Profit Maximization: RePricing, ReStocking & Reimbursements ⎜ Eva ⎜ EP 93
Ryan Kramer: What's up, everyone. welcome to my corner of the internet. I'm your host, Ryan Kramer, and this is Crossover Commerce presented by PingPong Payments, the leading global payments provider helping sellers keep more of their hard- earned money. Hey, what's up, everyone. Ryan Kramer with Crossover Commerce here. Welcome to episode 93 of this beautiful show that is presented by PingPong Payments. Shout out to our title sponsor there. Today's episode is titled Profit Maximization: Repricing, Restocking, and Reimbursements. All with the beginning prefix re-, but we're going to talk about getting back what is rightfully yours. And I'm really excited about this episode today. So, thanks again for watching us on Facebook, YouTube, LinkedIn, and Twitter. And if you're not going to be watching us live, please go ahead and download our podcast on audio format, and that's going to be on Amazon Music, Spotify, Apple, Google Podcasts. Truly anywhere where there might be a podcast, I'm going to be there for you so make sure that you search on your favorite platform, search Crossover Commerce, and make sure that you download and get notified of future episodes. That being said, if you are watching this live, this is an interactive show. If you have questions about any of the topics we're covering, want to give us a shout out, tell us where you're listening from, go ahead and do so in the comments section. You can do that on LinkedIn. You can do that on Facebook, YouTube, wherever. We're going to see those, and we want to make sure that we answer those questions live if they're applying to this topic, or if you just want to give us a shout out. So, go ahead and do so there as well. But if you're watching this later on in the day or next week, next month, whenever this show you might run across, you can go ahead and just put your comments in the section below and we'll make sure we also view those. And if they apply to our guests, we'll answer those for their own as well. But again, just a friendly reminder, I go live about four to five times per week, so make sure you either follow PingPong Payments on social media and get notified of all future episodes, clicking that notification bell on the bottom right- hand corner, or you follow me on Instagram, Facebook, LinkedIn, however you do social media, go ahead and follow me as well. I'm Ryan Kramer on most platforms. So, go and check us out there. But about our guest today, it's not just about me, it's about the beautiful guest that I have coming on my show with various expertises in subject matters that they have been involved in. Our guest today, he is the CEO and co- founder of Eva. guru. Formerly he was management consultants in central Europe, data intelligence director at IBM, and group vice president of Oracle Emerging Markets. In his 20 years of being a corporate... He calls it a corporate career. He was a seven figure Amazon seller for a decade and entrepreneur advised to successful startups in Silicon Valley. He created Eva, together with Barry, to help sellers, his co- founder Barry, to help sellers to maximize profits on Amazon. Eva is actually an AI platform to help with pricing management, reimbursements, and restockings, and that's what we're going to be talking about today. So, welcome to Crossover Commerce, Hai Mag, of Eva. Hi, how are you doing today?
Hai Mag: Hey, I'm really... Thanks for having me, Ryan. And I'm very excited to be a guest on your show.
Ryan Kramer: Absolutely. Well, thanks for coming on. Yeah, for everyone who is listening to us and... That's quite the background in terms of corporate business. That's fascinating to me, but we're talking a lot about what we're doing currently. So, to set the table, if you will, I love setting the table with my guests to know their beautiful story in the background, what's that that journey been like for you as a professional, either entrepreneur or just working in the professional field for really big time companies that we just touted?
Hai Mag: Yeah, that's right. And there are a couple of things all these companies helped me to achieve. I mean, one of the things is like pretty much I've been to everywhere in the world, from Asia to Africa, Europe, America, and Latin America, and that was really great for me because I really believe you learn by understanding different cultures, different people. I mean, I ended up in California in Silicon Valley, but still, I mean, I really, really thank to all these companies, Accenture, IBM, Oracle 20 years. It was a great journey for me. And it was a good career progression, as well, because I started as a management consultant working like 12, 15 hours a day in Germany with German banks, and from there, IBM is like one of the historical, iconic companies, it helped me a lot to understand how very large systems work, how the enterprise works. And then when I moved to Oracle, and that was through an acquisition, it was 10 years of understanding how people, how the very large companies procure what they need, how can you provide value to them, and that was all great. But at the end of the 20 years, when I look at myself and the things that I do, inaudible with all this enterprise world, I'm delivering great value, but I'm not touching the hearts. That was kind of like my feeling. So, I said one day... I mean, because I had the site business with Barry and Barry was running already our business for... like a seven figure Amazon seller business, and I told him like," Why don't we do something else? Why don't we touch the small and medium businesses?" And I know that everybody, most of the people that I meet, like providing some software services, they all want to go big. I mean, go big. And then I'm like go small. Touch the hearts of the small, medium businesses. There're all these families all around the US. Europe, they created these Amazon businesses and they want to grow, they want to provide for their families. I mean, I wanted to help them. And Barry had the same idea. We both have the computer engineering background. I mean, I'm an artificial intelligence guy for 25 years now. I wrote my first program, and that was like in'95, where the art of AI was not working because the processing power was not enough. crosstalk.
