How To Start Selling On Amazon On Budget And Make Money Fast

Learn How to Begin Selling on Amazon on a Tight Budget and Quickly Generate Income

Hey there! 🚀

Want to dive into the world of Amazon selling but worried about your budget?

Wondering how to kickstart your journey and make money fast?

Join me as I spill the beans on starting your Amazon venture without breaking the bank!

Recently, I sat down with Eli and Marina, two seasoned Amazon sellers, to uncover the secrets of launching your Amazon business on a budget and raking in profits in no time.

Let's delve into the strategies they shared and learn how you too can turn your Amazon dreams into reality without draining your wallet.

Keep reading to unlock the keys to success in the world of online selling! 🌟

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Introduction

Vova: Hi there! Today, we'll be diving into how you can kickstart your Amazon selling journey without breaking the bank and start raking in cash quickly.

Joining me are two fantastic guests, Marina and Eli, who are no strangers to the world of Amazon selling.

They started small, grew steadily, and now, their business is booming.

Today, we're not just talking theory; we're sharing practical tips on how you can get started on Amazon with limited funds and start seeing profits sooner than you might think.

Oh, and don't forget to check out Marina and Eli's YouTube channel for even more insights – it's definitely worth a subscription!

And hey, I'm Vova, an Amazon seller myself since 2016.

Welcome aboard!

Now, Marina and Eli, over to you for a quick introduction before we dive in.

Take it away!

Meet My Guest: Marina

Marina: Hi, folks! I'm Marina.

I've been selling stuff on Amazon for about two years now, starting back in 2020.

When I first dipped my toes into the Amazon pool, I, along with my partner, Eli, began with something called retail arbitrage.

Later on, we gave online arbitrage a shot, and currently, we're exploring the world of wholesale.

So, that's a quick overview of our journey so far, and we're excited to share more about it with you.

Vova: Great! Now, Eli, over to you. Tell us a bit about yourself.

Meet My Guest: Eli

Eli: Sure thing. So, my journey with Amazon began around 2019, and it actually happened quite spontaneously.

I remember scrolling through my feed while planning a vacation, just casually searching for ways to earn some quick cash online. 

That's when I stumbled upon a discussion about making money on Amazon in one of the finance groups I follow.

It was fascinating to hear about someone who had built a multi-million-dollar business through Amazon, and that's what sparked my interest.

The idea of starting off with reselling really caught my attention.

I mean, sure, eBay is something a lot of folks know about, but Amazon – that's a whole different ball game.

The potential to scale up and have Amazon handle the shipping logistics was incredibly appealing.

So, without much hesitation, I decided to dive right in.

My first move?

A trip to Walmart, where I stocked up on a bunch of flashlights that happened to be on sale at the time.

It was quite the thrill seeing those sales roll in while I was off on vacation.

I couldn't wait to get back and dive even deeper into the process.

I started devouring online tutorials, trying to learn all about scanning products and making smarter buying decisions.

At first, I was a bit apprehensive – you never really know if what you buy is going to sell.

But once I got into the swing of things, the growth was pretty rapid.

What is Retail Arbitrage on Amazon?

Vova: Great! Now, let's talk a bit more about retail arbitrage on Amazon.

Could you explain this concept for our viewers and readers?

It seems like a straightforward way to kickstart your Amazon journey, especially for those on a tight budget.

Eli: Absolutely. Retail arbitrage is often the go-to method for many beginners because it's quick and relatively simple.

Here's how it works: you hit up your local retail stores and start scanning for deals.

Usually, you'll head straight to the sales racks or clearance sections.

The idea is to find items that are selling well on Amazon for a higher price than what you can get them for in-store.

Sometimes, you can even list the item on Amazon right then and there, straight from the store.

And there were moments when I had items still sitting in my cart, and they were already selling on Amazon. 

So, naturally, I thought, "Well, why not grab the rest of them?" It's definitely a quicker process compared to Online Arbitrage.

Vova: So, just to clarify, with Retail Arbitrage, you're physically buying products from stores like Walmart or others you can visit in person, right?

Especially if you're based in the United States, you can walk into a store, use a special scanner or something similar.

Eli: Exactly. You can simply use the Amazon app that includes the Seller Central feature.

You might find that some items don't show up when you scan their barcodes.

Not all barcodes are perfectly synced with Amazon's system.

