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A bit of motivation...
We don't usually share account screenshots but here's the account of one of our clients who started selling on Amazon in February 2019, and who made almost 3000 euros in sales in March.These numbers are obviously not that impressive in terms of net profit, but they prove that anybody can do this business and very quickly get good results.This seller used the method of International Online Arbitrage that we're about to describe in this article.
The issue with Online Arbitrage in the UK
We've already established that OA is one of the best strategies (business models) to sell on Amazon. However, its simplicity attracts more and more sellers who now exclusively do OA/RA.
As a result, your competition increases.
Because every seller on amazon.co.uk is using the same exact system to source inventory. Let's look at the 3 phases every UK seller goes through in order to sell products on amazon.co.uk:
- They scan UK sites (argos, tesco, boots etc.) and find products that are also sold on amazon.co.uk.
- For each product found, if the price on amazon.co.uk is higher than the price on the source site, and if the Keepa graph shows that the product moves fast, they proceed to the last step.
- The seller places an order, receives his products, prepares and ships them to Amazon's warehouses.
The problem with this system is that EVERYONE is doing the same thing. Every seller is scanning the same sites as everybody else and comparing the prices against amazon.co.uk. This results in listings crowded with competitors.
So what's the solution?
I am about to reveal my secret weapon (not so secret anymore since I published this article), are you ready?
The solution is to find products sold in the UK and to compare their prices against other european marketplaces.
Finding products with little competition and great margins
The system or the "algoithm" we will use to find profitable products is exactly the same as before, but instead of comparing local products against amazon.co.uk, we will compare them against amazon.fr, amazon.it, amazon.de or amazon.es. In our example we will compare them against amazon.fr.
Think about it, French sellers are comparing the prices of their stores' products against amazon.fr. And UK sellers are comparing the prices of their stores' products against amazon.co.uk. But NOBODY is comparing products sourced in their country with a foreign Amazon.
As a consequence, there are thousands of products that haven't been found yet. The opposite scenario also works: buying from French stores in order to sell them on amazon.co.uk. But in order to do this you need a prep center in France (which may be difficult to deal with if you don't speak French).
Using a prep center to delegate the manual labor
There are two ways to go about shipping your products to Amazon France (or to any other European Amazon). You can either receive your products at your place, prep them and ship them yourself or you can use a prep center.
Prep Centers are third party companies (not owned by Amazon) that are experts in prepping produts for Amazon.
Here's what a Prep Center will do for you:
- Receive and inspect your products.
- Remove any old labels and promotional material from the source retailers.
- Repackage and ship your products to any Amazon Warehouse in Europe.
We will probably write an article dedicated to Prep Center, but in the meantime you already get a glimpse of how important Prep Centers are if you want to save time by not prepping your products yourself.