Everything You Need To Know About Retail and Book Arbitrage
What Is Retail Arbitrage?
Think of retail arbitrage as reselling products for a profit. It involves looking at the price of a product, buying it at its lowest and selling it on for a higher price. Often products are bought when on sale or heavily discounted either online or in store, and then sold through online platforms such as Amazon for a higher price.
For example, a kids’ toy is discounted at the local supermarket down to $10 but is listed on Amazon for $25. An individual can buy a few of these toys and list them on Amazon for a higher price. Even with Amazon seller fees, there is still a significant profit per toy.
When making these purchases, it is important to take into account how likely the products are to sell, how to list the product appropriately and to calculate profit after paying fees and shipping costs.
Best Categories for Retail Arbitrage
Many people who buy products to sell on Amazon often focus on certain categories of products as they know that they are likely to sell easily. When it comes to selling on Amazon the most popular products that sell well include:
- Home and Kitchen Appliances
- Beauty Products
- Fitness Items
- Board Games and Puzzles
What Is Book Arbitrage?
Many choose to focus their efforts specifically on books – known as book arbitrage. Book arbitrage is extremely popular as many good titles can be found at low prices in discounted stores and sold for a much higher price online. While digital books have become popular in recent years, many customers still love owning the physical copy meaning that they are still in demand.
Sellers of books can either sell themselves on online retail platforms such as Amazon or sell to third party sellers for a lower profit but guaranteed instant sale.
Where to Source Books For Book Arbitrage?
Many trying to get into reselling books online question where is best to source their books. There are two main places to source books – either in person at discount stores, thrift stores, garage or library sales (as long as the books are in great condition if second-hand), or online if they can be found for a good price. If you are shopping in person, there are many apps that you can use to check the online prices instantly before purchase, taking some of the risks out of book arbitrage. Some of the best stores to source books include:
- Dollar General
- TJ Maxx
Online Retail Arbitrage
If you don’t have the time or facilities necessary to go and physically find books and goods to resell in physical shops, there is another way to source products to resell without having to leave the comfort of your own home. You can search for products online in sales or on discount websites to find them at a cheap price. Many of the stores listed above have websites where you can find products to sell on. Amazon, also often has sales meaning that you can buy books or goods at a discounted price, and wait until the sale is over to resell them to make a profit.
Where to Sell Your Products
No matter if you are working to resell books, toys or other products, the most popular site to do this on is Amazon. This is partly due to the fact that they offer the Fulfilment by Amazon service which does most of the hard work for you – all you have to do is advertise the product for sale. They also offer the Amazon Seller app which can be downloaded from the app store to help track your sales, which products you have in stock and the fees you pay to Amazon. Amazon itself will deal with the shipping of the product, returns and any customer service issues.
While Amazon is a great place to start if you are getting into retail arbitrage, there are other platforms where you can also make a good profit including eBay and Craigslist. If you are specifically selling books, consider sites such as Paperbackswap, Abebooks and Powell’s books. It is always recommended that you compare book prices in order to sell your books for maximum profit.
Best Scanning Apps for Retail Arbitrage
As previously mentioned, there are a number of different scanning apps that are good to have downloaded on your phone if you are looking for physical books in person. These apps allow you to scan the bar codes on the back of books to see how much they are listed for on a number of platforms online. This can help you identify the best deals and increase your profits. Many of these apps are connected to Amazon’s database, meaning that they can give you information on how likely it is to sell and the average price of books that do sell.
Some apps do cost, but the subscription can be worth it if you are selling a lot of books as it can lead to better profits. Over time, the cost of the subscription will be worth it. Below are a number of different apps commonly used by those looking to sell books. Let’s take a closer look:
Amazon Seller App
Linked into Amazon’s database is the Amazon Seller App which not only allows you to check the cost of books but manage your reselling business if you are looking to sell those books on the Amazon platform. The app allows you to check your sales, support customers and handle selling and returns. This is extremely helpful if you are buying book copies in person.
If you are using Amazon FBA, Amazon will store, pack and ship your products for you, taking on most of the hard work.
If you are not looking to sell on Amazon, and instead thinking of selling to a third-party seller for a quicker profit, Bookscouter is a great app to use as it allows you to compare prices from a number of different book buyback stores. By scanning the barcode of the book, the app will give you the best offers for the title. After receiving this information, you can choose which vendor you want to sell to. Even if you are considering selling on Amazon, it may be worth having this app as often Amazon does not guarantee the best profits for all titles.
The Advantages and Disadvantages of Retail Arbitrage
The idea of buying products or books for cheap and selling them for a profit online sounds like a great way to make a profit. However, like any kind of job, it does come with its advantages and disadvantages that are important to consider before investing in this role. Take a look at some of the things that you should consider:
- You do not need to invest a lot of money to start up.
- You can choose how many hours you spend on this.
- The process allows you to start making a profit quickly.
- You don’t need to be an expert to get started.
- If you select the wrong titles, you can lose money as they may not sell meaning you won’t make a profit on them.
- Arbitrage is becoming more popular, and this means there will be a lot of competition.
- You might spend more hours than you had planned in order to make a profit.
The Take Away
It is clear that retail or book arbitrage is a great way to meet some extra cash but it does require some work and can be competitive. The most important thing is to keep an eye on the books or products that are selling well and try to find these at the lowest price possible. We hope our quick guide has helped you understand this field more – so what are you waiting for? Try it out today.