If you’re looking for a way to earn extra cash in your spare time from home, arbitrage may be something you can do. According to Wikipedia, in economics and finance, the definition of arbitrage is the practice of taking advantage of a price differential between two or more markets: striking a combination of matching deals that capitalize upon the imbalance, the profit being the difference between the market prices (please note that examples of products and prices in this article are from trends in 2009).
I practice arbitrage all the time. In fact, it’s not that difficult if you know the right places to search for items you can purchase at a reasonable price, and sell them for a reasonable profit.
I personally like to check out Slickdeals.net and hang out in their Hot Deals Forum. That’s where all the hot deals are posted by a community of like-minded deal seekers. Others vote on the deals by giving the topic a thumbs up or thumbs down. I scan the topics with the most thumbs up, and read them first. However, don’t discount the items without any “thumbs” because they can just be topics of not much interest to the majority of people, or they’re newly posted.
Once, I found a deal for Tony Hawk helmet cameras. Very cool, little cameras that fit on a sports helmet. Great for skateboarders, bike riders, skiers, etc. Someone on Slickdeals found them at an online store for $19.99. Well, sellers on Amazon were selling them anywhere from $60-$80. I purchased as many as I could from this online source, and even purchased them at $29.99 at another online source and turned around and sold them on Amazon. I made almost $3,000 from this one product in just two weeks (I have to add that it was the Holiday season so obviously that helped).
Check Out Amazon’s Deal Of The Day.
I also subscribe to Deal Alerts from DealCatcher.com. You enter keywords of either products or stores with deals or sales in which to be alerted. You will receive an email that informs you of these deals.
I received a DealAlert the other day from DealCatcher that let me know about a deal from Buy.com since that’s one of my keywords. Buy.com had a digital photo converter from Hammacher Schlemmer for $50. They retail for $200. I did a quick search on eBay to see the average price for which they were selling, and an advanced search informed me that I could sell them and make a profit. I bought four. I sold all four with a reasonable profit. Better yet, the auctions attracted decent traffic so everyone that looked at my auctions, also got to see a link from my auction to my About Me Page on eBay where I advertise MyMochaMoney blog, plus other links to articles and posts I’ve written.
Ebay is also a fabulous place to look to buy items that sellers have discounted and are clearing out of their inventory. You can purchase these items at a huge percentage off, then relist them on eBay, Amazon, or any other online marketplace.
Craigslist is also a great place to look for items that you can resell either on or offline. You can look for items in the “free” section under the “For Sale” category for items that people are just looking to get rid of. A lot of these items are leftovers from garage sales. I’ve picked up books in the past advertised in the free section of Craigslist, and then sold them on Amazon. I’ve also bought books under the “books” category and sold them on Amazon for a nice profit. If they can’t be sold individually at a decent profit, then I’ll group them together if they’re of the same category such as self-help, health, or business, and then sell them on eBay.
There are so many places to look for deals, the list is endless! A few years back, I would wait for my local Michaels craft store to advertise a 50% off coupon in their weekly flyer (they often offered 50% off one item coupons), and I would use the coupon to purchase a Sizzix personal die-cutting machine. At the time, they retailed for $80. I would then sell the machine on eBay and consistently make at least a $20 profit. I know that doesn’t sound like a lot, but I would buy extra Sunday papers for that one coupon and visit all my local Michaels stores to purchase several of those Sizzix machines! I could only buy one per store per day, so I would have to go back consecutive days to purchase them. My eBay auction was already written, so all I would have to do would be to relist the machines, and when they sold–ship them out!
Retail Store Sales
Any retail store advertising a sale, or that has a regular clearance rack is a potential arbitrage situation waiting for you to take advantage of it. Even Target has permanent clearance shelves near their electronics section. They are usually located at the end of an aisle facing the wall–at least they are at the three Targets near me. You can check every week to see what’s new on these shelves.
Take Advantage of Sales WITH Coupons
Don’t forget to take advantage of any coupons both on and offline. Often you can combine coupons with the sales price and get some fabulous deals! I once found an incredible deal on a Sansa Zune at Sears by combining a coupon with an in-store sale. In addition, they price matched an online price from Costco.com. The color Zune that Sears was offering was actually a more expensive, and more popular color Zune than the one on Costco.com (Costco.com didn’t have the popular one in stock). I don’t know if it was a mistake or not, but Sears did the price match. I bought the Zune and sold it on eBay making a tidy little profit.
Where To Sell Your Items
There are also many places to sell your finds such as Craigslist, eBay, Amazon, Half.com, your local Cheapcycle Group if your area has one. You can also advertise what you find on Facebook or Twitter. Arrange payment through PayPal which is a safer way to do a transaction.
I once bought a couple of Guitar Hero World Tour bundles from an online retailer who was offering a major discount. It was during the Holiday season, and I knew Guitar Hero was popular, and at the time, hard for retailers to keep in stock. I was shopping at my local BestBuy store talking to someone in customer service when I heard a woman ask another customer service representative if she knew where she could get a Guitar Hero World Tour bundle! I spoke right up and told her that I had one! We arranged to meet the next day at a local Starbucks where she paid me cash, and I gave her the Guitar Hero. I was thrilled because it saved me a lot of time; My buyer basically came to me without me having to do anything! I sold the other one on eBay.
Anyway, I could go on and on. I’m a big fan of arbitrage and have great fun finding things at great prices, and selling them for a profit. There’s plenty of room for all of us to do this because the products and places to find them are endless. It’s a great way to earn some extra cash from home, and I guess if you’re really good and have a lot of time to dedicate to it–a lot of cash! I could start an entirely new blog on arbitrage, but I’ll end it here. Feel free to share your thoughts and comments below. I’d love to hear about other people’s arbitrage experiences!