Online entrepreneurs have multiple choices when venturing into the Amazon marketplace. One of the popular options when selling on Amazon is online arbitrage. Many sellers opt for Amazon online arbitrage due to the convenience it offers them and the availability of Amazon seller tools, like Tactical Arbitrage (TA).
In this article, we will discuss online arbitrage, product sourcing, how Tactical Arbitrage can help, and other vital insights that can help you further improve your online arbitrage on Amazon.
What Is Online Arbitrage?
Online arbitrage (OA) has become a favored business model among Amazon sellers. Many sellers opt for this approach because it demands less capital than the two more popular Amazon business models, the Amazon Private Label and Amazon Wholesale.
Generally speaking, online arbitrage is a strategy that revolves around finding discounted products on one online marketplace and subsequently reselling them on another platform, such as Amazon. The key aspect of this approach is that the entire product sourcing process is conducted through online channels.
Amazon sellers engaged in online arbitrage benefit by capitalizing on price disparities, underscoring the significance of finding products with substantial profit margins when embarking on this business model. It is worth noting that utilizing Amazon seller tools like Tactical Arbitrage and other software can significantly enhance your online arbitrage operations.
In terms of initial capital requirements, approximately 29% of online retailers or sellers started their Amazon online arbitrage ventures with less than $500. Additionally, around 54% of online arbitrage sellers achieve profit margins of approximately 16% or higher.
How Does Online Arbitrage Work?
Online arbitrage is a direct contrast to retail arbitrage, as the former entails sourcing products exclusively from online marketplaces, while the latter involves physically visiting a discount or retail store to find products. When venturing into online arbitrage, the following steps should serve as a guideline:
Step 1: Search for discounted or clearance products on online retail websites. Some of the popular go-to destinations for discounted online products include the following:
- The Home Depot
- Best Buy
Step 2: Check the availability on Amazon for the discounted products you have found on the online retail platform. It is essential to cross-reference this information under Amazon categories, especially the top categories online arbitrage sellers frequently utilize to achieve better sales performance when selling on Amazon.
Step 3: If the potential online arbitrage product is available on Amazon, make sure to evaluate its profitability. You can use an Amazon FBA calculator to assess the profit margin.
Step 4: After finding a suitable product for online arbitrage, you can easily list it on Amazon. You have the option to select between two programs, the Amazon FBA or FBM. Opting for FBA means letting Amazon handle the entire process of picking, packing, storing, and shipping of products, while Amazon FBM entails managing these aspects independently.
Why Product Sourcing is Crucial for Online Arbitrage?
If you wish to have a successful online arbitrage business, don’t disregard product sourcing, as it is a crucial component of your Amazon business. Product sourcing helps you find suppliers for products that are trending and worth reselling on Amazon.
Effective product sourcing lets you find inventory items that offer a high profit margin. Thus, it ensures that you can capitalize on the price difference between the sourcing and reselling platforms.
By sourcing the right products, online arbitrage sellers can obtain the following benefits:
Profitability: Needless to say, finding products that are discounted or on sale enables your business to profit from the price difference.
Competitiveness: By acquiring products at a discounted rate from another online platform, you gain a competitive edge over other sellers. It enables your listing to stand out prominently in the marketplace due to its competitive price offer.
Scalability: You can quickly scale your business if you consistently find products that offer better profit margins.
Risk Management: Since product sourcing widens your options for potential Amazon products, you can minimize the risk of investing in items that may not yield significant returns.
While manual product sourcing is possible, utilizing Amazon product sourcing tools is recommended for a more efficient and effective product sourcing and research process. In particular, we will take a closer look at Tactical Arbitrage.
What is Tactical Arbitrage?
Tactical Arbitrage is an Amazon arbitrage software primarily used by Amazon sellers for online Arbitrage. As a product sourcing and research tool, it can run up to 7 searches simultaneously while using advanced matching algorithms.
Image Source: Tactical Arbitrage Homepage
Tactical Arbitrage offers access to more than 1000 searchable online retail websites, enabling scans of a wide range of products spanning multiple categories.
In addition to the pre-included websites, TA users can also manually add other product-sourcing sites. The software also incorporates various filters and unique features that add value to your product research endeavors.
