Ep. #1199 - Mexico’s eCommerce Landscape

Andrew Morgans  0:00

Hey, what’s up Hustlers? Welcome back. It’s Andrew Morgans, founder of Marknology. Here as today’s host of Startup Hustle. Today we’re going to be talking about Mexico’s eCommerce landscape. And before I introduce today’s guest, today’s episode of Startup Hustle is powered by FullScale.io. Hiring software developers is difficult. Full Scale can help you build a software team quickly and affordably and has the platform to help you manage that team. Visit FullScale.io to learn more. Mike Begg, welcome to the show.

Mike Begg  0:27

Hey, Andrew. Thank you for having me here. I appreciate it and am excited to be chatting with you today.

Andrew Morgans  0:32

Of course, I can’t remember where we first met. I don’t know if it was an introduction from a referring partner. Or maybe Chris Freiburg or someone along those lines. I’m not sure. But I know we’ve been connected for a while now. And it’s good to have you on the show.

Mike Begg  0:47

Yeah, I’m happy to be here. I mean, we’ve definitely crossed paths a lot. I don’t remember exactly the first time, either. But, you know, when I think about Amazon eCommerce, you’re always one of the people that’s in my mind. So

Andrew Morgans  0:58

Awesome. And you’re still in Mexico?

Mike Begg  1:01

I am. I live in Guadalajara, Mexico. I’ve been here for six years now, which is kind of crazy.

Andrew Morgans  1:05

But wow, that is crazy. That’s a that’s like half of my Amazon journey already. But I’m spending a month in Colombia in November. So I’m super excited about that got a villa and am just kind of going to work out or from down south a bit instead of here in Kansas City and taking my mom and sisters for part of it. So we’ll just be hanging out. Got another Mexico trip, I think, in January. So you’ve got the right idea being down there. And you know, something, I think when we first met versus now, the Marknology team has diversified quite a bit to have a lot of our team there either in Mexico or Columbia or various eras of Latin America. So I’m catching up on the plan you’ve had for a while.

Mike Begg  1:54

Yeah, we’ve been down here since the first employees we hired down here were in 2018. Now at this point, we have employees in Mexico, Brazil, Argentina, Costa Rica, and Nicaragua. And we don’t have anyone in Colombia, actually, I think about it.

Andrew Morgans  2:09

Good. I got all the good ones. I got all the took them all. No, it was just, it was a chance, chance coincidence that, like, I met our first person there, and they were just so good that I was like, Okay, I’m gonna give this a shot. And being in the Midwest and the CST timezone is just an absolute win. For us as an agency, we were working with offshore teams that were middle of the night or, you know, either were waking up late or early or they’re staying up late or whatever the case you’re not at your best, you know, and so finding something that really worked in our timezone has been an absolute home run. But let’s back up a little bit from there. Talk to me about just Mike. I guess getting know getting to know your story. I’d love to know. I know how in my listeners know how I got into Amazon and how I got into eCommerce. And, you know, it was a journey that wasn’t definitely something I set out to do. I didn’t plan on necessarily being an entrepreneur. I guess it’s in my blood, but it wasn’t part of my plan, so to speak. And I kind of just fell into this out of necessity and curiosity and ambition and passion around eCom I just fell in love with it. Where’s your story began? Did you always know you’re gonna be in business? Did you know it was about travel that made you move? What kind of got you to where you are today?

Mike Begg  3:24

So there’s definitely a good story here, as well, I think. So originally, I’m from Connecticut, with school in Philly and Long Island went to different schools. But I never was like, you know, I need to have a business. I need to be an entrepreneur, I need to do something for myself. That was never the mentality I had, you know, played sports growing up. I played sports in college. But I played lacrosse, it was all a team sport. So like it was all about the team accomplishing things. And also because where I’m from and sport like a lot of my exposure was to careers in like investment banking and finance, consulting and stuff like that. And I thought that was the route I had to go down. So out of college, I ended up working at Deloitte for a while and consulting, absolutely hated consulting for Deloitte was like, Alright, I want to switch go to something different. I ended up doing real estate development for Sears. Okay, so that’s kind of where like the main changes started happening. Because like I started getting exposure to the retail world seeing how things were working. And obviously Sears at the time was failing. So it was kind of a unique experience into this massive retailer, kind of, you know, coming to its deathbed on how you’re actually going to handle these challenges going forward. So I remember like we were doing projects, we sold off $2.2 billion in real estate, we were redeveloping stores, closing stores, and I was just seeing, you know, people getting laid off people getting fired, left and right. And it was yeah, it’s not a nice thing. It kind of sucks, to be honest. But that made me realize that there’s like no such thing as a secure company. There’s no No such thing as a secure job. At the end of the day, you’re just relying on the people making decisions to make the right decisions. It kind of started occurring to me that like, I trust myself to make better decisions than I trust someone that I’ve never met. And from that standpoint, I started looking at different options. Originally started doing KDP publishing, then kind of got into retail arbitrage. From there, it was like building the first private labels we had this was like 2014 2015.

Andrew Morgans  5:30

Talk about those like, just Yeah, it’s not entirely Amazon community that is part of the Startup Hustle community. So just breaking down what private label is a little bit? And I’m sure that was, I mean, a big part of what you’re doing today. It was those private label journeys. 2015 is when PPC came out. So you started private label 2014.

