As the retail and e-commerce landscapes continue to grow and evolve, many entrepreneurs and online business enthusiasts are looking for ways to profit by reselling items. One of the easiest and low-budget strategies to make money by selling goods is to engage in retail arbitrage, which involves buying and reselling products for profit.
Are you interested in starting a retail arbitrage business but unsure where to begin? Or maybe you’re an experienced reseller or someone who built a company based on your unique reselling strategy? Or you’re a product founder who acquired specific experience in the reselling niche and then launched a branded software tool for resellers that helps improve processes and operations?
The following material is based on the stories, tips, and insights from real retail arbitrage experts and reselling enthusiasts. We’ve collected the pieces of advice and the experience they agreed to share in hopes that you’ll find it interesting and instructive regardless of the group you refer to.
- Types of Products Best to Resell
- Product Sourcing Secrets
- Retail Arbitrage Trends in 2023
- How to Start a Reselling Business
- Tools & Software for Resellers
Types of Products Best to Resell
The first thing we were interested in was the best retail arbitrage items. So we asked our experts what types of products are most effective to work with to build a successful reselling business on Amazon and other popular marketplaces. See the most interesting answers below.
“Books are the best category to start with for newer Amazon sellers.
The main advantages are:
1. Books are cheap.
2. Books are abundant.
Anyone can start with $25, list some cheap used books on Amazon, and start making money fast.”
– Peter Valley, a 15-year Amazon seller, specializing in reselling used books
“The demand for physical books is still high. And with the latest trend of being eco-conscious, it isn’t going to die anytime soon. If you’re planning to start a reselling business on Amazon, used books are the best product to go for.”
– Marcus Arcabascio, CEO Founder of Random Names, a former Founder and Managing Partner of SEOPledge
“Unlike some other popular resale products, postcards are easy to ship and list, which is how I’ve been so successful (I started my business in 2021, and it’s grown exponentially each year). I haven’t visited a post office or scheduled a pick-up in months; every morning I swing by a blue mailbox on my way to work. Postcards are scanned, not photographed, which takes seconds. I can list 50 postcards in one hour (and my average sale price is currently $15.22, so that’s about $761 of gross future sales in a single hour).
Sourcing products can be one of the more difficult aspects of the business, as almost any other reseller will tell you. I won’t give away all my secrets, but online auction sites – like HiBid, Invaluable, and Live Auctioneers – are some of the best ways to find inventory without leaving your home. However, some of my best buys have been at postcard shows, antique malls, and from local collectors.”
– Daniel May, reselling business owner Mailseum, sells part-time and has a 9-5 job, YouTube channel
“Antiques are the best product that works effectively for a resale business.
Antiques can be bought below market value. However, these pieces are sold for much more than their actual price. Reselling them means anyone can earn a huge profit.”
– Elisa Bender, Co-Founder of RevenueGeeks
Product Sourcing Secrets
Product sourcing is a crucial aspect of retail arbitrage. Success in retail arbitrage depends on your ability to find products at a lower price and sell them at a higher price. As for the sourcing, we have the following advice from our interview participants.
“Identify high-demand items”
|“1. Focus on High-Demand Items
Identify high-demand items that are popular among consumers but are in limited supply. These products can often be sold at a higher price than their retail value.
2. Check Clearance and Discount Sections
Retailers often place items on clearance or in discount sections, offering you the opportunity to buy products at a lower price and sell them for a profit.
3. Scout for Limited-Edition Items
Limited-edition products can be sold at a premium price due to their scarcity. Keep an eye out for limited edition products and sell them at a higher price.
4. Consider Bulk Purchases
Buying products in bulk can often result in a lower price per item, allowing you to sell them at a higher profit margin.”
– Eric Jones, CEO of Couture Candy, a 15-year-old special occasion fashion e-commerce business
“Choose the product that is running hot in the market”
|“You need to choose the product that is running hot in the market. Also, it’s okay to start small so that you get used to the process.
You can simply source products from charity shops or from wholesalers. Always look for discounted items in stores to make big profits. For example, shop at local stores or look for items that are labeled “refill.” Also, you can search for discontinued products on eBay so that you can put them on your listing.”
– Jessica Shee, Marketing Manager at iBoysoft
“Scanning for deals…through the use of apps that scan barcodes”
|“Scanning for deals.
