What is Online Arbitrage?
Online arbitrage (OA) is a business model where individuals buy products from one online retailer at a lower price and then resell them on an online platform, such as Amazon, for a profit. The key is finding price differences between these platforms and taking advantage of them.
For example, imagine you find a popular kitchen gadget on sale at Sam’s Club for $20. After doing some research, you notice that the same gadget is selling for $40 on Amazon. You buy a few units from Sam’s Club and list them on Amazon for $40. After deducting Amazon’s fees and shipping costs, you could potentially make a profit of around $10 per unit. This is online arbitrage, and the goal is to repeat this process with multiple products to scale the business.
How to Find Profitable Products on Sam’s Club?
To find profitable deals and buy products from Sam’s Club to sell on Amazon, the key is to identify items that you can buy at a low price and sell at a higher price, while factoring in Amazon’s fees. Here’s how you can go about it:
Get a Sam’s Club Membership
First, you’ll need to sign up for a Sam’s Club membership to access their deals. They offer different membership options, including standard and business memberships, each with its own perks like access to exclusive discounts and bulk pricing. If you plan on buying in large quantities to resell on Amazon, the business membership could be a great option as it often offers lower prices for bulk purchases.
Research Products
Once you’re a member, explore the wide range of categories on Sam’s Club’s website, such as electronics, groceries, and home goods. Use tools like Amazon’s Seller app or third-party software like Keepa to track prices on Amazon and compare them with prices on Sam’s Club. This is also a crucial step when sourcing products from Walmart. If you want to source your inventory from there, don’t miss our guide on how to buy products from Walmart to sell on Amazon.
Look for Discounts and Deals
Sam’s Club often offers special deals and limited-time discounts. Check their clearance section, instant savings, and members-only offers to find products with deep discounts. These deals can give you a competitive edge when reselling on Amazon.
Factor in Fees and Shipping Costs
When calculating profitability, be sure to consider Amazon’s fees, shipping costs, and Sam’s Club’s shipping fees if applicable. A product may look profitable at first glance, but after all the costs, the margins might be too small. Use Amazon’s FBA calculator to get an accurate estimate of your profits before making a purchase.
What Are the Best Tools to Find Profitable Products from Sam’s Club?
Here are five of the best tools you can use to find and buy products from Sam’s Club to sell on Amazon:
1. Amazon Seller App
This free tool from Amazon helps you quickly check whether a product you find on Sam’s Club is selling for a higher price on Amazon. You can scan the product barcode or search by name to see its current selling price, sales rank, and estimated fees. This is essential for checking if an item is profitable before purchasing it.
2. Keepa
Keepa is a popular price tracking tool that allows you to track the price history of products on Amazon. It shows you trends over time, helping you identify whether a product’s current price is an outlier or if it has consistently sold at that price. This helps you gauge if the product will continue to be profitable when you resell it. If you’re still unsure whether Keepa is the right tool for you, make sure you read our Keepa reviews.
3. Profit Bandit
Profit Bandit is another popular product scanning app that provides quick insights on whether an item is worth buying for reselling. You can scan products at Sam’s Club and see estimated profits after all fees. It also shows competition, sales rank, and pricing trends, making it easier to decide on the spot. Check out our Profit Bandit reviews for more information about this tool.
4. Tactical Arbitrage
Tactical Arbitrage is a powerful tool designed specifically for online arbitrage. It allows you to scan websites like Sam’s Club and compare the prices of items with those listed on Amazon. This tool automates a lot of the research process, making it easier and faster to find profitable products. Our Tactical Arbitrage reviews can help you make an informed decision about this tool.
5. CamelCamelCamel
CamelCamelCamel is a price-tracking tool similar to Keepa, but it focuses more on price alerts and tracking specific product pages. You can set price drop alerts for products you are interested in from Sam’s Club, allowing you to act quickly when there is a significant price reduction that increases profit potential on Amazon. Our CamelCamelCamel reviews can give you more information about this tool and its features.
You can also use these tools to source products from other retailers such as Home Depot. However, make sure you know how to buy products from Home Depot to sell on Amazon before looking for products.
What Things Should You Consider When Buying Products from Sam’s Club?
If you want to buy products from Sam’s Club to sell on Amazon, there are several important factors to consider to avoid potential issues and maximize your profits:
Amazon Restricted Categories
Not all products at Sam’s Club can be sold on Amazon, especially if they fall under restricted or gated categories. For example, automotive products like batteries, oils, and tires are restricted on Amazon, and you may need special approval to sell them. If you are a new seller or your account metrics aren’t strong, it’s best to avoid these categories. Always check Amazon’s restricted category list before making a purchase.