Ryan Kramer: Right. Computers were still really big back then. They're still the sizes of rooms. No, I'm just kidding. Yeah. But what you were talking about, that my dad actually, personally, he worked for Texas Instruments when I grew up, so not only are they computers... or they were not only calculators, but they were on the defense side. So, there was that scalability of technology, emerging markets back in the'90s when there's a big tech boom of what the internet is, like email, all this other fun stuff that we just take for granted nowadays. But the emerging markets, like you said, you were working with AI back before AI was cool.
Hai Mag: Yeah. And I mean, I very much remember when I was in the university, I was working with all this Java and Sun Microsystems, which actually created Java. I mean, pretty much everything we use today that has a background of Java. And at some point, like 15 years later, when Oracle acquired Sun Microsystems, I was running Sun almost like 50% of the world, and I mean, that was really beautiful. That was really great. And it is time now, I mean, for the last two years, we get all the experience, the enterprise experience, technology development experience, combined with the Amazon expertise of Barry and myself, and we created Eva. And we had this one single idea, like it's great to be in e- commerce, it's great to start an Amazon business, but I remember our first six months, Barry was telling me," Yeah, I'm selling great. Everything is great." And I said," Okay, so how much money you make?"" I don't know. We don't make money. We sell. We don't make money." And that continued for a year or so, and when we look at the reason... Because Amazon is showing you all these great numbers, you make great revenue, let's do advertising, let's do this, let's do that, but the thing is, at the end, when you look at your bank account, there is no money. You still work, you sell, but you don't generate much. Then we said," What can we do to create profits? Let's just focus on everything that is important for a seller that can create profits," and that's the foundation of Eva.
Ryan Kramer: That's absolutely something that not a lot of people talk about, whether it's like how long it takes to actually they can be successful, but success comes in various ways. inaudible Amazon telling you you're successful by the amount of velocity of goods you're selling, but you're looking at a different perspective of," I'm going to look at my bank account and make sure that I actually, from when I started versus where I'm at currently, I have grown and scaled and it's worthwhile to..." You're seeing results. In the perspective of different people, you're looking at it from a profit standpoint instead of just a revenue standpoint. Does that make sense? Or is that very similar to what you're talking about?
Hai Mag: Absolutely. And you cannot really monitor what you cannot measure, so that's also our starting point. I understand, like there was always this time of first six months you want to test the things, you don't know what to procure, which product to sell, but that's the six months. After that, every month you should set up like a growth target and grow, and you need to monitor your profits rather than just the revenue. That's the key for having a sustainable success.
Ryan Kramer: So, you're selling online, you're working with Barry, you have corporate experience, you're with... Not just corporate experience, you're talking about the top 10 businesses in the world, even still, that you're managing and you're operating. So, you see it from a corporate perspective, you see it from a seller perspective. You took the two, mash them up together. You took technology, what small and medium sized businesses need and how to make everyone, basically everyone, profitable in those regards. Is that fair to say?
Hai Mag: Absolutely. That's crosstalk.
Ryan Kramer: Yeah. That's why Eva was born.
Hai Mag: That's how Eva was born. And we started with the idea of like, how can we show the Amazon sellers, first of all, the importance of the profit, to make sure that they take care of all your expenses, nothing is hidden. And once we were able to show that to the Amazon sellers, the next step for us was," Okay, how can you sell your products with the maximum profit?" And profit means a combination of profitability and sales velocity. And that's how we ended up focusing on the dynamic pricing and we created the dynamic pricing, or repricing engine, for the Amazon sellers.
Ryan Kramer: Okay. So, that being said, going into what our topic is about today. Repricing, restocking, and reimbursements, all things that tie back to some sort of profit or some sort of monetary gain. Why those three areas that you guys are focused on? What about those three areas stood out to you? Is it the easiest way to maximize, there's no competition? It's a processes that you figured out personally as sellers? What was the reasons going into those three main areas?
Hai Mag: Well, I think we pick up the most difficult topics, to be honest with you. If I go back, maybe the sorting will be different because pricing on Amazon is a difficult topic. Now, the other thing that we wanted to do was to make it really simple, to really make it simple, easy to use, and beautifully designed. These are very important for us. I mean, I like to use an Apple watch or a beautifully designed software. That's my kind of enterprise background. And what I see on the Amazon world is like, all the software look like each other, they are not easy to use, and Amazon sellers are already spending a lot of time to figure out, especially in a system like pricing, what is the way to do it? How to create some rules, I mean, pick up some algorithms. And then some of these software companies claim that they have some automation. So, we thought," Okay, so what can we do?" Number one target, or aim, is we need to maximize the profit. Number two, create a beautifully designed, easy to use system. And we ended up with first starting with the pricing problem, because if we are able to maximize the sales price, I mean, that will definitely help both resellers and private labels. And that was our starting point.
