Sourcing in Depth Part 2 – ONLINE ARBITRAGE

Sourcing In Depth Part 1 – RETAIL ARBITRAGE
September 20, 2017
Sourcing in Depth Part 3 – WHOLESALE
October 11, 2017

For my second post of the series I am going to look at Online Arbitrage as a valuable way to source products to sell online. If you are well practised in scouring the web looking for deals then congratulations! You are half way there already. If online shopping is new to you then, well, it is much the same as real shopping, with less human interaction, and fewer heavy bags.

If you are working on a small scale with a limited budget, it is worth searching in the sales sections of your chosen online retailer. If you find something that looks promising, check what it is selling for on Amazon or your retail platform of choice, and whether it is profitable. As in retail arbitrage it is useful to set yourself some criteria. For example, you may want to focus on products that will give you a profit that is higher than (for example) 30%, that cost less than a certain amount, have a good sales rank or even that weigh less than a certain amount for cheaper postage. Always remember that Amazon FBA will take a cut of your profit.

While online arbitrage initially just takes good timing and a bit of common sense, as your business grows it can be helpful to introduce tools into your online shopping escapades to save you time, and to yield more profitable results. Apps or websites such as do the time-consuming work for you, by scanning websites and comparing the products they find to their counterparts on Amazon. They will collect a lot of information that you can use to determine whether or not it is worth snapping something up.

While there are some free softwares out there to help with your online arbitrage, often the best ones come at a price. It is up to you to decide how much you want to fork out. Once you have downloaded and/or paid for your chosen software, running the scans is a fairly simple business. Often you can choose your own criteria like those above, in order to sieve through the available products for those that meet your standards. Once you have chosen your filters, you need to select a section of a promising looking website, copy the address, and off you go. Depending on the number of products on your chosen webpage, the scan may take anywhere from ten minutes to a few hours, so go and make yourself a cup of tea, watch some TV, or, if you’re feeling productive, get on with some other work.

Once the scan is finished it should provide you with the data you need to make your purchases. Make sure to check that all the products match up, and that you still stand to make a profit after your chosen retail platform (e.g Amazon or Ebay) has taken its cut. If your search has yielded good results then buy buy buy! However also be wary that some companies will not allow you to buy more than a few of the same product, for fear that you will sell it on (which in this case, is true). Don’t be surprised if your order of fifty identical frying pans gets cancelled – it probably looks suspicious! Often enough however you will find that it all goes through smoothly and you have gained some nice shiny stock to resell for a profit. If buying several of the same product is an issue, try buying them in batches of 3 and place an order every couple of days etc.

Finally, though you won’t have to carry these purchases home, you will need somewhere to store them. As with retail arbitrage, if you have a limited amount of storage space, don’t buy too much! Though in the midst of a sale frenzy it might seem like a good idea, it probably won’t when you are wading knee deep through boxes in your living room. Often at first it is a good idea anyway to buy one or two items to see if they sell well. Once you have gained experience you will develop an instinct for the kind of thing that does or doesn’t do well, and will be able to risk buying more.

In comparison with retail arbitrage, online arbitrage is far superior in terms of convenience. You can do it without leaving your bed if you want to! This convenience means you save time, and possibly money, as often there are better deals to be found on the web, and it is quicker to scour a web page than a physical shop on the highstreet. So, if you are looking to source some products, what are you waiting for! You can access hundreds upon thousands of shops from all over the world in the click of a button, happy hunting!

Once you have sourced and bought your products, it can be useful to have a helping hand in getting them prepped, packaged and sent to be held in an Amazon FBA Centre. Luckily, we are here to help you! If you want the boring tasks taken off your hands so you can spend your time on the important things, contact us! Our website has the details at, take a look… we’d love to work with you.