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Corey Ganim

Is retail arbitrage dead?

Published over 1 year agoย โ€ขย 2 min read

Is retail arbitrage still profitable in 2025?

Can I make money on Amazon as a college student?

How much profit does Amazon actually make from seller fees?

I'll answer each of these questions in today's newsletter.

(plus a bonus tip for opting out of a useless Amazon feature that you probably didn't even know you were using)

Let's dive in.

Full Time Amazon Seller ๐Ÿค Full Time College Student

I sat down with full-time college student and Wholesale Network community member Cameron Richard.

He started with arbitrage then graduated to wholesale where he's routinely spending $10-20K (or more) with brands.

No joke - here's one of his brand direct POs from last week:

This purchase order should net him over $4,000.

He graduates in a few months. Needless to say he will not be getting a "normal" job.

Retail Arbitrage - Dead Or Alive?

You probably expected me to say that RA is dead in 2025.

But that would be completely false.

Retail arbitrage can seem like a hamster wheel of constantly driving around town to source products.

And it is.

But savvy retail arbitrage sellers are treating it like a wholesale business.

They're building relationships with store managers, getting access to better pricing and exclusive deals in the process.

And just this week arts & crafts giant Jo Ann announced hundreds of store closures.

This is a perfect opportunity to build relationships with managers of Jo Ann stores to potentially buy some of their inventory at huge discounts.

There is an astronomical amount of money to be made from this exact strategy.

Opt-Out Of This Amazon Program ASAP

โ€‹
I'm talking about the In Stock Head Start program.

It seems like a great opportunity on paper - customers get to buy your products before they check into FBA.

But the reality is a bit different.

Long lead times coupled with FC transfers and other unforeseen delays can tie up your inventory for weeks.

In my opinion, this negates the benefit that both sellers and customers would get from this program.

Most of the mega sellers that I know hate this program and opted-out years ago.

Simply type "in stock head start" in your Seller Central search bar and pause the service.

How Much Is Amazon Making Off Seller Fees?

One thing is for sure - Amazon is making a killing off the fees they charge to third party sellers.

But what isn't quite as clear is exactly how much they're profiting from those fees.

I found this article discussing Amazon's fees and profit centers to be extremely interesting.

The key takeaways:

โ€ข Last year Amazon seller fees accounted for more than 29% of Amazon's non-AWS revenue (a 32% increase from 2019)

โ€ข Amazon lumps all non-AWS revenue into 2 buckets (North America and International) making it difficult to determine true profitability of seller fees

But the craziest stat of all:

Amazon brought in $150 billion in seller fees in 2024.

According to the article, if that revenue stream was its own corporation, it would rank inside the Fortune 25.

The sheer scale of Amazon is insane. You can read the full article below:

Hope you enjoyed this week's newsletter.

If you did, hit reply and let me know. I read/respond to all of them.

And remember...

You're only one supplier away!

-Corey

PS: Whenever you're ready, there are 2 ways I can help you:

#1: We've helped over 160+ Amazon sellers ditch the arbitrage hamster wheel by transitioning to wholesale inside our Wholesale Network community. Click here to apply.โ€‹

#2: Check out The Corey Ganim Show where I interview successful Amazon sellers, entrepreneurs and investors. New episodes every Wednesday on Apple and Spotify, and YouTube.

โ€‹

Corey Ganim

Join 7.6K+ readers of Corey's Notes - the weekly newsletter giving you my take on the intersection between AI and entrepreneurship.

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