Building a $30 Million $ “Boring” Business w/ Jason Macek
21:50 Share

Five, 10 years ago, you could just sell whatever, right? Cool product, cool name, cool offer, just sell it. Now people want to buy more and more from brands and the average consumer has cottoned on to dropshipping, right? They know what it is. They've learned about AliExpress themselves.

So you've got to start building a brand around it. My name is Rudy Moore, host of Living the Red Life podcast, and I'm here to change the way you see your life in your earpiece every single week. If you're ready to start living the red life, ditch the blue pill, take the red pill, join me in Wonderland and change your life. Guys, what's up? Welcome back to another episode of the red life. Today, we're going to dive into how the pains of growing a business, the problems of growing a business and Jason's story, growing a big brand and

You may have heard of it, Dollar Fulfillment. Welcome. Thanks for coming. Yeah, thanks for having me. So we were talking offline earlier, right? Like we've both been in business a long time. You've grew a big company. You're growing to hopefully have a nine-figure exit soon. And I've seen, obviously, seen you for a long time and sent a lot of clients whenever they ask about fulfillment and they have an e-commerce product. I'm like,

you know, go here. Right. And, and I, one thing I've always loved about you and is, is, and I don't know how intentional this was, was the name because a lot of what we teach is make it third grade level, super easy. So how did you come up with a name and maybe tell people about the business a little and you to start the show? Yeah, absolutely. So we started, uh, about 15 years ago, just out of our garage. My wife was, uh, doing this. She's packing boxes for a friend of ours that owns a parrot training business.

And so we were doing that for years for them and we were charging them a dollar per box to ship it out. And so when we decided to eventually kind of try and create a brand, we'd been charging them a dollar and it was right around the time Dollar Shave Club was coming about. And I really loved their marketing and their branding. And so totally copied them. Okay. So-

So, and for, how would you describe fulfillment for people that don't understand fully what that means? Yeah. So fulfillment is a little bit different than drop shipping to where you're going to buy your products in China, you know, in bulk, have them shipped to our warehouse. We're going to store them. And then when your orders come in, our system connects to your e-commerce platform.

We get those orders, we print the shipping label, we put the stuff in a box, we label it, we ship it out the door, and then we bill you our fulfillment fee plus postage. So say I produce these basketballs, right? And I get 200 of them from China or US, wherever I manufacture them. They send it straight to you and you deal with all the BS after that, right? Absolutely. Pack it and then when the order zaps across...

You just print the label, send it. So the business owner like me, the marketer, can just focus on the sales and marketing side, not the fulfillment side. Absolutely. You never have to touch that product. You never have to see that product. You don't have to worry about if it's gone out. We take that headache on. And I've done that for years, you know, use fulfillment parties and companies like books and stuff we sell. And even back when I sold supplements many years ago, and I was telling you offline, it amazes me how many people still fulfill their own products. Yep.

Because I guess they don't realize that this exists, this whole... I think a lot of people, they hold on tight. It's a control thing. They want to make sure it's going out exactly how they want it going out. Yeah, I mean, it's just not an ROI, right? I mean, I get it if they went with a bad company that wasn't sending it and causing... That's different, right? But if you find a good, reputable company like yourself where it's being processed properly... So if you're an e-commerce store owner...

you know, we talk about maximizing time, right? And you shouldn't be packing your own boxes. And what about cost? It pretty much the same. I guess you get shipping discounts. Yeah. Yeah. So we ship anywhere from 10 to 20,000 packages a day. Right. So we get some pretty discounted rates. Uh,

And then, you know, to be honest, if somebody wants to do it themselves, they may save a little bit of money. Like what, 50 cents an order? A dollar an order? Maybe 50 cents an order at most. And it depends on how efficient they are and things like that. But you're going to save a bunch on postage. And then, like you said, what's the ROI on your time? Well, even if you have someone at $20 an hour packing it, they'd have to do 40 orders a week.