Mike Begg  5:51

I think it was, yeah, December, I think we launched our first product, December 2014. And that was, so we had an art supply brand. And I say we it’s myself and my two partners now. And essentially, I mean, private label, we were sourcing the products from China, we had a manufacturer putting our own brand on there, we designed everything ourselves. And you know, we were putting it out on the Amazon marketplace to sell the products we were selling. Were like dual tip markers, colored pencils. Those called easels like all these different types of like art supplies. And it was interesting for us, we were like, Crayola is the known brand in this category. And like we shouldn’t be doing as well as we are like everyone is coming looking for art supplies looking for Crayola. And we were like, wow, we’re actually beating them and a lot of this stuff, right? That’s kind of where like, the eyes opened up. And it was like, these brands don’t know what they’re doing on Amazon. And from there it came the whole idea of how can we help these brands succeed? So from there, it turned into alright, well, let’s start AMZ Advisers, let’s start doing the consulting side, the marketing side. And luckily, I mean, to start with, we got some really big clients because there at the time, there were many people doing this. And that’s really what

Andrew Morgans  7:05

When was the agency, like, when you went from private label to kind of doing the agency thing?

Mike Begg  7:10

It was Spring 2016 is when we started the agency. So we did about a year a little more than a year and a half of selling, have an even more time before that. Figuring out the whole private label stuff, but of actually selling the products on Amazon and then we kind of converted to the agency from

Andrew Morgans  7:29

our store is very similar. I was an E commerce manager. So a start up and then eCommerce manager ’13 and ’14. Selling their products. So almost like private label, the automobile parts, one was private label. The toy company was all types of brands like reselling, and wholesaling, really, as well as their private label. And then I started freelancing on the side sorry, working with Adidas and Suiza. And some of those brands on off of up work because no one’s doing this. It was just like, you know, I was beating them out with chocolate, you know, like big chips a whole year in Nabisco with these small mom and pop cookie companies or, like, you know, just like little small businesses, making them national and winning and being like, what is happening? How is this happening? How am I outranking for chocolate chip cookies, like, you type that in? And it was the brand I was selling, you know, and I’m just like, How is this possible? But it was like through that experience of like, selling other people’s stuff, like really even through the agency where I’m building my own brands. Now. That’s been one of my my goals, but like learning along the way as we go just with all the scenarios, and you’re right, there just wasn’t anyone doing what we’re doing. At that time, there was software company selling software, like sellers that figured out how to make software and talk about it at conferences and sell it and make, you know, being a private label seller a little easier. They were kind of like these private label gurus that were running classes or workshops are things like that. But there weren’t necessarily companies or consultants doing it for other people, or brands or retailers or things like that. So that was really the opportunity that I’m talking about when I say like, being a first mover in the space. Yeah, the big companies are having to work with companies like you know, Marknology out of Kansas City, simply because there wasn’t other people doing it.

Mike Begg  9:17

Exactly. And I mean, that’s how we started tools like Upwork. We got some big brands off Upwork placards, Rembrandt, Neff, trying to think we worked with Clorox on some stuff for a little while, like, it was like, it was literally the Wild West. It was like if you were doing the consulting, there’s probably like three of us on Upwork. And we were probably competing on the same job posts all the time. So it was a great experience, learning that way. And obviously working with those types of companies gave us a lot of the fuel that we really needed to get started. Because without that, like, I mean, we were discussing it a little bit earlier, but like it’s tough working with smaller sellers to a certain extent. So having like big companies really started in a way like

Andrew Morgans  10:02

Validate your thing. Yeah, validating your, if I change this keywords like with this type of power behind it. Like, you know, changing these keywords or SEO or images had big impact versus changing it on a Crayola company that’s not Crayola, like you know, or colored pencils like and it’s not Crayola. You’ve got a limited amount of PPC, limited amount of people knowing your products, like, it just takes a lot longer to test everything, for sure when an exam be like this is working.

Mike Begg  10:03

Yeah, exactly. You can do it at scale. And you learn so much faster. I mean, that’s like when we look, when you think about the agency model in general, agencies are so good at what they do is because they’re leveraging the knowledge of all the people on the team and all their experiences. So when you have big companies that are letting you invest, and you have good people that are continually learning on the platform, the agency becomes more and more valuable over time, because the knowledge of the agency keeps growing. And I think that is, like, we said, the big companies are a big reason that we were able to get to the point where we are and be as successful as we’ve been.