Ryan Kramer: Very cool. So, obviously, those are great starting points. We actually had a quick question, if that's okay with you, about Eva from LinkedIn. Again, if you have a question about any of these software tools and whatnot, or just about the toughest in general, make sure you put in the comment section, whether you're listening to us or watching us live right now. How is Eva pricing different from an omnipresent tool? Because we talk about automated... And thanks for the question, Santush. When we're talking about automated pricing, it's obviously there's tools out there in the space, but you guys look at it from a perspective of a couple of different factors. Right? You're factoring in inventory levels, you're factoring in... What were all the things that you're factoring in terms of pricing, repricing, and then also pricing for your tool in general?
Hai Mag: That's a great question. First of all, every Amazon seller's store is unique, not only because they sell products that are unique, but their ratings, the history, the inventory, the context of competition, everything is unique. That's why we absolutely do not believe the automated pricing or using some templates that works for somebody or some guru that will work for you. And the main thing about Eva is like, Eva, first learns your data, I mean, reads through all the things as you mentioned, like the inventory, past sales, seasonality, and everything, and not only this, then starts analyzing the context you're in, like what's the categories that you sell. It's not the same if you are selling a health and beauty product versus grocery item. And who are the main competitors? How do they act in some certain situations? Now, this is a learning process. Now, when people talk about AI, which unfortunately is used a lot in the world of Amazon software, now everybody's AI, I would ask a very simple question. Where is the learning element? Because for the last 25 years, that as I know about AI, it's about a learning machine, a learning engine. So, that's what Eva does. That's the main differentiator. Eva continuously learns and updates the next best action. So, maybe today it's about raising the prices. Tomorrow, it's about maybe sharing the pie, and the next day, maybe the best is just to drop the price and get some more of the market share. So, the strategies change depending on what you want and also how the context changes. And there is a continuous learning. I am pretty sure there is absolutely no one looking at this AI thing from the learning perspective, which is the foundation and the only thing about AI, it's the learning. What I see is like automation or creating some templates served as artificial intelligence, and then crosstalk.
Ryan Kramer: Yeah. Oh, go ahead. Sorry.
Hai Mag: Oh, sorry. As I said, the next thing is the beautifully design product. We don't want the Amazon sellers to be computer engineers or some technology nerds, or they just crunch the data. It's not that. They should just use it as an iPhone. It cannot be more complex than iPhone. And we were really fed up with Barry when we were using all these tools, they look alike, I mean these white backgrounds, a lot of information, full of information. I mean, I think as Amazon sellers, we are already fed up with using Excel sheets, but it doesn't mean that we use software which looks like Excel sheets. And that's what we did. Right? Combine that cutting edge AI with beautifully designed product. crosstalk.
Ryan Kramer: Right. And I think that's a really cool way to look at repricing or restructuring a way to stand out from the market. Because as a seller, you're looking at three different things. Right? In terms of repricing. You're looking at a race to the bottom. Like all of your repricing tools might be a race to the bottom, making sure that you're always the best present web. Right > that would be a first option. Second option would be to fluctuate with known sales history and seasonality. And as people's demands or product demand goes up, your price starts to creep up with that demand, so you're actually fluctuating with the market, if you will. The third one is to watch competitors, and if it changes, making sure you either stay competitive with them, or that you are going to continue to stay a little bit higher. And like you said, market share, like," Hey, I'm not going to win today, but I'm going to win it tomorrow." Those are the three different components that Eva, essentially, or AI is looking at to say," How do I want to do that? And what's the most optimal way to win all three of those every single day but over the course of time?" So, that's a really cool concept because not everyone has every day to look at it and just watch markets and click and change your price. It's trackability. Me as a consumer I can look and see how often pricing is changing, and they're going to be looking at all these holistic kinds of things: when's a good time to buy, just making sure that I'm getting the best deal possible. But you on the buyer side is making sure that you're always visible, you're always being strategic, and making sure your money is working for you. Another cool thing is because if your inventory is lower, that might be another cool thing is, if your inventory's lower, you're inaudible one velocity. You might run out quickly, but you might not get inventory back in stock fast enough. And all the time on the show we're talking about if you don't have the inventory in stock, your ranking can just plummet and you're not going to get visibility and all of that money that you put into ranking there, first and foremost, it's going to go down the drain. So, talk about a little bit about restocking and repricing and working together.
