Some resellers are finding success in their flipping business by adding retail arbitrage to their eBay offerings.
Retail arbitrage is the practice of taking advantage of a price difference between two or more markets, and reselling items to make a profit. For example, some resellers buy items on clearance at major retailers like Walmart or Target and then turn around and resell them for a higher price on Amazon or eBay.
As an eBay reseller, you’ve probably asked yourself whether you should join in the hype of retail arbitrage and how you can get started. There are a couple of ways you can do retail arbitrage including Amazon to eBay arbitrage, which we’ll dive into.
What Is Amazon To eBay Arbitrage?
Amazon to eBay arbitrage is exactly what it sounds like, purchasing items for cheap on Amazon and then reselling them on eBay at a profit. For example, you might find items in bulk for cheap on Amazon such as a specific kitchen gadget for $5 each, and then you see that the same kitchen gadget is reselling on eBay for $10. Now, it’s not worth it for you to buy one of these items and flip it to make $5, but If you were to buy and flip these items in bulk, you might see a good profit.
You are capitalizing on Amazon’s lower price and reselling on eBay at a higher rate.
What Is Retail Arbitrage?
The same concept applies to other stores. You don’t only have to purchase from Amazon. You can shop in person or online at major retailers like Walmart, Target, Home Depot, Lowes, etc. and find great deals on products that you can then resell on eBay. It’s important to make sure you are doing the comparisons though before you buy the product. Look at how many items have sold at that price on eBay to make sure it’s consistently selling at a high price and you don’t make a bad buy.
Try Retail Arbitrage From The Comfort Of Your Home
Some people like to get out to the stores in person when sourcing items for retail arbitrage, but many resellers do it from the comfort of their own home. Create a separate email account and sign up for email notices from the different companies you like to shop from. You’ll be notified by email of sales so you can get better deals. People also shop for retail arbitrage products at the holidays during major sales like Labor Day, Memorial Day, and Fourth of July.
Is Retail Arbitrage Dropshipping?
Retail arbitrage can be dropshipping but it doesn’t mean it always is. Amazon to eBay arbitrage is often used via dropshipping so the resellers don’t have to have the stock on hand. When customers buy these products on eBay, eBay resellers buy from a third party like Amazon, and have them shipped directly to customers. This eliminates the need for resellers to handle the products. It makes it cheaper for resellers because they don’t have storage fees and can buy stocks of the product as necessary.
Now, you might be asking why would someone buy something on eBay if it’s cheaper on Amazon? Some buyers like to shop only on one platform. They might have an eBay gift card to use, or they might simply not have typed the right search terms into Amazon to find the product. People often don’t check multiple locations because they assume the best price will be on both Amazon and eBay. That’s where you can capitalize on price differences. Amazon may not ship to specific areas if it’s too expensive or remote, where eBay’s Global Shipping Program will ship to those areas, so that’s another reason people may prefer to shop on eBay.
When doing retail arbitrage it’s recommended to avoid specific categories like food, jewelry, and expensive items. Start out with one or two items and see how they do. Make sure to do your research before you invest too much money into retail arbitrage. That being said, it’s a way to diversify your eBay reselling business.
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