Andrew Morgans  10:59

For me, I talked about it before on the show, but I was like white labeled under bigger marketing agencies is really how I was getting a lot of my business on Upwork. Right. It’s like some company making a ton of money off me probably. I was making pennies, but I knew what if they already had contracts in place with these companies. And they were looking for Amazon consultants, like, you know, what, what kind of deals were they making. But Adidas had acquired a Fitbit type of company like a smartwatch, it was called My coach. And they were a one piece seller. So also at that time, the people really pioneering Amazon were creepy sellers, right. And one P had really been, Amazon had been populated by sales reps going out there and contacting the big retailers. And then they weren’t having to figure out Amazon or eCom. They were just simply filling POS. And then that meant they were selling on Amazon, it was like just like another retailer on their on their bottom line, you know. And so it was really the three P sellers are allowing you to do anything creative or outside the box or try things or test. And but I got a chance to work with Adidas, and they had amazing content. So if you know anything about like, you’ve probably heard about Nike and Amazon, they don’t get along very well, right, they’ve kind of boycott each other and stuff. Adidas went the other direction, I think and embrace Amazon. Because they were giving it tons of attention. Even at that time. This was like, you know, 2014 it was actually it was 2015 or 16. Because there was PPC involved. I remember taking a look at the program. But they had amazing photography and design and like video and stuff. And so I was building these pages EBC I think it was it was on vendor Central or what other brands didn’t have brand registry or they didn’t have they No, they didn’t have the content, they weren’t investing in the content they were doing like giveaways, things like that. So working with Adidas, I saw the impact of like, Wow, if I had this really great creative, that they just hold photoshoot for this brand. And then I like you know, uploaded the listings. And I saw directly the impact, like looking at the data, I saw the direct impact of great content copy. And that’s why early on, like I guess like for the last eight, nine years, I’ve been pushing storytelling and content and branding on Amazon. Because I saw the power of that through the big companies, and saw really the results. And whether I could prove that or not with small private label brands, like I saw what happened with Adidas when I did that, or different brands like that. It was just a big eye opener for me, you know, with where do I want to take my technology? And where do we want to focus? And what are we gonna be able to solve for brands and do and be able to compete with China and different things like that when they were starting to push out the private label sellers because they’re getting it from the same spot. You know, the content, content, content, content, and that was from getting an early look as an agency behind, you know, some big brands, so 100% echo what you’re saying.

Mike Begg  13:47

Yeah, completely. I mean, you pretty much nailed that all there. I think, over time, what differentiated the brands in Amazon was like, the amount of investment that companies are putting into it. And now it’s at the point where everyone more or less understands it, like there’s still some education piece that needs to be done. But back then, like no one tried anything.

Andrew Morgans  14:07

We were commerce managers much less like someone focused on Amazon.

Mike Begg  14:12

Yeah. I mean, we worked with a lot of we worked a lot in the one PSI to like we worked with Neff on one p we worked on Burt’s Bees with one P. Some other big brands like that and like you’re right, any good content made their brand stand out. And it was it was really fun. Like, I don’t know, it wasn’t it was less stressful that things are right now less competitive. But again, it was just an awesome learning experience.

Andrew Morgans  14:36

I was getting out of my nine to five during that time and being able to work on this stuff. And you forget it when your years past that moment when you left. You know, that company you hated or that company that was like, you know eating your soul, so to speak, because of whatever you were doing. Besides that was amazing, right? It was just like, man, I made a post today on my Instagram about being able to like iIn the early days, I was like walking to a coffee shop, owning my day sweats or workout clothes, I was gonna go to the gym after. And I’m like taking calls in a coffee shop next to suits and stuff downtown, like much like, you know, business people, and being like, my combo is just as important as theirs. And I’m in sweats, you know, kind of thing. And it just being this like, gratitude thing of just like, dang, I’m like getting to live life on my terms, this is really cool. And so some of that has passed, you know, when we were really like, trailblazing the industry, by still like, it’s just, it’s evolved into just I like doing it better. I like doing what I do better now. And a lot of times, that means getting to work with brands or partners, or sellers that are on the same page in regards to what they want to do to make that better, like holistic ecommerce, I want it all working together, like a finely tuned machine like it should. And you know, so for me that’s working with brands that have some of that together on the other side, or that are working on those things, so that my side will also benefit from that or do that or talking to companies, we were talking about talking to companies that have brand managers because then we can have conversations around content and storytelling and emotional connection that you can’t have with someone that’s just the tech guy.

Mike Begg  16:09

Yeah, exactly. Like at a minimum, they have to have an understanding of how Amazon fits into the bigger picture or where it is within the actual sales funnel. And I think it does become a lot easier when you get to these people that are more experienced, that are specialized in brand management or specialized in eCommerce because then you can start helping them see how things tie together. Yeah, and when you achieve that is when you start getting more patients from clients, when you start getting better results as a team, and then you can start focusing on the levers that are really gonna help the brand grow over time. Like, I mean, it’s, it’s such a difference than when you’re working with like a small private label brand starting up.

Andrew Morgans  16:46

Yeah, run this by you. Some of that has to do with pricing, right. So to be at the price point that we need to get the businesses that are like, I need a new channel for sales. It’s Amazon, I’m gonna go look there, you know, they, a lot of them have a pricing constraint around like how much you can charge for a retainer to work on that, okay, on both sides. And so it’s not that I don’t like working with the smaller brands, or sellers anymore, or any of that it’s not even just about the revenue. I believe that in order to achieve what we’re talking about, there has to be this education piece. Almost like you’re educating them on on Amazon, you know, and not just like slowly on the calls here and there. But it’s like, this is why you need a plus, this is why you need PDP. This is why category and BSR matters. This is why keyword rank matters. Because at a big company, like a Fortune 500, company, etc, they’re gonna be in 12 different departments. They’re not going to all talk, it’s not going to be like a private label brand, where everyone’s in the same room working together on the same thing. It’s very much independent apart media buying team and the content and branding team. And so there has to go in all of this work of really just even educating them. So then they can be patient and understand what we’re trying to do. And if you’re just operating on slim margins to like, you know, to get your foot in the door with smaller brands, they don’t have, you don’t have that margin built in to spend a ton of time educating, you just need to do

Mike Begg  18:12

The same. At the same time, when you’re working with smaller brands, like you don’t necessarily always have the same amount of collaboration in mind. Like at one extreme, you’re talking about how there’s so many different departments that need to be involved and need to have their input and because of that things move slower. But it shows that there’s a real investment on their part and actually achieving the results. I mean, there’s plenty of small brands where you can go work with them, or the owner, or maybe they have one or two employees are trying to manage you 10, 15 channels at the same time. And they’re, like, hey, just handle this for me. Like just do it. If they’re not invested in it, then like it, there’s no alignment, there’s no collaboration.