Hai Mag: Oh, that's a good thing. I also say like we are the Netflix of Amazon. The reason for that is... And the resellers get this very much, like the pricing thing, because they spend a lot of time on it because it takes one minute to set up Eva, just like you just connect the store, and then it takes one minute to set up everything about pricing. So, in two minutes you are ready to fight with a better technology than even the top 100 Amazon sellers in the world is using. And the only thing you need to do is watch, like you just watch the whole competition because we are the only one which we visualize the whole competition. Then you just sit down and watch your best movie, which at the end you make money. That's a great one. That's the Netflix. Now the private labels are also not... Always there asking me," Oh, we have pricing$ 9. 99,$ 19.99, And we are happy with that. We cannot change the pricing, otherwise Amazon will be unhappy." I mean, I'm really also like, I just want to touch that topic and then move to the restocking inaudible and why it's important because for the private labels, we are in 2021, it's an absolute must to use private label dynamic pricing. The reasons: Amazon has a lot of brands, like a couple of hundred brands, they all use dynamic pricing. Every single Amazon brand is dynamically priced every day. There should be a reason behind that. The second is, as a private label seller, your costs are dynamic and there is a big cost element. I mean, somehow 95% of the private labels, even the largest ones like FBA acquirers, they don't understand that the costs are dynamic, guys, and the way the costs are dynamic is because you're doing advertising and there is an advertising cost as well, which every day changes depending on what you do. So, combining it with the manufacturing cost, especially if it comes from outside of where you live... By the way, the Eva works for both European and also American marketplaces. The key point is, if everything is dynamic, why your pricing is not dynamic? And also, there is a lot of competition. There are hijackers. What if the inventory goes out of stock? And what if Christmas is coming, are you going to sell your products with less price or more price? I mean, there's a lot of factors that come into that, but what I'm saying is it's mandatory, it's a must. If you want to be successful in the private label work, yes, you need to do advertising, you need to do SEO, but also, you need to look at your pricing and make it dynamic. So, that's a must from my perspective.
Ryan Kramer: Good points.
Hai Mag: When we work on the sales velocity, we figure out that and we always talk to the sellers like... We have like 700 stores now connected to Eva, and we are very actively getting their feedback. Because we do sales velocity, weight- based pricing, at some point we understand that all the sellers are coming to us and they are talking about the restocking piece. Because sales velocity is important, but it's very much attached to what is the right way of restocking and how many units you can restock, and when is the right time to do it? Now, there is one thing, or there are two things that Amazon doesn't know. Amazon gives you a restocking forecast. Unfortunately, the level of success with that is questionable, and I'm very sure that Amazon can improve that. But if you go back to 10 sellers, I think probably much nine of them will tell you that they have a restocking problem, and the 10th one is probably out of stock. So, with that nine guys, when we look into what they do, the challenge is like Amazon doesn't look at competition, seasonality is extremely important, and that's not taken into account all the time unless the seller has an Excel sheet with all the numbers coming from last year's, et cetera. And on top of that, I mean, the cost element is not even there, so if you combine all these things together... Because why the cost is important, because restocking is not about a single unit, but restocking is about the portfolio. What is the best way to restart your portfolio is the right question to ask. And again, the same principle, how can you maximize your profit by restocking? So, it's not about," Oh, I have five products and Amazon is telling me for the first one, restock five units more, but is this the most profitable way? I mean, I have limited money. Am I going to spend all my money into my first product? What about the others?" So, that's the key thing, again. Look at the portfolio, create a restocking algorithm that actually balances the portfolio so you are limiting the out of stock, but you're e maximizing the profit. So, we combine this together, again, not to help Amazon, but to help Amazon sellers to make sure that out of five, 10, 100, or 1, 000 products that they have, what's the best way to maximize the profit and also not being out of stock? That's the crosstalk.
Ryan Kramer: So, does that look at also the component of when's a good time of year to buy inventory? Because, for example, everyone looks at restocking, like when to purchase goods, you have to look at outside factors such as holidays, or big one would be an example, Chinese New Year, when to forecast and purchase for those big time events and lead time. What is the restocking model going to be looking at? Is it going to be looking at all those different elements of it outside of Amazon's ecosystem? Or is it more like internalized based only purely on data? Does that question make sense to you?