Top Features of Tactical Arbitrage
While this product-sourcing software is well-suited for online arbitrage sellers, it is versatile enough to be used by anyone seeking to sell on Amazon. This Amazon seller tool offers a range of features that can significantly enhance your Amazon FBA business, such as:
An Extensive Product Search Database
The extensive database of Tactical Arbitrage provides sellers with better opportunities to find profitable deals for their online arbitrage business. The database of TA encompasses over 1000 websites of major department stores and other lesser-sourced online stores from A to Z, including the following:
|Hardware and Home Improvements
|Electronics and Gadget
|Electronics and Appliances
|Outdoor, Adventure & Hunting
|Home Essential & More
|Video Game and Consumer Electronics
|Gardener’s Supply Company
|Motorcycle Parts and Gears
|Leland Fly Fishing
|Hardware Tools & Equipment
|Road, Mountain and Cyclocross Bikes & Accessories
|Office Supplies and More
|Jeep Parts & Accessories
|Surf-Inspired Apparel and Accessories
|Rockler Companies, Inc.
|Woodworking and Hardware
|General Merchandise, Tools, and More
|Groceries and More
|Athletic Shoes and Apparel
|Toys and Games
|Vitamins, Supplements, and More
|Watch and Jewellery
|Footwear and Apparel
Premium TA subscribers can utilize a feature called Reverse Product Search. This software is unique as you start your search with competitors instead of online suppliers or product sources.
With the help of Tactical Arbitrage’s reverse search feature, you can find the best place to buy those specific products your competitors sell. You can either enter the seller ID or use the Amazon ASIN to proceed with the product search.
Return of Investment (ROI) Calculator
With Tactical Arbitrage, knowing the potential profit for a product you saw online is much easier as the software tool comes with Profit and ROI filters. Instead of manually calculating the ROI, you can rely on this TA feature for quick revenue estimates.
Whether you are selling on Amazon or other eCommerce sites, data insights are crucial for the success of your online business. Hence, Tactical Arbitrage provides you access to valuable data. Some of the vital data insights include estimated sales, competitor inventory levels, and more.
Reliable Help Center and Tutorials
For Amazon sellers needing assistance to fully leverage Tactical Arbitrage’s functionalities, the software offers a dependable help center and video tutorials. These resources are designed to assist Amazon sellers in understanding the software better.
Tactical Arbitrage Chrome Extension
Amazon sellers keen on experiencing the functionality of Tactical Arbitrage should consider exploring its Chrome extension. This Amazon Chrome extension allows you to try the software, offering three free daily scans.
Tactical Arbitrage Price Plans
Tactical Arbitrage is one of the must-have seller tools for online arbitrage sellers. Regardless of your business goals and financial considerations, TA offers a variety of price plans to cater to a wide range of users. Here below is an overview of Tactical Arbitrage’s price plans.
Online Arbitrage Plan: As the plan’s name would suggest, this TA plan is ideal for online arbitrage sellers. It comes with helpful features such as Product Search, Reverse Research, Always Be Scanning, and View Inventory. Its annual plan costs $840, while the monthly plan costs $89.
Wholesale Plan: For the Wholesale plan, Amazon sellers can use its unique Wholesale features along with View Inventory. With this plan, you can scan the Wholesaler manifest for profitable selling opportunities. This Tactical Arbitrage plan is priced at $69 per month or $660 if billed annually.
Flip Pack: This Tactical Arbitrage plan includes features like Amazon Flips, Library Search, and View Inventory features. You can use this feature if you wish to flip or sell used and new books on Amazon. It is priced at $59 per month or $600 if billed annually.
Online Arbitrage Plus Wholesale Plan: If you are looking for features that can help both your online arbitrage and wholesale business, you can choose the Online Arbitrage Plus Wholesale plan. Whether wholesale or online arbitrage, you can use features such as Product Search, Reverse Search, and Always Be Scanning. If billed annually, you will spend $1020, while $109 for a monthly plan.
Full Suite: The Full Suite plan gives you access to all the features of the other Tactical Arbitrage plans. If you choose the monthly plan, you will be charged $129 per month, whereas the annual plan will cost you $1140.
In addition to the plan-specific features, sellers can fully utilize the product research tool’s capabilities by taking advantage of the following features available in all accounts, including but not limited to the following:
- Estimated Sales
- Simultaneous Scanning
- Rapid Cache Scanning
- Image Matching Technology
- Competitor Stock Analysis
- Inventory History and Sale Alerts
- Discount and Cost Calculations
- Access to Tactical Arbitrage Video Tutorials
Pros and Cons of Using Tactical Arbitrage
Before incorporating Tactical Arbitrage into your Amazon seller toolkit, it is essential to acknowledge the software’s advantages and drawbacks. Taking advantage of TA’s 7-Day Free Trial allows you to gain insights into the pros and cons of the product sourcing tool, like the ones outlined below:
Pros of Using Tactical Arbitrage
Extensive Database: Access to more than 1000 marketplaces ensures that your product research will be comprehensive.
Easier Access & Better Decision Making: Tactical Arbitrage gives you access to thousands of products from various marketplaces, along with relevant data information you can use to make quick and well-informed decisions for your online arbitrage business.
Time Saver: Using Tactical Arbitrage to help you find winning products for Amazon online arbitrage can help you save time. Since TA automates the process of scanning multiple websites and products, you can find products for your business faster than manually doing the whole process.
