This insightful episode welcomes Daniel Hannig from SellerLogic, a leading SaaS company focused on empowering Amazon sellers through intelligent automation tools. With almost a decade of experience within e-commerce, Daniel shares robust expertise on product sourcing strategies, pricing optimization, and recovering lost revenue from FBA errors. SellerLogic’s flagship products, including dynamic repricing and reimbursement automation tools like Lost & Found, are designed by ex-Amazon sellers to simplify complex tasks and help brands maximize profitability on Amazon. To learn more, read the full transcript from the episode below.
Episode 42 of The Seller’s Edge – Daniel and Jonathan talk about:
- [00:00] Introducing SellerLogic with Daniel Hannig
- [01:17] Cultural Approaches to Product Discovery
- [02:41] How To Position Your Brand In A Niche
- [04:03] Selling Breakable, High-Risk Items
- [04:48] Advice For Expanding Into International Markets
- [07:32] Pricing Optimization
- [08:25] Reimbursement Claims
- [09:53] All the Money Adds Up
- [11:11] Walking Through A Reimbursement Scenario
- [12:22] Inbound Shipment Claims
- [13:54] Lost Items & Missing Returns
- [14:29] The Complexity of Amazon FBA
- [17:07] Recap and Closing Remarks
Key Takeaways:
- Adopt a Holistic Sourcing Mindset: Factor in macro trends (political, seasonal, geographical) alongside product data.
- Define and Understand Your Niche: Deep product knowledge often beats category breadth. Owning one sub-niche creates defensible profitability.
- Automate Operational Processes: Use automation for pricing optimization, FBA claim filing, and report reconciliation.
- Audit Your Reimbursements: Regularly review shipment, inventory, and fee reports. Sometimes reimbursements total thousands yearly.
- Partner Strategically: Work with companies that prioritize seller advocacy, not just platform compliance.
Full Transcript of Episode:
JONATHAN: As far as products go, have you seen a cultural difference in products? Or has that been pretty uniform?
DANIEL HANNIG: I’ve read so many blog articles where it’s just, well, you know, just get a product sourcing tool, check for the products, make an investment of, I don’t know, a thousand euros and then you’re good to go. But that’s not what I saw. That’s not what I saw in that international community there. Because those guys, they were researching day and night and the thing, the cool thing that I. They also, they took like a holistic approach to the whole thing. They were taking into account international political factors. For example, here in Germany we had this energy crisis due to the Ukraine war. We had it not only in Germany, but we had it everywhere in Europe that we knew heating stuff like that is going to become really expensive this winter because of the Ukraine war. Because we have to, we have to find a different provider. What went through the roof were sales in like, how do you say, heating blankets or blankets that you can heat up, the electric blankets, those that you plug in and everything? Exactly. And those were the things they were researching. They were taking into account, you know, political, Yeah, I don’t know the political situation. What type of the month is it? When is Black Friday? When is prime day? Do I have to take that into account? So it was like that they had a whole scheme going on on how to source their products, from where to source their products. As being in Indonesia, of course, it makes much more sense to what a lot of people in Europe also source in China. But if you’re in Indonesia, of course you’re going to source from China. And of course the shipment route is much shorter. So that’s what a lot of people did. What I also saw very interesting is how to take into account your niche, how to, how to like, position yourself in your niche. There was this one guy, Jonathan, you won’t believe. This guy was young, was a kid, but he was like 21 years old and he had made so much money with a product that I couldn’t believe. I had to ask him. I was like, are you for it? He had made it like he had found his niche and his niche was aquariums. Aquariums. I’m not kidding. Like the big aquariums. Because he’s French,I thought it might have been like a language barrier. I’m like, do you mean that it’s like. No, no, Danielle with the Poisson. I’m like, you really mean aquariums? Because they’re huge, they’re made out of glass. That’s like the most difficult thing to ship and. Yeah, but for some reason he had his niche. He had like. The thing is, he was also working before, in his teenage years, I don’t know, in a shop that had. He had knowledge about the product, he knew where to source and that became his niche. And because he knew all of that stuff and he was able to, I don’t know, read up on the A9 algorithm or whatever. He was able to like to make this niche for this particular area. It was his niche and he made crazy money with it. That. The one thing I can, I can, I can say to that is, first of all, if you go for product sourcing, don’t just rely on the, on the tools, only on the tools. Take into account, take into, take a holistic approach into account and also know your niche or get informed as quickly as you can about your niche. Yeah, for sure.