Sometimes, I came across items that I was already familiar with, especially toys because of my kids.

For instance, if I spotted a Barbie doll that I knew my daughter would love, I'd simply snap a picture of it.

Alternatively, you can type in the name of the doll or toy.

There's also a microphone feature where you can verbally search for items, like saying "Barbie doll yoga outfits," and all relevant listings on Amazon will appear.

This way, you can quickly check if the item is profitable and review all associated fees.

Overall, it was actually quite enjoyable, especially in the first year.

It felt like a bit of a treasure hunt, scouring for toys and other items to sell.

Sure, it could be tiring at times, but overall, it was really fun.

Vova: So, just to recap, you buy the products, scan them to assess the profit potential after factoring in Amazon fees and shipping costs. That's it!

Now, when it comes to shipping, do you send the items from your own home, or is there another process?

Eli: Right, there are actually two options.

Many folks start with what's called Merchant Fulfilled (FBM), especially if they're familiar with platforms like eBay.

With this method, you keep the items at home and list them as Merchant Fulfilled.

This means you're responsible for shipping the items directly to the customers.

The fees for this approach are calculated at a different rate.

If you've got a bunch of items, you always have the option to pack them up and send them off FBA, which stands for Fulfilment by Amazon.

This means all your items stay in Amazon's inventory, and when they sell, Amazon takes care of shipping them directly to the customer.

When I first started out, I actually tried both methods.

Initially, I leaned towards FBA because I didn't want to have a bunch of inventory cluttering up my space at home.

So, I just shipped everything off to FBA.

Later on, especially during busy times like the Q4 holiday season, when you want to move inventory quickly, I found it more efficient to handle some items myself.

There really are two ways to go about it.

The Benefits of Retail Arbitrage

Vova: Alright, let's dive into retail arbitrage a bit more.

Marina, could you share your experience with this method?

Marina: Absolutely. So, we've actually tried three different models: retail arbitrage, online arbitrage, and wholesale.

Each has its own pros and cons.

With retail arbitrage, the biggest advantage is speed.

It's incredibly fast, and there's less room for error.

You're able to physically inspect the products before purchasing them.

For example, if we're buying a bottle, we can check its condition right there in the store.

This is especially important for products with expiration dates.

By checking the items in-store, we can ensure they're not close to expiration or damaged, avoiding any potential issues we might face if the items were shipped to our home.

How to Scan Items for Retail Arbitrage?

Marina: So, when it comes to scanning products, there are two main options we use.

First off, there's the trusty Amazon app, which is free for everyone to use.

But we've also found a real gem in Inventory Lab.

Let me tell you, we're big fans of this program.

Inventory Lab comes bundled with Scoutify 2, a scanning app for your phone.

Now, why do we prefer this over the Amazon app?

Well, for starters, it offers a bunch of handy features.

For instance, you can set up various cost inputs, like the cost per pound for shipping items to Amazon from your home.

You can also account for sales tax if you're in a state that requires it, and even factor in discounts.

The app takes all of this into consideration and calculates everything automatically.

Plus, as Eli mentioned earlier, there are different ways to scan items.

The first method is using the barcode.

Most products come with a handy barcode, making our scanning process a breeze.

All we have to do is whip out our phone, scan it, and voila!

But what if the barcode isn't in the system?

No worries, we've got a few tricks up our sleeves.

We can snap a picture of the product instead and let the app do its magic.

Another option is to type in a description, like "Barbie on vacation with a car," and see if that pulls up the item we're looking for.

And if typing isn't your thing, you can simply speak the description, and the app will search for it on Amazon.

So, you can say that there are several ways to go about it.

While scanning the barcode is usually the quickest method, it's not foolproof since not every product is in the system.

Starting Retail Arbitrage

Marina: When you're just starting out, it's totally normal to feel a bit apprehensive, as Eli mentioned earlier.

There's so much to figure out – how to pack items, how the whole process works – it can feel overwhelming.

But the beauty of retail arbitrage is that you can dip your toes in with as little as a hundred bucks.

You're in the store, you spot a hundred different items, and you decide to test the waters with just one item of each.

Then, when you get home, it's time to prep them for shipping.

Now, prepping can vary depending on the product.

Each item might need a different approach.

Once they're prepped, it's time to pack them up and ship them off to Amazon.

