Retail Arbitrage How a Couple Earns Thousands Online

Retail Arbitrage How a Couple Earns Thousands Online What if you could turn your weekly Trader Joe’s run into a $30,000 side hustle? For Juston and Kristen Herbert, that’s not a pipe dream to idly consider while standing in line at the store every Sunday â€" it’s reality. The couple has figured out a way to earn profit big-time from the cult grocery chain, and it’s all thanks to Everything But the Bagel Sesame Seasoning Blend. Seriously. The Herberts are experts in retail arbitrage, a small business model in which a person purchases products in stores like Target, TJ Maxx and Trader Joe’s and then resells them on the internet. Shockingly easy and surprisingly fruitful, retail arbitrage works for the Herberts because it allows them to stay home with their young children. They’ve even begun making YouTube videos about their process, which â€" again â€" literally involves buying everything bagel seasoning in bulk and selling it to Amazon customers. “We’re trying to tell people anybody can do this. You can do it from your home, and you can make a pretty decent income just by walking into a store,” Juston tells MONEY. “I guarantee you’re walking past profit every single day.” From Thrifting to Flipping for Adoption Amazon has come a long way from Jeff Bezos personally driving packages to the post office in a 1987 Chevy Blazer. It’s an empire, and one that often relies on online entrepreneurs like the Herberts. In addition to Merch by Amazon, there’s also Fulfillment by Amazon, which taps into a network of people who buy products for resale. They let Amazon handle the storage, shipping and customer service while they collect the cash. According to Amazon, about 200,000 “small and medium-sized businesses” made more than $100,000 in sales in Amazon stores last year. The Herberts joined the resale game about four years ago while living in Los Angeles. With backgrounds in financial planning, they liked to search thrift stores for items to flip. The couple started actively selling on Amazon after their daughter, Stevie, was born. Kristen became a stay-at-home mom because of the high cost of day care, and Juston says they decided “to figure out how to get this side business into something that can generate a sustainable income.” They began by increasing the amount of effort they put into flipping secondhand stuff, scouring estate sales and selling books on Amazon. They created private-label brands for cosmetics, baby headbands and yoga chairs. They moved to Arizona and dedicated themselves to wholesale, buying everyday items directly from manufacturers to sell on Amazon. “It was then that the lightbulb really went off,” Juston says. Wholesale worked for them because there was little marketing, steady demand and a solid return on investment. Retail arbitrage was mostly a hobby until they recently started pursuing private adoption. That’s when they launched their YouTube channel, Flipping Profits. “We had been bouncing the idea off, why don’t we flip $1,000 into $50,000 for our adoption journey on the side?” Kristen says. “And one of my girlfriends was like, ‘Oh my gosh, you guys need to document this.'” Why Sesame Seasoning Is ‘the Perfect Starter Item’ The Trader Joe’s video is by far the couple’s most popular. More than 100,000 people have watched the 16-minute clip since it was uploaded just six weeks ago, on Dec. 30. The view count may be unexpected, but the decision to feature the seasoning wasn’t random. In the video, Juston says Everything But the Bagel is “the perfect starter item for anybody that wants to get on Amazon.” That’s because Trader Joe’s is reliable: The seasoning is always available there, the demand is always high and the seasoning always costs $1.99. As shown in the video, their process is simple. Juston quietly takes his camera into Trader Joe’s, wheeling a cart through produce and past the wine to reach the seasoning. He loads it into boxes while passers-by shop around him. When the cashier asks what he’s doing with all the containers, he says he’s putting them in gift baskets and sending them to family. It comes out to $141.29 for 71 seasonings. (The Herberts say they try not to be “obnoxious,” so they limit the amount they take.) Back at home, the couple wraps the items while 6-month-old Kruze sits on the kitchen counter. There are specific pack and prep requirements they have to meet, but it basically works like this: They put an item in a bag, place a bunch of those in a box and send that box to Amazon. Amazon stores those items in a warehouse until an order comes in. Then employees package the item in an Amazon box and ship it to the person. In order to do this, the Herberts use a shipping scale, box cutter, tape gun, tape measure, bubble wrap, Goo Gone, plastic bags, rubber bands, stickers, thermal printers and more. Juston then delves into the finances. On that day, 2.3-ounce containers were going for $6.75 apiece and sold for a profit of about $0.80 each. In another video, he points out that earnings can vary due to several factors, including whether they win the “buy box” that automatically comes up on each listing, the price point they’re competing at and what Amazon charges for packing, shipping and marketing that item. Hypothetically, though, if they picked up 100 Everything But the Bagel seasonings a day for a year and sold all 36,500, they could earn $29,200. For the record, Trader Joe’s says its products are best when sold as part of the in-store customer experience. “We do not authorize the reselling of our products and cannot stand behind the quality, safety or value of any Trader Joe’s product sold outside of our store,” a spokeswoman adds. To Trader Joe’s and Beyond Sellers have flooded Amazon’s listing for Everything But the Bagel seasoning since the video came out, driving the price down and making it not as profitable as it once was. As a result, Kristen says she doesn’t sell it right now. But her mission to help other moms hasn’t changed, so she uses YouTube to take them along as she and Juston source drill bit sets, water bottles, vacuum cleaners and sunscreen from places like Big Lots and Lowe’s. “A lot of my friends sell [multilevel marketing] products like Rodan + Fields, Young Living and Doterra, but I wanted to show that there are other ways to make money in your everyday shopping,” Kristen says. “You’re already at Trader Joe’s. You can pick up this product while you’re there and make money for yourself.” Funnily enough, the Herberts don’t actually like the Everything But the Bagel seasoning. (Juston admits in the video that it’s “not bad” on eggs, but otherwise they’re over it.) They also don’t actually earn the majority of their income from retail arbitrage â€" they say 80% of their income is derived from wholesale. The kids can make it hard to spend hours driving to faraway stores and scouring shelves for clearance items. But that doesn’t mean the couple isn’t always looking for the perfect deal. “There’s always the thrill of the hunt,” Juston says. “It’s exciting. What can you actually find out there?”