This involves scanning online marketplaces, discount stores, and clearance racks for products that are priced lower than their current market value.
This can be done manually or through the use of apps that scan barcodes and provide information on product prices.”
– Saj Munir, Chorlton Fireworks Founder
And here’s our top-secret advice on product types to build your reselling business with, which comes from Yoni Mazor, CGO and Co-Founder at GETIDA.
“Identify popular products that are hard to source”
|“The best products and most effective to work with in the long run for Amazon resellers are products that are constantly high in the demand, but also maintain good profit margins. Sounds simple, but this can prove to be challenging for the simple reason that most popular selling products tend to quickly get many other resellers that begin to source and compete on selling the product on Amazon. This is when the price war begins, and the race is to the bottom, and margins get cut down. Hence, if a reseller is able to identify popular products that are hard to source and other resellers are not able to easily source, there is a higher chance of longevity and success for the particular product. It saves a lot of headache and energy being able to constantly source and replenish bestsellers instead of constantly looking for the next popular product to source and compete on.”|
– Yoni Mazor, CGO of GETIDA.com
And here is an alternative point of view on the matter.
“Be able to recognize potential forgeries”
|“If you want to be successful in reselling, I believe that selecting a certain market segment is really necessary. Discovering your area of expertise and cultivating an in-depth understanding of it will enable you to make more money from reselling by locating better offers and selling them at a higher price. For instance, a fantastic comic book reseller will have no trouble recognizing popular and rare comic books that are being sold at prices that are lower than the current market value. Because of this, it is much simpler for them to locate chances that might result in financial gain. In specialized markets like comic books, it’s important to be able to recognize potential forgeries so you can avoid throwing away money on unintentional oversights. Developing the necessary abilities may be quite helpful in this regard.”|
– Robert Zeglinski, Managing Editor & Researcher at BreakingMuscle
Retail Arbitrage Trends in 2023
Now let’s explore the trends in the retail and e-commerce markets that may affect your reselling business. We are happy to provide you with valuable insights and knowledge from retail arbitrage experts that can be useful in making informed decisions in business or investing and adjusting your strategies accordingly.
What trends to expect in the retail arbitrage business in 2023? We’d like to highlight a few that deserve your attention: further growth, automation potential, and evolving channels.
Future Growth Potential
“Reselling will continue to gain massive growth in 2023 as the secondary market becomes more acceptable, not only as a means to save but because of the increasing awareness of sustainability and ways to help the environment.”
– Pinky Chong, Resale Consultant and Luxury Brand Authenticator at The Resale CEO Academy
“I would say that 2023 is a good year for arbitrage sellers to be in business. The reason is that inflation has hit the US economy and retail prices are going up. So, a good reseller should be able to source products to resellers at a really competitive price, and pass the price discounts and savings to consumers who in these challenging economic times, would be more likely to purchase from the most competitive resellers out there.
Therefore, if you are a reseller that is able to source really popular products for really good prices, you should be able to win big on the Amazon marketplace and beyond.”
– Yoni Mazor,
CGO of GETIDA.com
“The latest trend here is using tech to automate the whole process. Apps like SellerRunning can help source items, set prices, and sell to customers all on their own. With such apps doing everything on their own, resellers can greatly cut down on costs.”
– Marcus Arcabascio, CEO & Founder of Random Names, a former Founder and Managing Partner of SEOPledge
New Channels Acquisition
We’d like to share the experience of a successful reseller who shares a few ideas on new channels.
“Have Moved Away From Amazon More Towards eBay
I’ve been reselling for years and in the recent past I’ve moved a bit away from Amazon and more towards eBay. And I never thought I would say that because I was tremendously successful back in the day selling on Amazon. It just seems like they’ve made life too difficult for individual sellers, although that’s just my opinion.
OfferUp Has Been A Huge Success
I’ve recently had tremendous success with OfferUp. It’s mostly an app rather than a website, so you’ll need a smartphone to make it work. But I’ve sold a ton there and actually, the experiences have been mostly positive. As a side note, I rarely meet with folks – I make them come to me. Only because my pricing is on point. However, the environment we meet in is as safe as can be.