Cons of Using Tactical Arbitrage
Price Consideration: As a premium software, Tactical Arbitrage’s price plans can be relatively costly, particularly for new entrepreneurs selling online. To utilize the product search feature for online arbitrage, you must pay either a one-time fee of $840 or a monthly fee of $89.
Limited Search Feature: As mentioned in the preceding paragraphs, the product search features are only available to the Online Arbitrage and higher plans. The cheaper Tactical Arbitrage price plans do not incorporate both product search and reverse search features.
Active Account Required: While Tactical Arbitrage offers a 7-day free trial, not all online sellers can access the software tool. In order to utilize Tactical Arbitrage, having an Amazon seller account is a prerequisite. Even those who simply wish to check the software interface and functionalities quickly must complete the Amazon account sign-up process.
Tactical Arbitrage Alternatives
If you want to improve your product sourcing and research tasks, you can use other Amazon seller tools intended for product sourcing, product research, inventory management, and more. Here are some of the alternatives to Tactical Arbitrage:
InventoryLab is an all-in-one Amazon seller tool you can use to streamline your Amazon business. This seller tool offers various functionalities, including product listing, inventory & order management, analytics and reporting, and product research & scouting.
Another popular Amazon seller tool for your online arbitrage business is Jungle Scout. This software can help you discover profitable products and niches that are in high demand with low competition. Similarly, it can help you find top suppliers for your online arbitrage business.
Jungle Scouts also supports multiple Amazon marketplaces, including Amazon US, Amazon Canada, Amazon MexicoAmazon UK, Amazon Germany, Amazon France, Amazon Japan, and more.
SellerApp is also an all-in-one Amazon seller tool that can help you improve your Amazon online arbitrage business. It offers various features and functionalities, including Keyword Research & Tracking, PPC Analyzer, Listing Optimization, Product Research, and access to the product’s Sales History
Other Important Amazon Sellers Tools for Online Arbitrage
Your Amazon online arbitrage business success goes beyond finding the right products and suppliers. You will also need to consider the following Amazon seller tools for increased engagement and improved profitability of your Amazon online arbitrage business.
Amazon Repricer: Apart from the product quality, Amazon shoppers also evaluate the listing price before purchasing the item. To help you optimize your listing price and obtain a competitive edge in the market, you can use an AI Amazon repricer like Seller Snap to automate the price adjustments of your listings.
Keyword Research Tool: When listing a product, it is important to take keywords into account. Employing a keyword research tool can assist in finding relevant and effective keywords. Utilizing appropriate keywords in your product title and description can significantly enhance the discoverability of your listings.
Amazon Ads: Running Amazon ads will improve the discoverability of your product and brand. To help you create effective Amazon ads, you can use Amazon’s very own advertising solutions. Popular options for Amazon Ads are Sponsored Products and Sponsored Brands.
Feedback Management Software: Receiving feedback on your listings, particularly positive feedback, can enhance product discoverability, listing credibility, and overall seller performance metrics. To encourage more customer feedback, you can use a feedback management tool that automates the process of requesting reviews from Amazon store customers.
Overview of an Amazon Seller Account Creation | Amazon Online Arbitrage
In order to begin your Amazon online arbitrage business, the first step is to create an Amazon seller account. Below is an outline of the process to create a seller account, enabling you to begin your online arbitrage venture and likewise take advantage of Tactical Arbitrage’s free trial.
STEP 1: You need to visit https://sell.amazon.com to create an Amazon seller account.
STEP 2: Choose between an Individual and a Professional Seller Account. Sellers selling more than 40 products per month are better suited for the Professional account. In contrast, those starting small and selling fewer than 40 units per month would find the Individual Plan more suitable.
STEP 3: Once you have chosen your Amazon seller plan, you will need to input the information required by Amazon, especially those pertaining to store, billing, and seller information. Hence, you should have already prepared the following before signing up for an Amazon seller account:
- Business email address
- Amazon customer account (alternative to email)
- Government ID
- Tax information
- Phone number
- Internationally chargeable credit card
- A bank account where Amazon can send you proceeds from your sales
Step 4: Once you have entered the required information, you will wait for your account to be verified by Amazon.
If you wish to know more about creating an Amazon seller account, we have a separate article discussing in detail How to Become an Amazon Seller.
Start Your Amazon Online Arbitrage Business Today
As a newbie online seller exploring opportunities on Amazon, online arbitrage is an ideal business model for you to consider. This business model will particularly benefit individuals who wish to transition from full-time work to an eCommerce venture.
Online arbitrage is relatively easy to learn and demands minimal initial capital, making it accessible for aspiring online entrepreneurs. To further accelerate the growth of your online arbitrage business, you can utilize the Amazon seller software tools mentioned earlier, including Tactical Arbitrage.