25 Arbitrage Business Ideas
In this article, I share some of the best arbitrage business ideas. Some require an up-front investment, but others are for beginners looking for a side hustle. There are numerous ways to make money as a middleman.
But for all of them, you need an idea, a marketing strategy to get clients, sourcing, a price structure, and a platform where you sell your products.
|Designer Clothing & Accessories
|The RealReal, Vestiaire Collective, Grailed
|ThredUP, Poshmark, Depop
|Chairish, AptDeco, 1stdibs
|Estate sales, auctions, Craigslist
|Bookfinder, AbeBooks, Biblio
|Library sales, garage sales, Bookfinder
|Swappa, Gazelle, Decluttr
|Swappa, Gazelle, Decluttr
|Reverb, Guitar Center, Music Go Round
|Music stores, pawn shops, Reverb
|SidelineSwap, Play It Again Sports, 2nd Time Sports
|Garage sales, thrift stores, SidelineSwap
|Saatchi Art, Artfinder, Artnet
|Art shows, estate sales, Saatchi Art
|Bonanza, Ruby Lane, Tias
|Estate sales, auctions, Ruby Lane
|Sedo, Flippa, Afternic
|Sedo, Flippa, Afternic
|Home Goods & Appliances
|OfferUp, Letgo, Facebook Marketplace
|Garage sales, estate sales, OfferUp
|Mercari, Poshmark, Facebook Marketplace
|Thrift stores, garage sales, Mercari
|Kidizen, Mercari, Swap
|Garage sales, thrift stores, Goodwill
|PupSocks, Chewy, PetSmart
|Pet stores, Chewy, PetSmart
|Car-Part, PartCycle, Auto Parts Warehouse
|Junkyards, auto repair shops, Car-Part
25 Best Arbitrage Business Ideas To Start Right Now
Here are 25 arbitrage business ideas:
1. SaaS arbitrage – Software Arbitrage
SaaS arbitrage leverages the software as a service business model to make money as a middleman. SaaS arbitrage involves buying a Software as a Service (SaaS) product at a low cost and selling it at a higher price.
For example, you could purchase a Slack API to create a SaaS business enabling cross-platform messages with Microsoft Teams. Platforms like Twilio can be used in the backend to sell services at a higher price.
You offer a service to your customers provided by a third-party SaaS provider. You can use a white-Label video creator like Viddyose, join the Avast Reseller Partner Program, or find UCaaS providers that allow contractor arbitrage.
The SaaS reseller business model is the best for making money from monthly subscriptions.
2. Shoe Arbitrage
Starting a shoe arbitrage business can be a smart choice. You buy shoes at low prices and sell them for profit. It can be done part-time and requires minimal investment.
You can find deals at clearance sales or online. You can find discounted shoes on sites like Nike Outlet or DSW and resell them on platforms like eBay or StockX.
3. Clothes Arbitrage
Starting a clothing arbitrage business can be a smart move. You buy clothing at low prices and sell it for profit. You can find discounted items on sites like Ross Stores, TJ Maxx, or Marshalls and resell them on platforms like Poshmark or eBay.
Men’s clothes are among the bestselling things on eBay. It’s a flexible venture that allows you to turn your fashion sense into a money-making opportunity.
4. Web Domain Arbitrage – Domain Flipping
You can use Flippa and GoDaddy Auction or marketplaces on domain registrars like Namecheap and NameSilo to purchase and resell domain names.
Domain flipping could be an extremely lucrative income stream since 252,000 new websites are created every day. You can resell domain names for individuals or small businesses from your home.
5. Home Goods Arbitrage
Home goods like kitchenware, bedding, and furniture are popular arbitrage items because they are always in demand with a high-profit margin.
You can source products from sites like Overstock or Wayfair and resell them on platforms like Etsy or Amazon. It’s a flexible opportunity that allows you to turn your love for home decor into a profitable venture.
Here are some ideas for products sourcing:
- Thrift stores
- Estate sales
- Facebook Marketplace
- Warehouse clearance stores
You can resell these items on platforms like Etsy, eBay, a personal online store, brick-and-mortar shops, and flea markets.
Starting a bedding arbitrage business can be a wise decision. You buy discounted bedding products and resell them at higher prices. Websites like Bed Bath & Beyond or Wayfair offer great sourcing options.
