What Is Amazon Arbitrage?

What is Amazon arbitrage? It’s one of the easiest – and smartest – ways to kick off your Amazon selling business or earn money without big initial investment. 

Whether you're new to eCommerce or already juggling multiple SKUs, arbitrage lets you profit by spotting price gaps between retail stores and Amazon listings. You buy low, list high, and pocket the difference. Simple? Yes. Effortless? Not exactly. But with the right tools and approach, it can be a game-changer. 

In this guide, we’ll break down how it works, the tools you need (hint: that’s where we come in), and how to do it the smart way.

What Is Amazon Arbitrage?

Amazon arbitrage is a reselling model where you buy at a lower price from one marketplace – usually retail – and sell them for a profit on Amazon. The difference between your buying price and your selling price (after fees) is your margin. 

So where’s the profit? Let’s say you find a toy on clearance at Walmart for $10. On Amazon, the same item sells for $25. You list it, sell it, and after Amazon fees, shipping, and taxes, you still walk away with a margin. That margin is your arbitrage profit.

There are two types of Amazon arbitrage:

• Online arbitrage (OA)

You source products from online stores and ship them to your address or prep center.

• Retail arbitrage

You physically shop in brick-and-mortar stores, scanning shelves for profitable leads.

How does arbitrage differ from other Amazon business models?

Arbitrage vs. wholesale

You don’t need to buy in bulk or negotiate with suppliers. Instead, you source a limited number of units from regular retail stores – either online or in person – and resell them individually. There’s no need for brand approval or large upfront investments.

Arbitrage vs. private label

You’re not building a brand or manufacturing anything. With arbitrage, you're flipping existing products with existing demand. No branding, no product development – just sourcing and reselling.

Arbitrage vs. dropshipping

Unlike dropshipping, you actually hold the inventory. You buy the product first, then list it on Amazon. It gives you more control over pricing, shipping times, and customer experience.

Compared to other business models, arbitrage is low-barrier, low-risk, and perfect for fast movers, and at the same time you have control over the quality of what you resell and delivery terms. No need to wait on manufacturers or distributors – you’re sourcing and selling in real time.

What Is Online Arbitrage?

Online arbitrage is the process of buying products from online retail stores at a discount and reselling them on Amazon at a higher price. It’s all about identifying profitable price gaps between platforms – and capitalizing on them from the comfort of your laptop.

Unlike retail arbitrage, where you physically visit brick-and-mortar stores to hunt for deals, online arbitrage lets you source products digitally. This makes it scalable, less time-consuming, and ideal for sellers who prefer remote operations.

Example of online arbitrage

Let’s say you find a Lego Star Wars set selling for $30 on Walmart.com. The same set is listed on Amazon for $60. After subtracting $10 in Amazon fees and shipping, your net profit is around $20 per unit. Buy 10 units and you’ve just made $200 – without ever stepping foot in a store.

3 key online arbitrage insights

Winning product is key

To succeed, you need products with high demand and low competition. One wrong buy can lead to unsold inventory or policy violations.

Product research takes time

Finding profitable items isn’t random luck – it takes research. Tools like Seller Assistant make it faster and data-driven.

Check for restrictions and risks

Not every item is eligible for sale. Watch out for restricted products, IP complaints, and meltable or hazmat items.

Pros of online arbitrage

Low startup costs

You don’t need thousands to begin – just a small investment and a good eye for deals.

Work from anywhere

You can build and run your business remotely. All sourcing is done online.

Flexible and scalable

Start small and grow at your pace. You control how fast you scale.

Plenty of deals

Online stores constantly run promotions, discounts, and flash sales. These are prime hunting grounds for profitable products.

Cons of online arbitrage

High competition

Popular deals attract many sellers. Price wars can erode your profits quickly.

Time-consuming research

Finding a winning product takes consistent effort and analysis.

Amazon restrictions and selling eligibility

You must check if you're allowed to sell each item. Failing to do so can lead to wasted inventory or account issues.