Andrew Morgans  18:50

Right?

Mike Begg  18:50

Like, why didn’t I get myself it’s like, well, like, because I need your help you like, it’s not a one way street. And I think that, again, is another reason why it’s just so much more of a better experience to work with brands that are a little bit further even. It’s not saying that we won’t take anyone that’s a founder, but you really need that buy in. And I think that’s the most important thing.

Andrew Morgans  19:09

I can’t, I couldn’t agree more. And for me, I think from the outside perspective, there’s a small part of me that’s like, look, I still like working with a small business. I still like you know, helping someone become an entrepreneur that wants to be one I still like, you know, educating about private label and starting your own product or building a brand. But as someone that’s responsible for my team, and for someone that’s now 13 years into this, I like doing more advanced shit. Yeah, like, you know, I like being around like minded people that are building stuff that are very technical and strategy, high level strategy, business acumen. And you get that by working with medium sized or larger brands. Now don’t get me wrong. Not generally speaking. Not everyone is amazing at a medium sized or large company either. But there’s the possibility of that happening and all those kinds of things playing it’s like do you want to play in the minor leagues you want to play in the pros, you know, So just as we get more expertise in our agency, you know, even keeping young young people on my team invested in my brand and my business, I gotta bring them fun projects, I gotta be pushing their, their, their knowledge at work, we got to be trying to do more innovative things, we just became a tick tock shops, agency partner, you know, the content team worked hard, we got our foot in the door, we’ve been running some brands on tick tock as part of the brands I own, and got that opportunity. So it’s like, it’s, it’s not that you have to be doing everything, but it’s like you what, if you’re working with brands, if we just keep working with small brands that are really doing the whole picture thing, my my people, my team and my best talent are going to be like, Well, I’m just twiddling my thumbs doing the same thing over and over, and struggling a lot of times failing, like, so they’re like, I want to be somewhere I can win. Well, that means working with winning teams and winning brands. And so just taking second to educate kind of like why agencies start raising prices or start going a different direction, is simply, it’s like it’s the, it’s the natural flow of things. I think, as you gain expertise, and as you kind of understand what it takes to win and things get harder. I want to take us a new direction and really talk about the opportunity that is Mexico. And well, there’s an Amazon Marketplace there. There’s also like a lot of your team is their sourcing coming out of Mexico. Have got a lot of friends that are involved in bringing those conferences, those manufacturing, trade shows and things to air. So you know, a lot of a lot of chatter coming out of, you know, Mexico, Central and Latin America and kind of what the opportunity is, I’d love to share it on the second half of the show, kind of like what you’re seeing being there, boots on the ground. Shout out again, to our sponsor, FullScale.io finding expert software developers doesn’t have to be difficult. Use the Full Scale platform to find your technical needs, and then see what available developers, testers and leaders are ready to join your team. Visit FullScale.io to learn more. So on that, on that note? Like what are you seeing there? Like we’re based in the Midwest, we all went through the pandemic together understanding sourcing issues, let’s start with that. And just like what is the opportunity for eCom in regards to manufacturing and sourcing.

Mike Begg  22:16

Yeah, so I that’s a good place to start. Because when we talk about eCommerce in Mexico, you’ll see so many different directions. But from a manufacturing and sourcing standpoint, we’ve seen so much more interest since COVID, has pretty much happened. China has pretty much been a nightmare for most people manufacturing there. And a lot of the sellers we talked to have had problems switching manufacturing to other places. Now from our standpoint, Mexico is a great place to manufacture because of the proximity to the US. The time zones, communications a lot easier than dealing with someone on the other side of the world. But there’s also a lot of challenges with manufacturing in Mexico. First of all, like expectations around manufacturing, quality of product around manufacturing cost, it’s not going to be as cheap as China. And another one is. And this is just something that I personally struggle with with one of my brands is the cost of packaging is extremely high in Mexico. It’s more than some of the price of some boxes of stuff I buy down here. I’m like, How does this make sense. But from that standpoint, like, if you’re going to look at Mexico as a manufacturing hub, I think the best thing you can do as a foreigner or someone who maybe doesn’t even speak the language is to work with a contract manufacturing partner. Because otherwise, if you’re trying to deal with these local manufacturers on your own, it’s gonna be hard if you’re trying to find them, it’s gonna be hard. I mean, I, like I’ve been here for six years, I’ve tried to build a few brands down here. And these manufacturers, they’re not online. Like we’ve we found them through WhatsApp groups. We found them through Facebook groups, through referrals. And even then, like you’re shifting through people because the quality is not good enough. So it’s definitely if you’re gonna do it on your own, it’s definitely a long term investment to try to find someone versus like I would work with a contract manufacturer to make it the easiest. One thing I would say, though, is that since China has, since the Chinese manufacturing sector has kind of been hit hard by COVID, a lot of Chinese money has started pouring into Central America. So there’s more and more Chinese. I mean, like here in the office building I’m in there was never any Chinese. There’s a whole floor of Chinese now. And there’s more and more factories that are popping up. So I think a lot of them have started to realize that because of like geopolitical relations, they can actually come in to Mexico create better manufacturing processes and be able to take over a larger piece of the manufacturing sector. So it’s changing, and it’s changing fast and it’s hard to stay on top of it sometimes.