JONATHAN: Yeah. The glass aquarium, I would just think, I mean the size of it, it’s just a pain to store in a warehouse. And as far as being made of glass, I can’t imagine what the returns look like. Because you like, like what’s the success rate on that? I imagine like 5% get smashed in shipping. Oh my God, that’s just insane.
DANIEL HANNIG: I didn’t believe it at first. It’s crazy.
JONATHAN: Do you think that that’s the craziest product you’ve seen somebody?
DANIEL HANNIG: Definitely.
JONATHAN: Okay.
DANIEL HANNIG: Absolutely. But also how adamant he said it, “with the aquariums, Daniel, with the aquariums, I made the money.” I’m like, bro, this can’t be real. But, but it was, it was true. Yeah, yeah. I mean. And that just proves to show like, if you know your niche, you know your niche, you know.
JONATHAN: Yeah. What are some of the things you would see? Like, obviously, you don’t have the experience in the American market, but I’m just curious for people who are going from one market to the next. Given the complexity of Amazon, what sort of advice would you give them?
DANIEL HANNIG: Yeah. Take the time to always, to always look for, for companies or partners or services or agencies that will help you, especially if you’re trying to enter a new market. It doesn’t matter. Yes. E Commerce has made the world like a lot, lot smaller. I mean it’s not like a brick opening. You have a brick and mortar store here in Cologne and I decided to come over to America and open a brick and mortar store there. Of course that’s a whole different story. And you think that, well, this is E commerce. People are selling online, it’s going to be much easier. But there’s also a lot of nuances, nuances that you have to take into account, especially when it comes to vat, to taxing. I don’t even know. Like, I’m not a numbers guy at all. Like, I am the worst with numbers. But I know that it is very. Even if it’s only in the European Union where you’d actually think, okay, this is all pretty custom tailored. This is all, you know, one size fits all because it’s the European Union. It’s not like that. There are so many things that you have to take into account and so many ways that if you know the right people, you can save a lot of money. Like you can save a whole lot of money. So yeah, that’s like, you know, inform yourself. But also, this is one thing. It’s also, this is always a quote that I always like to bring from Jeff Bezos. He said at one point, we’re in the business of helping people buy things, we’re not in the business of helping people sell things. And if that doesn’t tell you where the priorities are, like, you know, that, that quote, when I heard it, I was like, listen man, like for someone who’s been to space, you don’t have a lot of perspective on that matter. Right? Because like for real, you mean the sellers are a vital stakeholder? I mean, yes, of course you’re a client or you’re a buyer oriented company, but the sellers being the people that actually provide the stuff that is being sold on the platform, they’re also a vital stakeholder. I think they should be more catered to. I feel that’s my personal opinion. I don’t know, maybe people would reject that as well. Maybe people feel perfectly catered to. But that’s not what I hear in Germany, at least not. But then again, Germans like to complain a lot. But still, like, you know, the thing is like yes, if, you know, if, but if that is said by the CEO of the company, and this is the, and this is the platform where you choose to sell predominantly, then you have to find people, like viral launch, like SellerLogic that work with Amazon or like work in the area of E Commerce, But that do have you as a number one priority, as a main vital stakeholder. That’s the main thing. And that’s. And if you, and if you, yeah, if you expand internationally, especially, especially then take that into account. And as I said earlier, it doesn’t have to be SellerLogic, but use. Use free trial periods wherever you can. Just use all of them. Use all of them multiple times if you can. Just avoid wasting, wasting time that you could spend, that you could spend intelligently, into expanding your business. And don’t waste that time on doing tedious tasks that are repetitive and that could be easily done by a machine. For example, when it comes to pricing, pricing optimization that you think like, okay, you always have, you have, you have to have like a really dynamic pricing model. And once you do have that, and there’s like 10, 000 things that you have to take into consideration, but if you do them correctly, Amazon, Amazon, gives you more, how do you say it promotes, it promotes your, your products. You know, you get more visibility. But the thing is, if you do that manually, it’s possible if you have only like 20 SKUs or like 30 SKUs. But most of our clients, they come to us after like 60 skus plus because it’s just not feasible for them anymore to like, you know, do their whole pricing optimization strategy on, on their PC like this, you every day. Okay. Okay. My competitor went up by 2 cents. I’m going to do the same. Oh, I went down again. Let’s go back again. You. Who, who, who’s going to do that? And of course, yeah, when it comes to like reimbursement claims or something, if people, and most of the people sell over FBA in Germany, I think it’s about 60 or 70%. And yeah, when it comes to FBA, I mean also Amazon makes a lot of mistakes. But the thing is like the FBA errors that happen, they’re not getting reimbursed proactively, which means you have to do it yourself. And this whole process, it would take you, I don’t know, you have to find the right reports, you have to contact seller support. Then it goes back and forth, back and forth. Let’s say like in a good case it takes like three hours. Are you going to do that for a reimbursement claim of €2? You’re not going to. Hell no. I have better things to do. And that’s the things like, I think and if you, and especially now with that growing competition, I think it’s really relevant that people find companies that help them with the automation. Like, I’m not saying, I’m not saying don’t, I’m not saying come to SellerLogic, but I’m saying find someone. Because especially like if it comes every, every company has like a free trial. Every company has like two weeks free trial, three weeks free trial. Test them all out. And once you see, oh, okay, now with this company I had a little bit, I had 2% more revenue than with the other one. Then you go for that company for sure. If it’s SellerLogic, cool. If it’s another company, also cool. But the worst thing that can happen is that people spend their time in front of the PC like doing these, these, you know, these repetitive and tedious tasks and just, you know, not spending that time, actively like, promoting their business or whatever or like product sourcing or looking for aquariums. I don’t know, man.