Platforms like Amazon or Etsy provide excellent opportunities to resell these products. It’s a flexible venture that lets you turn your interest in bedding into a profitable business.
Starting an appliance arbitrage requires some upfront investment. You buy discounted appliances and resell them for profit. Websites like Kmart, Appliances Connection, or Best Buy Outlet offer great sourcing options. Platforms like Bonanza or Newegg provide excellent opportunities to resell these products.
6. Toys Arbitrage
Starting a bedding arbitrage business can be a smart move. You buy discounted bedding products and resell them for profit. Websites like Bedding.com or Beddinginn.com offer great sourcing options.
Platforms like Etsy and Bonanza provide excellent opportunities to resell these products. It’s a flexible venture that lets you turn your interest in bedding into a profitable business.
7. Automotive & Car Parts Arbitrage
Reselling auto parts and car accessories online is a good side hustle, but you can also make a full-time income. The used car market is part of the multi-billion car industry. Some savvy resellers prefer to invest in classic cars, and others in new car parts.
On average, car part retailers can earn from $6,000 to $600,000 annually. According to Statista, Carparts.com made US$559 million in 2021 selling products in the Car parts market across the US.
8. Arbitrage Trading
Arbitrage takes advantage of price differences of stocks, currencies, and other assets in multiple markets. For example, if you buy Tesla stocks for $186.20 and resell them at $192.96, you may profit depending on the number of stocks and brokerage fees.
Arbitrage traders usually purchase assets in one market and resell them in other markets as fast as possible.
Crypto arbitrage exploits price discrepancies between cryptocurrency exchanges. When you trade Crypto, your profit margin relies on the on-ramp crypto (exchanging fiat currency, like USD, for cryptocurrencies) and the off-ramp crypto (exchanging Crypto for fiat currency).
Consider all the Crypto transactions and withdrawal fees to calculate your net benefit. To maximize profit, you should be able to purchase and sell digital coins in various countries. This trading method gives the best results when you use tools.
Paxful is one of the most effective peer-to-peer platforms for trading Bitcoin. And TransferWise will allow you to have bank accounts in multiple countries to buy and sell Cryptocurrencies worldwide.
Arbitrage Trading Stocks
Arbitrage opportunities arise due to inefficiencies in the market, such as differences in supply and demand, information asymmetry, or logistical issues. However, these opportunities are often short-lived as the market quickly corrects itself.
In the context of stocks, arbitrage trading could involve buying a stock on one exchange where it’s cheaper and selling it on another exchange where the price is higher. Platforms like Interactive Brokers, E*TRADE, and TD Ameritrade provide tools or services for arbitrage trading.
Merger arbitrage, or risk arbitrage, is an investment practice speculating on the outcome of acquisitions and mergers. The arbitrageur (the investor) aims to make money on discrepancies between stock pricing before and after an acquisition or takeover.
Investing requires money and a good understanding of the market: buy, hold, and sell shares at the right time.
9. Contractor Arbitrage (Service Arbitrage)
Contractor arbitrage, also known as service arbitrage, involves buying services from a freelancer or agency and reselling them at a higher price. For instance, you can hire freelancers on Fiverr, Upwork, or 99Designs to perform graphic design work.
And use services like Kapa99 to outsource tasks. Your profit comes from the price markup between what you pay the freelancer and what you charge the client. It’s a viable way to start your online business by selling services others deliver.
10. Fiverr Arbitrage
There are three ways to benefit from Arbitrage on Fiverr. The first option is to create a gig on Fiverr to offer online arbitrage services, such as Amazon arbitrage, online arbitrage product sourcing, and Airbnb rental arbitrage.
The second option is using Fiverr to source low-cost services and resell them at a higher price. The third option (a grey area, not in complete accord with Fiverr TOS) is to be a Fiverr freelancer and outsource tasks from a cheaper freelance platform like SEOClerks.
11. Amazon Arbitrage
Amazon arbitrage is when sellers buy low-priced products from other marketplaces or retailers and sell them on Amazon for a profit. It could be in-person commerce by leveraging clearance sales, outlet sales, and brick-and-mortar suppliers.
But more and more FBA sellers prefer Amazon online arbitrage, which uses software like Tactical Arbitrage and SourceMogul to find the best product.
12. eBay Arbitrage
eBay arbitrage refers to purchasing products from a site, such as Walmart, to resell them at higher prices on eBay. You have many ways to source your products. For example, you can use tools like AutoDS and ZIK Analytics to automate product searches.
