How to earn more when working with Amazon and Costco? This is a question many home business owners ask. It isn’t as simple as just using your Costco card at Amazon, or vice versa.
The main difference between how to do business with Amazon and Costco is that Costco only sells merchandise from one supplier. As a result, they are forced to sell lower-priced merchandise. In the retail arbitrage business, however, you don’t have that constraint.
A few years ago, I asked my friend about Costco’s pricing on merchandise. She had a Costco membership and was happy to tell me. Then she explained that their prices were lower on merchandise than at Amazon. Why?
Because Costco’s main supplier of products is also the largest manufacturer of Amazon items. To supply Costco, Amazon purchases product from several manufacturers in order to cut out middlemen and be able to pass the savings on to the consumer. This method of pricing has long been used by Costco.
Now, let’s say you purchased a product from Amazon and tried to resell it at Costco. You may be able to profit from this, if the product was a lower priced product but not that low priced. However, the higher-priced product, maybe because of more demand or because it is an original design, will sell for less. This is when the arbitrage opportunity comes into play.
Costco doesn’t advertise their arbitrage opportunity, but you can find out about it online by searching for “Costco cost arbitrage”. When you compare products that aren’t priced the same and are priced at the same price from the same manufacturer, you’ll see the difference in price. If you find a lower priced product that costs the same at Costco and Amazon, you can make a profit.
eBay and other online retailers are a great place to find low-priced products. eBay can be a great place to find items to resell for a better price.
I know that some people may think that you need an agent to become an arbitrage retailer, but in reality you can start as a retailer and become very successful. I’ve done it.
With Costco and Amazon, they provide their members with information on how to negotiate with different vendors. As a retailer, you should be doing the same things.
Of course, you can always find products that are price adjusted for arbitrage. Price adjustment is when a manufacturer or importer will increase the price of a product and then you take advantage of the “overprint” feature. You can sometimes find products that have price adjustments and are now marked down to a discount.
You can also find inventory that is purchased by a local wholesale distributor who can offer it at a discount. In many cases, wholesalers buy from manufacturers for pennies on the dollar. By purchasing from these wholesalers, you can save a ton of money on a product.
In closing, there are many advantages to working with Costco and Amazon. Make sure you find out about the arbitrage opportunities that are available and try them out before making a final decision.