Proven Amazon Course

121 OEA Podcast - Stop Wasting Time With Online Arbitrage

What’s up Empire!

Joshua Woodward here,

So many of us have been wasting needless time on online arbitrage. Between sourcing, listing and shipping this method can seriously drain of time.

For those of you that are not familiar, Online arbitrage is the practice of buying something online one site and selling it almost immediately in another place where it is worth more. Most people tend to sell on Amazon and eBay. This is a fantastic way to make money. For those of you starting out i could not recommend this method more.

I do want to bring to light one major problem with this method. As i said above, It takes a ton of time! It all starts with research. You begin by searching on a site you love. Once you find a product for a great price you check the item on amazon or eBay. This process goes on and on. Once you are done sourcing you have opened dozens of pages for cross comparison and have used hours and hours of valuable time. That is just the start.

What happens when you need to ship?
What happens when your garage fills up?
What happens when your store runs out of product?

Nate McCallister has seen it all. We are having him on the show to talk us through his top tips for dominating the world of online arbitrage. He encourages us to stop wasting time and use the tools out there to start making more money

Work Smart….Not Hard!

Nate has created some amazing sourcing tools to help you save time and make amazing money. If you want to find out more go to, http://www.theonlineempireacademy.com/nate
If you want to know more about us and all we are doing go to, http://www.theonlineempireacademy.com

For those of you wanting more information about our podcast sponsor follow the directions below,
Step #1. Go to Amazon.com
Step #2 Type in "address labels" into the search bar
Step #3 Click on "perfect peel address labels"
Step #4 Purchase "perfect peel address labels" with the online empire exclusive promo code given at the end of the podcast.

Here's the transcript of the show:

Josh:
You're listening to the Online Empire Academy Podcast where you'll discover some of the best and most creative ways to provide for your family and get started on your journey to entrepreneurship. No crazy get rich quick schemes, no living in a van down by the river with your family while you build your business. If you want real, actionable, and proven entrepreneur ideas that you can use right now, join us for free at the onlineempireacademy.com. Now, get ready for the Online Empire Academy Podcast.

Joshua:
What's up Online Empire Academy? Joshua Woodward here, your podcast host. Today's sponsor is the Yorba Label Company. They're giving us 25% off of 3,000 address labels. If you've ever shipped Amazon FBA, you know that you need those address labels, so it's a great deal, guys. Here's how you get it. Go on to Amazon.com, type in "address labels", select Perfect Peel Address Labels. In the checkout, you're going to use the promo code "Labels25". That's going to get you the 25% discount. It's time to hop in with our guest. Thank you so much for tuning in, and enjoy the podcast.

Today we're going to be talking about online arbitrage. You know that I love the whole arbitrage game. I love the idea of going to a store and finding something at a discounted price that I can end up flipping. There's a whole new world, and it's fun because me and my wife are on this journey of really diving into this thing full-time. I've been doing online sales for the last 3 years, full-time, but now my wife is joining. It's really exciting and really intimidating. One of the things that I'm really excited about right now is the online arbitrage. We've done the retail arbitrage, but we're starting to move into online arbitrage.

I brought in Nate McAllister because he is the man when it comes to this. I just wanted to have him share his perspective on what this can do for your business. Nate, first off, share your story with the community.

Nate:
Well, first, thanks for having me on, Josh. I appreciate it. I started selling online when I was in my senior year of college. Well, I take that back. I started selling on eBay when I was 15, but that was definitely not professional by any means. I'm just selling baseball cards and stuff for my grandpa. I started doing it seriously when I was in college. I was finishing up my degree in economics, and I was working full-time. I sold a copy of the 4-Hour Work Week. I don't even remember why I sold it. I had this little podcast, and somebody had been talking about selling on Amazon FBA. I was like, "That's pretty cool. I'll try to sell his book." I sold it. I had 2 copies of it. A really great book, by the way.

Joshua:
I actually have it on my desk. That's so funny. I'm looking at it right now.

Nate:
That's one of those books you can read over and over. You get something out of it every time. I sold it, man. I probably made ... It sold immediately. It's a popular book. I didn't think it would. I had never sold anything on Amazon, so I was shock that sold so fast. I probably, after the time I spent, probably made 12 cents an hour. I used my first shipment. I did it merchant fulfilled. The fact is, dude, that first dollar you ever make is the best, because you start to realize like, "Hey, it actually works. I can do this at scale now, and I can start to make some serious money." From that first book, I was hooked.

