WHAT IS AMAZON RETAIL ARBITRAGE?
What is Amazon Retail Arbitrage and how it works? First of all, we will discuss what is retail Arbitrage actually. In simple words purchasing a product from a retail store at a lower price and selling it with higher profit. That,s all called Retail Arbitrage. Let,s suppose your purchase a product at 10 rupees and sell out it on your E.commerce store at 15 rupees. The same thing is demonstrated on Amazon when you list this discounted product on Amazon.
Difference Between Normal retailing and Arbitrage Retailing
As far as arbitrage retailing is concern, there is no supplier you can source your product directly without any intermediaries such as a supplier. While in the case of Normal retailing you have to depend upon sourcing and suppliers.
Is Retail Arbitrage Works or not?
- Obviously, it works. As you know there are different prices for the same products in different regions. On the other hand demand for products also fluctuate in different regions. So under Retail Arbitrage, you can target a specific area and sell out your product easily with a profit margin.
- Convenience is another indicator in favor of Arbitrage. Because E.commerce is more convenient than traditional commerce for buyers.
Retail Arbitrage On Amazon
There are two methods for retail arbitrage over Amazon Which is given Below
There is a big difference between them. On an Individual Seller account, you have some limitations such you have to pay a certain amount of payment as commission to Amazon on every sale up to $.99 while you can list only 40 products. On the other hand, Professional Account charges you only $40 dollar with some referral fee. On a professional Seller account, you can sign up for FBA which is considered a unique feature for your own brand recognition. It will become your flippable asset in the future.
- You can also read HOW TO CREATE AND AMAZON AFFILIATE ACCOUNT
- HOW TO EARN WITH AMAZON AFFILIATE MARKETING
Pros and Cons of Amazon Retail Arbitrage
There are some pros and cons of Amazon retail arbitrage. This biggest advantage is quick and low-cost entry into the market. On the other hand, there is some disadvantage also exit that is lower profit margin as compared to Amazon FBA. Secondly, you have to follow the brand regulations also. You cannot make your own brand with retail arbitrage.
To sum up, our discussion we can say that Retail arbitrage is riskier with quick entry into the market. It also holds low profit as compared to Private labeling. So it depends upon you whether you want to go with Amazon retail arbitrage or Private labeling and FBA. Both require some sort of market analysis. If there is no demand for a specific product not to speak of retail arbitrage, even you cannot sell your product under private labeling. But FBA and private labeling are more advantageous than retail arbitrage.