Amazon partners with various shipping companies; we usually go with UPS because they offer discounted rates.

You input all the details into the system, pack everything up in those big boxes (which you can easily find at stores like Walmart), and you're good to go.

And that's pretty much the process!

You prep your items and then ship them off to Amazon.

Retail Arbitrage vs Online Arbitrage

The reason we emphasize that retail arbitrage is both fast and budget-friendly is because you have the flexibility to buy as little or as much as you want. 

Unlike online arbitrage, where there's often a minimum purchase requirement for free shipping, with retail arbitrage, you don't face this issue.

You can buy something today and have it shipped out tomorrow – it's that quick.

Ordering online, on the other hand, can take a while for your items to arrive, and you often need to wait until you've accumulated enough orders to make shipping worthwhile.

This speedy turnaround is crucial in this line of business, where cash flow is key, as it's all about moving merchandise.

When it comes to making money, you've got to have some money to start with – that's just how it goes.

In my view, retail arbitrage is not only the quickest way to get started but also the simplest.

It's way easier to grasp than online arbitrage.

Eli: Absolutely. With Retail Arbitrage, you don't need a bunch of fancy software like you do with Online Arbitrage.

You can physically see and touch the products yourself.

You can tell right away if it's a standard-sized item or something bigger, which can affect the fees you'll pay.

It's really straightforward to assess.

Why Did Eli Stop Doing Retail Arbitrage?

Vova: So, you both started out separately, right?

You weren't partners from the get-go.

It's interesting how you didn't even know about each other at the beginning.

Now, Marina, I've always been into private labels myself, so I'm curious – what made you decide to move away from retail arbitrage?

Do you still dabble in it from time to time?

Eli: For me, it came down to wanting to scale up.

In my first year, I managed to rack up sales of around $500,000, which was pretty incredible.

Normally, you're looking at a return on investment of about 25-30 percent, but as you can imagine, it's impossible to keep up that pace.

I was shipping out items twice a week, and the whole process – from sourcing products to prepping them and getting them ready for sale – was just incredibly time-consuming.

So, doing more than two or maybe three shipments a week just wasn't feasible for me.

I found myself stretched thin, and it seemed like switching to online arbitrage might save me some time.

With online arbitrage, everything gets delivered to your doorstep, so I could still handle all the prepping myself and hopefully gain back some precious time.

However, what I didn't anticipate at the time was that the profit margins are generally smaller in online arbitrage.

There's more competition, too, as it opens up sourcing opportunities for people who don't have as many retail stores nearby.

So, while I ended up making about the same amount in sales, my profits remained pretty much unchanged due to these tighter margins.

That's when I decided to explore other cost-saving options, like using a prep center instead of doing all the prepping myself.

So, all the items I purchase go straight to a prep center.

This not only saves me time on prepping but also allows me to increase my revenue slightly.

However, it's important to note that the cost of prep eats into your profits, so it's a bit of trial and error.

Ultimately, it depends on your preferences.

If you enjoy the hands-on approach of going to stores, talking to managers, and building connections, then retail arbitrage might be the way to go.

There are many people who have been doing it for years and prefer it over online arbitrage.

It really comes down to what you're comfortable with and your personality.

Retail Arbitrage Summary

Vova: Let's also touch on online arbitrage.

While we've covered retail arbitrage, let me summarize it in a few sentences.

We essentially scour online stores for deals and opportunities, just like we would in physical stores.

Our main objective is to sell products on Amazon, but our process starts with physically visiting stores to scout for different items.

We utilize scanning tools and Amazon searches to identify products where we can potentially turn a profit.

Once we've found these items, we purchase them and return home to prepare them for sale.

This involves labeling the products with stickers provided by Amazon and then shipping them off to Amazon through various channels.

Typically, we request shipping labels directly from Amazon to ensure the products reach the correct destination.

Sometimes, it can get a bit complicated with multiple shipping addresses, but we consolidate all the information onto one mastercard and send it off to Amazon.

That's retail arbitrage in a nutshell.

What is Online Arbitrage on Amazon?

Vova: Now, onto online arbitrage – how does that differ?

For those who may be unfamiliar, could you give a quick rundown of online arbitrage?

Marina: Sure!

Online arbitrage follows a similar process to retail arbitrage, but instead of visiting physical stores, we shop online.