Andrew Morgans  24:51

No, I’m on the same page as you in regards to contacting a contract manufacturer. Or the funny story came to mind but I like Just kind of creating similarities and I grew up in Africa, I grew up in Congo, moved back when we were 16. And similar, okay, in a lot of ways people just don’t understand this, when you’ve only lived in a Western country or like the US or whatever, or Europe. There is no real estate website, there is no zillow.com, there is only connections and referrals and networking. Every house is behind walls with glass or barbed wire on top, you can’t see past the gate, a city of 12 million. So you know, it’s a lot, city 12 million people. Mexico City is one of the biggest cities in the world. I know you’re in Guadalajara, but like Mexico City being massive. And to think about it being that big, you’re just like, you kind of make these assumptions. But there’s a lot, there’s a lot of the world where that isn’t the case. And you got to go through human to human relationship. And you know, there’s great opportunity. But if we were looking for a place like to move our compound, it had to be like through the vine, through the vine, you’re like putting out feelers, you’re filling stuff out. And that’s something that you just can’t do through the internet. You got to be boots on the ground, you got to be there, you know, you make those relationships yourself. So

Mike Begg  24:56

Yeah, it’s actually funny, you brought up one of the some of the conferences and manufacturing stuff down here. I think it was last year, actually. I was involved with one of them, and they were looking to do the tour and you know, go find factories, but they’re having trouble finding factories in Mexico City. And like, that’s how difficult it is to actually find these people to work with that a conference that is dedicated to finding manufacturers is struggling to do that. And today alone, like, I’ve had, I’ve already had two conversations with other people like, Oh, why is there no Alibaba in Mexico? Or like, why is there no Alibaba equivalent of manufacturers in Mexico. And I’m, like, because it’s a nightmare to track all these people down, and make sure that the quality is good, that the communication is good, the expectations are gonna be realistic. It is a really, really big challenge, especially I mean, here in Mexico, I know Mexico better than anywhere else. That is like a massive problem. When it comes to finding manufacturing partners. It’s always better having someone pulling the strings for you on the contract side, making sure things are delivered on time, if they’re not delivered on time, you’re getting money back. So in general, that’s a that’s usually a better route to go.

Andrew Morgans  27:18

Speaking of Mexico, but also just Central and South America, I did make a visit, I was working with a manufacturer that was going direct with their brand out of Costa Rica. And it’s almost the exact opposite experience in what we’re talking about. Like Costa Rica is known for their just like quality of production. Cleanliness, like, eco-friendly, just they’re just very well known for their manufacturing standards, got a huge tour of the facility, it was a bunch of pet products and human products in two different facilities. One was, like, they do all the craft beer in Costa Rica. They did all of the like cereal, so, like, Frosted Flakes, like those kind of healthy cereals, we literally had cereal tasting, okay, you had to drink all the milk. He insisted, because the milk is part of the flavor profile of the cereal. And it was interesting, like these Frosted Flakes, like after 10 minutes, we had to wait or something, they didn’t get soggy. It was cool. But, but just talking about, you know, not every country is the same. And that was an amazing experience for me. So every country has a little bit of nuance to like, you know, what they bring to the table or not. So looking for that opportunity. And then also like what kind of products you’re selling. You know, it might be worth it to go through these hassles for six months, or even a year trying to find a manufacturer than to go to China and be copied instantly, you know, so you might buy yourself five years of runway or something like that because people aren’t copying your products or different things like that. He talked about Alibaba, I believe it was some of the Carbon6 guys like Tim Jordan that were doing, I think the event and maybe February or March of this year in Mexico City, and they were partnering with Alibaba, I believe. Alibaba was kind of sponsoring the event or something to bring it to life. So

Mike Begg  29:11

You know, sourcing in Mexico with a Chinese sponsor.

Andrew Morgans  29:15

Yeah, just if I have to go to one country, I’ll probably go to Mexico, if I have to choose just weatherwise alone. Then China, but like, the short of it is find a contract manufacturer, someone you trust, like I’m building my own brands, I haven’t gone to China. I haven’t been to an actual manufacturing plant to find my products. I just go with a trusted you know, contractor that I know of that I know is well connected has been doing this a long time. So talk to me about some of the other advantages of Mexico. I know a lot of your team is based out of there. Was that just something that you’re like, we need to, you know, diversify our team or was it like I’m going to Mexico and make this thing work in Mexico? What was kind of your thinking? I guess in the early days,

Mike Begg  29:56

It was there was never an intention. Like we were gonna hire in Mexico when we first came when I first came down here. Kind of when we were like, going back to a little bit earlier, when we were kind of starting up the company in like 2017 was actually our second year. We had quit our jobs in, like June 2016. We started the agency a few months before, we were starting to make money. But we were pretty much living in like family homes. Like when I say family homes, like our family’s homes, like one of my partners had a family beach house in South Carolina. I had a family beach house in Rhode Island, another one had one in Connecticut. So we were kind of like just jumping around where we could live for free to make the money last as long as possible.