Then I learned about FBA, and I was like, "Okay. This could really start to scale, especially because I was so constrained on time." I was working 40-hours a week as a manager at a yarn mill down here in Georgia, and I was going to school full-time, so I could finish up my degree. I wanted to do it because I loved it, and I wanted to make some extra money, and I wanted to see if I could do it full-time.

We started selling, and things really took off. We started doing pretty solid sales. We started making more doing that than I was at my job. It was a decent job. It was one of those college degree type jobs. I wasn't bad, but I was still pressed for time. What we did, I read Chris Green's book Online Arbitrage. I was one of the first to get ... When it came out, I got it right away. I plowed through it. I loved it. I loved it, but I still knew that I didn't have the time to do it myself, so I actually outsourced it to a VA. I taught them how to source online and all that. It was horrible at first, but eventually it started making me money. It was great. I started realizing, I'm like, "I can scale this now."

From there, it ended up I eventually quit my job. I got into some other things as far as services go. I started an ungating company, ungateyouraccount.com. I started a copywriting company for listing creation and all that. I was just immersing myself in every aspect of it. I loved everything about Amazon, and I love the service side of it. I love the whole thing, but I ended up really, really, really falling in love with the online arbitrage aspect.

My most recent projects have been with online arbitrage extensions, and just different things to make the online sourcing process better and faster. If you're not familiar with online arbitrage, basically, it's just the same as retail arbitrage, except for you're not constrained by time. The stores don't close online. It's a different game. You've got more competition in the sense that everybody sees the deals, but also, you have a bigger scope. You're not limited by gas or by sales and stuff. It's a different game than the retail arbitrage. If you're not at least trying it, you're missing out.

With that, and with all my businesses, I think, "How can we make it better?" It's not easy, so you need to find it, and it's getting harder. People know about it. It's not super easy anymore. The low-hanging fruit is getting a little bit higher. You got to constantly find better ways to do it. What we've been doing is working on these extensions to speed up the process. The most recent one we have is called OA Highlight. I made it with Chris Green.

Basically, what it does is you can find any text in a website, you hover over it, you highlight it, and then you can open that text in any of the search engines that we include. If that doesn't make sense saying it, it might sound a little confusing, but basically what it does is it saves you a tone of time. It keeps you from having to open up a tone of different tabs. If you are an online arbitrage or you're going to, you'll understand the value of it once you get into it. The whole online arbitrage arena is just awesome. I love it. I love doing it, and I also love creating these tools for it.

Joshua:
I think it's crazy. So many of us started when we're so much younger. I think when you have that entrepreneurial spirit, it's just there. It's funny you're talking about selling cards for your grandpa. There's always those opportunities that present themselves and roll over, and roll over, and roll over. As an entrepreneur, I know how exciting it can be when something new like OA, online arbitrage, sorry, or retail arbitrage come up, because it does present a new opportunity to make money. What would you say are some of the biggest pitfalls with jumping into online arbitrage?

Nate:
There's definitely a ton of opportunities to make mistakes. There's a lot of saturation that can happen. You get better and better at it. Really the best way to do it is to just accept that you're going to make some mistakes at first. A lot of times, people will buy it. They'll go deep on a product, and they'll realize, "Oh crap. Everybody else went deep on it too." and then the price tanks, which is just going to happen. The more you do it, the more you realize how to play the game.

A lot of people that don't make it in the business are the ones who are afraid to pull the trigger on deals. I tell people, "For the first month, if you just make your money back and you do it constantly, and you learned constantly, you're just paying the tuition to learn the game." You can't be afraid to make bad choices. You will make a ton of bad choices, especially in online arbitrage, when you're new. There's a ton of chances. The best thing to do is to just see what works. Try it.

If you don't have a ton of capital right now, go slow. You can just buy some. You don't have to buy 30 of everything you see. There's just a lot of factors that go into it. You got to consider the visibility of the product, the quantity available. Is it a deal? Is it a clearance thing? Is it something that's going to stay at that price? Is there a reason why it's making profit now? Is it a seasonal thing? Is it a deal that is going to be really public like in the sourcing groups, like things from ...

A lot of times, there's big sites like Walmart. You can get a ton of great OA deals at Walmart, but you also got to be careful because a lot of that stuff are very visible. There's people that scrape Walmart, and they see all those deals too, but that's just part of the game. What I love about OA is that the better you get at it, it is one of those things where you get what you put in. I love things when realize there's so much I don't know, but every day I learn more, you'll make more money. That's an awesome thing.