JONATHAN: No. It’s interesting that you called up the scenario with the two euros. Yeah, like dollars to donuts, you’re going to be like, that’s not worth my time. But that money does add up. So I don’t even know what that looks like in the long run. Have you seen that situation, like nickel and dimes here that end up being lots of money. Like what’s a claim that you, you’ve seen where you’re just like, oh, this is, this is substantial.
DANIEL HANNIG: The most substantial claim we’ve, we saw at SellerLogic was one which was, it was a, a clothing company who started. And the first, who started with us with the lost and found tool and they got reimbursed. The first reimbursement they got was over 200k, €200,000. And that’s just. And I, I was just sit, I was looking at the case, I was like, this can’t be true. Like imagine like that much money just sitting with Amazon for no reason at all.
JONATHAN: Right.
DANIEL HANNIG: It’s not their money or any, they don’t have a claim to it. It’s just there. Yeah. 200. 200. I mean that’s the biggest case I know. Maybe something new came in in the past months or something like that. But in general it doesn’t, in general, this is only like a immediate amount but the, most of our clients get around six, thousand a year. So I mean it doesn’t sound like a lot, especially like, for like huge companies, but–
JONATHAN: I mean it’s $6,000!
DANIEL HANNIG: That’s it. That’s it.
JONATHAN: You’re not going to find that underneath your couch cushions.
DANIEL HANNIG: You might find it on Amazon!
JONATHAN: It’s so interesting because that’s a part of the business that is so foreign to me. So like, walk me through a scenario so like Amazon, like somebody will have inventory and like what happens?
DANIEL HANNIG: An inventory stock. Just simply inventory goes missing because people make mistakes, machines make mistakes. Sometimes inventory just goes missing for no reason at all. Or, or Amazon damages your items within their warehouse, does not reimburse you proactively. That also happens just stuff breaks in a huge warehouse like that. And of course that gives you a reimbursement claim. But yeah, that’s But you do have to go ahead and make that reimbursement and file that reimbursement claim with the seller support. And yeah, that would be for example, inventory, stock, what I also see a lot. I’m just going to like, if you want, I can just like list the claims that we get the most that with our clients. Like, okay, the ones Most common, e.g. FBA fees. Amazon overcharges you due to like wrong. Due to wrong measurements. So you send in a package and they don’t measure it horizontally but diagonally or something. And they say, okay, your package is that big, but it’s simply wrong. But they charge you more. And if that’s like, with one package, okay, no problem. But if it happens to 100 packages, then you’re looking at a substantial amount that you, that you might want to get back from Amazon, for example, or also inbound shipments. Inbound shipments is basically you have something stored at your place and you send it to the Amazon FBA warehouse, which I find actually pretty cool because also the, the area of risk that Amazon takes is also the. When you give it to, to the, to the delivery company and they take it off your hands and it goes to the Amazon warehouse and something goes missing, from your house to the Amazon warehouse. It’s also on Amazon, you can also get that money back. So it’s pretty cool. Yeah. Let’s say, like if I would be selling socks or something and I would have like 50 pairs of socks that I’m sending to the warehouse and only 48 arrive at Amazon, I have a reimbursement claim for the two pairs of socks.
JONATHAN: And that’s something that Amazon like calls out or like, do you get an Alert a notification or you just have to keep track of like what you’re putting in and what actually ends up there.
