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How to Find Profitable Products for Amazon Online Arbitrage
Despite the ever-growing competition on Amazon, online arbitrage is worth it. It has low entry barriers, and you don’t need much cash to launch and scale your business.
To make a profit, you need the right product. Majorly, the online arbitrage sales process spins around product research. Finding the lucrative item involves much time and effort.
Keep reading to discover how to find products for online arbitrage and the ways to simplify your product research routine.
How to Select the Profitable Product for Online Arbitrage?
Online arbitrage is a business model of reselling a product with a profit margin. The principle behind this model is simple: buy low, sell high. Online arbitrage sellers find lower-priced or discounted products online and resell them on Amazon for.
Finding the best products for online arbitrage starts with the product idea. Then, you have to check product profitability, sales potential, and restrictions.
Selecting Amazon online arbitrage product step by step
Step 1. Product idea: identifying low-priced items.
Step 2. Product research: identifying sales potential, restrictions, and account health problems.
Step 3. Product analysis: making sure the product is profitable to sell on Amazon.
How to Identify a Product Idea for Online Arbitrage?
Selecting a deal for online arbitrage involves understanding the search criteria, choosing the popular product category, and an item itself.
Search criteria for online arbitrage deals
- Best Seller Rank (BSR) of less than 30 000;
- stable BSR during at least 90 days;
- price between $15 and $100;
- average rating of 4 stars and up;
- review numbers between 5 and 500;
- “new” condition;
- standard dimensions;
- popular product category;
- not sold by Amazon;
- not a Private Label product;
- no Amazon in the Buy Box;
- legitimate product variations;
- not an extremely seasonal or trendy product;
- not a highly niche item.
What are the popular online arbitrage categories?
- Home & Kitchen
- Toys & Games
- Books
- Beauty & Personal Care
- Grocery & Gourmet Food
- Health, Household, & Baby
- Kitchen & Dining
- Baby
- Office Products
- Pet Supplies.
Where to look for online arbitrage product ideas?
- use product finder tools (e.g. Tactical Arbitrage, Search Mogul);
- look for your product on websites featuring discounted deals, like Brickseek;
- check discounted offers from online sales platforms other than Amazon, like Walmart or Etsy;
- buy lists of researched Amazon deals.
Note. With this link to Search Modul, you’ll get an extended 10-day free trial.
Examples of websites to find online arbitrage products
- Google trends;
- Brickseek;
- eBay’s trending list;
- SaleHoo Market Research Lab;
- Walmart;
- Etsy;
- Pinterest;
- Shopify stores;
- AliExpress’s best-sellers list.
Related: Read how to find online arbitrage product suppliers in our blog.
How to Do Product Research for Online Arbitrage?
Product research involves checking the item’s sales potential, verify sales restrictions and make sure it didn’t cause account health problems.
Identifying sales potential
- check BSR — it should be less than 30 000, and don’t jump up and down during 90 days;
- look into the Buy Box dynamics over 3 months – it shouldn’t change too much;
- find out the total number of FBA and FBM sellers on the listing — it should be between 2 and 10;
- calculate potential product sales if you start selling on the listing as one more seller.
Verifying sales restrictions
Ensure the product doesn’t belong to a restricted category or brand. If that is the case, you’ll need to get approval from Amazon to sell it.
Related: You can read about restricted categories and brands in our blog.
Checking product for sales limitations
Make sure that the item is not:
- oversize or fragile;
- meltable;
- adult product;
- prohibited category product.
Ensuring that an item doesn’t have an account health warning
Verify that the item doesn’t have:
- suspected intellectual property violations;
- received intellectual property complaints;
- product authenticity customer complaints;
- product condition customer complaints;
- food and product safety issues;
- listing policy violations;
- restricted product policy violations;
- customer product reviews policy violations;
- other policy violations.
How to Automate Product Research?