Just like I said, with the first dollar that you make, that's beautiful because you know that you made a dollar. You're like, "Okay. If I could just do this 10 times better, I can make 10 times that." You start to realize that scale like that. It's the same with online arbitrage. You just got to take advantage of everything that you can and learn from your mistakes. It's an awesome model. It's not for everybody.

Joshua:
One of the questions I've had with getting into this is, it's not like drop shipping or anything like that. You've actually got to buy it, have them ship it to your house, put stickers on it, and then send it to Amazon. Correct?

Nate:
Right. Dude, let me tell you this. This is the new thing. Prep and ship companies, there is just the genius idea. The one that I promote most is Prime Zero Prep with Brenden Sullivan. He's an awesome guy. It's in a tax free state. Basically, you send them ... You can order things online and have them shipped straight to them, you don't even get to tough them. That's the new thing too. It's actually starting to become just like drop shipping where you don't have to touch it, except it's also ...

Drop shipping can be detrimental to your account health. I also work with Cynthia Stine at Online Sales Step by Step. I'm a suspension consultant. We do see those ... Sorry. [inaudible 00:12:08].

Joshua:
It's getting real.

Nate:
One of the beauties of working from home is you get to see all types of happenings around the house. Drop shipping can be risky because people will sell things, and then you're at the mercy of whoever your source is running out, and then the customer buying it. This is different because you're actually sending it to ... You're using FBA where you're not ... With drop shipping, you're not using FBA. You're using merchant fulfilled. We deal with a lot of suspensions that are results of drop shippers who didn't keep track of their inventory, and they ended up overselling a product. They got late shipments, and the next thing you know, they're suspended, because late shipment is not something that Amazon is okay with. It's a big deal.

That's the beauty of online arbitrage drop shipping. Drop shipping is not my model. It's never been my model. I know a lot of people it is. I know a lot of people that do it really well. You can do it and do well, but it's a lot more tedious, and you have to be a lot more ... You have to be a lot more careful. You have to be a lot more diligent and make sure that you don't let things fall between the cracks, and you don't run out of product. These prep and ship companies are just awesome. I've got a list of them somewhere on my blog. There's 25 of them now that I know of. They've got a bunch in California where you are. They got them in pretty much every state now it seems like. It has one at least within 100 miles of it.

Joshua:
Okay. Explain that process. I buy the product ... Let's use Walmart. I buy the product on Walmart, then what happens if I'm going to use a prep shipping place?

Nate:
They all are different. I've only experienced ... I haven't used them all. You basically would ... You'd order it. You would create a spreadsheet with the order, and then you would send that on to the prep and ship company who then would expect the product. You would put the address and they order it as their address, and they would receive it.

Joshua:
Okay. That was my question.

Nate:
They would receive it and then put it up into your inventory. They have a certain ... They're all different, but usually they won't send them in to Amazon until you get to a certain amount of products. Yeah, you're not touching those stuff, dude, it's awesome.

Joshua:
That's really interesting. I think that's a model I can definitely get behind. I'm going to go look at Prime Zero Prep. It's one of my notes. I'm thinking about it, and I'm like, "We have a garage, but I like my truck to be in the garage."

Nate:
Right. This is what I tell people. They're like, "Well, I already got to pay Amazon fees, and I got to pay blah, blah, blah." You pay a flat fee. The pricing is different for all of them, but you usually pay a flat fee. How much time can you save that you're not packing? In that time, just make up that extra buck you're selling on each product. Instead of packing, you can be ... Even if you don't have more money to spend, in that extra time, you can find better deals and make up for that easy. Who likes packing? That's the worst part of the whole business-

Joshua:
That's really interesting.

Nate:
-personally [inaudible 00:15:37].

Joshua:
I hate merchant fulfilled because I hate shipping.

Nate:
Yeah it's a nightmare. Some people like it. It's definitely a great thing that you can outsource the heck out of that. Easily, you can pay some neighborhood kid 10 bucks to do it, as long as they're good with it. This is a beautiful model, man. You don't have to double touch everything. It goes there, and then since it's a tax free state, you're not going to pay that sales tax on the products.

Joshua:
I think just the idea of taking a product, it's making your life one step easier, which is interesting. We were talking earlier about this app, this extension that you guys have created, and it's all about this idea. I love this saying that ingenuity is the father of laziness or something like that. This idea of, "Yeah. I want to make my life easier, so I'm going to create something to do that." I love this. I knew you explained it a little bit, but there is a problem when you're going on different sites and trying to source different products.