Andrew Morgans  30:37

in keeping cash flow going and lean as possible.

Mike Begg  30:41

And that we you know, saved up a bunch of we were like, You know what, let’s, let’s go do something cool. Kind of, like you said, take control of our time. And we were like, Alright, let’s go down to Mexico. So we ended up in Playa Del Carmen. After a few months there, you know, things kept going, well kept growing, we started traveling, I ended up in Guadalajara, which is where I met my, my wife. She’s originally from here, and I moved here in ’28. At the end of 2017. I moved here permanently. And then 2018. About halfway through the year, we were running into problems, like you said, with overseas contractors or like timezone differences. And I was just complaining about this one day in my wife. And she’s like, why don’t you just hire here? And I was like, like, well, I don’t know, like, maybe

Andrew Morgans  31:25

Why don’t you say that like a long time ago.

Mike Begg  31:27

It’s like, I don’t know about this, maybe it’ll work. So I had my doubts. We hired our first employee, you know, August 2018. And we were like, Alright, let’s go work. And then from there, we just kind of kept scaling up. So for us, like, I think there’s a lot of great advantages to it. US and Mexican culture is more similar than it is different. I mean, obviously, the language is different. And that’s the main hurdle that I think makes people think that it’s that much different, but consumer habits are very similar. Mexicans want things fast, they actually have a preference for foreign goods, which is another great thing for foreign brands coming into Mexico. But in general, that helped us hire people that understood how US consumers worked. And many of them even lived in the US and came back to Mexico. So for us, it was a great advantage from a content creation style of, like, knowing what people were looking for, from just like the psychological aspects of marketing strategies, like what is someone? How do we position this product differently? Or like, how do we make it stand out in the category? And I think that was one of the big advantages for us being here in Mexico at the time, and why we’ve hired so much of our team here. But it’s also opened up other opportunities for us. So that we’ve, some of the brands have been able to start here in Mexico or started producing here in Mexico have been one thing. We have another project down here in Mexico that we’re slowly getting going as well. So it’s opened up new doors, which I think is the cool thing.

Andrew Morgans  32:49

Well, the next time you have a conference or something I’m trying to come through, you know, so it gets really cold here for a big part of the year. No, but I mean, I think I think that’s, it’s awesome, just hearing it, because not everything starts out as like, this is our plan, we knew of it for five years, we’re going to go get it. A lot of times, it’s just like, you do what you got to do to get through that hurdle. You know, maybe your planning isn’t five years out, it’s three months out, or five months out, you know, and you just kind of trying to figure out what’s going I know, in the early days, when we were launching, when we were launching the agency was me, myself and I and, you know, bootstrapped it was in debt from a divorce. And was just freelancing and was like, I think I’m onto something I was real passionate about working 100, 120 hours a week, you know, between my day job and this business blowing up, I was trying to get on my feet. And so similar to staying with a family and a family home, it was like, just stockpiling to try to, you know, get get back on my feet. And eventually, my sisters left their careers and came and joined me in the early days when I started getting some momentum. So that was my three. And they’re smarter than I am. So it was, it was a big moment when they came to join me, but about the pressure that probably put on you too. Oh, man, you have no idea. I still have pressure but we handle it together. And we did go through a war and crazy stuff together as kids so we’re kind of just a little bit different than other siblings in regards to just like going through the shit together, you know, and being able to communicate really without even communicating. We just kind of have that that trauma bond in a way like you know, you just been through hardship together and you just you know, you have this bond so a lot of people can’t work with family or siblings and I see a completely the opposite I wouldn’t be here without them. I know we just went through so many hurdles as an agency that couldn’t have done it if I hadn’t been able to lean on you know them we had a bigger why than just like the money and the job you know, it’s a bigger why we want to take care of the family and in doing so, and we’ve now 35 employees and you know doing the thing so it’s a lot more than just my sister’s now but definitely started out probably the first four years of the agency was like me. You know, more like a consultant, you know, a contracting team. Now we’re a full service agency, like we operate like an agency and never intended to build something like we have, I just wanted to be the best at what we did. And so many people, you know, they think about Amazon. And I think like, when you’re talking about the founder that’s doing it, the thing is, is that there’s so much work involved in Amazon, that’s not very rarely can one person have all of the skills that you need to be good at a business on, on online, much less Amazon. So, you know, from copywriting, to data analysis, to bookkeeping, to advertising and media buying to sourcing, if you’re doing that to, you know, all this design and photography to video, if you’re doing that, to just develop his own and on and on, you know, can you imagine a guy being good at Data Science and also good at, like being creative, it’s not really a skill set that goes well together. If you’re going to be amazing, and one or the other. I did them all myself to some degree level of skill set, right? And was just like, I knew early on, like, I have to have help for these things. Like, I’m not good at all of these things. And so that just a little shout out to the people trying to do it themselves. Like, listen, this is not, you know, for the faint of heart, like to be able to do all those roles and how to build a team. Like you said, I was always just you growing up, I was always team based, too. I’m not the Lebron, I’m the, you know, I’m the guy team together, like he’s from, from motivation to picking the team to telling us how we beat the enemy to like, you know, and then players gonna go out and do that. And so, you know, for me, I spent a ton of time focusing on the team. And I think that just giving a plug, I guess, to what you were saying about the culture and things like that, you know, I grew up in Africa, where $100 A month was enough to feed a whole family there. And I know it’s different from the Philippines to India, to Mexico to Colombia, there’s all different qualities of life and different things like that. But being able to like, feel like you’re on the same team and partners with whoever’s in in your team, whether you’re a brand is, you know, going offshore and hiring team like that, whether you’re with an agency that’s doing that, whether you’re, you know, just trying to be a freelancer yourself, that culture move is bigger than you think. We’ll talk about just giving, like, let’s say, there’s a refugee camp in Africa, I’m working with giving them skills, free calm. And I actually asked if I could do the educational part around the cultural fit. So how to talk to an American company and American employees, and what is the day to day like, and what is, you know, a day in the life like of an American in the Midwest at a corporate company, and because these kinds of things are so you know, different from each other. Not even just the work, it’s not to say they’re not capable of getting in and doing PVC or things like that. It’s simply being able to understand how people communicate here, and what their lives are like and what their norms are, and things like that, it just really matters. You know, where your team is, and how much of that education you have to do before you’re on the same page, or at least close to the same page.

