How do I calculate Amazon arbitrage profit?

Arbitrage Profit = Sale Price - (Purchase Cost + Shipping to Amazon + FBA Fees + Referral Fees). Use our calculator to quickly determine if a retail product is profitable to resell on Amazon.

What is a good ROI for retail arbitrage?

Good ROI for retail arbitrage is typically 30-50%. Beginners should aim for minimum 30% ROI to account for returns, damaged items, and unexpected costs. Experienced sellers often target 50%+ ROI.

What percentage of retail price should I pay for arbitrage?

For profitable arbitrage, pay 30-50% of the Amazon selling price. If an item sells for $30 on Amazon, pay $9-$15 retail. This leaves room for Amazon fees (25-35%), shipping, and still yields 30%+ ROI.

What are typical Amazon FBA fees for arbitrage sellers?

FBA fees for arbitrage include: referral fees (8-15% depending on category), fulfillment fees ($3.22-$6.50+ per unit), storage fees ($0.75-$2.40/cubic foot), and optional prep fees ($0.30-$3.00/unit).

How do I find profitable arbitrage products?

Find profitable products by: scanning barcodes with apps like ScanPower or TacticalArbitrage, looking for clearance items (70-90% off), focusing on non-media categories with lower competition, and checking rank/BSR for sales velocity.

Amazon Arbitrage Profit Calculator — Retail Arbitrage Margin

What is Amazon Arbitrage?

Amazon retail arbitrage is a business model where sellers buy products from retail stores (like Walmart, Target, or clearance sales) at discounted prices and resell them on Amazon for a profit. The profit comes from the price difference between the retail purchase price and the Amazon selling price, minus all fees and costs. This model requires less capital than private label and offers faster entry into Amazon selling.

How to Calculate Arbitrage Profit

Follow these steps to calculate your retail arbitrage profit accurately:

Enter your Amazon Sale Price ($) - what customers pay on Amazon
Enter your Purchase Cost ($) - what you paid at retail
Enter your Shipping to Amazon ($) - cost per unit to ship to FBA warehouse
Enter your FBA Fulfillment Fee ($) - Amazon's picking/packing fee
Enter your Referral Fee (%) - Amazon's category-based fee (typically 8-15%)
Enter your Prep & Labels / Unit ($) - cost for bagging, labeling, etc.
Enter your Units Purchased - number of units you're buying

Arbitrage Profit Formulas

Referral Fee = Sale Price × (Referral Fee% ÷ 100)

Total Cost = Purchase Cost + Shipping + FBA Fee + Referral Fee + Prep Cost

Net Profit = Sale Price - Total Cost

Profit Margin = (Net Profit ÷ Sale Price) × 100%

ROI = (Net Profit ÷ Total Investment) × 100%

Real-World Example

Example: You find a product at Walmart for $12 (retails for $34.99 on Amazon), shipping to FBA is $3.50/unit, FBA fee is $5.50, referral fee 15%, prep cost $1/unit, buying 10 units:

Referral Fee: $34.99 × 15% = $5.25

Total Cost / Unit: $12 + $3.50 + $5.50 + $5.25 + $1.00 = $27.25

Net Profit / Unit: $34.99 - $27.25 = $7.74

Profit Margin: 22.1%

ROI: 28.4%

Total Profit (10 units): $77.40

Why Arbitrage Profit Matters

Understanding your arbitrage profit helps you:

Make buying decisions - Quickly evaluate if a deal is worth pursuing
Set minimum thresholds - Only buy products meeting your ROI targets
Scale efficiently - Focus on products with consistent margins
Manage cash flow - Understand ROI timeline for reinvestment

Frequently Asked Questions

Is retail arbitrage still profitable in 2026?

Yes, but margins have tightened due to increased competition and higher retail prices. Successful arbitrage sellers focus on: clearance/closeout deals (50-90% off), less competitive categories, products with seasonal demand spikes, and using software for faster product research.

What app do arbitrage sellers use?

Popular apps include: ScanPower (comprehensive scanning and sourcing), TacticalArbitrage (online arbitrage and reverse sourcing), SourceMogul (retail and online arbitrage), and Amazon Seller App (free basic scanning). Most sellers use multiple tools for different functions.

How much should I pay for retail arbitrage products?

Use the rule: Pay no more than 50% of the Amazon selling price. Better yet, use our calculator to ensure 30%+ ROI. Account for all fees including FBA, referral, shipping, and prep costs before making a purchase decision.

What categories are best for arbitrage?

Best categories for arbitrage: Home & Kitchen, Beauty, Health & Personal Care, Toys, and Kitchen. Avoid media (books, DVDs) due to high competition and lower margins. Look for products that are lighter, non-fragile, and have consistent year-round demand.

How do I ship to Amazon FBA?

You can use: Amazon's partnered carriers (discounted rates), or your own shipping account. For small volumes, use 2-3 day shipping. For larger volumes, negotiate LTL rates. Always use FBA label service or thermal printers for professional labels.

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