We might check out clearance sections on websites like Nike's online store rather than visiting their physical outlets.

From there, we dive into each listing, comparing the product to what's available on Amazon by checking the title, pictures, and Universal Product Code (UPC) if it's provided.

Our goal is to find a match and assess if it's a profitable item to sell.

Additionally, we need to make sure we're allowed to sell that particular brand or product, as some items may be gated or restricted.

Once we've confirmed all these factors and identified a profitable opportunity, we simply place an order.

When it comes to purchasing items online for online arbitrage, the process is straightforward.

We simply add the item to our cart, input our address and credit card information, and choose whether to have it shipped to our home or to a prep center if we're utilizing one.

Vova: That's pretty clear.

It's quite similar to retail arbitrage, except we're sourcing products online instead of in-store.

Once the products arrive at our home, we follow the same process as we do with retail arbitrage: sharing, prepping, and so on.

However, since we're sourcing products online, there tends to be more competition, as you mentioned.

This is because more people have access to online platforms, whereas not everyone can physically visit multiple stores.

Why Did Marina Stop Doing Retail Arbitrage?

Vova: Marina, could you share why you decided to stop doing retail arbitrage?

As Eli mentioned earlier, you were dealing with a high volume of sales, and it was becoming physically demanding.

Marina: I've never been one to enjoy the hustle of visiting physical stores.

I prefer the convenience of online shopping, even for things like clothes.

Living in an area with few nearby stores or outlets, every shopping trip required a considerable distance of 60 to 70 miles.

Along with the distance, there were expenses for gas and tolls, making each outing a significant investment of time and money.

I often found myself spending entire days sourcing products, sometimes working up to 12 hours at a stretch.

This routine became exhausting, especially considering the need to wait for stores to restock.

For instance, I'd travel on Monday to source products, pack on Tuesday, and then head out again on Wednesday to repeat the process, which took a toll on my energy levels.

Yeah, my motivation to expand the business stemmed from a desire to streamline operations.

At a certain point, retail arbitrage started feeling more like a regular job, with me handling every aspect of the process.

I saw the need to establish systems, like hiring staff and utilizing prep centers to manage the workload more efficiently.

Transitioning to online arbitrage allowed me to avoid the physical demands of visiting stores, which was a welcome change.

However, I understand why many people prefer this method, as I often hear concerns about the challenges of retail arbitrage.

Despite this, I still advocate starting with retail arbitrage, even if only for a short period.

The hands-on experience teaches valuable lessons much faster than online arbitrage, which involves navigating various factors like promotions, discounts, and sourcing strategies.

To succeed in online arbitrage, you must learn to leverage various strategies, such as combining cashbacks from different websites and credit cards, as well as utilizing discount cards.

This process involves exploring numerous extensions and tools, which can be time-consuming to understand and implement effectively.

Learning how to apply gift cards and utilize other promotional offers is crucial in maximizing profits.

Contrary to popular belief, the days of finding products for a few dollars and reselling them at a significant markup are largely over.

While occasional opportunities may arise, they are often fleeting, such as clearance items that are not restocked.

Adaptability and a nuanced understanding of online retail dynamics are essential for sustained success in today's marketplace.

In Online Arbitrage, finding profitable deals isn't something you stumble upon every day.

It requires mastering the art of leveraging gift cards, cashbacks, and discounts to slash prices by significant margins, ultimately leading to profits.

However, mastering these tactics takes time and effort, especially if you're new to selling on Amazon or unfamiliar with the intricacies of prepping and shipping items.

It can feel like tackling multiple learning curves all at once.

That's why I highly recommend starting with retail arbitrage, even if just for a short while.

It's a quicker way to learn the ropes because you're hands-on in physical stores.

You can easily explore clearance aisles and other sections to find potential deals.

It's a more straightforward approach that can lay a solid foundation before diving into the complexities of online arbitrage.

You don't have to overthink or worry about scanning every inch of a store when you're doing retail arbitrage.

A simple strategy is to head straight to the clearance section and start scanning those items.

Good Stores for Retail Arbitrage in USA

Marina: One of my go-to stores for this is Big Lots.

When they have their 15, 20, or 25 percent off sales, it's prime time to shop.

I'd visit multiple Big Lots locations, as well as other stores like Marshalls, TJ Maxx, and Ollie's, scanning away and adding everything to my inventory list on Inventory Lab.

