Online Arbitrage For Beginners: Why Amazon FBA?

In this blog post, I am going to be talking about why Amazon FBA. I am going to be explaining the fundamentals and the basics on why this model, which we call arbitrage, is such a big opportunity right now, for you to take advantage.

Arbitrage is simply getting a product from one price, from one marketplace, and selling it at a higher price, on another marketplace. And the difference could be your profit.

I am going to get into why FBA in this blog post, and explain why Amazon FBA is such a win-win for everybody - for you as the seller, for you as the customer, for Amazon themselves. It is a win-win for everybody.

If you would like to learn more about Amazon FBA, Kev has a full series where goes through the 3 major systems in full detail, watch the video below!

Amazon FBA Full Series

Consumer

Some benefits as a consumer, is that you trust Amazon. You know that if you purchase something from Amazon, it is going to turn up. It is not the same as just purchasing from a random retail store, which you are putting your credit card details into. Amazon have built trust over 20 years, so as a consumer, there are a lot of customers on Amazon. The traffic is incredible. Also, you have got what you call the Prime Service, and this is where Amazon have changed the game, because this is what the FBA stands for.

Amazon were very clever...They recognised that people, sellers, they used to have warehouses with great big stores, and then ship products themselves; they recognised that, if they could build this system, where sellers no longer have to ship their own products and deal with customers, they could get all sellers or a lot of sellers through their programme and onto their marketplace. This then fundamentally changed the game online, because that is what differentiated them from eBay, because eBay was essentially lots of different sellers, but you would have to pack it yourself. 

So, they developed Prime, and as a consumer, what did this give you? Prime gives you many benefits, but there are some core ones which really stand out; for example, Prime Video. But the biggest one is next day delivery. Next day delivery is incredible. You could purchase some products, and the next day, it can arrive. It is incredible. 

Now, as a consumer, if you are possibly running late at purchasing some birthday gifts, you know that you could now purchase it today, and still be able to get it tomorrow. The power of that is incredible, and that attracts a lot of customers. 

So, you have got trust, Prime Video, next day delivery, and the future of Amazon is only just growing. All of this has basically made Amazon the biggest retailer in the world.

Seller

Why is Amazon FBA so attractive to sellers? The thing is the traffic. Amazon have the traffic already, so you don't have to get the traffic or drive the traffic to you, because it is already there. This is a huge. 

Another is the FBA service itself. The fact that you can send and ship your products is incredible. Amazon is everywhere - they are worldwide. So, what this basically means as a seller, is that you now have access to a lot of traffic. But Amazon are a powerhouse, they have a financial capacity that you and I can only dream of. They have the resources to basically supply a lot of the world, they have fulfilment by Amazon centres, where you can ship your products. If you think you are going to scratch the surface on Amazon with your 100 products... Amazon are shipping millions of products, and what does it take to change your life?

If you thought about it, would 20k a year change your life? Would it get you out of your current job? What if it were 30k per year, would that get you out of your job? How many products is that? If you were to sell 5000 products per month, and you were making £5 per product, that is an extraordinary amount of money, and that will completely transform your life - Amazon will accept this. 

Further reading:

How To Achieve Goals - 3 Tips To Ensure You Achieve Them

How You Can Open 3 Wholesale Accounts In 24 Hours

How to Make Your Business Easy to Sell