Retail Arbitrage - Good or Bad? | Chris Malta's EBiz Insider Podcast

Chris Malta's EBiz Insider Podcast

If you think it's a good idea to waste all your time, gas and energy running around to retail stores all week long, looking for individual bargain products that you then have to package and ship to Amazon to hopefully get resold on FBA for an artificially jacked up price (which is cheating your own customers), before Amazon figures you out and suspends your account, please raise your hand.

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EPISODE TRANSCRIPT

Let's talk about this little gem that the bad guys like to call "retail arbitrage".

If you think it's a good idea to waste all your time, gas and energy running around to retail stores all week long, looking for individual bargain products that you then have to package and ship to Amazon to hopefully get resold on FBA for an artificially jacked up price (which is cheating your own customers), before Amazon figures you out and suspends your account, please raise your hand.

If you raised your hand, please start this podcast over again and listen more carefully. I'm betting that you didn't raise your hand, though. When you hear it in plain English like that, the utter ridiculousness is unavoidable.

There are a lot of people who tell you that this is a good idea. The absolute morons who tell you that either don't know the first thing about the retail business, or they're lying to you with a big fake grin on their faces.

Personally, I believe it's the second choice. But it is true that there is no lack of morons in the internet guru space. So it could be either one.

No matter which one it is, don't let them suck you in.

Retail arbitrage is a phrase that was simply invented out of thin air by an unscrupulous online marketer several years ago to make it sound like it's a thing.

It isn't a thing. Look, the word arbitrage is a term that's used in the financial world. It generally refers to people who buy and sell on the world's securities, currency and commodity markets.

Here's the actual dictionary definition of arbitrage. The simultaneous buying and selling of securities, currency or commodities in different markets or in derivative forms, in order to take advantage of differing prices for the same asset.

Notice, there's nothing there about retail.

Yes, the word commodities could be loosely interpreted to mean physical retail products, but only by someone who doesn't understand commodities.

Gold is a commodity. Grain, precious metals, electricity, oil, beef and natural gas are all commodities.

An easy bake oven that you have to chase all over town to find on sale and then overcharge for on Amazon is not a commodity.

So by definition, retail arbitrage doesn't exist. It's a fake con artist buzzword. It's a waste of your time, money and energy, and it has a glass ceiling.

That means that you only have so much time in a given year to schlep around to retail stores pointing your iPhone app at stuff on sale, and when you use up that time, that's all the money you're ever going to make under this glass ceiling.

And by the way, don't let any of these blithering ninnies tell you that it works better if you buy liquidation lots either. Here's another definition for you.

Most products that are liquidated, are liquidated because nobody else could sell them.

Retail arbitrage isn't real. Don't do it.

For much more amazingly truthful and insightful information about e commerce, check out my Free EBiz Insider Video Series at ChrisMalta.com.

Thanks for listening and I'll catch you next time.