Ever since I started selling on Amazon, a few questions that I get frequently is. What exactly do you do? How do you do it? What products do you buy? And the list goes on and on! So with that being said, I’m going to answer these questions today in this blog post! Let me know in the comment section below if you have any other questions that I didn’t get to today.
To answer the question of, what exactly do you do? Simply put, I sell physical products online through various marketplaces (Amazon, eBay, Mercari, Facebook Marketplace, Poshmark, etc.) I purchase nearly all of my inventory from retail stores, or online stores (These methods are called Retail Arbitrage/Online Arbitrage)
So you buy inventory from retail stores and sell them for more online? Why would someone pay more for something online, than just going in the store and getting it? Simply put, people are busier than ever these days, so they will pay for convenience. Amazon Prime’s 2 day shipping was a game changer when it was released. Now they have it down to a few hours or even 1 day shipping to all Prime customers.
The other thing that is in play when selling on various marketplaces, is the law of supply & demand. For example, the demand for widget A in Minnesota is significantly lower than in Florida, so retailers will clearance out that widget A in Minnesota, but yet there is a significant demand for that product at full price in other locations. So yes, supply and demand is in full effect in 2020! (I’ll share some screenshots from my accounting software below to back up these claims)
Once I purchase my inventory, I then get it prepped and shipped into Amazon. I use Fulfillment by Amazon (Amazon FBA) Basically this is a service that Amazon offers to third party sellers on their website. You will send your inventory directly to Amazon, they will then warehouse the product, and then when the item sells, they will send it directly to the
customer. They handle all of the customer service, including returns, problems with orders, etc. They of course charge fee’s for this service, but it is 100% worth it, as I don’t have to do the shipping, and storing of all of these products. Using Amazon FBA isn’t for everyone, but those who want to scale and not add extra employees, and a warehouse, this
is a great option.
I’ve learned how to sell on Amazon through several different methods. I started out watching tons of YouTube videos, listening to podcasts of sellers, etc. The amount of FREE content that is out there is AMAZING, and also it’s inspiring! I’m excited to share my journey with everyone of you on how to scale an Amazon business. I’ll be sharing the successes, as well as the defeats throughout my journey. You’ll see below a few major wins that I have had when it comes to creating secondary income/full time income from Amazon.
I will share these screenshots with the hopes of showing you that it is possible to generate an extra $250, $500, $1000 or whatever it is you are looking for a month. Imagine that, an extra $1,000 to your budget on a monthly basis. Please don’t view any of these screenshots as bragging, or self-promoting, I just want to show that it’s possible. If I can do this, you can do this! With that being said, here are a few screenshots of some bigger wins I’ve had with selling on Amazon/other marketplaces in 2019.
Example 1:
You’ll see in this example above that I purchased all of these items for $82.46, it was a total of 7 video games. Here’s the breakdown:
Buy Cost Each: $11.78
Sold For: $47.29
Net Profit Each: $24.21
Quantity of 7
So this means I turned $82.00 into a total of $250 after all fee’s, and all of these literally sold in one transaction. How cool is that?
Example 2:
Here is another example of an item a pair of headphones I sold. You can see the breakdown in the screenshot above.
Purchased: $40
Sold: $159.99
Fee’s: $37.54
Net Profit: $88.44
I turned $40 into $128 in one transaction.
Example 3:
Here is an example of an item that I sourced throughout the last year. I was purchasing this toy for between $10 – $20 each on average. The screenshot shows $10.71, but that was when the product was put on clearance nationwide at Walmart. Here’s the breakdown:
Qty: 50 Purchased
Total Cost: $694.85
Total Revenue: $1,743.01
Total Fee’s: $372.99
Net Profit: $675.17
I turned $694 into $1,369 through the year by selling this one product 50 different times.
Example 4:
Here is an example of an item that I called a “replenishable” product. Meaning I buy this over and over again, and continue to profit off of it. These are key for running a stable online business. Having products that sell consistently, will make for a nice base line of profit each month.
Check out the break down below for the screenshot:
Avg Product Cost: $12.10
Total Buy Cost: $1,331
Total Revenue: $2,828.06
Total Fee’s: $980.01
Net Profit: $517.05
If I could keep this product in stock on the regular, as you can see I have 0 on hand right now. The sales and profit would be at least double than what’s shown, since I’ve done a poor job of keeping this product in stock on Amazon. I’ve been selling this product for probably around 6-7 months in 2019.
Those are just 4 examples of some products/wins that I’ve had reselling in 2019. I hope these motivate you to think of the possibilities what selling online could do for you and your family.
Let me know if you have any questions in the comment section about using Retail Arbitrage/Online Arbitrage as a way to make some side money!