You have a thousand different tabs open, and you're trying to get all of those different listings on Walmart or whatever. You're trying to see if they're going to be selling on Amazon. That can be really frustrating. You can have a thousand different pages open, and it's still not producing what you want it to. Just from what we were talking about before, it seems like your extension helps eliminate a lot of that process.

leveragerandom

Nate:
Exactly. Anytime that you can make something, you can just save a minute on each product, how much that adds up? Again, like I said, just like the prep and ship companies, if you can save yourself a couple of minutes, you can pay off those fees just with the extra time you'll spend sourcing. Every time that I get a chance to try and get an edge on anything with online arbitrage, I take it. Me and Chris went ahead and built this extension. There was one like it, but you had to upload everything yourself. They actually stopped supporting it. This is just a time saver for everybody, and it's also updates, and it only has the 42 links that are relevant to Amazon sellers.

Every time an online arbitrage, like I said, if you get a chance to get a leg up, you got to take it, because it's not getting easier. Every time it gets harder, you just got to come up with a way to make yourself a little bit better at it. It's getting popular. Obviously, I think if anybody is listening to this and they haven't heard about online arbitrage, I hope that they're getting excited, because it is awesome. There is still definitely ... I'm saying it's getting harder, but there's still a ton of money in it. It's all about how much you put into it, how much you're willing to learn and figure it out. The smart people come out on top, that's the beautiful part of it. If you put in the work, you'll make money doing it.

Joshua:
That's good. The app is OA Highlight. We'll have a link. I'll share that in a little bit. I want to get a better idea of what exactly it does. Will you walk us from finding a product, searching for products? Will you walk us through that process from step 1 to your sending it to your prepping company or you're sending it to your house?

Nate:
Right. Do you mean with online arbitrage in general, or just the extension?

Joshua:
The extension.

Nate:
Okay. With the extension, if you're on any website online, any text that you can highlight, you can use this extension with. Let's say that you're on Walmart, and you see, let's say, Disney Channel porcelain mugs something, whatever. You could right click that, or you would highlight that text, you'd right click. It's going to drop down a menu. You're going to hover over our extension, and then it's going to create, it's going to show you a list of all these different sites that you can search that text in.

If I was on Walmart and I saw that product, and I thought, "Okay. I wonder if they have this at ... I want to see what this is sold for on eBay." I could highlight that, open it up in eBay completed, which is one of our search engine URLs that's installed, and it'll be doing the exact same thing as if you were in eBay and type that into the search box. It's basically saving you the time of opening the tab, because it opens the tab for you after that. You're not opening a tab. You're not typing anything. You're not copying and pasting anything. Basically, it takes away all that.

Then like I said, in online arbitrage, you're doing that lot. You're doing a ton of opening tabs, copying and pasting, and all that stuff. Every time you get a chance to speed that up, you need to take it. Our extension, it's a one-time payment of 14.99. Even if you use it for 1 day, it pays itself off. For me, it's a no-brainer. It's a great tool for anybody doing online arbitrage. It works well even if you're doing ... Even if you're an eBay seller, you can use it for eBay. If you're a private label seller, you can search for products.

You can be on Amazon, highlight something on Amazon and search for it in Alibaba, or AliExpress, or Tmart. You can see if they have that product on those sites. Really, it's just a way to speed up the process. I'm obsessed. My website is entreresource.com. I actually made that because I'm so obsessed with business tools and efficiency and stuff. I'm a hoarder of anything that saves me time or makes me more money. That's what this is like. Every time that I see an extension that I know will make me money. There's a couple I love, OAXray, Ace Inspector, How Many. I love them. I buy them, I put them up, and I use them.

This is just one that if you're an online seller, you need to add it to your arsenal. It's a no-brainer really. At 14.99, it's [inaudible 00:22:10]. Once you start to use it ... I know saying it over the podcast might sound confusing, but the second you use it, you'll fall in love with it, super, super efficient, super awesome.

Joshua:
This is Google Chrome extension. Correct?

Nate:
Yeah. You have to run it on Google Chrome. With online arbitrage, you're going to want to always Google Chrome anyway.

Joshua:
Why is that?

Nate:
Because all the good extensions are on Chrome. Firefox, I know some people who source with Firefox. If you read Chris Green's book, Online Arbitrage, that is all on focused Chrome. Also, Chrome extensions, in my experience, are easier to develop. We have a team now of people that develop extensions, and we can make them really quickly on Chrome. We're already using all the biggest tools like OAXray, like I mentioned before. They're already on there. I like to have everything on that one browser. For me to make it in Firefox would mean that I wouldn't be able to use the other ones I'm already using.