Mike Begg  38:04

For sure, it does make a big difference. And like when I say that, specifically here in Mexico, like the culture is similar. It’s more that the younger generations are more accustomed to what US called Lipsky,

Andrew Morgans  38:15

YouTube, they’ve got social media they ever own, everyone has a phone, and they’re getting, you know, they’re seeing how life is like. Even if it’s through a phone, it’s a lot different than it used to be before.

Mike Begg  38:28

Because I have you know, I have plenty of friends that work in, you know, multinational companies here in Mexico. All the all the leaders, all the management, they’re all older generation, they have this old mentality about how things are supposed to be run and how things are supposed to be working. And like most Mexican employees hate it, like they want to work for a US company. They want that US structure, that US feeling. And I think that’s like one of the big advantages that we had when we first came down here is number one, there’s no one doing eCommerce down here. And number two is like everyone was so miserable with their current work situations. The workweek in Mexico is 48 hours before you get paid overtime. So pretty much everyone was working six days a week, we implemented five days a week, 40 hour weeks, like, you know, remote work, unlimited vacation. Everyone’s like, what is this? Like, how do you do this? And it’s like, this is what we want to build, like, this is what we think is fair, and what we think it creates, it should be a team environment and what you guys should have and like. Yeah, I mean, it makes a big difference. Like, it’s the same. They want the same as we have in the US. They understand what we have in the US. It’s really just a matter of getting them that here, which makes the huge difference from a work standpoint.

Andrew Morgans  39:42

Yeah, and it’s, it’s no you know, advantage one of the other I guess, trying to find the right words to say it but essentially like the gratitude that we have with our team that’s just in Central and South America is unmatched. You know, I love my, my US-based team, we’re in Florida in Kansas City, the people with us not they’re still with us have been with us a long time. You know, as we continue to hire out, and you’re just looking at what makes a good team, what makes people want to come together and do something unique and special. You want us to build your branding, we can just do it uninspired, or we could do it effing inspired, right? And if we’re effing inspired, you know, the work that’s going to come out of that is beautiful and amazing. And, and that’s what I’m trying to do. I’m trying to do great work. And so you know, it’s about finding people that, you know, our companies are what we’ve built is giving them an opportunity not just to collect a wage, but to do something be part of a team, there’s, there’s happiness that comes with that, you know, and so figuring out what those things are, it’s really uplifted our team working every day with people that are just so grateful to be there. It’s insane. Some of the notes we get that’s just like, I’m not I’m not even trying to my horn, just like it’s like, it’s humbling. It’s just like, you know, you’re just like, wow, this is incredible. And I grew up in that, but you, you also just, you know, you start doing stuff, you start being a founder, there’s not a lot of It’s a thankless job at an agency and a lot of ways, right? There’s no one’s saying, like, great job. Pretty much it’s only there when you’re like, what’s next? Or why did that thing happen, you know, or whatever, it’s it’s pretty thankless job. So you either get it from your team or not at all. And so you know, having a team that’s just positive and happy to be here and happy to be working on fun stuff, like you mentioned, happy to be part of American culture with what we’re doing. I think all you want as a business owner is people that are like, happy to be there that bring a good attitude and that are gonna, like try really hard. And I mean, like that’s, that’s a home run. And we only have three in Mexico, on our team. The rest are Colombia. So a little bit different culture, right, but still absolutely amazing. And for us, I don’t know about for you guys. But I want to talk about this, like, as we close out the show is like, you know, there’s still a lot of marketplaces, in Mexico in Central and South America as far as like eCommerce goes, and Spain and different things like that. And so now having a diverse creative team and a diverse account team. I feel bilingual, we have a lot more skills to conquer the Spanish market, which is an advantage.

