If you’ve been puzzled about how to sell Amazon products on eBay, you’ve come to the right place.
The answer to this age old question lies in retail arbitrage. It is a concept in business where you buy a product from one retailer and sell it to the consumer on another platform to earn profit.
Amazon to eBay arbitrage is a business model that many online entrepreneurs have adopted. It is a good work from home business, where you don’t have to do much effort and earn profits on being the middleman.
The concept is simple. You pick a product that is present on Amazon for $20 and list it on your eBay shop at $30. Once you get an order for it and the seller sends money through PayPal, you then order the product on Amazon and directly enter the buyer’s shipping address. This way you don’t deal with the hassle of inventory and logistics while at the same time make a profit of $10.
eBay doesn’t restrict wholesaling or has restrictions about where you get your store products from. But when you are dealing with Amazon products on your eBay shop, you are using Amazon as drop shippers.
Drop shipping is when the goods are directly delivered from the manufacturer to the customer. In this method, the seller does not have to worry about the shipping.
The Amazon drop shipping is used by eBay sellers to a great extent. But how does this work and is it okay to engage in this practice? This article discusses the legal and moral stance of the practice, the Amazon and eBay sellers’ and buyers’ positions, and a guide on how to sell Amazon products on eBay.
Is It Legally and Morally Acceptable?
Technically, yes it is legal as none of the marketplaces have policies or laws that state otherwise. However, it is a sneaky practice and there are laws and policies in some countries where this may be prohibited.
Earlier this year, eBay took into account this practice and released a policy saying that drop shipping, where orders are fulfilled directly from suppliers, is allowed but listing an item taken from another retailer and getting the item shipped directly to the buyer, is not permitted.
In response to this, drop shipping on eBay was banned in Australia and some of the European countries as well. The retail arbitrage practice can be a problem considering some of the global trends on data protection and intellectual property rights.
Protection of Data
Data protection laws and rules, particularly in Europe, can conflict with the retail arbitrage practice. According to the rules, you cannot give information of one party to another without their permission as this is violation of data protection laws. When a buyer gives eBay sellers their shipping address and other information, they are obliged to protect that data. This means that if an eBay seller is engaged in the arbitrage practice and is going to give the buyer’s information to Amazon, the buyer must be informed of that. The information will be passed to Amazon’s manufacturers and also third parties. The data will also be in Amazon’s system probably forever.
Since the arbitrage practice highly depends on the buyer not knowing that the product is from Amazon, it is difficult for eBay sellers to not violate this rule. They could be penalized to heavily..
Consumer Protection and Service
All around the world, there are consumer protection laws applicable to ensure the consumer’s rights to complete details about the products, honest and satisfactory customer service, and others. Consumer laws also include the responsibilities of the seller to be able to comply with the buyer’s complaints. In Amazon to eBay Arbitrage, the eBay seller becomes the third party and hence any problems with the product will be dealt by the seller while the product is from Amazon – but there is no direct relationship between the actual seller and buyer.
Intellectual Property Rights
These rights are for the Amazon sellers whose products are being used in arbitrage. They have a Verified Rights Owners (VeRO) program under which they can report eBay buyers for violation of intellectual property rights. If eBay sellers take the exact title and descriptions for the products from Amazon without a notification or gaining a permission to use, they can be reported and this can get their eBay shop suspended as well.
How Does Amazon to eBay Arbitrage Work for Sellers and Buyers?
To understand how retail arbitrage works for buyers and sellers, and who is at a gain and who isn’t, is the important part. Here’s how the buyers and sellers are affected by the practice.
It is not that eBay doesn’t notice that you are drop shipping. When you start drop shipping extensively, eBay notices it through the unhappy buyers. But why are the buyers unhappy when they receive their product?
Here’s the catch. The buyers receive the products in Amazon packaging. When you drop ship from Amazon, you order the product but it gets delivered to the buyer directly from Amazon in their packaging. This would strike the buyers that they could have gotten the product at a cheaper price directly from Amazon. This makes them unhappy and they would most likely leave negative feedback.
Tip for the unhappy buyers: Always do a price comparison. Look at all the online channels before buying a product. You may find much cheaper options available and won’t feel unhappy after the product has arrived.
Sellers Feel Cheated
If Amazon sellers find out that their products were bought and sold at eBay at a higher price, they may feel cheated because someone else is making profits on their products. But some may think why they feel cheated since a sale is a sale.
The eBay sellers buying from Amazon sellers are still buyers to them. Their sale is being made and they are earning a profit on it, so why feel offended? In the end of the day, both parties are benefiting from the sale. Moreover, the Amazon seller’s product is indirectly being promoted on another channel and their sales are increasing without additional efforts.
On the other hand, there are sellers who feel they are being cheated and exploited by the eBay sellers. They feel they are doing all the effort of purchasing the products, developing relationships with suppliers, adding their titles and descriptions, while others are earning profit on the same information.
This is also because they have to suffer the negative consequences as well. If a product is returned, it goes back to the Amazon seller, which creates a hassle for them. The returns on arbitrage products are more because eBay sellers are just third parties and are unable to provide sufficient customer service. They would often poorly copy the details or make mistakes in listing products and that would cost the Amazons sellers.
Many Amazon sellers build their shops over time and develop their products. Seeing eBay sellers benefitting from their business will naturally make them angry.
Some tips for Amazon sellers to combat this situation are:
- File VeRO complaints if you notice eBay sellers copying your pictures and descriptions.
- Report the seller to eBay.
- List your products on eBay as well at competitive prices.
A Guide on How to Sell Amazon Products on eBay
If you are looking to try this business model and get the chance to earn sitting from home, here is a step by step guide:
1. Browse eBay
The first step is to go on eBay and start searching. Look at the products most-searched for and find out which products are in demand. You can also check the eBay trending page where all items that get high bids are listed.
2. Select a Product
The next step is to select the product that you want to arbitrage from Amazon. While selecting the product, remember to not choose highly expensive items or ones that can have fluctuating prices. Avoid any extremes in choosing the categories.
3. List it on eBay
When listing the product on eBay, remember to ensure the correct spellings and descriptions of your products. When setting the price, you need to look at the Amazon price and the prices of the same or similar products on eBay. Set a competitive price with a margin of at least 10% for your profit.
4. Find Customers
Find the potential customers who will pay the price and allow you to make your profit. If you have an established eBay shop, you have an advantage as you can attract your already existing customers to your new listings.
With proper research and active selling practice, you can run Amazon to eBay arbitrage successfully and earn good profits on the products in no time. However, there are always risks involved in such practices.
However, if you are going to do this, the better and longer term solution would be to reach an agreement with an Amazon supplier, making sure all parties are on the same page.
What Are the Risks?
Amazon to eBay arbitrage has had lower risks which is why it is being practiced openly. It is considerably an easy option to get started on earning profits. The common risks associated with it are:
- Fluctuation in prices
- Amazon seller goes out of stock
- Buyer wants to return or exchange the product
As an eBay seller, you need to stay up-to-date with the prices and the activities of your Amazon seller. Since you are dependent on the products and quality offered by some other seller, it is risky to take responsibility of that. If the product turns out to be defective or low-quality, you could get a bad review on your page and negative feedback on your eBay shop. Similarly, if the product goes out of stock, you will have to cancel the order, which will also be a negative point for your shop.
Another major risk is always sitting on the edge of getting reported under VeRO intellectual property infringement. This could be stressful throughout running the business.
Also, having so many Amazon to eBay arbitrage sellers makes it a tough competition. The chances of earning profits in this way are getting lower day by day. So choose wisely whether you want to get into it or not.