We’ve all heard about them, those guys who sell on Amazon but who don’t shop. How do they do it? Either they are buying wholesale or they practice online arbitrage. Online arbitrage is a great option not only for people who hate to shop or who live far away from stores, but for anyone as a part of their overall business.
Chris Green – the FBA seller and CEO of ScanPower who brought you Arbitrage: The Authoritative Guide on How it Works, Why it Works and How it Can Work For You – leads the way again with his newest tome (epic? Iliad?) Online Arbitrage: Sourcing Secrets for Buying Products Online to Resell for Big Profits. It weighs in at around three pounds and it is hefty in more than one way. I’ve been trying to read it in bed at night. It digs into my chest. If you buy the book, be sure to buy the softcover version from Amazon.com. You will get the Kindle version for free which will make it a lot easier to read.
At its simplest, the concept of online arbitrage is buying inventory from online retailers to resell on Amazon.com (or eBay or any platform of your choice). You find a good deal online and flip it on another platform – or sometimes the same platform. It is different from wholesaling because you are buying from a retailer rather than a wholesaler. You can buy as few as one item if you want unlike wholesaling which usually has a minimum purchase. Also, many online retailers like Target, Walmart, ToysRUs, etc. have retail stores where you can source the deal you find online. So why is Online Arbitrage more than 400 pages if it is so simple? The details! This book is chock full of strategies and precise tactics.
Chris doesn’t hold back. He shares his tools right down to his recommended browser (Chrome), websites and much more. Most importantly, he shares how he thinks. With many, many real-world examples he takes you through his thought process of how he found the deal, how he analyzed the data and then how he sold the item. His data is fresh – many of his deals are from earlier this summer.
Let’s face it, when a $200+ book comes out, the question everyone asks themselves is…”Is this the silver bullet that will transform my business? The magic beans that will lift me to FBA nirvana?” Well, no, maybe, could be, yes! The thing about this business is that you have to work it consistently and in a disciplined way. Despite the book title, Chris Green is the first one to tell you in his book that there are no “secrets” to making money on Amazon, only strategies diligently applied.
That being said, we all know that the really successful sellers are obviously doing something different from us or we would be as big-time as they are. At CES II in September, for example, I learned from sellers who have outsourced their businesses, who shop together in large buying groups, who create unique products to sell on Amazon, and many other strategies that have helped them scale up.
Like many of you, when I plunked down my money to buy the book during the conference, I wondered if it would be really worth it, especially to someone like me who has been selling for a while. I understand online arbitrage and have done a little bit of it myself on Black Friday, etc.
I wasn’t doing it like Chris Green, that’s for sure! I learned a lot. Several times I found myself saying “holy sh%^#!” because I had either never thought of it that way or I had not realized exactly what I could do with all of the available data out there.
For example, I’ve sold on the Amazon platform for over four years and I never understood why some offers were suppressed (i.e., no buy box – you have to click thru to see the offers). I never really thought about it. More shame me!
I learned in the book that a suppressed buy box means that the offers are all higher than MSRP (manufacturer’s suggested retail price). It also means that Amazon is not selling that item at the moment (if ever) and that there is an opportunity for me if I can find that item at retail price to flip it on Amazon. If the item isn’t selling online, Chris can often find out where it is selling in his area stores and go out to buy it. In addition, he often finds deals where Amazon has an artificially lowered price that he can flip quickly to make money at normal prices.
Combine that knowledge with how he finds fast moving items and I could immediately see the huge potential to make money and frankly, what an unfair advantage Chris has when he looks for inventory. His analytical mind makes it easy for him. The rest of us may need to practice a bit before it seems natural to us – but he shows exactly how he finds his deals in the book and with the 35+ private videos that are part of the book. You can scan the QR code to see them, type in the link or press on it if you are reading the book in your Kindle (or the free Kindle reader).
Chris calls the book a course more than a book. I think of it as spending several hours inside the mind of a master seller. Reading it reminded me of the hours he spent with me early on answering my questions and helping me understand not only the mechanics of retail arbitrage but the strategies and big picture. I used to leave his office or hang up from a call with my hair on fire – so excited I wanted to run outside immediately and get to work.