Scaling takes effort

It’s easy to start, but long-term success means reinvesting, refining your strategy, and automating parts of the process.

How online arbitrage works

Online arbitrage is straightforward, but doing it well takes strategy. Here’s how to launch and scale your business step by step.

Step 1. Set up an Amazon seller account

Choose between an Individual (under 40 items/month) or Professional plan (40+ items/month). Register with your tax, bank, and identity details to access Seller Central.

Step 2. Find profitable deals

Manually browse online retailers or use tools like Seller Assistant's Price List Analyzer to automate product sourcing, Brand Analyzer to analyze and pinpoint resale-friendly brands, and Seller Spy to sell the best Amazon deals your competitors sell.

Step 3. Analyze product profitability

Use Seller Assistant's tools to check sales rank, fees, eligibility, and risks. Make sure there’s enough margin after all costs.

Step 4. Decide inventory size

Estimate demand and start small to avoid overstock. Tools like the Sales Estimator help forecast how fast products will move.

Step 5. Purchase the products

Use coupons, cashback, and gift card deals to lower costs. Stack discounts to increase margins by up to 20%.

Step 6. List your products on Amazon

Join an existing listing or create a new one if it doesn’t exist. Avoid duplicate listings – they’re against Amazon policy.

Step 7. Choose fulfillment method

Use FBA (Amazon handles shipping) or FBM (you do it yourself). FBA is easier but has more fees – so run the numbers.

Step 8. Optimize pricing

Use repricers to stay competitive. Check your break-even point in Seller Assistant and set smart minimums.

Step 9. Track and scale

Monitor sales, reviews, and inventory. As you grow, reinvest profits, expand your catalog, and automate sourcing and pricing.

Note. Seller Assistant is a comprehensive product-sourcing software that helps Amazon sellers quickly find high-profit deals. It combines three extensions: Seller Assistant Browser Extension, and IP-Alert Chrome Extension by Seller Assistant, and VPN by Seller Assistant, Amazon seller tools: Price List Analyzer, Brand Analyzer, Seller Spy, Bulk Restrictions Checker, and API integrations, and features: Storefront Widget, Side Panel View, FBM&FBA Profit Calculator, Quick View, ASIN Grabber, UPC/EAN to ASIN converter, Stock Checker, IP Alert, and Restrictions Checker.

Seller Assistant shows all essential product data on Amazon search, product, and inventory pages, on supplier websites, and your competitor storefronts to help you find high-margin deals. By using this FBA and FBM product sourcing software, you can easily identify products that have the potential to be sold well on Amazon.

What Is Retail Arbitrage?

Retail arbitrage is the practice of buying discounted products from physical retail stores and reselling them on Amazon at a higher price. The profit comes from the price difference after accounting for fees and shipping costs.

Unlike online arbitrage, which can be done entirely from your computer, retail arbitrage requires you to physically visit stores. You're scanning shelves, checking prices, and hauling inventory home yourself. It’s hands-on, fast-paced, and often driven by in-store sales and clearances.

Example of retail arbitrage

You walk into a local Target and find a clearance on electric kettles selling for $15. A quick scan with the Amazon Seller App shows that the same kettle sells for $40 on Amazon. After fees and shipping, you pocket a $15 profit per unit – and grab 5 units to start. That’s $75 profit in one shopping trip.

3 key insights of retail arbitrage

In-store product research is vital

Your scanner app is your best friend. Profitability depends on scanning barcodes and comparing prices in real time while in-store.

Highly time-consuming

This method requires travel, scanning, and inventory runs. It’s ideal for those who enjoy the hunt, but not for those short on time.

Manual restocking limits scalability

You must physically revisit stores to restock inventory. Discounts may not be available again, making consistent supply a challenge.

Pros of retail arbitrage

Quick and easy to set up

Register your Amazon account, hit the stores, and start selling – no special tools or training needed.

Low startup cost

With just $500, you can start sourcing products from local stores and begin turning a profit.

No advanced skills required

Anyone can do it. If you can scan a barcode, compare prices, and do basic math, you're good to go.