Yeah. Google Chrome, if you're an online arbitrage, don't even start without Google Chrome. It's free. You know Google, dude, everything they do is awesome, and somehow they do it for free. It's solid.

Joshua:
Do you have a mobile version?

Nate:
No. It wouldn't ... I supposed you could actually. I haven't even thought about that, but no, not yet. No. Sourcing on mobile is ... You can do it, but it's hard. I wouldn't even ... When you source on mobile, what I do is I just download the biggest deal apps like Ben's Bargains. I think they changed its name. Savory Groupon, each day, if I'm bored, I'll go through them and check, and sometimes there'll be a deal right there on the top. As far as deep online arbitrage goes, you need to have the tools. You need to have a full screen browser to really do it right.

There's so many extensions and tools that make the process easier. Everything that you need is out there. It's just a matter of putting in the time and taking some risks, maybe losing a couple of bucks every once in a while. You'll make it back. I tell people it's just the tuition of learning of how to be an online seller. I can't tell you how much money I've blown on things that haven't worked in my brief career so far. It's the best way to learn, is when you have your own money on the line. It really starts to ... It's amazing how your brain really starts to fire up and retain things, come up with more creative solutions.

Joshua:
Before we end, what is the one thing that you could tell somebody, just something encouraging to tell somebody wanting to get into online arbitrage?

Nate:
Well, it isn't easy at first, but you've got the entire internet at your disposal. I actually gave you a link to another product you might want to share. It's a 150 different sourcing sites. It sits in your browser and a bookmark. There's 150 sites, you will never run out of products to find. Things are constantly changing, deals are constantly going up and down. If you can learn how to find them and how to be ready for the drops and all that stuff, you can kill it. It's not like ...

Here in Atlanta, if I wanted to go out and retail source, I'm at the mercy of the region. Sometimes I'll get lucky and I'll get some clearance stuff. Sometimes I'll have a store that's got a bad manager and they ended up overstocking something, and I get some crazy deals that other people don't get. With online arbitrage, dude, I have no limit. I don't have enough time to even come close to scratching the surface of the possibilities. Is it easy? No, not at first, but the world is your oyster really on it, because there's just so many options.

Anybody who says online arbitrage is going away is misguided, don't even make sense. There's too many products.

Joshua:
That's awesome.

Nate:
It's a great opportunity. It's definitely something to at least try, even if you're in wholesale already, or if you're in retail arbitrage. If you're doing retail arbitrage, you'll love this, because they'll give you a chance to stop going to the stores and driving around. You also save in gas money. Stores close at 10, online is open all night, baby. You can source that anytime. You can go at 3 in the morning, 4 in the morning. It's awesome. Pay a VA to do it while you sleep.

Joshua:
There you go. Again, thinking smart, not hard. I love it.

Nate:
Yeah, dude.

Joshua:
I love it. Well, Empire, if you want to know more about Nate and all his projects, we'll have the 100 and however many different sites to source on, as well as the OA Highlights. You can find those both at the onlineempireacademy.com/nate. That's going to get you all of that. Nate, thank you so much for coming on, man. It's been awesome.

Nate:
Yeah, buddy, I appreciate you having me on.

Joshua:
Thank you so much for tuning in. I appreciate you guys listening, and I hope you were motivated by our guest today. Again, our podcast sponsor for the day was the Yorba Label Company. If you want to get that 25% off of 3,000 address labels, I know I already got mine, and I'm so excited about them, they're fantastic, go on to Amazon.com, search address labels. You're going to find them under Perfect Peel Address Labels. Click on it. In the check out, go to the promo section or the promo code, and type in "Labels25." Again, that's going to secure you that 25% off.

Thank you so much for tuning in. I appreciate it, guys. If you want to know more about us and everything we're doing, go onto the onlineempireacademy.com. You can also go on Facebook at facebook.com/theonlineempireacademy, or on YouTube, same thing, guys. I appreciate you tuning in. Until next time, empire, have a fantastic day.

Josh:
Thank you for listening to the Online Empire Academy Podcast. If you want real, actionable, and proven entrepreneur ideas that you can use right now, join us for free at the onlineempireacademy.com. If you've enjoyed this podcast, help us make more by rating us on iTunes and Stitcher Radio. We'll see you next time.

About The Author

Dean Soto

Founder of the Online Empire Academy and creator of Wooshmetrics.com

0 Comments