As far as I can tell, there is nothing held back. He may or may not be sharing every single one of his online sources, but by sharing the strategy of “Rabbit Trails,” he teaches you how to find your own deals in the exact same way. Several times in the book he shows how he started in one place and ended up finding a deal somewhere else because of his strategies and approach.
He covered a lot of sites and tools that I’d never heard of before which made the book valuable to me. It helped cut time off my learning curve and I love automating tedious things like research.
In the chapter on “Scaling” he covers the pros and cons of scaling along with resources he uses to outsource part of his business.
The strategy “Learn a Line” teaches you how to quickly become fluent in any line or any product and to find out which products in a line are going to be popular, hot and/or hard to find. This isn’t just about toys. It applies to any consumer line of products. Knowledge is power in our business and this chapter answers the question “what’s going to be hot for Christmas?” once and for all.
He is highly analytical in his approach so there is a lot of math, charts and graphs involved – brace yourself. If you think of numbers as dollars…it is way more fun than school. He also has a lot of full-color pictures – big screenshots with arrows (I wonder where he got that idea?).
Considering that everything is on the internet and this is online arbitrage you may be wondering, “couldn’t I just find all this stuff myself online if I did some research? The answer is absolutely! IF you happen to already think like Chris Green. That’s why I said the book is like looking inside his mind. Throughout the book in his comments to the reader you get insight into how he thinks about his FBA business and basically why he is successful. Buy the book for the strategy not the tools. They will come and go, but the strategies are what will make you money.
I had a lot of “holy sh$#^$!” moments and my hair is aflame again with the possibilities.
There are some cons in that some of the resources and websites will no doubt become obsolete over time – one chapter was devoted to a site that is already gone. The book is heavy and so physically large that it is hard to read. Again, I suggest you read it on your Kindle. He warns you in advance that there are typos. It is expensive and we FBA sellers are by inclination cheap (me included!).
While online arbitrage offers a lot of benefits in terms of working from home, and lots of free shipping supplies, it also involves a lot of sit-on-your-butt research and math. Also, part of his success strategy is to be the guy that buys up all the stock so he can control the price. That won’t work for smaller sellers. This is not to say that there aren’t smaller deals for folks with more modest inventory budgets, but understand that volume is power just like knowledge is power.
The table of contents is more than 30 pages into the book and I found it hard to navigate the book. This is partially because he ran out of pages (CreateSpace has a limit) and had to eliminate every single white page that might have made it easier to navigate (by putting chapters on the right-hand side of the book and other publishing tricks). For the same reason the text font is small even though the pictures are nice and big. Again, buy the Amazon 2-for-1 deal, but read it on the Kindle or your eyes will start to cross and you’ll get frustrated when you want to go back to something later. It is not a bifocal-friendly book. I had to resort to sticky notes and make tabs for myself.
These are minor issues, though. To my mind, this is a transformational book. It has the potential to completely change how you think about your business. Some of the ideas seem so obvious once he explains them but the fact is they weren’t intuitive to me and I didn’t think of them until he explained them so I’m grateful he wrote the book.
Online Arbitrage is more than worth the price I paid and highly applicable to what I am doing now. Put aside a few of your Q4 dollars and buy this book as a present for yourself. You’ll be glad you did. And if you aren’t? Amazon has this lovely extended holiday return policy. I’m sure you’ve heard about it!
Still not sure? Either download a sample to your Kindle or click here to have the first few chapters emailed to youfor free.
Have you read the book yet? Please share your comments below! Happy scouting!
Please note that if you click on the links above, they will take you to Amazon.com or ScanPower. I am an Amazon affiliate and will make a small commission if you decide to buy the book. You can, of course, go to Amazon.com without an affiliate link to buy the book. The free Kindle with the purchase of the softcover book is Amazon’s special, not mine. The free chapters from ScanPower are not an affiliate link and you can go there directly from Scanpower.com.