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“Flesh and Blood robots working for Amazon”
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Thanks for posting! My first thought was that the employee at Target that helped them clear the shelves of those water bottles is probably no longer employed (or at least got in some trouble). Target is notoriously anti-reseller.
I’m certainly not doing RA at a high level, but am on pace to do around $80-100k gross this year (for around $24-30k net). I probably spend 20 minutes a day repricing/etc, 1hr per week in an online “mastermind” with a few other sellers, and 2-5hrs per week scanning/buying/shipping product.
It’s not the most exciting income stream for me personally, but it is a wonderful supplemental income stream to my eBay selling.
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I posted this on another thread, but might as well bring it over here. According to your numbers, you spend quote a bit to make a profit.
Amazon.ca sales: $954.00 (CAD) (Approx $238.50 net profit)
Amazon.com sales: $1,269.00 (Approx $317.25 net profit)What do you think of your Amazon experiment?
–Does it make sense to spend $900 to make $300? (that $ nothing to sneeze at, but that’s a lot of money to have tied up)
–Do items sell fast??
–Have you had any issues with buying in bulk and then the items not sell the way you expected?
–Do you find and sell the same items consistently, or are you always finding different items to sell because of availability and/or market saturation?0
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I watched one of the videos linked to in the article – The Bearded Picker spent all night traveling to various Wal-marts to buy 182 Monopoly for Millennials Board Games. Paid about $19.99 each and flipped on Amazon for $60ish. After expenses, mileage, etc. he profited over $3K for 22 hours of work – most of those hours were driving, so not bad. Of course, everyone jumped on board after the video so now ebay is flooded with them and the price is much lower. At the end of his video he said retail arbitrage is “the Ricky Bobby School of Reselling: If you ain’t first, you’re last.”
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I can see the potential in RA, but like many others here, I have a hard time convincing myself to do RA, especially since I’m in an area where I can usually find non RA stuff without too much trouble. (Admittedly, getting a little harder as more people get involved with this sort of thing, but as Jay likes to point out, we live in a country with So.Much.Stuff…)
I’m not entirely risk averse, but one thing that bothers me is what Julie B just said: “If you ain’t first, you’re last.” I don’t like the idea of getting stuck with a bunch of RA stuff that is declining in value….at least some of my scavenged stuff has actually increased in value as it sits, waiting to be listed LOL
Also, I worry the B&Ms will increasingly crack down on RA buying in their stores. I walk into an antique mall, no one is going to complain if I empty an entire shelf….they’ll be too busy high fiving each other instead.
If I didn’t have so much scavenged stuff already, and good sourcing, I’d probably do more with RA. But for now, it’s some thing I do only if I stumble across something that looks like a really easy and profitable flip. Which isn’t often.
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I feel that people hype Retail Arbitrage as a quick way to make a lot of money. But it takes as much time as anything IMHO. Maybe easier to list, but you have to spend more time scanning, researching, running around to buy clearance at stores. The time spent is just in a different part of the process compared to buying/selling long tail.
It all comes down to what style of selling you enjoy.
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“If you ain’t first, you’re last” is the key. I’ve been playing the RA game for the last few years and got burned a bit a few summers ago. In Canada, McDonalds released various sauces like “Big Mac Sauce” at grocery stores, I bought about 48 bottles for $4 each and the first three sold easily for around $40. Then the market got flooded. The price dropped, and I was stuck with 45 bottles of something I don’t really like to eat. I ended up donating the rest to the food bank.
I learned to play it safe on items like that – just buy a few, and I could always buy more if it remained hot.
Now, almost all the RA we buy is something we could use. For example, I bought 10 big and tall shirts last week – but just in my size. I’ve already sold one, and need to sell 3 to make a profit. Any shirt I don’t sell, I’ve made sure it is something I would wear. So if I sell 3, great, if I sell 9, I’m well in the money, if I don’t sell any, I have some nice new brand name shirts to wear one day. This is something I do often, so I know I’ll do great, and the odd shirts that don’t sell I’ll use eventually…
Another RA item I just listed is a discontinued specialty men’s shampoo – again, bought it cheap enough that if I have to use it, I’ll just have a couple months of shampoo to use up and it was cheaper then the shampoo I usually buy. The scent isn’t something I really like, but bearable if I lose out on the gamble. In this case I bought 15 bottles for $1 each, and see others have sold them for $20+. I have mine at $18, and I sell one, I’m safe.
