I love a business plan that gets to the meat of the topic and answers all my questions before I ask them (in my mind). Too much fluf and demographic nonsense is a sure fire way to lose this audience member. Great tips.

To really have an advantage over others, you would want to set up an RSS feeder that updates you immediately on price cuts at many different online retail stores. For my example, I have used an RSS feed to show me price changes in products at Newegg.com. The RSS can be found at camelegg.com, and will even update you on the biggest price drops among all products at Newegg.

This example uses only Newegg and Amazon, but you’ll notice the huge amount of arbitrage available. First, look at the price offered at Newegg: [ bit.ly/bvWOh4 ]. I discovered a recent 50% drop in price to $1000+30 using my RSS feed from Camelegg which tracks price changes at Newegg. Now look at the Amazon price for the same product: [ amzn.to/b4DESt ]. At $1350+0 that’s a $320 difference. If you were quick, you may be fortunate enough to capture a large portion of this opportunity. However, the reality is there are likely going to be other arbitragers out there undercutting you before you are able to sell the product. If you look carefully you will see that there is another seller now selling this product for $1100+42. Assuming you undercut that seller by a penny so that the buyer would purchase from you, deducting Amazon fees you will receive $1049 when the product sells. This comes to an arbitrage profit of $19. This is true arbitrage because you won’t need to put up any money, store any products, etc.

The benefit is that the process is highly automated. You aren’t searching for cheap products anymore as signficant deals are going to be fed to you through your RSS reader. Your only task is to make sure there is still an arbitrage profit when undercutting the cheapest price on Amazon. Listing products on Amazon is extremely fast because you do not have to post the product information yourself. I would argue listing a brand new product this way would take less than 2 minutes once you got the hang of it. You can then monitor your “inventory” to make sure you remain the cheapest until you sell the product or your arbitrage has vanished.

I will add another example, because it is most likely best to use products that are cheaper than $200 to get your arbitrage. We are much more likely to sell a $100 product while the arbitrage exists because buyers will spend much less time making purchasing decisions. This product on Newegg sells for $170 with free shipping[ bit.ly/aCNfwO ]. The price drop occured 11 hours before this writing. The same product on Amazon is currently selling for $200. [ amzn.to/9MYI8e ]. Including Amazon fees and assuming our price is set at $187.41 to account for the additional $12.49 shipping cost, we would receive $182.67 upon selling this product, a risk free arbitrage profit of $12.67.