Retail Resale Arbitrage, sometimes referred to as retail real estate arbitrage, is a type of business that involves buying products from independent distributors, re-purposing them, and then selling them back to the original distributor or retailer at a higher price. Retail resell values are the difference between what you paid for an item and what it sells for in a store. For example, if you buy a used car at a dealership, you will probably be able to sell it back to the dealer for more money than you paid for it. This is called retail resale and it is commonly referred to as the resale tax.
There are many advantages to buying wholesale and resold items, but what is resale arbitrage doing for today’s internet marketer? Retail reselling is becoming more popular online, particularly with the international expansion phenomenon. With resale arbitrage, a retail merchant is taking orders for products from independent vendors and then is selling them back to the original vendor or retailer at a markup from the wholesale price. You may have seen these ads or advertisements on TV, in the newspaper, or on the Internet. It really is an awesome way to make some extra money!
The question that often arises when considering resale arbitrage as a business model is this: What is the cost involved in starting such a business? Is it something that can be done with minimal investment? If so, why wouldn’t everybody start a retail resale business? Unfortunately, there is a significant cost to consider before getting involved in retail arbitrage.
Although resale arbitrage can make you a substantial profit, you are going to have to be in it for a while before you start seeing significant profits. There is a learning curve that you are going to have to overcome in order to become successful in this type of business. There is also the issue of shipping internationally. Although most people think that the cost of shipping is high, it actually depends on where you are shipping to, how large the package is, and what country you are shipping to.
If you take all of these factors into consideration, you will quickly realize that resale price maintenance can get expensive. Even though it may seem like a good idea at first, the costs of buying and reselling inventory can quickly add up. Not only are you going to have to buy additional equipment, you will also have to spend a lot of money on postage costs and other costs associated with shipping. In fact, if you are going to make money doing this type of retail arbitrage, you are going to have to make sure that you are keeping your overhead as low as possible. After all, if you do not keep the prices you charge as low as possible, you are not going to be able to stay in business for very long.
One way that you can decrease the cost of buying and reselling is to go international. Of course, it is true that you will have to pay more fees when you go international, but there are some countries out there that do not require an international sales tax or any other special tax for reselling. These countries include Switzerland and Panama. In fact, some countries actually have no sales tax. If you are able to find a country that you can sell your products and services to that does not require an extra sales tax, then you should definitely look into doing business in that country.
Of course, if you have a lot of product lines to sell, international expansion can get expensive very quickly. You might only have a few products to sell locally, but if you want to make money selling internationally, you are going to have to expand your product line very quickly. This means that you will have to buy more stock, pay for more packaging, and increase the number of employees you have to help you with the increased inventory. Those costs are not worth it for a lot of people who want to start making money selling on the Internet.
Another thing to remember is that you will have to expand your business very quickly in order to be successful. When you get down to selling five products a month or less, the costs to start up can add up rather quickly. So, it is important to remember that the biggest problem with becoming a reseller on eBay is actually finding enough buyers to make it profitable. Luckily, kevin says that there are three places where you can go if you want to make money reselling on eBay: auction listings, eBay store pages, and third party bidding sites.