I’d hate to be stuck with something I couldn’t use in quantity from a bad RA buy again. I wouldn’t have gambled on the Monopoly games in large quantities at $20 like the video has.
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I don’t like the margins on RA, so I don’t do it. I get why people do it (multiple quantity, brand new items, ease of purchasing at a local store, etc,.), I just don’t choose to buy and sell that way myself.
However, what I don’t get is why people that do this share youtube videos on the process of how they do this. “Here’s the store I go to, the aisle I go down to get the products, the listing software I use to list the items, the price I have it listed for.” What?!?
Especially the people with repeatables. Why would you create your own competition in order to get a couple of thousand views on your video?
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Jay asked:
-What do you think of your Amazon experiment?– It has added another income stream to our income. I have approached it VERY cautiously/slowly. I’ve slowly found a few niches that are regular sellers (a few units per month), good profit (in some cases, 70-80% returns), but are ranked low enough, or are difficult enough to find that they don’t attract many other FBA sellers. Probably 80% of my items are replenishable. I just go out and pick up another month’s worth of inventory when I run low, and send it in.
–Does it make sense to spend $900 to make $300? (that $ nothing to sneeze at, but that’s a lot of money to have tied up)
– Compared to the return on investment that eBay gives me, no, but for the minimal amount of time/work it takes me each week, an extra $400-1,000/wk of income is pretty incredible. We have no consumer debt (just a mortgage and vehicle payment), so cashflow/debt isn’t a huge concern at the levels I’m at. If I was able to find any other investment that offered a 30% + return with relative consistency/predictability, I’d throw far more money at it than I’ve been investing into Amazon…
–Do items sell fast??
– Honestly, I try and steer clear of things that sell too quickly, as they draw other sellers out of the woodwork, and the prices end up tanking. I’ve had items sell within two hours of hitting the warehouse, and I’ve had items sit for a year (rarely, thankfully). Most sell a few units a month, and I try to keep about a month’s worth of inventory in the warehouses.
–Have you had any issues with buying in bulk and then the items not sell the way you expected?
-Very few times, but yes. I don’t often jump onto anything “hot” but if/when I do, I sometimes get stung. An example is a board game that got discontinued some time ago a while back (it wasn’t very PC, and was targeted towards kids). Stores were starting to pull them from shelves, and I managed to pick up 12 units on clearance at $14/ea. I sent six into the warehouses right away. Two sold instantly for $59.99. One sold a while later for $54.99. One again for $45.99. Currently have two in the warehouse, and six more in storage. Current selling price is hovering around $34ish. I’m still above break even after fees, but probably shouldn’t have gone as deep as I did.
All in all, for me, Amazon is by no means as enjoyable as ebay selling, but I’ve found some consistent income without much extra work, and it helps to supplement my income as I try to break out to full-time reselling. I’ll keep doing it as long as it doesn’t make me unhappy, and as long as it provides another income stream.
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Cool. Sounds like it’s working out well.
–Do you struggle with Amazon’s long term storage fees? I think that fee kicks in after 6 months if I remember correctly.
–Do you have any issues with ungating categories?0
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Something I had never considered until recently is the prospect of selling my amazon business in the future. I recently came across someone looking to purchase an existing business, and it got my brain thinking. Doing some searching, it looks like sometimes small companies, or new sellers will buy an existing account. I’m guessing part of it is to be able to hit the ground already being ungated for certain categories/brands, and to have an established revenue history.
It’s not something I’m actively looking into, but with a seller’s account that is over two years old, and ungated for a LOT of difficult products, it’s something I’ll keep in the back of my mind should I ever tire of it.
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The vast majority of my inventory sells before LTSF kick in. It’s been pretty insignificant to this point. Talking <$20/6 mo.
There are still some brands/categories that I’m not ungated in, but it seems like I get auto ungated in most of the ones I request. If I’m in a store and scan something that I’m gated in, I request approval right then on my phone (even if it’s not a profitable item). That way if I ever scan a comparable item that’s profitable, there’s a good chance I’ve previously gotten ungated. I’m still blocked from lots of the BIG names (apple, Nike, etc) but there’s rarely anything that I would buy by them anyway since competition is so fierce.
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