When you get started with Amazon arbitrage, there are several decisions you need to make. One of the most important is how you will source products. There are several options, including arbitrage software and leads lists. Both options are great ways to sell on Amazon, with each more suited to a particular type of seller.
Each has pros and cons, like price, ease of use, and time efficiency. If you want to know which one is the best for you, you need to understand these differences.
In this guide, we will cover everything you need to know about these two product-sourcing methods to help you decide which is best suited to your business.
How to Source Products for Online Arbitrage
Online arbitrage is all about buying items for a lower price and selling them for a higher price. Amazon resellers can make excellent money doing this, but only if they're smart with product sourcing. There's a knack to it involving choosing the right products. The items must have a good ROI and be profitable while also suiting your store's niche.
There are several ways to track down products, but two of the easiest methods involve using leads lists or software. These facilitate the process so you don't have to locate products manually.
There are some significant differences between the two methods, though.
Source: oacheddar.com
What Is Software Arbitrage?
Software arbitrage automates the process of finding products by utilizing downloadable software. This includes programs like Tactical Arbitrage, Source Mogul, and more. These tools help sellers find profitable products to sell through Amazon FBA in a very quick and efficient manner.
Software like this leverages cutting-edge technology and data-driven algorithms to automate the process of finding and evaluating potential products. Depending on the software, you may get access to features like:
- Automatic wholesale manifest
- Product search
- Reverse search
- Data analytics
- Data filtering
Online arbitrage software has revolutionized the way sellers approach product sourcing. Most have an easy-to-use interface, making it straightforward to see and interpret data. This empowers sellers to make informed, data-backed decisions and gain a competitive edge.
But does it compare to leads lists?
What Are Leads Lists?
Leads lists might seem a bit more old-fashioned than high-tech software, but they have a great many advantages. When it comes to product sourcing, leads lists give resellers an enormous edge. Namely, they allow you to connect with the right audience at the right time.
Leads lists could hold the key to unlocking the true potential of your business. They are curated by expert, 7-figure resellers, carefully crafted to include individuals and products who fall within a seller's desired demographic. They help you locate profitable products to sell without having to toy with any of the data – somebody has already done that for you.
Traditional marketing approaches cast a wide net in the hopes of capturing the right leads. However, leads lists give you surgical precision with data that's ready for the taking.
For sellers who are just starting out, leads lists offer the chance to locate products and grow your business quickly. Meanwhile, for established sellers, leads lists mean you can focus on other business areas while automating a significant part of the process.
Some lead lists integrate seamlessly with software, like OA Cheddar and CheddarSoft.
Pros and Cons of Different Sourcing Methods
Each method has pros and cons, so you must carefully consider which suits your business. The general aim of product sourcing is the same: to find products that offer high profitability and achieve a good sales rank. Both software and leads lists can help you achieve this, so you must focus on their other advantages and disadvantages.
Pros of Arbitrage Software
Arbitrage software has many pros, from its features to its interface.
- Useful features: Arbitrage software programs have different features available, often depending on the pricing plan. For example, Tactical Arbitrage's Full Suite is the most extensive offering. It provides access to product search, reverse search, a Flip Pack, and more.
- Provides multiple data points: Software often gives you access to a wide range of data, including tracking your inventory, prices, and more. It's all in one place, which makes your life as a reseller a whole lot easier.
- Automation: With automatic functions, OA software does a lot of your jobs for you. It scans the web for profitable products, transforms its findings into data points, and can even make predictions and identify market trends.
- Integration: Many OA software tools integrate seamlessly with the Amazon marketplace, allowing you to manage inventory and listings all in one place.
- Development: Most software programs are continuously changing. As they get better, your online arbitrage tactics become even more solid.
Cons of Arbitrage Software
Arbitrage software also has its downsides.
- Expensive: The major downside of software is that it's an expensive solution compared to other product research methods. For newcomers to OA, it's often not feasible. Tactical Arbitrage's Full Suite, for example, is $95 per month.
- Learning curve: Users of online arbitrage software must get to grips with its features and interface. While developers design these tools with ease in mind, you still need to spend some time figuring out how it works and how it fits into your business.
- Less control and the potential for errors: With software, you have less control over the data and products you receive. Many software solutions are sometimes inaccurate, so you have to check the information, wasting time.
- Time-consuming: Although software automates some of the processes, you need to go through the various marketplaces it generates and find profitable items.
- Data overload: Sometimes, the sheer volume of data can be overwhelming. It may also take you more time to go through and analyze it.
Source: tacticalarbitrage.com
Pros of Leads Lists
Leads lists solve many of the problems caused by OA software.
- Efficient: Lead lists are rapid, saving you time by removing the need to search for products.
- Broad product searches: Depending on what you are looking for, leads lists can give you a vast range of products to choose from. You can still perform a wholesale search to diversify your offering.
- Curated list: Experts in arbitrage compile leads lists, which means they are handpicked and curated for you.
- Frequent updates: Many leads lists providers give frequent updates that provide a continuous flow of new products.
- Less risk of account suspension: With handpicked products from experts, you are less likely to use counterfeit or restricted products accidentally.
- Personal support: Many leads lists providers offer personal support, giving you access to a community of other resellers who can offer advice. OA Cheddar, for example, has bi-weekly webinars with 7-figure resellers to help you unlock new knowledge.
Cons of Leads Lists
There are, of course, downsides to leads lists.
- Competitive: OA sourcing lists are available to multiple sellers, meaning other sellers could use the same list. As a result, getting the products is competitive. You can combat this by looking for a provider with limited seats for each list.
- Costly: You are less likely to find a coupon code or sale for leads lists, whereas OA software frequently offers discounts.
- Availability: With products handpicked by experts, there may be limited product numbers.
Which Sourcing Method Should You Choose?
Choosing the right sourcing method for Amazon FBA is crucial for success. Ultimately, it comes down to evaluating the pros and cons and determining where your priorities lie. If you want more control over your own search and the chance to find online arbitrage wholesale items, then the software is the better option. However, leads lists are better suited to those with budget constraints or who want a personalized touch.