Return Policies
Some items, like tires or automotive products, can be harder to return if there’s an issue. Unlike other products that may have easier return policies, specialized items may leave you stuck if they are defective or unsellable on Amazon. Make sure to review Sam’s Club’s return policies for the products you’re considering to avoid complications.
Bulk Purchases and Instant Savings
Sam’s Club offers discounts through its Instant Savings program, which automatically applies to your purchases. However, these savings are often limited to a single item, meaning you won’t receive the discount if you’re buying in bulk. Be aware of these limitations, and factor them into your cost calculations when sourcing products to ensure you’re still making a profit.
Membership and Benefits
Consider upgrading to a Plus Membership if you’re serious and want to buy products from Sam’s Club to sell on Amazon. This membership level offers free shipping on most items, and you can earn 2% cashback through Sam’s Cash on all purchases, increasing your profit margin. Basic members earn Sam’s Cash only in-store, while Plus members can earn it for online purchases as well, which is important for online arbitrage. Other retailers such as Kohl’s also offer coupons and deals, which is perfect for online arbitrage. Before sourcing your products from Kohl’s, make sure you know how to buy products from Kohl’s to sell on Amazon.
Step by Step Guide to Sell Sam’s Club Products on Amazon
Here’s a step-by-step guide on how to buy products from Sam’s Club to sell on Amazon:
1. Sign Up for a Sam’s Club Membership
To start buying products from Sam’s Club, you need a membership. They offer two main options: the standard membership and the Plus membership. The Plus membership costs more but includes benefits like free shipping and 2% cashback through Sam’s Cash, which can boost your profits. Choose the plan that fits your budget and needs.
2. Identify Profitable Products
Use product research tools like the Amazon Seller App, Keepa, or Tactical Arbitrage to find and buy products from Sam’s Club to sell on Amazon. When evaluating potential products, consider:
- Seasonality: Certain products may sell better during specific times of the year, such as holiday-related items.
- Market Trends: Stay updated on what’s in demand. Check customer reviews and analyze market trends using tools like Keepa.
- Profit Margins: Ensure that the product’s price, after factoring in Amazon fees and shipping costs, leaves room for a profitable margin.
3. Evaluate Product Restrictions
Make sure the products you want to buy are not in restricted or gated categories on Amazon. Some categories, like automotive products, alcohol, and organic items, may require special approval to sell. It’s important to check Amazon’s restricted category list to avoid any issues.
4. Take Advantage of Discounts and Offers
Sam’s Club frequently offers discounts, such as Instant Savings, seasonal promotions, and clearance sales. Use these discounts to buy products at lower prices, but keep in mind that Instant Savings usually apply only to one item. Bulk buying can also save money and increase profit potential, especially if you purchase popular or high-demand items.
5. Buy in Bulk
When you want to buy products from Sam’s Club to sell on Amazon, consider buying in bulk to get better discounts. Bulk buying not only reduces the cost per unit but also ensures you have enough stock to meet demand. This is especially useful for fast-selling products that have consistent demand throughout the year.
6. Set Up Your Amazon Seller Account
If you haven’t already, create an Amazon Seller account. Choose between the Individual and Professional selling plans:
- Individual Plan: Suitable for selling fewer than 40 items a month.
- Professional Plan: Ideal for high-volume sellers with added benefits like bulk listings.
Complete the registration by providing your business information, payment details, and tax information.
7. List Your Creations on Amazon
Once your account is set up, list the products you’ve purchased from Sam’s Club on Amazon. If the product is already listed, you can add your own inventory to the existing listing. Otherwise, you can create a new listing for your product. Research competitors to set a competitive price while still ensuring you earn a profit after fees and shipping costs. You can also use dynamic repricing tools to automate this process.
8. Monitor Sales and Restock
Keep an eye on your sales performance and customer reviews. If a product is selling well, consider restocking it quickly to avoid running out of inventory. Use tools like Keepa to track price fluctuations and determine the best time to restock.
Conclusion
You can buy products from Sam’s Club to sell on Amazon and make a profitable business out of it, if you do it the right way. By becoming a member, leveraging discounts, and using product research tools, you can identify high-demand items and maximize your profit margins. Be mindful of restricted categories on Amazon and make sure to follow their selling guidelines to avoid any issues. With careful planning, attention to trends, and proper use of Sam’s Club membership benefits, you can build a successful and scalable online arbitrage business.
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