Hai Mag: Absolutely makes sense. And we always recommend the private label sellers primarily, but also resellers, to make sure that they create this micro restocking kind of routines. Meaning that they should be normally restocking like every week, even every day, if there is a possibility. Because the micro decisions, it's much better than just having one decision and... like pay a million dollars, get the inventory in from China. So, that's why, I mean, most of the big private labels, they use 3PLs. So, they, first of all, they bring the stuff from wherever it's coming from, if it's outside of US or Europe, and then, from there, our tool is helping them to restock, every day, every week. But it doesn't matter. Obviously the tool can also, the software platform, can also estimate, like what is the 100 days of stocking? What does this look like? Or 200 days or two days. So, that's the parameter, actually, we get from the... So, we actually respond to two very basic questions. That's how the Eva works and AI works. Right? Number one question, I have$10, 000, and what's the best way to restock? That's the number one question. Right? How much money you have, what's the best way to restock, so we answer that. The second question is correlating with what you said, I would like to restock 30 days of inventory, then what's the best way to do it? Click the simulate button, you get that. So, that's the beauty... It sounds really complicated. Today I know that the sellers are spending huge time on it. What I'm saying is like, I'm going to reduce that time to two minutes, again, just by simulate, see what's going on, change that parameters to those two questions, how much money you have, how many inventory days do you want, and then come up with that. And you need more money, I don't know, go back to whomever is providing you the money, you can ask that. Or you can even ask them to go to the system and check what's the real situation. That also shortens the time to get funding our product because a lot of money lenders now, they are also looking at Eva and it's super easy for them to know whether it makes sense to fund this guy because then they check like how much money he needs, what's the level of inventory days he wants to get, next hour they got the money. So, we simplified the whole process, which is probably one of the biggest problems today in the Amazon world.
Ryan Kramer: Yeah. Making sure it's not all tied up in inventory and making sure that you can use it to spend on advertisement, spend on VAs or paying yourself out. Yeah. I can see how that's very beneficial. So, we covered a little bit about all the different components of profit- maximizing in the components of repricing. You're looking at what your competitors are doing based upon inventory levels, you're talking about seasonality, restocking in terms of making sure you're going to do micro restocking instead of major restocking, which I get that component as well. The last one would be like reimbursements. And not a lot of people understand that the reimbursement side of the business on Amazon, they might just think like," Hey, I sent 1, 000 units to Amazon, they only check in 998 or 997," or something like that. And those components of reimbursements or someone returned it and you just don't get those different kinds of... You're just out of money and they don't reimburse you for that return. What are the different ways that sellers need to know about reimbursements on Amazon and not just, in theory, that's something that you could do, but it has to be super significant? What's your thoughts on reimbursements are?
Hai Mag: And as we are talking about profit maximization, if you are able to reimburse from Amazon, which means it's really like a cashback, it's like cash, it's a great way to make some money. That's why the reimbursements are important. I still see that the US Amazon sellers, maybe 70% they know about it, and in Europe or in other places, even most of the sellers, they don't know how the reimbursements are important. Because what happens is like... I mean, it's not done on purpose or anything, but Amazon lost the inventory or they damaged the stuff in the warehouse or other places. Some customers return things which are not actually the product that they purchased. I mean, there're like 22 to 25 different cases that there are some mistakes. So, the first thing, when we look at it, first we looked at it from a perspective that we already have data, we have billions of data points, we are already pricing more than 10 million products on Amazon, we are doing restockings. Then we thought," Okay, we have all the data, we just run our artificial intelligence algorithm, find all these, detect all these anomalies." that's done in an automated way. But then in order to be Amazon TOS compliant, what we do is we manually open cases... Because I mean, it's really a tedious job. Amazon sellers shouldn't be really dealing with that. And we open cases, we follow up, we close, we bring the money back to Amazon sellers' account. So, that's a great way. Now, I know that some Amazon sellers use virtual assistants to do some of these reimbursements. That's a great way. But if you add on top of it a software like Eva, what happens, or the service that Eva is providing, your reimbursements can double or even triple, that's what we have seen, compared to what you are already doing. So, we don't mind what you are doing, but we have already seen that, that this can go up to three to 4% of your monthly revenues that can be recovered. It's huge money. Now, on top of that, I know there's a lot of software companies providing services like that. They got like 25, 30% of what they recover. We also work based on a fee that is only based on success. But I have a different mission on this. Okay? I have a very different mission. I would like to do a million dollars of reimbursements for free for Amazon sellers, a million dollars. So, that's important. It's the first time I'm talking about this. As one of the reasons why we built Eva, is to help Amazon sellers. I mean, obviously, we want to create a great company, but we do it for fun. Because of that, we do a beautifully design software. We also crosstalk.
Ryan Kramer: crosstalk recovering money manual process as fun. And Hai, I have to tell you, man, that does not sound like fun, that you're mainly finding and digging through all the paperwork that I personally know that it's very strenuous to go through and open cases and have to deal with Amazon on that front. You're just calling it fun. Are you sure you want to call it fun?