Low risk with small investment

Because you’re buying in small quantities and only what you can sell, the financial risk stays low.

Cons of retail arbitrage

Time-intensive business

Every profitable find requires time in-store. The more you want to earn, the more hours you need to put in.

Inventory must be restocked physically

You can’t order more with a click – you need to go back out and hope the deals are still there.

Finding deals is challenging

Success often depends on timing and luck. You’ll scan dozens – sometimes hundreds – of items before landing a winner.

Difficult to scale

Since inventory is limited by store stock and your ability to travel, scaling beyond a part-time hustle can be tough.

How retail arbitrage works

Retail arbitrage is straightforward in theory but labor-intensive in practice. Here’s how to get started step by step.

Step 1. Set up your Amazon seller account

Sign up for an Individual or Professional seller account. Provide your personal and business details to get started.

Step 2. Install a barcode scanning app

Download the Amazon Seller App (free) or another barcode scanner. These tools let you scan products in-store and instantly check Amazon prices and fees.

Step 3. Visit retail stores and scan products

Head to stores like Walmart, Target, TJ Maxx, or local discount outlets. Scan clearance and sale items to find products priced significantly lower than on Amazon.

Step 4. Match your product to Amazon listings

Ensure your product exactly matches a listing already on Amazon. Confirm the brand, model number, packaging, and variant.

Step 5. Research the product

Use the Seller App to check sales rank, price history, estimated sales, and potential restrictions or risks (like IP complaints or hazmat flags). Only buy if the numbers check out.

Step 6. Purchase the products

Once you've confirmed profitability and eligibility, buy your desired quantity. Be mindful of your budget and always buy conservatively when starting.

Step 7. List your products on Amazon

Add your offer under an existing listing. Go to Seller Central, click “Sell a product,” select condition and quantity, and set your price.

Step 8. Choose a fulfillment method

Use FBA to let Amazon store, ship, and support your customers, or go FBM if you prefer to handle logistics yourself.

Step 9. Monitor sales and restock

Once products sell, repeat the sourcing process. Keep your inventory flowing by regularly scouting for deals in stores near you.

Amazon Online Arbitrage vs. Retail Arbitrage

If you’ve ever wondered what is Amazon arbitrage and how it actually works in real life, the answer lies in two main approaches: online arbitrage and retail arbitrage. Both models are built on the same principle – buy low, sell high – but they differ in how and where you find your products, how much time you invest, and how easily you can scale your business.

Here’s a detailed comparison of each to help you decide which fits your Amazon selling strategy best.

Key differences between online arbitrage vs. retail arbitrage

Product sourcing

• Online arbitrage

Products are sourced from e-commerce websites like Walmart.com, Target.com, Overstock.com, or any other online retailer. Sellers take advantage of online discounts, clearance sales, and marketplace pricing gaps.

• Retail arbitrage

Products are sourced by physically visiting stores like Walmart, Ross, or local outlets. Sellers browse shelves and clearance sections to find discounted items.

Convenience

• Online arbitrage

Everything is done from home. You can find, evaluate, and purchase inventory without leaving your desk.

• Retail arbitrage

It requires visiting stores in person, which can be time-consuming and physically tiring but enjoyable for those who like hands-on work.

Time commitment

• Online arbitrage

You can search multiple sites simultaneously and use sourcing software to speed up the process, saving hours.

• Retail arbitrage

Sourcing takes longer due to travel time, in-store scanning, and checking each product manually.

Product availability

• Online arbitrage

Deals are public and often get scooped up fast. High competition means you have to act quickly before stock runs out.

• Retail arbitrage

Deals are often unique to local stores, making them less competitive. However, stock levels and discounts vary widely by location.

Scalability

• Online arbitrage

Easily scalable with automation tools and nationwide access to online stores. Sellers can grow quickly without leaving home.

• Retail arbitrage

Scaling is harder because sourcing is limited by the number of stores you can visit and the inventory they have.

