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I hit up the toy clearance at Walmart pretty good while they were clearing up room for the Christmas inventory. I sent in multiples of several things. One of the items the price came back up and I sold out in a dayor two of quantity 9.
The price on everything else I sent in has not came up. New sellers keep tanking the price. I’m hoping that this mythical last minute Christmas rush experiment will pay off. Otherwise I’ll be stuck with a lot of large toy inventory. Knowing what the fees are, I cannot comprehend the business model of many sellers on FBA. Considering the sales price, fee’s shipping costs, etc, many of these folks are selling at prices where they cannot possibly be making money unless they are getting the inventory for free.
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Yeah, you always hear people’s gross sales numbers which often seem incredible. But I guess it’s the huge volume that makes up for the small, unpredictable margins.
Good to hear your experience. Though we havent gotten into retail arbitrage, our FBA experience has been similar. The only times we made out like bandits is when we have found multiple of new inventory for dirt cheap. That’s the rare scavenger find, but not a foundation to build a business.
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Margins on RA are very, very low. I think I average $7 after all COGS and fees.
Here is a current example I am awaiting sales on:
I bought and shipped these while out of town on business. I found these on great clearance at walmart for $9 each plus tax. I sent in 15 of them. My shipping costs were $33 along with an additional $10 in boxes and packing supplies. So my total cost per item rounded up to the nearest dollar is $13.
Shipping was expensive because I could only fit 5 to an 18x18x24 box. They also made me ship one box to CA.
History shows that this item went through the roof in the last few days before Christmas last year. I don’t know if that translates, but Monster High is still a hot item this year.
Currently the price is $25.99 and it has hovered there since I shipped items in. The fees are $12.58 at that price. At that price point I will make a whopping 41 cents per item for a grand profit of $6.15. Woo hoo!!!! I really do think there are amazon sellers that sell at those margins, which is crazy.
My goal sale price is $44.99. That would bring in $16.56 per item and $248 profit. It took me about 30 minutes to pack the items and listing time was negligible since this was a single SKU. So if (and at this point it is a very big if) these all sell for that price it will have definitely been worth the effort.
One other note, I am not including the ridiculous storage fees amazon is charging this month. I’m not sure what those are at this moment, but I’ll assume $1 an item.
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I do not do retail arbitrage much, that seems like a tough item to flip and mark up $19. There are dozens of other FBA sellers between 25.99 and 44.99. The rank is good at 11k so you should see some movement as the lower prices go out the door. I would make the call around the 17th to lower the price as time dwindles down before Christmas. See how many sellers are still under the $44 range, if they are selling out you may have a chance to move them at that price. Good luck, hope it works out.
I really do not want to keep any toys in Amazon after Christmas, not with new fee structure. I will dispose or have them send back any I do not sell and then reship them with new stuff next October.
*Edit* There are some selling on Ebay for $36-38, possible to cross list them and have amazon fulfill the order. Probably come out cheaper than shipping yourself.
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I just had an item ( Lego fairies set) sell out quickly. I priced high at $60. I’ve been checking every day on price. It shot up very quickly and I was out of stock just like that.
It is pretty cool when that happens.i do wish Amazon would alert me when I have a tentative sale though – that way I can check price and maybe raise it.
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Yes, but where as Ebay is like sailing (if you know what you are doing it is a slower and more relaxing ride), FBA is like driving a speedboat. Things change and they change very quickly. If you find something good, you need to be able to get it in right away. You need to know a great deal of small bits of information and apply that information in a cohesive fashion. How many other sellers are selling, are you competing against Amazon, what are your storage fees, what is the ranking, is this item going to be hot, how has it done in the last 12 months, am I getting this clearanced out a major retailer or one that is more local to my area (will every Tom, Dick and Harry race to the bottom).
I balance all of the above by having a selection of slower moving, merchant fullfilled items. But I make money very quickly, which is nice. It also offers interesting possibilities such as having a more hands off business. Ebay is fun. Amazon is a different kind of fun.
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From what I’ve learned from Amazon FBA sellers, the workload just seems different. Once items are shipped in, Amazon takes care of things. So that’s the chill, easy part.
But I see FBA sellers spend a large portion of their time always sourcing new items to sell. As you said, you have to be on top of the competition and prices. Because it’s a much more dynamic marketplace, it doesn’t sound like you can just passively check out.
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