TOP TIPS FOR ARBITRAGE ON AMAZON
Published by Julian in Arbitrage
Make Amazon an arbitrage-friendly zone. With a few hours of work per week, and these five tips from our blog, you can quickly set yourself up with an income of a few thousand bucks a month or more! Know anything cooler than that?
1.READ THE RULES!
The first and most important task for beginners is to familiarize themselves with the rules of selling on Amazon. Start at this page, and work your way ahead. Knowing the rules of the game before you begin to play will save you the cost of learning by error, later on.
If in doubt, ask away! Join a sellers' forum and have your doubts cleared by those who have walked before you.
Another thing to keep in mind is that Amazon changes the rules frequently, and the savvy seller must find ways to stay updated. Often there are different rules for different product categories (groceries, beauty products, clothing, etc.), so don't jump in without doing your homework.
A dime worth of automation will soon pay off in dollars! When you use automatic tools to handle inventory or shipping, you give yourself more time to sweat the big stuff – customer service, plus researching and sourcing quality products at the best rates.
- Use the Amazon Seller App or ProfitBandit to scan items on store aisles. These tools will give you a clear picture of the popularity and price of a product. Remember – the best Amazon sellers keep looking for deals, no matter where they go.
- Explore services like Feedback Genius to prompt customers to give you some positive seller feedback (or to get back in touch with you if something is amiss). Likewise, employ web based services to handle your inventory, repricing strategy, bookkeeping, barcodes and title keywords.
- A laser printer, tape dispenser and label maker should be sufficient for your initial packaging needs.
- And of course the absolute essential Amazon Repricing Software.
3.PLAN YOUR STRATEGY
Know the best part of selling online? You get to compete on your own terms. So get a sound selling strategy in place before the rubber hits the road, to save yourself a headache later.
No budget? No problem! Start with unused items you would find around your house… Many of our homes are cluttered with books we finished long since, or gift items we never opened. Raid your closets and garage for objects that you can sell.
Later on, ask yourself the following questions:
- -What products am I going to sell, and what products are best left alone? Items like beauty products or perishable grocery items have special requirements that might be outside your reach as a newbie seller.
- -Who are the sellers I am competing with? Choose you battles wisely! It is very easy to be kicked out of the race by a seller with deeper pockets than yours. Similarly, competing with Amazon itself is far harder.
- -What is my ideal profit margin? After factoring in overhead costs and taxes, don't forget to pay yourself for your time!
- -What is the minimum category rankings that I want to maintain for my products?
4.GO ON YOUR 'TREASURE HUNT'!
This is probably the most fun part of arbitrage, at least for those who don't mind getting down and dirty! The secret to a successful treasure hunt can be summed up here – Don't be afraid to look in unusual places.
Source objects from auctions, retail stores, thrift stores, flea markets, and your local handicrafts fair. Clearance items at stores like Walmart, Target or IKEA can be hidden gems. Don't be afraid to contact the manufacturer directly for bigger discounts, check out sourcing websites like made in china, Alibaba and AliExpress! Push your game up a notch by collecting coupons, loyalty points and freebies with regular purchases. Although small objects are easier to ship, larger items often have the least competition and bring the highest profits.
Are you in the habit of ignoring books without barcodes? Stop right now! Enter its ISBN code to find out how popular it is, actually. The most outrageous offers exist right outside your comfort zone.
5.FBA ARBITRAGE IS SERIOUS BUSINESS!
Once you get into arbitrage, do take your side business seriously. Selling on Amazon is more rigorous than eBay, so you can forget about good packaging or customer support only at your own peril. Put efficient systems in place for managing sales, inventory and tax. And don't get your bank account details messed up! A word to the wise – save your receipts when buying from stores like Walmart, to be eligible for a tax deduction.