This way, all the calculations are done automatically, making the process much smoother and faster.

Ollie's is a great spot if you're out on the East Coast.

Unfortunately, they're not available on the West Coast, but you've got a Grocery Outlet there instead, which is another good option for scanning.

Eli, how about you?

Any favorites for retail arbitrage?

Vova: Yeah, you mentioned some good ones. What about you, Eli?

Eli: Well, for retail arbitrage, I'm a fan of most of the stores Marina mentioned, except Ollie's since we don't have that here in Chicago.

It's a bit of a trek for me to reach one.

So, instead, I turn to Five Below.

They've even expanded their offerings now with Ten Below, which has really broadened their inventory.

But back then, Five Below only had up to five dollars for their items, and they stocked a wide variety of toys from popular brands like Marvel, Spider-Man, and Star Wars.

These toys proved to be very profitable for us. 

Interestingly, even when compared to wholesale prices, the items at Five Below were often cheaper.

This is because they purchase their products in large quantities, which allows them to offer competitive prices.

For example, if there are five Spider-Man toys, five Iron Man toys, and five Black Panther toys in a box, it's typically the Spider-Man toys that sell the most on Amazon and yield the highest profit margins.

Unlike wholesale purchases where you might need to buy the entire box, with Five Below, you can simply choose the items that are currently profitable.

Luckily, I have about four or five Five Below's near me, and their managers have always been very helpful and accommodating.

So back then, Five Below made up about 60 percent of my inventory.

Marina: I'd like to share a couple more insights.

If you happen to live near outlet malls, they can be a goldmine for sourcing inventory.

Outlet malls are typically clustered with various stores representing different brands like Nike, Adidas, Coach, and more.

If you're fortunate enough to reside nearby, it can be a fantastic opportunity.

For instance, there are excellent outlet malls in Orlando.

Unfortunately, for me, Orlando is about one and a half to two hours away, which makes it less convenient.

Additionally, many outlet stores impose purchase limits, such as 30 pairs of Nike shoes per day.

This means you might have to return another day if you hit the limit.

For someone like me who lives far away, it's not feasible to make that trip every day.

However, if you're in close proximity, outlets can be an excellent option for acquiring inventory.

Building Relationships with Retail Store Managers

Marina: I'd like to mention another approach to this business, as Eli pointed out.

She's connected with many store managers, and you can do the same.

You can offer to help them clear out inventory that's been sitting on their shelves.

Just let them know that you're available to swoop in and take items off their hands if they need to discount them.

Don't hesitate to reach out because you both have a mutual interest.

You're looking to buy items at lower prices, and managers are looking to move inventory.

Often, they may even be willing to set items aside for you without putting them on the shelves, sparing you the hassle of dealing with those pesky stickers.

It's a win-win situation for both parties.

When you're at these stores, it's often quicker and more efficient to scan items directly from a palette rather than searching all over the store.

So, it's really beneficial to establish connections with store managers.

This can be incredibly valuable because they can reach out to you whenever they need to discount items or when new inventory arrives.

They might give you a heads-up and say, "Hey, we've got some new stuff in. Do you want to come take a look?"

And of course, you'll be more than willing to jump on the opportunity.

What is Wholesale on Amzon?

Marina: Let's turn our attention to wholesale.

Vova: Sure, so, you're considering getting into wholesale.

What exactly does that entail?

Marina: Well, when it comes to wholesale, there are two main approaches: the traditional method and a newer approach we've been exploring recently, which has been quite promising.

Let's start with the traditional way.

Typically, you'd reach out to either a distributor or directly to brands.

Distributors act as middlemen, representing multiple brands.

They purchase products in large quantities and then sell them to retailers like us in smaller batches.

To get started, you'd need to contact them, set up an account, and provide your reseller certificate.

Also, you'll need to have a registered company.

Once all that's sorted, they'll provide you with catalogs containing product titles, UPC codes, prices, and sometimes discounts for larger orders. 

Plus, they'll arrange shipping if you're not located nearby.

Let's break down how wholesale works.

When you order from a distributor, the shipping logistics can vary.

If the distributor is located in another state, you'll likely deal with freight shipping, which can add to your costs.

Unlike retail sites like Walmart, where you might get free shipping over a certain purchase amount, wholesale is different.