Instagram Showing Promise
I’m starting to get involved with reselling on Instagram, which so far has shown some promise but I’m mostly selling sneakers there. At least that’s what’s getting the most traction. All I can tell you about that is that high-quality images are a must and a multitude of them no matter what you’re selling.”
– David Bakke
How to Start a Reselling Business
Here’re the tips on how to start a successful reselling business and what tools and software are great to use.
When it comes to selling books, the whole process seems very simple. That’s what our experts say.
“The scanning app will tell you what the books are worth”
|“Here’s everything you need to get started:
2. Scanning app (Scoutly is my personal choice for best app).
3. Amazon seller account.
4. Place to source used books.
Find a couple local sources of cheap used books. This can be anything from thrift stores, to garage sales, to library book sales, to any place that sells second-hand merchandise.
The scanning app will tell you what the books are worth, and how often they’re selling. Realistically, a very small percentage of books are worth money. But since most book sources have thousands of books, you shouldn’t have trouble finding profit.
That’s a proven formula for anyone to get started selling and making money on Amazon fast.”
– Peter Valley, a 15 year Amazon seller, specializing in reselling used books, wrote a book on Amazon selling
“Following other resellers on social media”
|“Regarding how and where to source items in retail arbitrage, the biggest piece of advice is to continually monitor when there will be sales. For example, the Nordstrom Rack “clear the rack” sales and the TJ Maxx yellow tag sale. You can become aware of these events by following other resellers on social media because, with deals this exciting, every reseller wants to share the good news!
It is also best practice to visit your local stores often. You can even ask an associate if they are aware of any upcoming sales. Also, ask if there is a certain day of the week when they perform markdowns.
The software I use to house my inventory is Vendoo. They offer flexible pricing, top-notch customer service, and all of the essential tools, including multi-quantity listings for when you pick up a few of a certain Item.”
– Amanda Manera, Founder of The Resale Doctor
“Look for tags that are marked 75% off”
|One strategy that has worked for me as a reselling business owner is to visit Goodwill and other thrift stores and look for tags that are marked 75% off. While browsing through the CD/DVD section, I focus on items that are new and sealed, as these tend to sell well on marketplaces like Amazon.
I’ve found that complete seasons or shows can also be profitable. While buying used DVDs at full price may not always be the most cost-effective strategy, it’s worth keeping an eye out for unique or rare items that have the potential to fetch a higher price. For example, I once found a used Prince DVD that sold for close to $50.
– Peter Koch, a retail arbitrage enthusiast and Dollarsanity.com founder
Tools & Software for Resellers
As for the software, we’d also like to mention a few more recommendations we got from fellow resellers.
“Use price comparison tools such as Google Shopping, CamelCamelCamel, and Keepa to help you identify products with a high resale value.”
– Eric Jones, CEO at Couture Candy
“Inventory tracking and management tools are the best for keeping track of your sales. These tools help predict profit based on the data you provide.
Lessonly is the most effective tool to use. It helps track the performance metrics. Through this, the pace of the business can be assessed.”
– Elisa Bender, Co-Founder of RevenueGeeks
“Tactical Arbitrage is stellar software that can help you find tons of products from retailers. The best part is that it runs its own tests. Plus, the results are error-free. These products can be sourced from places like Walmart, which are already visible, so that’s a win win!”
– Donnie Rand, Marketing Coordinator at American Association of Owner Operators, LLC
The final thought and smart advice that seems to be the key to success is to focus on the niche and especially the one you’re familiar with. Check out a great comment related to the tip.
“By focusing on a specific product category, such as toys or electronics, you can become an expert in that area and identify deals more easily. This strategy can also help you build a loyal customer base and increase your profit margins.”
– Saj Munir, a business owner with over 20 years of experience, established a retail site in 2012 without investment.
We hope you can use these insights to the best advantage of your business regardless of whether you’re a seasoned reseller with years of experience or someone who’s just started or plans to become an Amazon (or any other retail) seller. With so many people getting started selling and making money, with our tips and recommendations, we’re sure you can also succeed in retail arbitrage.
Feel free to explore our other articles about retail arbitrage and reselling business:
The 11 Best Book Scanner Apps of 2023
Determining Book Condition Guide
Tips on How to Prepare Your Book Business for a Recession
Book Inventory Management Software: Comparative Overview
Restricted Inventory? BookScouter Help You Sell It with the Bulk Liquidation Tool.