Well hello folks. You may have thought I died. I didn’t! However my progress with retail arbitrage may as well have. This has been a great lesson in supply and demand, rather than cost vs. benefit. It’s also been a great lesson in online sales in the marketplace era.
For now I’m calling it quits with retail arbitrage as a dedicated pursuit. When I happen to spot something that I know is a still, I’ll still give it a shot, but I’m no longer dedicating any time to it.
I’ve renewed listings on Facebook and Craigslist multiple times for all my items at steep discounts. Nevertheless, the majority of inquiries I’ve gotten have likely been spam accounts, or extreme low-ballers (i.e., I’m selling something at a 50% discount, and they’re asking for it 75% cheaper). On principle, I won’t sell for that cheap. Maybe I need to stop operating out of principle.
So the worst case scenario with retail arbitrage has happened: I’m stuck with about $35 worth of stuff that I’ll have to either give away or figure out a use for. The good thing is most of it is stuff I wanted anyway.
When to call it quits with retail arbitrage
I think after the first 3 months of listing my items, I started operating at a loss. I start thinking about the time decay with options and realize the profitability of these ventures dramatically drops the more time that passes. Even if I sold them at the intended prices now, the time decay ate into the real profit a long time ago.
Branding with retail arbitrage
Branding seems to be the way to go. Without a brand, you’re just a glorified yard sale. No one goes to yard sale expecting to pay listed prices. No one sees value in the items being sold. Everyone wants a discount because they assume you’re selling the stuff because you don’t want it anymore, rather than for a profit.
Developing a brand is something I would need to get more involved in to make this more lucrative.
While I do intend to brand and merchandise some day, I don’t think it’s a part time job.
Alternatives to retail arbitrage
Now that I’ve called it on my dedicated retail arbitrage ventures, it’s time to consider some alternatives.
I’ve already been more successful in my other blogging ventures. My fitness blog went from $1.35 in affiliate commissions in 2018 to more than $40 through September of 2019! I only added minimal content, and did some minor SEO on some of the existing posts, and that was it.
So maybe Google updated its algorithms, or maybe it just took a while for my site to get indexed, but for the year I’ve been making about $10 a month on average. Nothing to write home about (although worth writing about here), but it has been an interesting case study.
So I intend to dedicate more time to blogging on here about my successes and failures on my fitness site and seeng if I can make that run a bit more.
Is retail arbitrage really dead?
I think unless you’ve got a brand, a specific niche, or a really unique and hard to find product that stays in demand, you might as well say bye to any thoughts of striking it rich with retail arbitrage these days.
The successful guys who are importing form Alibaba and dropshipping with AliExpress got their start early enough to get a pricing/shipping strategy that works, and a niche carved out. Getting started now in any scaleable way puts you at a disadvantage, especially with what’s happening with international trade disputes, and products from China costing more to import.
While I won’t say retail arbitrage is dead, I think the “get rich quick” boat has sailed unless you’d already gotten a footing.
So I will say that retail arbitrage for me is no longer a worthwhile venture. I do, however, see tremendous value in blogging. I thought I was too late to that game as well, but I’ve found with my fitness site that even a minimal amount of effort can yield tangible results, and it’s certainly worth pursuing.
What are your thoughts on retail arbitrage? Have you had success in the “modern” day?