You select the items you want, but you'll need to factor in the shipping expenses separately.

This can be a challenge because even if you find profitable items in their catalog, you might need to buy a whole pallet to make the shipping costs worthwhile.

Let's talk more about the shipping costs when dealing with wholesale purchases.

Imagine you find some profitable items, but they're heavy, like toothpaste, for example.

If you order several boxes of these heavy items, shipping costs can quickly add up.

You might end up paying around $100 for shipping per box.

On the other hand, if you opt for buying a pallet, you could be looking at a higher upfront cost, perhaps $200 or $300.

But in the long run, it might be more cost-effective, especially if you're dealing with heavy or bulky items.

However, if you're only interested in a few items, buying a whole pallet might not make sense financially.

Besides this, there's the other approach to wholesale that I mentioned. 

This one is more local and blends elements of both retail arbitrage and wholesale.

You can search for wholesalers in your area by simply Googling terms like "wholesale Tampa" or "distributor Tampa."

This way, you can potentially find local suppliers or distributors who offer wholesale deals, which could save you on shipping costs and simplify the process.

Another approach to wholesale is to find local suppliers or distributors.

This can be advantageous because you might be able to pick up the items yourself, saving on shipping costs that others from different states would have to pay.

By doing this, you could lower the final price per item.

Alternatively, some local suppliers may offer delivery services, providing convenience if picking up isn't an option.

The third method we've explored involves a company called E-com Solutions/Bold City Distributors.

We even had the opportunity to interview the CEO.

The video is embedded below if you're interested. :)

With this method, they provide a catalog that's already been matched with Amazon, streamlining the process for sellers.

It's a convenient way to access a selection of products that have already been vetted for compatibility with Amazon's marketplace.

So essentially, with this method, we get access to a supplier's catalog that's already matched with Amazon.

It's straightforward: the catalog lists the supplier's prices, the corresponding ASIN on Amazon, and the potential profit.

Of course, profits can vary because market prices fluctuate.

We have access to these listings, which they call "seats," and we can browse through them to see what catches our interest and how profitable it might be.

Then, if we're satisfied, we make the purchase.

Now, in terms of purchasing requirements, they do have a minimum item purchase, but it's quite low compared to other wholesale methods.

Typically, it's just one item minimum, sometimes it's six, twelve, or eighteen, but I haven't seen it go higher than that.

So, it's a pretty manageable minimum requirement, making it accessible for sellers who are just starting out with wholesale.

Vova: So, how does this wholesale process actually function?

Do we sell items on Amazon in bulk, or individually?

Do we have them sent to our home for preparation?

Do we need to handle logistics ourselves, or is there another way?

Marina: Well, with traditional wholesale, the items can be shipped either to your home or to a commercial address.

However, there's a hiccup with some distributors who may insist on shipping only to commercial addresses.

They might even require a loading dock for pallet deliveries.

This can pose a challenge if you don't have a commercial space or warehouse.

Now, with E-com Solutions, it's simpler.

You place regular orders by adding items to your cart and then pay the invoices accordingly.

It's a more straightforward process compared to traditional wholesale methods.

E-com Solutions essentially consolidates all our orders into one.

This includes orders from me and other Amazon sellers.

By doing this, they can maintain lower prices because they're still ordering in bulk due to the collective volume of our orders.

This collective approach allows for better pricing and the ability to purchase smaller quantities, which is beneficial for individual sellers like us.

Moreover, one of the best aspects of E-com Solutions is that they handle the preparation process for us.

While there is a fee for this service, it's significantly lower compared to the fees we've encountered with other prep centers.

Previously, we were charged $600 monthly for preparing our items.

With E-com Solution, they take care of everything upon arrival.

They ensure that the items have the correct expiration dates and are in good condition.

They handle the preparation, labeling, and shipping process for us, using our account details.

This simplifies the entire process and saves us a considerable amount of time and effort.

And that's the path we've chosen now: wholesale.

So far, it's been a satisfactory choice for us.

The Model with the Biggest Profits on Amazon

Marina: However, I want to make it clear that while wholesale can be profitable, the model that typically yields the highest profit margin is private label.

Unfortunately, we don't have experience with private label, so we can't speak to its effectiveness.

Out of the three methods we've discussed, retail arbitrage tends to offer the most lucrative returns.