Startup costs

• Online arbitrage

You can start small and grow. With as little as $500, you can begin purchasing discounted products and reinvesting profits.

• Retail arbitrage

Also low-cost to start, but sellers may need to buy more inventory per trip to justify travel expenses.

Competition

• Online arbitrage

Higher competition because many sellers are hunting for the same deals online using similar tools.

• Retail arbitrage

Lower competition since in-store deals are local. Fewer people will find the same products in your area.

Tool dependence

• Online arbitrage

Heavily tool-based – requires software for sourcing, analyzing profit margins, and tracking trends.

• Retail arbitrage

Light on tools – usually just the Amazon Seller App or a barcode scanner is enough for in-store analysis.

Risk level

• Online arbitrage

Slightly higher risk due to delayed shipments, order cancellations, or damaged goods from online suppliers.

• Retail arbitrage

Lower risk since products are inspected and taken home immediately, giving sellers more control.

Ideal for

• Online arbitrage

Best for sellers who prefer remote work, want to scale quickly, and are comfortable using sourcing software.

• Retail arbitrage

Great for those who enjoy in-store shopping, treasure-hunting deals, and don’t mind physical effort.

What to Sell With Online Arbitrage?

Success in online arbitrage hinges on one crucial factor: choosing the right products. Picking profitable, low-risk items can maximize your returns and help scale your Amazon business faster. With tools like Seller Assistant, sellers can spot high-margin opportunities, avoid problematic listings, and stay ahead of competitors.

Below are four smart strategies for uncovering the best online arbitrage deals.

Strategy 1. Scan price lists automatically

What it is

This approach uses bulk product lists from retailer websites, scanning them to find profitable resell opportunities. It helps sellers process a large number of items efficiently – no need to check every product by hand.

What it achieves

It eliminates low-margin, high-risk, or oversaturated items so you can focus on listings with good ROI, low competition, and high sales potential.

How it works

Use a web scraping tool to parse product information from any supplier’s website of your choice. Upload product lists into Seller Assistant's Price List Analyzer., which automatically matches items to Amazon listings, calculates profit margins, and flags any red flags like restrictions or IP complaints.

Effective research tips

• Sales performance

Use BSR (Best Sellers Rank) – aim for ranks between 1 and 200,000.

• Competition level

Avoid listings with more than 15 sellers or where Amazon dominates.

• Buy Box chances

Check who owns the Buy Box and how often it rotates.

• Profitability

Analyze ROI, margin, and breakeven points.

• Restrictions and IP complaints

Spot IP alerts, Amazon policy violations, gated items, and other flags.

Best for

Sellers handling bulk sourcing from multiple online retailers.

Read more

Strategy 2. Analyze profitable brands automatically

What it is

This strategy uses brand-level analytics to find high-performing brands that sell well on Amazon. The goal is to align your inventory with brands that already enjoy customer trust and demand.

What it achieves

It highlights brands with strong sales histories, low competition, and consistent buyer satisfaction – helping you sell faster and with fewer risks.

How it works

Use Seller Assistant's Brand Analyzer to evaluate brand-level data such as pricing trends, review scores, and seller competition. It also identifies brands heavily controlled by Amazon so you can steer clear.

Effective research tips

• Sales performance

Look for steady revenue across time.

• Competition level

Skip brands where Amazon holds more than 30% of the sales.

• Product range

Target brands with at least 500 ASINs for scaling potential.

• Customer feedback

Prioritize brands with 4+ star ratings.

• Restrictions

Use Bulk Restriction Checker to confirm resale eligibility by uploading your product list.

Best for

Sellers who prefer working with popular, trusted brands and want to avoid uncertainty.

Read more

Strategy 3. Spy on your competitors

What it is

This tactic involves researching what successful Amazon sellers are already selling. It lets you reverse-engineer their strategies and piggyback on proven products.

What it achieves

By monitoring top sellers, you can uncover trending products with strong demand – and replicate their success in your own store.

How it works

Seller Assistant’s Seller Spy helps you track competitors’ listings, pricing movements, product launches, and removal patterns.

