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Why I Quit Retail Arbitrage - Is Amazon FBA Retail Arbitrage Dying?

Published on: November 30 2022 by Carter Maxwell

Why I Quit Retail Arbitrage - Is Amazon FBA Retail Arbitrage Dying?

Why I Quit Retail Arbitrage - Is Amazon FBA Retail Arbitrage Dying?

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00:00:00 00:00:03 what's up guys in this video I'll be
00:00:01 00:00:06 going over why I quit retail arbitrage
00:00:03 00:00:10 and also going over the question is
00:00:06 00:00:11 Amazon FBA retail arbitrage dying off so
00:00:10 00:00:13 if you don't know me already my name is
00:00:11 00:00:15 Carter Maxwell I'm a 17 year old
00:00:13 00:00:17 entrepreneur and I go by the nickname of
00:00:15 00:00:19 the high school hustler and if you're
00:00:17 00:00:21 trying to create an online business and
00:00:19 00:00:22 make money while you sleep then this
00:00:21 00:00:24 ditch and refused to go ahead and hit
00:00:22 00:00:26 that scribe button just like any
00:00:24 00:00:28 business on Amazon there's always a
00:00:26 00:00:30 business model that someone else prefers
00:00:28 00:00:31 that someone else doesn't and basically
00:00:30 00:00:33 in this video I'm just going over my
00:00:31 00:00:35 personal opinion when it came to reach
00:00:33 00:00:37 arbitrage and just basically what I
00:00:35 00:00:38 think about it well those of you that
00:00:37 00:00:41 aren't familiar with what exactly
00:00:38 00:00:43 reach arbitrage is it is basically the
00:00:41 00:00:46 purchasing of a product from a retail
00:00:43 00:00:48 store such as a Walmart or Target or
00:00:46 00:00:50 Toys R Us with the intentions to then
00:00:48 00:00:53 resell that product back on Amazon FBA
00:00:50 00:00:55 obviously to make a profit so this
00:00:53 00:00:57 business the model has been around for a
00:00:55 00:00:58 long time and I just want likes to know
00:00:57 00:01:00 that this business bone actually is
00:00:58 00:01:02 really profitable and you can scale it
00:01:00 00:01:04 if you actually know what you're doing
00:01:02 00:01:06 so if it's a profitable business model
00:01:04 00:01:08 like I just mentioned then why would I
00:01:06 00:01:11 ever quit it well I'm actually gonna go
00:01:08 00:01:13 for a few reasons to why I quit retail
00:01:11 00:01:16 arbitrage and why just not for me so the
00:01:13 00:01:18 first reason being product prices so
00:01:16 00:01:20 what I mean by this is with interview
00:01:18 00:01:22 arbitrage to be one of those top sellers
00:01:20 00:01:25 you need to have a huge cash flow system
00:01:22 00:01:27 consistently purchasing new product to
00:01:25 00:01:29 then send back to Amazon and that's
00:01:27 00:01:31 basically the only way you can really
00:01:29 00:01:33 scale your business at a quick rate so
00:01:31 00:01:34 if you don't really have like that huge
00:01:33 00:01:36 cash flow it's gonna be a lot a little
00:01:34 00:01:38 bit harder to scale for instance the old
00:01:36 00:01:40 business model that I used to do is
00:01:38 00:01:42 basically just purchasing random product
00:01:40 00:01:45 to then set up the Amazon so I would
00:01:42 00:01:47 pick up like books and CDs and video
00:01:45 00:01:49 games from that dollar to a three dollar
00:01:47 00:01:50 range so then sell them all day long for
00:01:49 00:01:54 around that fifteen dollar price point
00:01:50 00:01:56 on Amazon so with retail arbitrage it
00:01:54 00:01:57 all comes down to the ROI of the product
00:01:56 00:01:59 which is going to be your return on
00:01:57 00:02:03 investment for example if you purchase a
00:01:59 00:02:05 toy for $10 most sellers look for a
00:02:03 00:02:07 hundred percent ROI so if they spend $10
00:02:05 00:02:09 they want to make ten dollars back and
00:02:07 00:02:10 profit spend twenty dollars making
00:02:09 00:02:13 twenty dollars of profit just like that
00:02:10 00:02:15 so when it comes to margins
00:02:13 00:02:16 um different sellers have different
00:02:15 00:02:18 types some of the bigger sellers will
00:02:16 00:02:21 actually go down a little bit Martens
00:02:18 00:02:23 depending on the if it's a large enough
00:02:21 00:02:26 profit or if the product is going to be
00:02:23 00:02:28 a quick sale the second reason was
00:02:26 00:02:30 actually just the competition and so
00:02:28 00:02:33 what I mean by that is for instance if I
00:02:30 00:02:34 was to find a product at a Walmart it
00:02:33 00:02:36 could potentially be at every other