With retail arbitrage, it's possible to find items with profit margins of 50%, 70%, or even 100%.

It requires a lot of effort, but the potential earnings make it worthwhile.

Plus, retail arbitrage provides a quick start, which is appealing.

Next in line is online arbitrage.

It's important to remember that when you're shopping locally, you're only competing with others in your area.

This can limit competition compared to the broader online market.

When you purchase items online for resale, you're essentially competing with sellers from all over the world.

This global reach means there's often intense competition, which can sometimes drive prices down.

As a result, there may be instances where you end up taking a loss on certain items.

I want to be transparent here and set realistic expectations.

Contrary to some misconceptions, success on Amazon doesn't typically lead to overnight riches or luxury sports cars.

It's important to recognize that building a profitable business takes time and effort.

Out of the three methods we've discussed, wholesale generally offers the lowest profit margins.

However, it also tends to be the least hands-on approach, at least in our experience.

With wholesale, you can order in bulk, which means less time spent on dealing with individual returns.

On the other hand, with online arbitrage, there's often the hassle of dealing with damaged goods or returns, which can eat into your time and profits.

In wholesale, the process is pretty straightforward: we select the products we want to sell, make the payment, and that's about it.

When our inventory runs low, we simply place another order to restock.

Amazon Listings and the Wholesale Model

Vova: So, do you have to do anything with the product listings on Amazon? Or do you just use existing ones?

Marina: Ah, yes, that's correct.

With wholesale, we typically rely on existing product listings.

While you could potentially optimize or add images to listings, it's worth considering whether it's appropriate if you didn't create the listing yourself.

Eli: Another strategy you can use is advertising on existing listings.

This means your product will appear as a sponsored listing when someone views a similar item.

For example, let's say you're selling a Barbie doll, but someone else's listing includes an additional item.

By advertising on their listing using their ASIN, you're giving customers the option to choose your Barbie doll alone.

This can lead to extra sales for you.

Alternatively, you can create your own listing, especially if you're selling bundled products.

Time vs Money

Eli: There are numerous approaches to explore, depending on your budget and preferences.

If you're tight on budget, starting with retail arbitrage can offer the best return on investment. It's like planting a seed that grows into a snowball of profit.

As your budget grows and your time becomes more valuable, you might transition to other models.

For instance, wholesale becomes appealing when you have more funds and less time to spare.

Marina and I have other projects we're passionate about, so we're exploring wholesale to free up time.

With wholesale, the prep work is taken care of, which is a big plus.

When items arrive from suppliers, Marina mentioned concerns about potential damage.

Now that I'm still working with my prep center, I'm the one who needs to contact them if there are any issues like short shipments, wrong items, or damages.

Handling this correspondence can be time-consuming, but it's necessary.

Marina: I wanted to add something else that we've tried.

Like Eli mentioned, it really depends on what you enjoy.

Some people love the thrill of shopping, discovering hidden treasures in stores, and getting excited about the profit they can make.

I can feel their excitement through the screen.

But that approach just wasn't for us.

We wanted to prioritize time over earning more money, especially considering Eli's family and kids.

Time becomes more valuable as you consider factors like age and financial stability.

Speaking of finances, starting with wholesale is feasible, but it requires a significantly larger budget compared to other methods.

Can We Start Amazon from Wholesale

Marina: Selling brand name items through wholesale often entails getting ungated, which is both time-consuming and costly.

Additionally, buying in bulk carries its own risks, especially if you're not familiar with how Amazon works. 

Mistakes in wholesale purchases can be more costly since you're dealing with larger quantities and higher expenses per item.

If you make a wrong choice with wholesale and end up buying a hundred items at ten dollars each, that's already a loss of one thousand dollars.

When I started, I didn't invest the full seven or eight thousand dollars right away.

I wanted to test the waters first, so I started with a smaller amount, like 200 or 300 dollars.

As I saw how things worked out, I gradually increased my investment.

Putting in such a large sum of money without fully understanding the process would have been risky.

Plus, back then, my credit score and history weren't in great shape either.

So initially, I started with a small amount of money and operated within that budget.

As time went on, I reinvested all the profit I made back into the business.

I also obtained several credit cards, and gradually, my credit limits increased.

From starting with just seven or eight thousand dollars, I eventually grew my investment to around 100,000 dollars.