Hai Mag: Yes. Because if I give you$1, 000 now you're going to smile, and that's fun for me because I really enjoy people being happy. That's our thing. Right? Now, what we want to do is like, because our software is already doing all these things, we were able to simplify the reimbursement process, we're going to be doing a million dollars of reimbursements for free. We're going to make it really simple. And anybody can come to our service and use it and they will pay very low fees compared to any others. But at the same time, we are pretty much doing most of it for free anyway. So, I'm going to give it for free. I like it. It's really important. Something you need to give back to the community as well. And we decided that reimbursement is the right way to do it. So, for every single seller, we're going to be doing a lot of free reimbursements just to help them to get some money so that with that money they will buy more inventory, they will subscribe to our software, they will do something else. So, that's better that crosstalk.
Ryan Kramer: You're giving value add just like an Amazon seller. You're giving a product or you're saying," This is our bread and butter, but we're also giving value out in other ways that might bring even more additional value." I like the concept. My question to you is because you're using AI and all these tools, you're mainly doing inaudible using AI, do you use the AI to pinpoint and can help semi predict where you're going to need to get reimbursements or look for reimbursements from Amazon?
Hai Mag: Well, I mean, we already identified... I mean, we are working on this for the last 10 years ourselves. And my partner, at least he's not inaudible but he looks at every single cent, but that's how we created success. Because it's very important. One of the things that I want to tell the Amazon sellers, you need to look for every single cent you spend, otherwise, you're not going to be successful. It's not only about like growth, growth, growth. So, as we were looking at every single cent, every single penny, we ended up already identifying all these different types of reimbursements and all the things, and now the AI is helping more into looking at where to detect, what to identify, and which, for example, warehouse, between which geographies we see more challenges. So, that's why, also, that's another reason why I'm going to give you a million dollars of reimbursements for free and I would like to make this reimbursement service free for everyone, is because the more data we get, the more data we have about where Amazon is doing mistakes so the system improves even more. So, that's really a great fly wheel. Right? I mean, it just starts from one place but it helps to the other, so we enjoy it very much, the whole thing.
Ryan Kramer: So, that being said, you're looking at data, you can start to predict... Like you said, your goal and mission is to predict where Amazon was struggling in terms of inventory losses and whatnot. Is there an insight or a peak under the hood that you guys have seen in terms of categories in these regards are getting more reimbursement than in the toy or gaming community? Or the categories. Or is there a category that you're seeing more and more reimbursements typically from?
Hai Mag: Well, I mean, we identify a lot of things. Like for example, in some geographies, some of the Amazon centers, some of the routes, let's say, between LA and San Diego, maybe we see more reimbursements, things like that. That's one thing.
Ryan Kramer: Just on category, you're talking about locales, as well.
Hai Mag: That's one, is location. The second is with resellers, or if you have more products, if you're sending more products to inbound, for example, diversity of the products is increasing the level of reimbursement. If you're sending one single product, then it's less reimbursements we see. But if you are sending 100 different types of products, they reimburse the possibility of doing mistakes increased by 10 times, not like one or two, three times. I mean, we have a lot of statistics there. And by the way, this whole service comes on top of the automated Amazon reimbursement because some of the sellers thunk," Oh, Amazon is reimbursing back to me if they have an issue," and I tell them," Yeah, I'm sure that..." Amazon is a great service. Whenever you call them, they always respond to you in one second. I know that part. But the other part is, I mean, Amazon cannot reimburse what they don't know. They don't do it on purpose. If they just don't know, they basically tell you," If you tell us, we're going to reimburse you, but if you don't tell it to us, we are not going to do anything with that." So, the service is on top of that automated. The automated probably brings 0. 3 to 0.5% of the revenue back, and the sellers are aware of that, but then, it can go up to two, three, 4% depending on all these different factors. And then Europe, interesting, but if Amazon is expanding in one area, let's say Amazon is more doing FBAs in UK, then you see more reimbursements in UK because it's maybe the whole operation is starting new, maybe the people are not as mature as another area in US. So, there are a lot of factors we already see, and we help the Amazon sellers in this way.
Ryan Kramer: I'm curious, as you scale, how time consuming is this process for you personally?
Hai Mag: Personally? Yeah. I mean the whole thing, I mean, I work roughly 80 hours a week. It's an 80 hours a week work. I think I work as much as when I was 20 years old. I mean, I think it was better when I was 30s inaudible 40s. I was also like, for every hour I was making huge amount of money, and now when I'm doing the startup plan, it's more or less like a startup world in Eva the last two years, it's like I work a lot. I definitely don't make too much money because crosstalk.
Ryan Kramer: crosstalk. Yeah, exactly.
Hai Mag: But then I enjoy it very much because I'm meeting with a lot of great sellers every day. I get thank you messages. I just one yesterday. It was so lovely. It was so great that we helped one of our sellers in many ways. And we did nothing, by the way. That was the best part. We did nothing, but she was so thankful to the software that it's easy to use, it's beautifully designed. And I was so happy to receive that. So, with all these things, I'm happy to work 80 hour... I'll continue to work. I'm not getting really tired about what I do. I wake up at 7:00, I work until midnight, and I don't mind. If I don't need to sleep, I'll continue to work because it's not work, it's fun.
