Both Wholesale and Arbitrage (or Online and Retail Arbitrage) are popular routes to selling branded products on Amazon. Both have their advantages, they similarly have their drawbacks. Throughout this article, we will look at the basic elements of both Amazon routes whilst explaining and comparing them.

As opposed to Wholesale, where you open trade accounts directly with brands, distributors and wholesalers alike, ordering larger quantities of individual items, with Online and Retail Arbitrage you are purchasing branded products, think of Lego, Nivea, L’Oreal etc, from normal retailers (both online and at physical retail locations) such as Tesco, Asda, Smiths, Notino etc. You purchase these items that are heavily discounted by the retailer, usually all the way down to their cost price ie. on clearance, and then sell them on Amazon for a profit. It’s as simple as buying and selling on Amazon gets. However, retailers don’t usually have tens or hundreds of each item for you to purchase like you do with Wholesale, instead, we have to purchase smaller quantities of each item.

With that said, you can see a comparison between Wholesale and Arbitrage above, comparing their respective risk, time commitment and reward. Your risk with arbitrage is much smaller as you purchase smaller quantities of each item and the time it takes to start arbitrage is also much lower compared to Wholesale – at the end of the day, arbitrage is the most beginner friendly launchpad into starting your Amazon FBA business.

How Exactly Does Arbitrage Work? Step-by-Step…

With arbitrage you don’t need to spend time learning complicated Wholesale methods or hunting for brands, distributors or wholesalers to open a trade account with. You don’t to complete a long list of tasks to get up and running either. Nor do you need as much money. With arbitrage, all you need is an Amazon account and a starting pot of anywhere from £300-500! It is the absolute most beginner-friendly, low-cost, low-commitment route into starting Amazon and one which many people seem to forget.

Yes, with Wholesale you can absolutely scale your Amazon business month-on-month at a much faster, uncapped rate compared to arbitrage. However, it can be a daunting commitment, there’s no doubting that! Arbitrage provides people that are new to Amazon with a much more friendly, accessible route into selling; whether that be dipping your toes into the Amazon waters, having a flexible side-hustle that you enjoy on a weekend or starting the foundations of your Amazon business to eventually expand into Wholesale.

As far as it goes for a brand new Amazon seller with absolutely zero knowledge, arbitrage is near on perfect. With that said, if you want to learn more about Arbitrage and want to skip past paying thousands to learn all about Wholesale, then click here for the Seller Circle Online and Retail Arbitrage Launchpad