Now, I can comfortably allocate up to a hundred thousand dollars a month into the business without any issues.

This growth didn't happen overnight; it took me about two and a half years of consistent effort and gradual expansion to reach where I am today.

Yes, it's definitely achievable.

We just want to illustrate that it's possible for anyone.

Amazon Bundle Model – Private Label on a Budget

Marina: Another thing to consider is creating bundles, which is similar to private labeling but more budget-friendly.

For instance, you can identify two or more best-selling items, like toothpaste and a toothbrush, that are commonly purchased together.

By bundling them, you can tap into this synergy.

When you sell items separately, you have to pay a fee for each transaction.

On the other hand, when selling items as a bundle, the fees might be higher because of the combined weight and size, but you only pay the fee once, not for each individual item.

You can purchase the items, create a listing under your brand name, and package them together, like toothpaste and face wash.

This listing is unique to you, so no one else can sell it, and customers are more likely to trust and buy from recognized brands. 

If they see value in your bundle, they'll choose to buy it from you.

One thing I realized we needed to do differently was to include a filler item.

This means adding something extra to the bundle, like a generic toothbrush with our brand name on it, such as Eli and Marina.

If we only listed the main items, like toothpaste and face wash, anyone could join in and sell them too.

But by including a branded filler item, it makes the bundle unique to us.

Even if it contains products from different brands, having our logo on the toothbrush makes it our own brand.

If you're interested in learning more about this, feel free to leave a comment on this article's video, and we can discuss it further in another video.

We've tried various approaches to find what works best for us.

Vova: Is there anything else you'd like to share about starting a budget-friendly Amazon business quickly?

We've discussed retail arbitrage, which offers fast profits and is easy to begin with.

Then there's online arbitrage, which you can manage right from your computer, offering another avenue for earning.

Lastly, there's wholesale, which might be less profitable per item, but it's more hands-off and can be started with a larger budget, though it's not always necessary.

Marina: Yeah, I'd like to mention that E-com Solutions does require a larger budget compared to online arbitrage.

You'd need at least fifteen to twenty thousand dollars to begin.

Vova: Yeah, that's quite a significant amount.

I mean, I reckon all arbitrage might need a few thousand bucks or up to two thousand just to get started.

Marina: Exactly, yes. With retail, you can even start by purchasing just one or two products from a store.

Quick Recap

Vova: Alright, do you have anything else to add before conclude?

Marina: If any of the topics we discussed today caught your interest, feel free to drop a comment on the article's video.

We're open to creating more videos on those subjects.

You can also check out our channel where we regularly upload content.

Vova has already shared the link with you, so feel free to let us know what topics you'd like us to cover.

Vova: That's great! Thank you, and I hope to see you again on the channel.

Good luck with your own channel as well.

Marina: Thank you.

Eli: Thank you.

Conclusion

So, wrapping up our conversation, we've covered a lot about making money on Amazon.

Starting with retail arbitrage, where you can hit the ground running with minimal investment and see quick returns.

Then there's online arbitrage, perfect for those who prefer doing business from the comfort of their computer.

And lastly, wholesale, which requires a bit more upfront capital but offers a more hands-off approach once you're set up.

Each method has its pros and cons, depending on your budget, time, and preferences.

One key takeaway is that success on Amazon isn't instant.

It takes time, effort, and learning from mistakes.

We've shared our experiences, from starting small with just a couple of hundred dollars to gradually scaling up to larger investments.

It's been a journey of trial and error, but also one of growth and opportunity.

We've also discussed the importance of adapting and being open to new ideas.

Whether it's exploring different sourcing methods, experimenting with bundling products, or engaging with our audience to create content they're interested in, flexibility is key in this ever-evolving landscape.

Ultimately, it's about finding what works best for you and your goals.

If you're passionate about shopping and enjoy the thrill of finding hidden treasures, retail arbitrage might be your thing.

If you prefer the convenience of online sourcing and have a knack for spotting good deals, online arbitrage could be a good fit.

And if you're looking for a more scalable and hands-off approach, wholesale might be worth considering.

Whatever path you choose, remember that success comes with patience, persistence, and a willingness to learn and adapt along the way. 

And if you ever need guidance or want to dive deeper into any of the topics we've covered, just let us know.

We're here to help and share our knowledge with you.

Best,

Vova :)