Mike Begg  42:15

For sure. And like that’s honestly one of our biggest focuses focuses as an agency and just in general, what we do in the eCommerce space is like, how do we continue to grow the Latin American markets are how do we continue to make the E commerce experiences better here, and you touch briefly on the markets, like, two of the biggest ones are obviously Brazil and Mexico. But Colombia is growing fast. Argentina is growing fast. Like, there’s a lot of new opportunities that are opening up more and more that we’re actively trying to solve for. And I think that’s, again, another example of some of the cool things that we have the opportunity to do, it’s like, whatever. For example, let’s say Argentina is like Amazon, you know, 2017 or 2015, or whatever, even further back. Like, you have, the work we’re doing, or the work that we’re trying to do to bring these brands in and get them set up and going, it’s gonna have a material impact on the quality of life of the people in Argentina, and the quality of the workers in Argentina that we have, they’re gonna get involved in something that doesn’t really exist now. Be one of the first movers in their country doing it, and it’s gonna set them up for the rest of their career. So yeah, I don’t know, it’s really exciting. It’s really awesome.

Andrew Morgans  43:27

No, that’s didn’t even think about it that way. But it’s absolutely beautiful. You know, for us, like the being first mover to like Canada, or to the UK back in the day, or Australia or Japan, huge opportunities for the brands we’re working with and sellers we’re working with, but an even bigger opportunity for people that are working with you in those countries. That’s absolutely awesome. And some will have talked about offline because we have yet to really crack the code in selling well in South America, Central, and South America. You know, so we’re getting better at some bilingual stuff, especially on the creative side, if we’re trying to do for both, but actually getting in those marketplaces and dominating, and we have a ways to go. Talk to me just lastly about the opportunity that is like for sellers and brands, as you know, if they want to reach out to you, you know, they talked about Amazon, Mexico. There’s a NARF program, I’m not a massive fan of the NARF program. It can be like a little dip your toe in the water, I guess, in a way, but it’s not really the best chance of success. What are brands, you know, seeing are you mainly working with Amazon sellers in the US? Are you, like, you know, trying to make a push to bring them into Central South America on Amazon? Do you work with different eCommerce marketplaces than Amazon in South America? Give me a little color there.

Mike Begg  44:45

Yeah. So I mean, I think you, from our perspective, like we’re focused on the US, that’s obviously the biggest platform, but we are bringing more and more brands into Mexico, into Latin America. The opportunities on Amazon are awesome. When we look at the NARF program, it’s such a waste. I don’t know why people do that. But we brought one brand incorrectly. Their margin went up 130% from when they were sent north, the shipping times went down the customer experience was like it makes no sense to do the North program. I don’t know why people focus on that. But apart from NARF, sorry, apart from Amazon, we also focus on Mercado Libre here in Mexico. That’s another big market. I mean, the market shares are about 50-50 between the two. So if you’re not focusing on both of them, you’re, like, losing half the potential market for you to reach. Beyond that, I mean, there are even more challenges the further south you go. Brazil is like a nightmare for most brands to get into. Without doing some program like NARF for Mercado Full is the global fulfillment side there. So we are trying hard to bring more brands in. We have a pretty close partnership with Mercado Libre and Amazon here in Mexico. Yeah, I mean, if anyone’s interested in that, we’re always glad to talk about what we can try to do to help them from that standpoint.

Andrew Morgans  46:01

Awesome. And where can people find you, contact you, and follow along with your guys’ stories? So that’s where we reach you.

Mike Begg  46:07

The two best ways to reach me are either LinkedIn on my LinkedIn profile or my email directly. It’s Mike@AMZAdvisers.com And yeah, just reach out, and let me know you’re interested in Mexico and or Latin America in general. And we’ll try to find a way to help you.

Andrew Morgans  46:21

I love it. I am definitely looking into Amazon Brazil and different things. I’ve been on some podcasts but as a hung. I have a lot of interest in that pushing in that direction. And I think if I if I recall, a lot of homes and addresses are still in Brazil, or they don’t have addresses, or like GPS locations. Yeah. So imagine the nightmare. There’s that logistically, but also one of the most booming economies in the world. So it’s a perfect storm for some businesses to explode if they figure that out and get over the hurdles, you know, of getting into those markets or being there first. Just what an opportunity. I can remember being in Congo and once in a while finding like Cool Ranch Doritos at a shop or different things like that that were just like you would buy all of them. Like you’d buy all of them and hold them for six months, as you know, so those opportunities probably exist in eCommerce as well. Like, you know, getting products into those markets or not used to seeing them and just being like, there’s a lot of expats there alone, that could be buying goods, whether it’s like the locals or not. So you’re talking about this forever because I’m just passionate about it. But it’s been awesome having you on the show Mike and sharing your knowledge with us.

Mike Begg  47:29

Awesome, Andrew. Thank you for having me. I really appreciate it. It’s always fun chatting with you. And hopefully, we can do it again sometime.

Andrew Morgans  47:35

Yeah, I know. This is, I think it’s your third of the day. So really appreciate you closing out the day with us here at Startup Hustle. And shout out again to our sponsor, FullScale.io. They have the people in the platform to help you build and manage a team of experts. If you’re looking for software engineers, testers, or leaders when you visit FullScale.io. All you need to do is answer a few questions and let the platform match you up with a fully vetted, highly experienced team of engineers, testers, and leaders. At Full Scale, they specialize in building long-term teams that work only for you. Learn more when you visit FullScale.io. Thank you, Mike. Thank you, Hustlers. We’ll see you next time.