Amazon Online Arbitrage: 5 Mistakes Beginners Make

For those of you who are starting on your Amazon Journey and want to know what are the common mistakes beginners make. We got you! Today, we will talk to you about 5 beginner mistakes sellers do in the Amazon online arbitrage world and the things to do to avoid them.

 

Of course, if you do like the video format of this article. You can watch it here.

In this article, we will talk about:

 

  • Introduction to Beginner Mistakes
  • Why is it important?
  • Five beginner mistakes of sellers doing Amazon online arbitrage
  • What FTF users say about the common mistakes beginners make

Introduction to Beginner Mistakes

As a seller who is just starting on Amazon FBA, there are some mistakes you could easily make without realizing it. In the next coming articles, we will share the common mistakes from different Amazon selling stages: sourcing products, purchasing, shipping and prepping, Amazon selling, restocking items, and the things you need to know to sidestep each and every one of them.

 

But in this article, we will be giving you an overview of the most common mistakes per stage. So, expect that there will be follow-up articles after this.

Why is it important?

We said it earlier and we’ll say it again, it is unavoidable to make mistakes but if you start learning from this article, you can lessen making common mistakes that beginners make. So, it is better to learn from other people’s mistakes and avoid them from happening in your Amazon business.

 

At the end of the article, we will also talk about what other FTF users said about the common mistakes they made while selling on Amazon.

Five beginner mistakes of sellers doing Amazon online arbitrage

  1. The first common mistake that beginners make during the stage of sourcing is not being able to check if the product you are sourcing is actually selling. We all use a calculator to know the profit and the Return on Investment (ROI), but the most important thing that some people fail to consider is learning how to read Keepa and know if the product is actually selling by understanding the sales rank.

 

You might be asking why is this important. Simply, profit and ROI mean nothing if the product isn’t actually selling. So, ensuring the product's actual sales is key to the deal analysis process.

Now, what we recommend you do is avoid sourcing products that are not selling well. We generally say if the FBA Multi-tool shows above 50 sales per month then use that. But now, I will also check the Keepa graph to see compare the data given. Why? Because the deal might have a good profit and ROI but the product is not good in sales. So, to double-check the FBA Multi-tool data, always check the Keepa graph and use the drop method.

 

Another example we’ll show you is how to read Keepa with a sample ASIN with good profit and ROI, and also good sales per month.

As we can see, even though it is showing a good profit and ROI, the sales are low.

Here is an example of good profit, ROI and good sales.

2. After going through sourcing, the next stage is Purchasing, and the second mistake that beginners make under this stage is Cancelled orders because of too many or multiple orders.

 

Since not all suppliers allow large quantities of orders, they require a limit when it comes to customer purchases. So, if you have multiple orders, your order can be canceled.

What is the solution for this?

 

What we practice in our business is that we buy 10 products per day instead of ordering in bulk in one sitting. Some suppliers like; Beauty Bay, The mankind, and Boots, can easily detect those people who are retailers based on the number of orders made. So, what you should do is try to buy 3 to 10 items today, then do the same thing the next day as we are trying to avoid suppliers detecting you as retailers.

 

If you want to learn more about canceled orders and what you can do about them. We’ll drop a link to a video we created called 3 Reasons why your Supplier is Cancelling your orders.

3. For the third mistake, which falls under the Ship and preparation stage. One of the common mistakes is that beginners don’t tell Amazon the correct weight of the boxes that they are shipping to the FBA warehouse through UPS.

Now, this is important because sometimes Amazon loses your stock on check-in. When you ask Amazon to check, what they do is add up the weights of the items in the bottom and see if that tallies with what you reported as a total weight at shipping.

 

If it doesn’t, you would not get your money back.

 

Now, to avoid this from happening, simply ensure that you always enter the correct shipping weight.

4. The fourth common mistake which is about selling your products on the Amazon platform is repricing.

 

Every day, every hour, and almost every minute, Amazon is changing; especially the prices. What sellers do is keep their prices competitive to increase profits. If you fail to reprice your product, you might have a negative profit (after costs) or low sales. Why? Since prices are always changing, let’s say the price dropped already and your price is still high. The outcome would be other sellers have already dropped their prices so, you won’t get many sales since people will buy from other sellers who have a cheaper price, of course.

The solution for this is to reprice your products! You can use Amazon’s free repricing software and manually set a minimum and maximum price. Now, if you have enough budget for repricing software, you might want to get one so that you can keep your price competitive and always win the buy box.

5. The fifth and final common mistake during the restocking stage is spending too much time sourcing products and then shipping the product in, then going look for other products. The goal is to always replenish first.

 

What is replenishable? Simply, this is any item you can reorder. But for our Amazon business, what we classify as replenishable are any ASIN that we ordered within the last year. Meaning, if we buy a product in January and then reorder it again in November, that would be considered a replenishable product. 

 

Now, if you want to save time sourcing online arbitrage deals and make your life a bit easier while increasing profit at the same time, then try utilizing a replenishable system.

If you want to learn more about replenishable products and increase your profit, might as well watch the video which we created with Mr. Luke Dugan who earns £84,000 in one month just by selling replenishable products on Amazon through online arbitrage.

Going back to solving the issues in restocking is by replenishing the products first. Begin tracking good-selling items and record them, of course, make a list. If you’ve got products you’ve purchased before and they’re out of stock, make sure that you are looking to see if you can restock them in the future. Trust us, this will make your life so much easier.

If a product is out of stock today, keep a tab and recheck it over the course of the next couple of months. You’ll never know when it’s going to come back in.

As a seller just starting your Amazon journey, you might be a bit overwhelmed by all the stages you will be going through. What we will say to you is that you can begin by getting online arbitrage leads from us. You know, saves your time and gives you an idea of which deals you should be looking for.

What FTF users say about the common mistakes beginners make

We posted a question on our Official Facebook group and asked what are the common mistakes that beginners make and they came back with the following answers:

Now, we want to thank those people who responded, this is very useful, especially to those beginners who are starting on Amazon. So, if you are one of those people, I’ll drop a link below if you are interested to join our Official Facebook group, one for the USA and UK, which is composed of Amazon sellers helping each other go through different issues on Amazon selling.

Understanding the common mistakes beginners make will make you want to consider watching our Youtube Channel with a playlist we created called Arbitrage for beginners which is a series of videos that will guide you through your Amazon business journey.

Are you a beginner on Amazon?

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