13. Airbnb Rental Arbitrage
Airbnb rental arbitrage is when you rent and sublet a property on the platform.
Before you start Airbnb arbitrage, consult the short-term rental regulations in your area and ask the landlord to sign a sublease agreement. You can become an Airbnb host even if you don’t own a property.
14. Section 8 arbitrage
You can practice Section 8 Arbitrage by buying rental properties at low prices. If your monthly house payment is $1,250, you can rent the property for $1,900 to make a profit.
States like Texas and Florida are excellent choices for becoming a landlord because they have a large population, low taxes, and demand for rental properties.
15. Antique Arbitrage Business
Starting an antique arbitrage business can have several benefits, including:
- High-profit margins: Antiques can be bought at low prices and sold for a much higher price, resulting in high-profit margins.
- Low competition: The antique market is less crowded than other markets, allowing entrepreneurs to establish themselves.
- Flexibility: Antiques can be bought and sold online or at brick-and-mortar shops, providing flexibility in business operations.
- Historical value: Antiques have historical value and can be appreciated by collectors and enthusiasts.
Platforms to find low-cost products include estate sales, garage sales, thrift stores, and auctions. Venues to resell antiques include online marketplaces such as eBay, Etsy, and Chairish, as well as brick-and-mortar antique shops and shows.
16. Pet supplies arbitrage
Starting a pet supplies arbitrage business has several benefits. It allows you to tap into the growing pet industry in high demand. You can source pet supplies at a low cost and resell them for a profit.
Places to find low-cost products include Alibaba, wholesale suppliers, liquidation sales, and clearance sales. Platforms to resell pet supplies include online marketplaces such as Amazon, eBay, Chewy, and your own stores.
This business model lets you capitalize on people’s love for their pets while providing affordable and convenient pet supplies, creating a win-win situation for both you and pet owners.
17. Ticket Arbitrage
Ticket arbitrage is a good way to make some extra money. You can find tickets at competitive prices using ticket presales, fan clubs, StubHub, Ticketmaster, and SeatGeek.
You can then resell these tickets on StubHub, Vivid Seats, SeatGeek, or your own ticket resale website. This business lets you provide access to popular events for people who missed out on tickets while earning a profit.
18. Book arbitrage
You can get cheap books through platforms like thrift stores, library sales, or online marketplaces such as AbeBooks or Alibris. You can resell them on Amazon, eBay, and BookFinder. Here are some book ideas recommended by Amazon for your book arbitrage business:
- children’s books
- non-fiction, fiction & comic books
- hardcover collectibles
You can resell the most common book formats on Amazon. Pricing is highly subjective. For example, some people are willing to pay more for a collectible or a rare episode of their favorite comic.
19. Health and beauty arbitrage
A beauty arbitrage business allows you to tap into the booming health and beauty industry. Platforms to find low-cost products for health and beauty arbitrage include retail stores, online marketplaces (Amazon, eBay), wholesale suppliers (Alibaba, AliExpress), and wholesale suppliers.
To resell health and beauty products, you can check platforms like Amazon FBA, eBay, and other online marketplaces. This business model enables you to provide customers with affordable and quality health and beauty products while earning a profit.
20. Specialized Pet Supplies Arbitrage
Specialized pet supplies is a lucrative business where you sell unique and niche pet products. According to the American Pets Product Association, pet owners spent around $95.7 billion on their pets in 2019.
You can start this business without stocking up an inventory using dropshipping services like Sellvia.
21. Clearance Sale Arbitrage
Clearance sale arbitrage involves buying discounted products from clearance sales and reselling them for profit. For instance, you can purchase products on sale from stores like Walmart, Home Depot, and Lowe’s and resell them on platforms like Amazon FBA, and eBay.
The profit comes from the margin between the discounted purchase price and the resale price.
22. Thrift Store Arbitrage
You can find valuable things in thrift stores, dollar stores, and liquidation stores. Once you’ve purchased the items, you can resell them on platforms like eBay or Amazon.
Most successful sellers focus on things under $20 with profit margins greater than three dollars per unit and aim for a 50% return on investment.
23. Beauty Products Arbitrage
Beauty products are perfect for arbitrage. They are typically small, lightweight, and have significant profit margins. You can source these products from stores like Marshalls and resell them in a brick-and-mortar store or online.
