Retail Arbitrage vs Private Label

These two strategies divide lots of sellers. There are pros and cons for both. Here are just a few of the Pros and Cons for both Retail Arbitrage and Private Label Selling.

Retail Arbitrage

Pros

• Low risk.
• You have control over what budget you spend on buying items to resell.
• Retail stores always have offers.
• Fundamental to learning Amazon policies.
• Scalable using virtual assistants.
• Wider reach of stores through Online Arbitrage.
• Fun going to retail shops to find bargains!

Cons

• Visiting stores (retail arbitrage) or trawling the internet (online arbitrage) to find products can be time-consuming.
• Competition means other sellers can ‘drop’ their prices. Meaning your items can be left in stock for a period of time.

Private Label Selling

Pros

• Potentially high profit margin IF you find a good product to produce.
• Brand registry. Meaning you can protect your product from being copied.
• Satisfying knowing you are selling your own products.

Cons

• High risk.
• High initial investment.
• Takes months to have a product ready to go.
• Dealing with manufacturing companies.
• Need to have legal documents in place. Certificates etc.
• Buying barcodes.
• You need to get product images produced in line with Amazon policies.
• No historical sales, so your product may not sell.
• Need to pay for advertising.