00:02:34 00:02:38 Walmart within the United States so if I
00:02:36 00:02:40 was to purchase that product then trying
00:02:38 00:02:42 to send up Amazon FBA look what tends to
00:02:40 00:02:44 be thousands and thousands of other
00:02:42 00:02:45 people purchasing that same product with
00:02:44 00:02:47 the intention to then sell it back on
00:02:45 00:02:48 Amazon FBA
00:02:47 00:02:50 which is basically going to tank the
00:02:48 00:02:52 price and minimize your margins and
00:02:50 00:02:55 that's currently why I use the business
00:02:52 00:02:57 model private label to where I order one
00:02:55 00:02:59 unique product I brand that product with
00:02:57 00:03:02 my company to then resell it back on
00:02:59 00:03:04 Amazon and minimize my competition don't
00:03:02 00:03:07 get me wrong you can make a large amount
00:03:04 00:03:07 a full-time income doing retail
00:03:07 00:03:09 arbitrage
00:03:07 00:03:11 I know tons of people through Instagram
00:03:09 00:03:14 and YouTube that still do it it's just
00:03:11 00:03:16 not the business model for me and I
00:03:14 00:03:18 actually am going to do some retail
00:03:16 00:03:20 arbitrage so I'm actually not quitting
00:03:18 00:03:23 but I'm just kind of postponing it and
00:03:20 00:03:25 so q4 comes up and q4 is gave me the
00:03:23 00:03:27 last three months of the year and that
00:03:25 00:03:29 is basically when ecommerce sales just
00:03:27 00:03:31 absolutely blow up so I'll probably do
00:03:29 00:03:33 end up doing it the last two months of
00:03:31 00:03:35 the year and just kind of dabble into if
00:03:33 00:03:37 I want to do some Amazon FBA but I was
00:03:35 00:03:39 kind of looking into March in fulfilling
00:03:37 00:03:41 two and so those last three months of
00:03:39 00:03:43 the year everyone is just purchasing if
00:03:41 00:03:46 it be for am upcoming for Christmas or
00:03:43 00:03:48 just preparing for the holidays people
00:03:46 00:03:50 are purchasing off Amazon like crazy and
00:03:48 00:03:51 it's honestly sometimes hard to keep
00:03:50 00:03:54 stuff in stok so that's what reach the
00:03:51 00:03:56 arbitrage is you're gonna see the best
00:03:54 00:03:58 margins and the highest returns and you
00:03:56 00:04:00 can also merchant fulfilled toys in
00:03:58 00:04:02 different ionises during q4 school
00:04:00 00:04:04 because there's just not enough in stok
00:04:02 00:04:05 in your being able to ship it from your
00:04:04 00:04:07 house as well and to your margins are
00:04:05 00:04:09 gonna increase because you are doing the
00:04:07 00:04:10 fulfillment obviously it's gonna be a
00:04:09 00:04:11 little bit more upfront work on your
00:04:10 00:04:13 side because amazon is not doing the
00:04:11 00:04:14 fulfillment you are doing it but it's
00:04:13 00:04:16 going to give you a lot more leisure and
00:04:14 00:04:18 your margins are gonna be a lot higher
00:04:16 00:04:21 but when it comes to the big question is
00:04:18 00:04:24 Amazon FBA retail arbitrage dying off
00:04:21 00:04:26 the answer is no it's not dying anytime
00:04:24 00:04:28 soon it's been here for the past
00:04:26 00:04:29 ten years it's gonna be here for the
00:04:28 00:04:31 next ten years there's always gonna be
00:04:29 00:04:34 thousands and thousands of new products
00:04:31 00:04:35 coming in to Amazon system even though
00:04:34 00:04:37 there's gonna be new sellers there's
00:04:35 00:04:39 just gonna be a ton of new opportunities
00:04:37 00:04:41 and it's all about how well you can
00:04:39 00:04:43 adapt how you're using your cash flow
00:04:41 00:04:45 and just how you're feeding Amazon keep
00:04:43 00:04:47 sending products to them to then resell
00:04:45 00:04:49 and get your profits back and how much
00:04:47 00:04:51 you reinvest back in the business
00:04:49 00:04:52 hopefully scale your business to that
00:04:51 00:04:56 point that you desire but that's it for
00:04:52 00:04:58 this video on why I quit Amazon FBA Reed
00:04:56 00:05:01 - arbitrage and going over the question
00:04:58 00:05:03 of if Amazon FBA reach arbitrage is
00:05:01 00:05:05 dying so if you enjoyed this video
00:05:03 00:05:07 please feel free to comment below any
00:05:05 00:05:09 questions and/or video ideas you would
00:05:07 00:05:11 like to see in the future also don't
00:05:09 00:05:12 forget to Like and subscribe as I'm
00:05:11 00:05:15 always gave away different tips and
00:05:12 00:05:16 tricks on how to make money online you
00:05:15 00:05:19 know that note I'll see you guys next
00:05:16 00:05:19 video