Retail arbitrage is not just a hobby or side business. It is a business model that many follow to run highly profitable businesses. Retail arbitrage involves finding products created by other brands and manufacturers and then reselling them on Amazon, eBay, or Walmart for a profit. The goal is to find a high in-demand product for an affordable price, buy it in bulk and then list it on one of these platforms. The more products you source and resell on these platforms, the more revenue you can make.
These essential tips will help you start and run a profitable retail arbitrage business:
Use the Amazon Seller App
The best way to ensure you are sourcing products with a high-profit margin is to take advantage of the Amazon seller phone application. This app allows you to scan items to see their current sales price, sales rank, and potential return on investment.
Shop More Than One Store
Find more than one store to shop from, even if it is the same type of store. The more deals you can find with the most units, the more profits you can make. For example, if you find a candle that people are buying for $2 at a local store but know you can sell it on Amazon for $10, you will want to purchase and sell at least twelve or more to make a profit worth the work.
Verify Your Profit Margins
In other words, find products you can sell at all different price points. However, beware of your limits. Anything that provides at least eight dollars or more in return is where you should start if you want to start and run a profitable retail arbitrage business.
Price and Ship Right Away
Don’t let the product sit once you purchase it. Follow the instructions on how to properly ship your items to Amazon’s warehouse as soon as possible. Be sure to price the items competitively but fairly. In other words, if others on the platform are selling the same thing, don’t over or underprice them, as this will only hurt you in the end. Keep the price the same by fifty cents to a dollar keeping in mind your profit margins.
As you can see, you can’t just post any product and expect it to be successful. It needs to be an in-demand product and offer a good return on investment after being shipped to Amazon then packaged and sent to the new owner. For retail arbitrage to be successful, you must sell at a profit and find more than one unit. This means most successful retail arbitrage businesses eventually open a warehouse and hire employees to source more products and get them shipped to Amazon quickly.