Effective research tips

• New product monitoring

Keep tabs on recently added items to catch trends early.

• Product removals

Avoid products your competitors have stopped selling – they may be declining.

• Seller feedback

Analyze feedback to gauge quality and performance.

• Pricing strategies

Stay competitive by understanding your rivals' pricing tactics.

Best for

Sellers who want to minimize guesswork by modeling success after high-performing competitors.

Read more

Strategy 4. Find deals using deep product research

What it is

This method involves manually reviewing each product to evaluate its profitability, competition, and risk factors. It’s ideal for sellers who prefer hands-on analysis and want full control over their sourcing choices.

What it achieves

By diving deep into each product, you can ensure every item meets Amazon’s selling criteria, offers solid profits, and avoids unnecessary risks like IP violations or low demand.

How it works

With Seller Assistant Extension, you get real-time product insights while browsing Amazon listings, supplier sites, or competitor storefronts. It helps you assess demand, fees, risks, and eligibility – without needing to leave the page.

Effective research tips

• Sales performance

Focus on products with a Best Sellers Rank (BSR) between 1–200,000.

• Competition analysis

Look for listings with 2–15 sellers to strike the right balance between popularity and profitability.

• Amazon presence

Avoid listings where Amazon itself dominates the Buy Box.

• Profitability metrics

Use the FBM&FBa profit calculator to break down ROI, profit margins, and breakeven points.

• Risk assessment

Check for selling eligibility, restrictions, IP complaints, fragile, hazardous, meltable, or other product flags.

• Historical data

Use built-in Keepa charts to evaluate past sales and pricing trends. For example, if the product is new, note that forecasting sales will be less reliable.

Best for

Sellers who want precision and confidence in every product they source – ideal for those who value data-driven, deliberate decision-making.

Read more

FAQ

What is Amazon arbitrage?

Amazon arbitrage is a business model where sellers buy products at a lower price from retail stores (either online or in-person) and resell them on Amazon for a profit. The difference between the purchase price and selling price – after fees – is your earnings.

Is online arbitrage better than retail arbitrage?

It depends on your preferences. Online arbitrage offers convenience and scalability, as everything can be done remotely. Retail arbitrage is more hands-on and time-intensive but often comes with less competition and more localized deal opportunities.

How much money do I need to start with Amazon arbitrage?

You can start with as little as $500. Both online and retail arbitrage are low-barrier models that allow you to grow gradually by reinvesting your profits.

What tools do I need for online arbitrage?

Essential tools include a sourcing and analysis extension like Seller Assistant, discount tracker, inventory management, and repricing tools. These tools help streamline product research, evaluate risks, and track performance.

Are there risks involved in Amazon arbitrage?

Yes, risks include buying restricted products, encountering IP complaints, or misjudging demand. Using tools like Seller Assistant can help you verify eligibility, calculate profits accurately, and avoid policy violations.

Final Thoughts

Whether you’re sourcing deals from your laptop or scanning shelves in-store, Amazon arbitrage offers a powerful entry point into the world of e-commerce. Both online and retail arbitrage have their strengths – what matters most is choosing the model that fits your goals, schedule, and budget.

With the right strategies and tools, you can consistently find profitable products, reduce risks, and build a business that grows over time. Tools like Seller Assistant simplify every step – from product research and restriction checks to profit analysis – making success in arbitrage more achievable than ever, and help you turn deals into dollars.

Seller Assistant is an all-in-one product sourcing software offering all the features vital for product sourcing. It combines three extensions: Seller Assistant Extension, IP Alert, and VPN by Seller Assistant, tools: Price List Analyzer, Brand Analyzer, Seller Spy, Bulk Restrictions Checker, and API integrations, and features: Storefront Widget, Side Panel View, FBM&FBA Profit Calculator, Quick View, ASIN Grabber, UPC/EAN to ASIN converter, Stock Checker, and other features that help quickly find high-profit deals. Seller Assistant also offers integration with Zapier allowing to create custom product sourcing workflows.