just Google it, find the website, but we've also linked it out in the episode show notes below. I'm Ryan Cramer. This is Crossover Commerce, we'll catch you guys next time. Let me go and cue that up on another episode of Crossover Commerce. Take care.
Ryan Cramer of Crossover Commerce talks with Pearl Ausch of First Choice Shipping, discussing how you can solve for logistic headaches in 2022.
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