an hour just to save that 20, pay their payroll and break heat. Absolutely. So, yeah. Yeah. And I, I mean, we were talking offline too. One thing we've done a lot of with e-commerce is like the package inserts, promos. Um, so,

How do you do much of that? Are you looking into doing more of that? Yeah, we're actually looking into it right now. There's a lot of opportunity for our clients to offset some of their fulfillment fees by being willing to put in non-competing product inserts. Yeah, cross promos. Yeah, cross promos. Yeah, I like it. And I think one important thing is if you're listening to this and you've wanted to start selling products, one thing I found over the years is it's way easier than you think, right? You can literally...

You go onto websites, order a hundred of something. It's not going to cost you that much money. They get sent straight to you. You take care of the rest. And it's like, I mean, when you're like trying to start a business, you think,

wow, I've got to order tens of thousands of them. I need a million dollars. I got to ship them all myself. It's like, no, the beauty of the internet is you can like go, right? One extreme is like literally drop shipping where it's nothing to do with you. And it's like, you're selling products pre-made. The next step is like white label and print on demand where there's some customization and, but you're taking existing products and tailoring it

And then the next stage now is, I think, minimum order quantities have come so far down in the last five years, right? Whereas, yeah, 10 years ago, you probably had to do 1,000.

Now there's a lot of places you can do 100 or 50 and send them and test it. So you could start an e-commerce business for $500 and test it, right? Absolutely. And a lot of our clients have started like that. They'll drop ship. They'll find that winning product and they'll order in bulk and send it to us so they're not taking the gamble of buying stuff that may or may not sell. Well, that's what we say. And then you can add your logo, start building a brand. And if you're an e-commerce listener, building the brand is so important. I was teaching at my mastermind the other week, 5%.

Five, 10 years ago, you could just sell whatever, right? Cool product, cool name, cool offer, just sell it. Now people want to buy more and more from brands and the average consumer has cottoned on to dropshipping, right? They know what it is. They've learned about AliExpress themselves.

So you've got to start building a brand around it. Yeah, absolutely. You know, when those boxes show up with all the yellow tape and the Chinese writing, it's like, yeah, this came directly from China. Yeah. Yeah. Okay. And let's talk a little about, you know, obviously you run a fulfillment company, but it's end of the day, a business is a business, right? And we talked offline a lot about when you get past the 10 million mark and you have a lot of employees, some of the harder parts of business that when you started packaging, you

what was it, TV cassettes, right? Yeah, VHS tapes. VHS tapes, right? You started packaging those. You never thought you'd be dealing with lawsuits and all the BS of running a big business. And same for me, right? I was selling fitness programs on the internet. And so what have you learned going through all that and maybe some of the examples you want to share?

Yeah, I mean, we've had everything from trademark infringements from our clients that then they come after us because they can't get to the clients because they're international, to the Idaho Attorney General coming after us because our clients weren't responding to complaints. And so at the end of the day, it's just...

You have to take a step back, realize you're going to get through it. You know, it's probably going to cost you a little bit of money, but don't let it steal your focus from, you know, continuing to build your business because that's the ultimate goal. You know, there's going to be bumps in the road. Yeah. And I always teach, like I always kind of say cheesily and jokingly money solves all right. But like it kind of doesn't solve a lot of things because if you have a million dollars in the account because you run a successful business,

And you know this is going to be a 20 grand settlement or you've got to pay 10 grand for an attorney to figure it out and say, hey, we're nothing to do with this. We're just sending the package. This isn't our company. Yeah. And you've got to pay 10 grand for an attorney to go backwards and forwards and argue that. It's like it's not the end of the world. But if you have no money in your business and bank account and you get that and then you have to hire an attorney for 10 grand and go in debt, kind of is the end of the world. Yeah. And I sleep in at night. Yeah.

