Source:
https://www.podbean.com/eau/pb-87a9m-10f4fe1
Episode Twenty One features Rob Cosman about how he makes money on Amazon with Online Arbitrage as well as living as an Expat in beautiful Costa Rica. Pura Vida!
My Key Takeaways:
I really enjoyed talking to Rob and learning not only about Online Arbitrage but his decision to become an Expat in Costa Rica.
Rob got started early on in Ecommerce when he created his own website selling craft products for Tole Painting that his Dad made. He learned how to code the site by copying Amazon and other online retailers but quickly learned that Build it and They will come was not a viable strategy. He learned that by going to online forums about Tole painting he could participate and direct others to his site. By doing so he found that his customers were often teachers who would buy from him in bull.
He spent some time in the Cayman Islands and really enjoyed it but ultimately found himself back in Toronto where he bounced around in various Accounting roles. He and his wife, Marsha, identified that this was not the lifestyle they wanted and began making a plan to opt out and do their own thing. She wrote a children's book that she sold on Amazon and they both started their own Accounting firm. Rob also started selling on Amazon, first doing thrifting and then doing Private Label but ultimately decided that Private Label was not for him.
Rob discovered that succeeding in Private Label was very difficult. Typically you hear about people that source a product from China via Alibaba. It takes a long time to get the product in and by the time that you get it you are competing with a bunch of other sellers as well as the manufacturer! To have any success at all in Private Label requires a huge Ad spend and was something that Rob decided was not for him.
While there plan was to wait until 2022 to make the move to Costa Rica it was accelerated when Marsha lost her job. They were able to sell their condo quickly in a Seller's market and then sold or got rid of whatever possessions they did not want to bring with them. They ultimately ended up moving in to a resort area with amenities that were at least as good if not superior to what they had before.
Rob describes the Pura Vida lifestyle as a very relaxed lifestyle where "Pura Vida" is almost used as a form of greeting. The downside is it can be used as an excuse for missed expectations. Sorry but we closed the office down yesterday - Pura Vida!
Rob talked about Online Arbitrage which as he defined is basically buying something from another online website and reselling it on Amazon. He will have the product shipped to a Prep center that he does business with and they will inspect it, make sure that it isn't damaged, and then send it on to Amazon for him. Because it is Fulfilled by Amazon, Rob's products qualify for PRIME status which is a huge advantage for him. Rob also really likes Online Arbitrage becuse it isn't as risky as Private Label and you can get a series of wins with very little risk. As he said "Just take small little risks, get your confidence, start building up that cash flow, take that small investment, roll the profits over, and then you can start buying more inventory. Right?"
Rob uses several tools - KEEPA which is a Chrome Extension shows him the historical sales data over time and will allow him to set an alert to but an item when it is at a low sales price. He also uses a tool called AZ Insight which will allow him to calculate the potential profit on any item he is currently viewing.
Rob is also a huge fan of using credit card rewards and stacking those with online stores that are having discount sales.
He also recommends starting in Home Goods and then going to Toys when you cna qualify to be ungated for that category.
In addition to Amazon, Rob still sells home good products on the East Coast Rustic ecommerce site with his Dad. They started out on Etsy, and have expanded to HOUZZ as well as Home Depot. Rob's Dad handles the manufacturing and he handles the Ecommerce, Tech Support, and Customer Service sides of the house.
Rob's #1 Piece of Advice: I don't care if you want to move to Costa Rica, if you want to travel in an RV, whatever. We always say you want to design a lifestyle that you want, figure out what that side hustle is and let it grow. He likes Amazon, because it's a very low barrier to entry, You don't have to deal with the customers, You don't have to create a website, all this stuff. it's something that you can start so easily with a few dollars just at night and it can grow into a full-time business where you could work wherever. Start that plan, start that side hustle while you have that job, because then you can build that nest egg of profit and keep turning it over to build up that inventory so that you get to that amount with the profits that are kicking out, could replace that job. He said some people think, oh, I'll quit my job right aw