24. Liquidation Sale Arbitrage
You can source products from big box stores like Walmart or liquidation shops to start liquidation sale arbitrage. You can also buy clearance pallets in bulk for retail arbitrage from sites like Merchandize Liquidators.
25. Garage Sale Arbitrage (or yard sales)
You can find non-expensive items at garage sales to resell online or in a brick-and-mortar shop.
Plan your route and hit the garage sales likely to have what you want. Many sellers are willing to lower prices, especially if you’re buying multiple items. Once you’ve purchased them, clean and repair them if necessary to increase their resale value.
Examples of companies using arbitrage business
Retail arbitrage is when you purchase from brick-and-mortar stores to resell for a profit, such as buying in bulk during clearance sales and reselling on eBay.
Examples of successful businesses leveraging retail arbitrage
Here are five more examples of companies that use retail arbitrage:
- Dollar Stores (Dollar Tree, Dollar General): These stores are known to source products for flipping, especially items in categories like toys, stationery, party supplies, groceries, and electronics.
- Outlet Malls: These malls contain many retailers that offer discounted products suitable for retail arbitrage.
- Liquidation Stores: These stores are excellent for retail arbitrage as they often sell products at significantly reduced prices.
- Wal-Mart: Known for its clearance racks, Wal-Mart is a prime spot for sourcing products for retail arbitrage.
- Home Depot: This store sells various products, making it a good source for retail arbitrage.
These companies do not solely focus on retail arbitrage; retail arbitrageurs commonly use them to source products.
Examples of successful businesses leveraging online arbitrage
E-commerce arbitrage or Online arbitrage (OA) is when you purchase products online to resell them at a higher price on other online marketplaces, such as using SaleHoo for drop shipping on Amazon.
Here are five examples of companies that use e-commerce arbitrage:
- Amazon: Many sellers on Amazon use retail arbitrage as a business model. They buy products at a lower price from retail stores or other online platforms and resell them on Amazon at a higher price.
- eBay: Similar to Amazon, many sellers on eBay also use retail arbitrage. They find underpriced products, buy them, and then sell them on eBay for a profit.
- Walmart: Some sellers use Walmart as a source for their retail arbitrage business. They buy discounted items from Walmart and sell them on other platforms at a higher price.
- BookDeal: This company is known for its use of book arbitrage. They buy books at a low price and sell them at a higher price on various online platforms.
- Zen Arbitrage: This online platform helps users find books to buy low and sell high, essentially facilitating book arbitrage.
These companies provide platforms for e-commerce arbitrage, mainly for individual sellers or small businesses.
Products sourcing is possible through online and retail arbitrage. It would help to do thorough research before purchasing products. Ensure that they will sell well and make a profit.
You can also use tools like Algo Pix, Tactical Arbitrage, and FBA Toolkit to help automate the process and find profitable products. Online and retail arbitrage can represent a side hustle in your spare time. Starting with a minimal upfront cost and minimal monetary risks is possible.
However, it’s important to remember that there are better long-term business models than online arbitrage since it cannot be scaled easily.
What are the benefits of starting an arbitrage business?
Some benefits include low startup costs, flexibility in choosing products or industries, potential for high-profit margins, and the ability to leverage market inefficiencies to generate income.
What are some popular types of arbitrage businesses?
Common types of arbitrage businesses include ticket arbitrage, e-commerce arbitrage, real estate arbitrage, SaaS arbitrage, and currency arbitrage.
How do I find low-cost products for my arbitrage business?
You can find low-cost products through various means, such as thrift stores, garage sales, online marketplaces (e.g., Craigslist, eBay, Facebook Marketplace), wholesale suppliers, liquidation sales, or even direct partnerships with manufacturers.
Where can I resell the products I acquire through arbitrage?
Many platforms exist to resell your products, including popular online marketplaces like Amazon, eBay, and Etsy. Or you can sell on specialized platforms for specific industries, such as SeatGeek for ticket reselling or Alibaba for international wholesale trade.
Are there any risks involved in arbitrage businesses?
Like any business venture, risks include market volatility, competition, potential counterfeit products, or legal considerations.
How do I determine the profitability of an arbitrage opportunity?
Assessing profitability involves analyzing factors such as the price difference between buying and selling, associated costs (shipping, fees, storage), market demand, competition, and potential scalability.