Yeah, so like guys don't under appreciate the cash flow and building wealth and money because it's that buffer for these problems. Whoa, whoa, whoa, wait a second. Before we go into the rest of this episode, I'm gonna interrupt abruptly and just ask you one big favor. I hope you're getting a ton of value, a ton of knowledge. I hope you're getting some breakthroughs from myself and the guests.

and I want one thing in return. What I would love is for you to subscribe and leave a review. The reviews and the subscription grows the podcast. It allows me to bring you even better guests. It allows me to invest even more time and money

into this podcast to bring you the latest and greatest, the best entrepreneurs from around the world that are crushing life, crushing their business, and giving you all the tools, the mindset hacks, the knowledge, and the environment you need to be successful. So do me a favor, if you've got any amount of value from today's episode so far, or any previous episode, or any of the content I've done, it would mean the world to me if you hit a five-star review, give us your feedback on the show, the episodes,

and subscribe and download. Plus, if you do that and send me a screenshot on Instagram @rudymorelife, I will send you a bunch of my free training, marketing courses, sales courses worth $499. Yes, $500 worth of courses

for a simple 30 second review. It would mean the world to me. Send me that screenshot. I would love for you to leave that review and I would appreciate it very, very much so we can keep growing this show and make it awesome. So let's get back into the episode. I appreciate you guys and let's dive back in. So let's talk mindset because we're both seasoned. We've had the attorney letters and the potential lawsuits and all that and worked through it. And we were talking about this

But we're like now, like we get it. It's part of the game. But tell me about the emotion and feelings the first time you got the attorney, the state attorney letter or something big. Yeah. You know, I mean, the Idaho attorney general letter was the first like big thing that came in. And it was terrifying because it's like I'm going up against, you know, the attorney general. There's not like this company with a limited budget that's going to come after me. It's, you know, it's my tax dollars paying for them to come after me. And it makes no sense. Nothing to do with you. Yeah. And I had no control over it.

So what happened? You got the letter in the mail one day at the house, at the office? Yep. Got the letter. No, I was actually served by, you know, you've been served or whatever. And knocking on the door. At the house or at the office? Okay. Yeah. What did you think when that happened? You know, your heart drops, right? You know, it's just like, what am I going to do? And so, you know, obviously you find an attorney. And so we found a super reputable attorney and his partner. Did you go on Google or you asked around or? No, I asked around town and, um,

there's one where we live and his partner is a state representative. And so I figured maybe there'd be a little bit of a pull there since he's down there dealing with the government officials and what. Yeah. Okay. So, and then how did you, how many days did it take? Like, did you lose sleep over it? How many days did it take to work through that? Yeah, I don't know. So it probably took a good three to four months for it to kind of go through the process and for our attorneys to go back and forth with her before she finally was like,

"Okay, I understand what's going on. As long as you make sure your customers are responding to these complaints, then we're not gonna hold your feet to the fire. But if they keep coming in, we're gonna come back after you." And thankfully, we haven't had any other issues yet, but I mean, it could happen anytime. - Yeah, right. That's always your somewhat of a risk, right? - Absolutely. - And people in business, like guys, what you'll learn in business is people look to place blame. So if they can't, if you're partnered with someone in China, right, or whatever,

They're going to go there first. If they can't find it, they're going to come to you. And sometimes if you're the... We even watch it because if we're doing business partnerships and something fails and this person's a no, you know, no name, right? And I'm a big brand. It's like, and they do something wrong when I'm not looking, right? You're a failure now. And they're going to come for me, right? Especially if it's full equity. So it's always...

