How the Online Arbitrage Calculator works
Online arbitrage adds two costs and one saving that retail arbitrage does not have: shipping from the retailer to you, and cashback or portal rebates that reduce your real cost. This calculator includes both, then applies prep, inbound shipping and Amazon's fees.
Because OA orders are often multi-unit, divide the retailer's shipping charge by the units in the order.
Formula
- Effective buy cost = Price × (1 + Tax %) + Shipping to you − Price × Cashback %
- Net profit = Selling price − Effective buy cost − Prep − Inbound shipping − Amazon fees − Returns − Misc
- ROI = Net profit ÷ (Effective buy cost + Prep + Inbound shipping) × 100
Example
An $11 item with 5% cashback and $0.60 shipping resells at $29.99 for about $7.50 profit and 60%+ ROI.
Selling price: 29.99Amazon category: home_kitchenWebsite price (per unit): 11Sales tax %: 0Shipping to you (per unit): 0.6Cashback / portal rebate %: 5Prep & labeling (per unit): 0.5Inbound shipping (per unit): 0.75FBA fulfillment fee: 4.5Return rate %: 3
Frequently asked questions
Should cashback count as profit?
It lowers your cost, but it arrives later and can be denied. Many sellers evaluate deals both with and without it.
What about the retailer's return policy?
Not modelled. A generous retailer return window lets you undo a bad buy, which is a real risk reducer.