Let me tell you how I was able to open a successful Amazon FBA store as a 15-year old that generated
over $4,000 in revenue in the first 30 days while only using my bike and let me show you
how you can do the same thing.
I'm not lying and will break down all of the numbers later, but let me tell you why I think
you shouldn't do this.
This all started a little more than a month ago, I was watching YouTube and came across
a video where a person talked about how they drop-shipped from Walmart to amazon successfully.
If you don’t know what dropshipping is, it’s where you find an item on a website
like Walmart, that for example costs $2.98, then you find that same item on a website
like amazon, and sell that item that you can get on Walmart for $2.98 for $14.99.
Then when someone buys that item on Amazon, you go to Walmart and buy that item directly
to the buyer’s address.
You effectively don’t have to keep an inventory of your products, and all you do is find the
products, and keep the difference when someone buys.
This immediately intrigued me, but after doing more research I discovered that dropshipping
is against amazon's terms of service, so that ruled out any chance of me trying it.
I was still intrigued by the idea and found out that if I bought the item from Walmart
and sent it to myself, then sent it to the customer, that was perfectly “LEGAL” based
off of amazon's terms of service.
Knowing if I found one or two good products that I could make thousands of, I spent a
few hours searching for products manually, with no luck.
I then remembered that I can code in python.
I spent the next 2 or so weeks every day writing software that would compare amazon and Walmart
prices to find products.
Long story short, the software worked, but I never ended up using it.
Somewhere along the way of my coding, I came across a video from the channel “Reezy Resells”.
His videos introduced the concept of Retail Arbitrage to me.
This is when you go into physical retail stores and go to clearance isles and find products
that are marked down enough for you to make a profit selling on amazon.
I was actually on vacation in Florida when I found out about this concept, so I spent
the next multiple days watching videos about retail arbitrage on youtube from other creators.
I also spent this time figuring out what I needed to start, like software such as Inventory
Labs and Keepa.
When I got home, the fun begun, I went into Target and started scanning, but with no luck.
I found things that had profit, but none that I was allowed to sell.
I called it a day and went home.
The next day I tried Marshalls and struck gold, or so I thought, I found these Hydrapak
water bottles that were selling at marshalls for $12.99 and amazon for $39.99.
I bought every single one they had on the shelf.
I continued to find a few more products throughout the following days.
On amazon, you are restricted in selling a lot of categories when you start off as a
new seller, and this was a big problem I was facing.
I was constantly finding things to sell that had a good return on investment, but I wasn't
allowed to sell them due to amazon restricting me.
I watched youtube tutorials on how to remove these restrictions and came across the website,
“The Funnel Guru”, that claimed to un resttrict any seller in any category and brand.
I chose the “Topicals, Toys, Grocery” category and I paid the website “$997”
in bitcoin.
I also paid an extra 200$ for them to unrestrict me in a day.
Little did I know this would be the worst decision I could have made.
A few days passed by and they sent a request to amazon for me to get ungated, thankfully
it was denied, and the website refunded me my money.
I will explain later why this was the best thing that could have happened.
While watching these videos on how to get un restricted I also saw that you can get
un restricted by buying from a wholesaler and submitting an invoice to amazon.
I applied to multiple wholesale websites and got accepted to one called “Frontier Coop”.
I placed an order for some Burt's bees chapstick and tea, to get ungated in “Burt's Bees”,
“Topicals”, and “Grocery”.
The total order cost was $119.00.
The order came in a week later and I submitted the invoices to amazon and crossed my fingers.
To my surprise I was ungated.
I now was able to sell things in the grocery and makeup section, this opened up a huge
world of opportunities for me.
This is also about the time my first amazon shipment reached amazon and was processed
by Amazon.
I was starting to see sales and most importantly profits.
I was now coming to my local marshalls every day that I had free time after school.
I also upgraded my in-store product scouting methods by buying a barcode scanner and an
iPad.
I was scanning hundreds of items per hour and finding alot of products at this point.
This is also about the time I found my best selling item which was this, a microfiber
hair towel.