something to be aware of and like i like diving into the mindset side because you know we've had our fair share of letters and threats and stuff and you know we've run a great business honest business we've never done anything wrong never got into any big problems but like you we've had to ring the attorney work through it and like there's a few days of like sleepless nights old shit like thinking about it a lot absolutely then but once you've gone through the reps enough times

like your mindset gets better, right? So what would you say to someone listening that is starting a business that's going to have the employee steal, they're going to get an attorney letter, they're going to forget to file a tax form and get a threatening letter? What would you say to those people? Yeah, I'd say think about it now because right now you're just so focused on the day-to-day stuff and trying to grow a brand and you don't, you know, you're going to have that success if you put in the effort, but you don't think about these things on the front end. And so if you're

resign yourself to, hey, that's going to happen eventually and I'm going to work through it and I'm going to learn something from it and I'm going to be better on the other side, then it's not such a shock when it comes. Yeah. I speak to Grant Caldone about this and he's helped me because he's always like,

that's a good problem to have hey you're big enough now that you're getting a big warning letter here and then obviously it's not nice and you don't want to proactively go and get issues right but it's they're gonna if you know they're gonna happen it's like how do you build the mindset and the framework in your head and brain to handle and work through them because they can't you know building a business it's like for a lot of you you're starting out you're trying to make your first million you're trying to make your first 10 100k and

But your problems right now to us probably would be irrelevant. We wouldn't even hear about it. Our staff would, but we've been through those starter problems. So the building the mindset now will help you when the freelancer steals a $500 contract, right? Like we deal with $50,000 in theft from whoever, right? So build it now because it's always going to happen. And you will look back in five years and laugh about what you got upset. Absolutely. But then-

we're dealing with problems now that are like oh my god and mark zuckerberg and elon musk would say i get a letter every day like that okay yeah right yeah so you've always got to know there's a new level of problems and if you stop getting those problems i always teach you stop growing probably right yeah that's awesome yeah you've plateaued so what what about advice about building a business because obviously you've built a successful business you're you know you're going for that hundred mil plus valuation i think you know i'm excited to see you do it and you've

you know, hit numbers and revenue that most people will never hit. Right. So how'd you get there? What are some business lessons you've learned? Yeah. I mean, honestly, it's like, I'm a big believer in, you know, there's kind of old fashioned, you know,

I'm going to deliver on what I say. And then just being super conservative, you know, you know, we've made a lot of money over the years and we didn't take it all out and go buy, you know, fancy cars or we reinvested into the business and we continue making that capital work for us. Another big thing is, is finding the right people to build a team, not having that kind of that Superman syndrome where I have to do everything myself and being the bottleneck of growth. And so we've got a really great team at Dollar Fulfillment and I'll

I'm able to step back. I'm not super involved in the day-to-day and just helping with like the big picture and the growth initiatives. And so just making sure you've got that team, you work hard, conservative with cashflow, don't be dumb with that. And then just, yeah, everything kind of falls into place. Yeah, I love that. So let's talk about the stepping back, right? How'd you build a 20, 30, $40 million company and not be involved? Because I'm sure people would love to understand that. Yeah, absolutely. And it takes time, right? You can't do that in the beginning, but-

Um, it's just, as we grew, uh, we intentionally, uh, we're, we're mentoring people that we could see stepping up into the next level. Um, and we have a really great person named Susan who kind of runs the whole show for me. She's my right hand person. Um, she's workaholic. She's there all the time. She'll answer Skypes at three in the morning. Um, and she's learned how to do things the way I would do them to the point where I have faith that. Yep.

everything's going to happen the right way. And this last year, we just hired a CEO for the company to kind of continue growing that, looking at some new mergers and acquisitions. And so just putting people in place that you know will do things the way you want them done, and then slowly stepping back and giving them the freedom to do things better than you might do them. So two questions. How'd you find a Susan? And then how'd you make sure she stays with you? Yeah. So honestly, it's a...

It was luck. She came to me from a Craigslist ad. Wow. Yeah. And she was just a part-time person. My head of tech came from Upwork. And it's like, I don't believe it. Yeah. It's a needle in a haystack game. I don't know. How many people did you hire from Craigslist? Lots. Okay. I mean, over the years, probably hundreds. And you found a few really good ones that have stayed a long time. Yeah, absolutely. Yeah.