DANIEL HANNIG: Exactly. You have to, you have to keep track of what you’re putting in and what ends up there. So you always have to. Basically, if you do it manually, of course, you have to always compare, your list with the list that, that is at Amazon. You can like. Or the reports that you get in Seller central. Yeah, imagine the word. I can already see you rolling. I was like, nope, ain’t nobody got time for that. Nobody. Stuff gets lost in the warehouse regularly. No. Doesn’t matter the reason. But if stuff gets lost in a warehouse and your, deal with Amazon is, well, I get to store my stuff in your warehouse and I pay you money for that. And it gets lost in their warehouse. Of course. Reimbursement claim. And yeah, missing returns. I always, every time I say this in webinars, it’s really funny. Especially the Germans, they get really riled up about this. There’s like missing returns. It’s like, oh, yeah, the thing is the buyer can return a stone to Amazon and he will get reimbursed completely. But where’s my reimbursement from Amazon? And that’s the truth. Like Amazon is the most client or the most buyer oriented company in the world. They have been, it’s well interwoven into their DNA. You know, since Jeff business was selling out of the garage, they’ve been like this. But that doesn’t mean that the sellers also should be vital stakeholders. You know what I mean? And like, if the, if the buyer gets reimbursed directly through, you know, through negligence, conducted by Amazon, then I think also the other party, you know, the party that the, the item actually belongs to should also get reimbursed directly. But sometimes they wait for over 60 days. Now, like, that seems kind of unfair. Like, where’s the, where’s the equilibrium here, man? It’s not there. So that’s, that’s also a case that we get a lot.
JONATHAN: Like, there is no report. Like, it’s like fascinating to me that there isn’t some sort of report that says like, hey, like, you had 50 things in your inventory yesterday, now you only have 30. They magically just disappeared.
DANIEL HANNIG: No, the thing is, I think these reports, they do exist. And you can download them in the, in the Seller central. As I said, I’m not, I’m not a seller. You know, I’m like. But, of course these reports, they do exist. We also use these Reports at SellerLogic in order to, in order to compare. Hey, okay, so what data does the, the, the, the seller have? What data does Amazon have? And if you, if you compare it and you see, okay, there’s a, you know, there’s a discrepancy, then we know, okay, this is where we send, this is where we send the email to the seller support. So these reports do exist, but they do not get, and you don’t get notified of them. They just exist and they get updated but you don’t get a notification that. What you just said, what you just said is like, oh, listen, so there was 50 things, now there’s only 30. Do you want to check up on that? That doesn’t happen. So either you do that yourself and then, and that’s only the first part. After that you also have to, you know, download those reports, maybe download a backup report. And then after that you have to like talk to seller support. And they’re not, they’re not going to say, oh yeah, sure, you know, whatever, it’s going to be a ping pong game, and well, you’re going to lose a lot of time. And I think, I’m not like to be completely fair, I think they do that not completely on purpose, but there is motivation behind it to make it, to make this process as tedious as possible so that most sellers think, you know, what, for €2 I’m not going to get behind that. But at the end of the day those two euros may accumulate to €200,000. Like with my market motor, with our, with our, with our client.
JONATHAN: Listen, I think Amazon’s great for sure. I think you know, like, I mean obviously like there’s a platform there that has enabled a lot of people to make a lot of money for sure. But it’s like it’s, it, there are, there’s a lot of complexity to it. So it’s, it’s almost like being in business with somebody. It’s almost like having like a business partner that doesn’t tell you everything you need to know.
DANIEL HANNIG: Yeah, for sure.
JONATHAN: Well, I appreciate you coming on and talking about all of this. Super helpful. Like, I just need to explore that side of the business more. I think I’ve been so locked into just optimizing listings and getting them visibility that I don’t really think about the other end of it.
DANIEL HANNIG: If you want, like, if you want, you can come onto our, into our, onto our show and we’ll talk about listings more and less about price optimization if you like. That. I mean, yeah, I really enjoyed this is the. What I’m trying to say is, like, I really enjoyed talking to you as well. You have a great vibe. Yeah, for sure. It was a lot of fun. And, yeah, I’m looking forward to future collaborations. Or if you want to come over. Yeah, if you want to come over to our show, I interview you, I’d be very happy to, for sure. Very, very happy.
JONATHAN: 100%. I’m on board. Cool. You name the time and place, and I’ll be there.
DANIEL HANNIG: Sounds great, man.