Ryan Kramer: So, of all that 80 hours you're talking about, how much of that is spent just on reimbursements? Because you said you're immediately doing this, but you have other things you have to operate. You're doing the backend stuff as well. You're doing marketing, you're doing all this stuff as a co- founder. It's baffling to me how you have time for all this to manually process and do it. If it's just you, my goodness, man, you've got it down to a science.
Hai Mag: There is something wrong there, just to clarify. So, we have a huge team doing this reimbursement that's more than, right now, 20 people. Otherwise you cannot do it. I mean-
Ryan Kramer: I was going to say, you're just there just looking at forms all day. I don't see when you have time for other things.
Hai Mag: I mean, I pretty much do not much other than telling the sellers that we are happy to do some free reimbursements and things like that. That's my job. I just create more work for my team, and they do it. That's really a way, like we use it more like a promotion. It's a nice way to build the relationship. We use this like, get some free reimbursements, and then from there, we talk about real topics where we can really help them with pricing management and the whole restocking. The only thing we don't touch on Amazon world today is advertising, and we don't want to do that. There's like 100 companies doing it, and acquisitions happen. There's a lot of money going into that. We like to partner with all the advertising companies and digital marketing agencies, and we cover all the rest. It's almost like a e- commerce finance platform where we help all the small, medium businesses to maximize their profits, and then once they have the profits, they can spend it with their advertising companies. We are happy with that.
Ryan Kramer: That's right. Exactly. Well, I mean, with this, it seems very much like so much of data's inflowing to you guys and disseminating all has to take tons of time, a bunch of server space. You have a lot of data points that you're touching on, but with the AI, you need to do that so it's constantly learning and growing and developing and optimizing. What's the future look like for an engine that you're building in terms of this solution?
Hai Mag: First of all, that's one of the great reasons why Amazon is very happy with us, because not only we are an Amazon partner in terms of that we are selling on Amazon, marketplace partner, we are solution development partner, but then we also use Amazon web services. I don't want to go into technical details. But it's an elastic infrastructure, which means that the performance is stable and it's always a great performance, but the infrastructure is scaling without you knowing about that. Well, you know about that because there is an invoice. The more it scales, the invoice is getting higher. So, every day I'm like looking at,"Oh my God, my AWS invoice is getting higher." But it's okay because we are really experts into this and Amazon is helping us as well. We are an AWS partner, too, and that's very, very helpful. We really built that business plan to make sure that, at the end of the day, we're going to have more than 500 million products in our system. Today, I think we have roughly around 50 million, and it's like... I don't want to say that, but it's like my babies, 50 million babies. I know about their competition, their history, I have a lot of pictures of them. I enjoy looking into this, try to understand what people bought and they bought something else that they don't even know, try to understand the correlation. And that's scaling, that's getting more and more into a huge data intelligence platform.
Ryan Kramer: Amazing. Well, Hai, what's the best way to, if people are looking for more information or they don't have a solution like this, or they do and they want to just connect with you or just have that one- on- one conversation, because I know you're the one who picks up the phone and you get to talk to people directly, what's the best way for people to reach out with you or learn more about Eva? What are those different answers if you can provide for the listeners or the people watching today?
Hai Mag: Well, I mean, the best way is really... I mean, I'm very happy to talk to anyone who's selling on Amazon because it's really fun. We always share experiences. That's the way we develop our software, too. So, me personally, Barry, and we have the customer delight team, we call it customer delight, rather than support or success, and we put a lot of people into this all the time. And the main thing we tell them, like always talk to the customers, prospects, whomever it is. By the way, there is one more thing. We don't care if our customer is doing$ 10,000 or$ 10 million. We don't care in the way we serve to a 10K guy like we serve to a$ 10 million guy, meaning that we really, it's very easy to reach out to us. Anybody can reach out to me easily, but if you just go to Eva. guru, which is really easy, connect the store, next minute you have somebody, you can just connect from the chat window, and it will be live. And that's very important for us to keep that level of service where we do it 24 hours. I mean, many of the companies, even in the US, the large ones, even tech software providers or healthcare providers, there is no way you don't... You cannot even find a contact us button or even a phone number that you can call and wait for two hours. That's the KPI now in US, to wait for somebody. In our case, I'm like 24 hours, we're going to respond, 24 hours. Well, there is something else. We also have operations in Europe and we are going to do it also in Asia very soon in Singapore. So, all combined, we are able to follow the sun and make sure that there is always somebody available and somebody who is relevant. We take ex- Amazon sellers to be our customer delight team, so it's not somebody who has no idea. They know about Amazon as well. It's important for us to give that level of service to our customer.