And so, yeah, so Susan's great. You know, she does things, like I said, how I would want to do it. And that took years of her, you know, watching and us having conversations. And, you know, we're going to go ahead and wear this one because we made the mistake. And so we're going to refund them for their cost. And so just so she's in that same mindset of that customer always comes first. Yeah. And how'd you keep a Susan? So Susan...

So we've become almost like family. And so we love working together. And then, you know, she'll definitely get a little bit of a bonus on the X.

exit because she's... So like exec team, you're looking at profit share, maybe even equity eventually or shares in the company. Absolutely. Yeah. Anything at the executive level. Yeah. And what else have you found for the team side, building that team to motivate and keep them? Yeah. So culture is huge to us. My wife and I, we always said people over profit, whether it's our clients, whether it's our teammates. And so it's

We do things, we go above and beyond. I mean, it's not as fancy as this, but I mean, even in our warehouse, you know, we've got, you know, game rooms and arcades and we do big Christmas stuff. And so making it a place they want to come every day or it's maybe they don't dread coming to is huge. Yeah, I always say, I tell everyone when I interview them, I don't need you, you don't need me. I want you to, I wanted to build a place you could.

could enjoy coming and obviously that's not every day even husband and wife is you don't enjoy every day but over time right like on average and it's like hey if that stops happening and continues happening then it has to be addressed or end right and there's just like any relationship in life and you know you can't I mean as a CEO you know we built to 100 staff you can't please everyone there's going to be parts in the path right like when people go in their own way

but you've got to look at what can you control, what can you do and how do you build that great culture that makes people want to be here and a good energy and all the things that go into it. Yeah, you know, I think if you can get away from it in that employee-employer relationship where that is, it's transactional and going kind of above and beyond that to where, you know, it's,

They want to be there for you, not just they want to be there for X amount of dollars per hour. Yeah. And we tell them that. We're like, hey, don't work here because of the money only, right? Like, we'll pay you. You'll find a better job elsewhere for just transactional. Yeah. Come here because of the vision. People buy into vision and mission, too. Absolutely. Like, buy into the vision, the mission, the culture, the opportunity, the growth. Then that's what money can't buy. Absolutely. Yeah.

Yeah, and that's my job is to provide that vision for them, something that they can latch onto and say, hey, I want to take this ride with you. Yep, yep, good. So what final words for business owners, e-commerce, startups, people trying to grow a company to a million, maybe 10 million, or in general, the theme of living the red life is building a life on your terms, a life of your dreams using the internet. What would you say if you had a relative, a niece, a nephew say, how do I build a dream life?

Yeah. I mean, I'd say find something that you're, you're interested in or passionate about because it makes it a lot easier coming to work every day when you're, you're dealing with something that you like. Um, and then, and just try to solve a problem in that industry. You know, if there's a product that can be created that solves a product or a problem or a service that you can provide someone that makes their life easier. Um, you know, and then just

find, find mentors as well, because there's a lot of people out there who are willing to help just because they want to see you succeed. Um, and, and don't,

don't worry about asking you know if they say no great move on to the next person yeah yeah yeah yeah i mean that fear we've i've talked on another podcast like the fear of rejection stop absolutely people all right and it's like it's like asking a girl out you know yeah you gotta do it we're gonna say no and eventually one will say yeah you'd want to say just need one yeah good all right well i appreciate you coming on and we obviously have a very exciting trip now going to necker island this this week so excited to spend the week with you there and talk shop and

obviously a lot of experiences that I think we'll create there. So appreciate it. And guys, until next time, look, keep living the red life, keep working hard, know that those problems are going to come. And today's episode was really to show you, hey, look, if you're in e-commerce, if you're trying to build e-commerce, amazing industry and companies like this, make it super easy to start and maybe quit your nine to five or scale your current company and then

business lessons, right? Like we've both been doing it way over 10 years and you learn a lot during that time and the problems are going to be there. How you handle the problems will dictate success. Absolutely. All right. Well, until next time, guys, keep living the red life. Appreciate it, buddy. And I'll see you guys very soon.