I bought it for $6.99 and sold it for $22.00.
I found 23 of them and bought them all.
Keep in mind I was doing all of this on an electric bike and the distance from the marshalls
to my house was 2 miles.
The towels were all sold within the same day I listed them, that day alone I was able to
hit 500$ in sales.
This was huge for me, I realized that if I was able to find a few products like this
from stores like Target that I can restock, I could be selling hundreds of dollar a day.
Unfortunately, I wasn't able to find anything else like this.
After this happened, I decided I would focus on products that I could replenish, which
means products that I can continually buy over and over for the same price.
I decided to pay $69 a month to join a group chat that shares different finds like this
with each other.
This was also my second biggest mistake.
Most of the things shared in this group are not helpful at all.
Whenever someone would share an item they found, the other people in the group would
start to sell it and because of supply and demand, the price would end up tanking and
you in turn would end up loosing money.
It's possible that I didn't try enough but I would say not to join any of these groups
for the first couple of months of selling.
This also leads to the first replenishable product I found that I am still selling, so
I can show you what it is, but I can tell you what I make from them.
I buy the product for$ 6.99 flat, I then sell it for $22.99.
I make around an 8$ profit and sell multiple a day.
That’s without listing optimization and I expect this to rise to 10 per day within
the next few months.
Thats $2,400 a month from one product.
This leads me to why I'm stopping, this issue for me with Retail arbitrage is that it's
not scalable.
You have to put time into going out and sourcing to make money.
It's not a get rich quick scheme, or even a get rich scheme.
This is because the amount of profit you make is proportional to the amount of time you
put in.
I prefer something that I can put time into once and simply maintain for an hour once
a week.
If you are thinking of starting a retail arbitrage store, you need to know that this business
strategy does require real dedication of time and it's just something that I can’t commit
to with school.
Now to the part you have all been waiting for, how much money I made.
The simplest way possible to break it down would be, Revenue, Cost of goods, FBA fees
and selling fees.
And if we do the math like this we can see that in a month we have sold $3,912 in products,
and after all fees, we have profited over a thousand.
This puts us at 75% return on investment.
This is where most youtubers would stop, but this does not take alot of expenses into account,
the biggest one being subscriptions.
They will completely kill your profit.
t
Now if we look at the chart that accounts for expenses , we can see that the numbers
are alot less appealing.
I had $330 dollars in expenses and that took our return from investment from 75% down to
53%.
Let's break down the hourly pay because none of the earlier charts take into account time.
I never tracked my time, but I think it's safe to make a generous bet that I spent around
60 - 70 hours sourcing items, packing shipments, setting up software, etc throught the month.
While this might seem like a ton of time that you might say you dont have, I persenoally
have spend 53 hours on tiktok in the last month.
Thats more than two whole days watching tiktok out of the whole month.
Im willing to bet that if you are my age and use tiktok at all, your screentime could be
similar and you might not even know.
There goes your excuse of “I dont have the time”.
So lets say I spent 65 hours doing all of this work, which would make out to $11.4 dollars
an hour.
Not that great.
If we take out the price of subscriptions, it would be $16.60 an hour, that's already
looking a little bit better.
This is where I come back to the “The Funnel Guru” un restricting services.
If I did actually end up paying them the $1250, I would not have ended up making a profit.
I would have had to continue working for months more to make it off, this is why I strongly
recommend buying from a wholesaler if you are looking to get unrestricted.
There definitely is a way that you could make money with this strategy, but there are different
ways to make more per hour of your time.
You shouldn’t be selling your time for a fixed hourly rate, you should be spending
your time finding things that will make money without your time like stocks, rental income,
etc.
There might be something I missed in this video, but, this is the part of the video
where people typically start to find a new video to watch, but I want to ask you if you
did get any useful information at all from this video or learned anything new , that
you click the like button.
It helps get this video out to more people and gives me the drive to make more videos.
If you liked this video, consider subscribing and youtube will recommend more videos like
this.
I plan on posting more frequently from now on.
Thank you.