Ryan Kramer: Well, and I know I can personally speak because you've let me peek under the hood a little bit and I've gone through a demo of this solution. It's one of the more slick UIs and interfaces and quick responding solutions I've seen out there personally. So, I personally want to give you guys very much a congratulations on the success so far. I know that it's the beginning for you, at least you only hope that this is the beginning. And you have a really cool vision of where you want this to go to help sellers, like you said, small and medium size businesses, to really grow in various different ways, and this is just one of those ways to help people out. So, very cool stuff, man. It was a pleasure picking your brain. And you can see behind all my guests' eyes of, when I'm watching them face- to- face, how passionate they are, and you are super passionate about these specific areas and helping people grow. So, I'm very excited to hopefully see Eva grow and hopefully see you guys, like you said, the different ways that you're helping them be more successful. So, congratulations on that.
Hai Mag: Thank you, Ryan. That's great to hear it from you.
Ryan Kramer: I appreciate that. Yeah. Well, thank you so much for hopping on Crossover Commerce. Again, you're a friend of the show. I know we've connected on various different fronts, so welcome to hop on any time and talk about the specific things and insights. And also, because this is like off topic, have you read Jeff Bezos' final statement to his shareholders yet today? Or did you read it yesterday? I know you're a big connector in that space so I'm not sure if you've read it yet or not.
Hai Mag: To be honest with you, I haven't yet.
Ryan Kramer: That's okay.
Hai Mag: By the way, pretty much, I don't read any newspapers or anything. I just spend my time with the sellers. I mean, I have this idea, like when I talk in the family, the more I spend with everybody I think later on maybe I can jump into politics because I have all these funds now. As long as I served them in a good way and think about the millions of Amazon sellers in US, so I'm thinking, if we are providing a good software, the next thing is like," Here, vote for me." Anyways, I do not have the time, really. And I have no Amazon shares, that's one more thing to mention. Maybe that's why I'm not one of the audiences of Bezos. What about like anything special from there?
Ryan Kramer: No, I just think it's fascinating to think, where I think the quote that he left behind is," Do right by the workers and the sellers." I think I've only been able to skim it, and it's on my docket, it's on my tab to read after this. I made a note to make sure that," Hey, I need to read this today," but it's very fascinating to hear where, as people may or may not understand that he's stepping inside as CEO, which means he's no longer leading the company in that regards. But where he's bookmarking it is fascinating to see what's important to him and how he wants the business to grow. And I think we've had this conversation where people have thought, or in past guests have thought, where the company continues to grow and innovate, because there's all sorts of problems, but there's also lots of success and exciting things that are continuing to evolve in the world of e- business. Where does the next chapter lie for them? So, I know you have your pulse on the tech community out there, but I was curious to hear your thoughts if you had any. Super exciting, obviously, in the future. Who knows what the future holds for everyone and e- business in general. Again, thank you so much for hopping on the show today.
Hai Mag: Thank you. Thank you, Ryan, for having me.
Ryan Kramer: Not a problem. Hai, thank you so much again. If you hang out right there, I'll just recap with you afterwards. But again, thank you everyone for, again, tuning into Crossover Commerce. This is my show that I go live four to five times per week. It's a lot of content, but it's my passion to bring you the best and greatest minds in the Amazon and e- commerce space. I only do this for you, the Amazon and e- business community, so my job is really easy in that regards. But hopefully you took a lot of nuggets and takeaways from there. If you're interested, go ahead and check out Eva. guru. It's in the comments section as well as the show notes if you're listening to this on our podcast. So, before we hop off, I hope everyone had a great weekend. Hopefully everyone's staying safe out there and continuing to grow and develop their businesses in really great, creative, and fascinating ways. Continue to tune into the show because, again, I do this for the community in terms of education, content, and making sure that you are aware of all the great things that can help your business take to the next level. Next week, we have a really exciting, again, list of guests. I will be live four times next week. I'm slowly approaching that 100 episode mark, so tune in for really extending things that I am personally planning for in the works. Hopefully I will get back lots of past guests and making a really fun celebration as well. But that being said, next week, we're going to be talking with the following guests. I'll go ahead and actually, I'm going to do this quick teaser. Go ahead and subscribe or follow me on social media and you'll be notified of the guests once it's released next week as well. We're trying to solidify one or two guests, so make sure that you tune in or subscribe to my channels. Again, that's Ryan Kramer on Instagram, LinkedIn, or Facebook. You can just follow me there and you'll be notified, or PingPong Payments, again. We go live in all of those channels. I'm Ryan Kramer. I'm the host of Crossover Commerce. Thanks for tuning in, everyone. We'll catch you next week on another live episode of the show. Take care.
Ryan Cramer of Crossover Commerce talks with Hai Mag of Eva about Profit Maximization: RePricing, ReStocking & Reimbursements
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