Product research is quite a task for online arbitrage sellers. It’s a routine process, it takes a lot of time and efforts. Moreover, if online arbitrage sellers go through hundreds of products per day, the risk of making mistakes increases.
There are seller tools that help you automate this complicated task. Seller Assistant App is one of such tools. It’s a powerful product research instrument for online arbitrage sellers that can help you see all essential product metrics right on the Amazon search page and save results to Google Sheets.
Estimating product sales potential
BSR
Seller Assistant App’s Product Information dashboard helps you estimate product sales potential. It shows BSR and its changes. If BSR goes down, you’ll see a green arrow pointing down; if it goes up, you’ll see the red arrow pointing up. The Drops metric displays BSR drops for 30, 90, and 180 days. The Top metric shows the BSR change in %. Also, a link is displayed with the name of the product category.
In addition, the Sales gives you the approximate number of product sales, calculated based on the BSR and category.
Buy Box
Seller Assistant App gives you Buy Box information as well. The Seller line in the Product Information dashboard displays a name and link to the seller's storefront in the Buy Box.
Besides, there is also a link to the information about the seller and a button to copy the link to the seller's storefront. If Amazon is in the Buy Box, there is no link, and the seller's name is red.
FBA and FBM sellers and potential sales
Seller Assistant App’s Product Information dashboard FBA and FBM columns show the number of FBA and FBM sellers that sell items in the “New” condition.
There are two numbers in the line. The figure on the blue background is the total number of merchants selling the product. The figure on the white background next to it is the number of sellers who offer the Buy Box price + 5%.
Est shows potential sales of the item.
Identifying sales restrictions
Seller Assistant App assists you in detecting potential problems with the product. If there is a problem, the IP Alerts feature will show a red triangle on the notification bar. That means that there have been problems with the product in the past. The database of complaints is updated daily and automatically.
The Restriction Checker feature will show if you can sell a product on your account. The green "Lock" icon means that you can sell the item. The red "Lock" icon means you are not eligible to sell this product on your account.
Checking product for sales limitations
You’ll see a corresponding icon in the Seller Assistant App if a product has such limitations.
Seller Assistant App’s product sales limitation alerts
- a Red Box icon appears if an item is oversize;
- a Red Drop icon - if it’s meltable;
- a HazMat icon - if it belongs to the HazMat category;
- an 18+ icon - if it’s an adult product.
How to Do Product Analysis?
Product analysis helps ensure the product is profitable to sell on Amazon and has a good profit margin.
Quick checkup of product profitability
- deduct your purchase cost from the Amazon sale price;
- deduct other expenses - shipping costs, sales tax, Amazon fees, and inbound shipping costs;
- see what’s left;
- calculate ROI (it should not be lower than 10%).
If you’ve got a positive result, the product is profitable.
How to Automate Product Analysis?
Here Seller Assistant App comes into play again.
Product profitability
The Profit calculation box of the dashboard shows you the Profit, ROI, and Margin (profit margin) figures for FBA and FBM separately.
Fees and logistics costs
You can see all your fees and costs in the Fees and logistics costs box of the Seller Assistant App’s dashboard.
In the Fees and logistics costs box, you can:
- switch between FBA and FBM to see respective costs;
- Fees show the total amount of Amazon commissions;
- R15% shows the Amazon Referral fee;
- Sto displays the cost of monthly storage of goods in Amazon warehouses;
- 3PL indicates third-party logistics costs;
- Ship is the cost of shipping the item.
You can also use Seller Assistant App’s FBM & FBA calculator to estimate your expenses.
Final Thoughts
For selling with an online arbitrage model, product research is critical. At the end of the day, it shows if you should deal with selling the particular item.
Product research is quite a routine task. Seller Assistant App can immediately tell you if a product has any sales restrictions or has led to problems with account health in the past. It combines an FBM&FBA profit calculator, Quick View, Stock Checker, and Restrictions Checker in one tool.
Try Seller Assistant Аpp now. Register for our 14-day trial. Grow your Amazon business with confidence.
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