First: the 3 numbers that decide if a model fits you

Before you pick anything, pick your targets. If you can’t hit these, the model will feel “hard” no matter what.

1) Minimum deal quality (per item)

Use these as “don’t even test it” filters:

• Net margin:
  • Arbitrage/wholesale: ≥ 15% (after all fees, shipping, inbound, prep, returns reserve)
  • Private/white label: ≥ 25% (because ads + returns + velocity dips will happen)
• ROI on cash (profit ÷ landed cost):
  • Fast movers: ≥ 25%
  • Slow movers: ≥ 40%
• Contribution profit per unit (real dollars):
  • Aim for $5+ on small items, $10+ if bulky/fragile/return-prone.

If a product clears margin but only makes $1–$2 per unit, you’re building a job, not a business.

2) Inventory health

• Sell-through target: aim to recover your cash in 30–60 days early on.
• Aged inventory rule: if something hasn’t moved in 90 days, treat it as a pricing/ads/listing failure and cut.

3) Channel fit (Amazon vs Walmart)

• Amazon tends to reward review density + ad spend + operational consistency.
• Walmart tends to reward price competitiveness + fast shipping + perfect metrics (cancel rate, on-time delivery, valid tracking).

You can sell the same item on both, but your execution must match each platform’s “reward system.”

The 8 business models (built for Amazon + Walmart)

Each section includes: capital needs, what you’re really doing day-to-day, profit reality, and the “do this/not that” metrics.

1) Wholesale (authorized distributor / brand direct)

What it is: buy established branded products in bulk, resell at retail.

Capital reality: usually $5k–$50k+ depending on MOQs and how many SKUs you carry.

Why it works on both platforms

• Amazon: existing demand + known ASINs (if you’re eligible to sell them).
• Walmart: branded catalog can perform well if you win price + shipping.

Where sellers mess up

• They confuse “good sales rank” with “good buy box odds.” If you can’t win buy box often, you don’t have a product—you have a listing you subsidize.

Hard rules (use these)

• Offer count: avoid crowded listings early. If there are 10+ strong sellers and you don’t have a structural edge (pricing, WFS/FBA, distributor discounts), pass.
• Price delta: if your landed cost only allows you to be within 3–5% of the current buy box price, you’re exposed. One price drop and you’re underwater.
• Reorder threshold: reorder only when you can cover 30–45 days of sales, not 6 months.

Best fit for

• People who want predictability and can handle supplier relationships, invoicing, and compliance.

2) Online arbitrage (buy online retail, resell higher)

What it is: find price gaps between retail sites and Amazon/Walmart.

Capital reality: can start around $1k–$3k if you’re disciplined and don’t chase junk.

Works best when

• You’re systematic: spreadsheet/automation + strict filters + fast restock cycles.

Direct metrics that keep you alive

• Keep SKU count low: start with 10–25 SKUs, not 200.
• Test buys: first order should be 2–6 units, not a case pack.
• Returns reserve: assume 2–5% of revenue gets eaten by returns/damage (more in apparel/electronics).
• Velocity confirmation: don’t buy depth unless you’ve watched stable demand for 14+ days.

Platform nuance

• Amazon can gate brands/categories and suppress sellers quickly.
• Walmart can be more forgiving on some brands but punishes bad operational metrics fast.

3) Retail arbitrage (in-store clearance / shelf flips)

What it is: source from physical stores.

Capital reality: $500–$2k to start, but your time cost is the real expense.

Why it’s still valid

• It’s the fastest way to learn fees, listing, prep, and what “profit after everything” actually means.

Rules that separate winners

• Only buy what you can replenish OR what you can liquidate fast.
• Clearance is a trap if the item has no long-term demand.
• Exit plan before entry: if it doesn’t sell in 45 days, where do you dump it? (price cuts, bundles, local, other channels)

Best fit

• Beginners who need reps and proof-of-concept more than scalability.

4) Private label (create a differentiated product under your brand)

What it is: you design/spec a product and build a listing around your brand.

Capital reality: $5k–$25k+ if you do it properly (samples, freight, packaging, content, compliance).

This is the model most people romanticize—and then fail—because they ignore the math.

Private label math that matters

• Target TACoS (ad spend ÷ total revenue):
  • Launch: 10–20%
  • Stabilized: 5–12% (category dependent)
• Gross margin target: 35%+ (so ads + promos don’t kill you)
• Review plan: if you can’t ethically generate early reviews, your launch will be expensive and slow.
• Inventory risk: never place a “big” reorder until you’ve proven:
  • conversion rate is healthy AND
  • return rate is acceptable AND
  • you can maintain price without collapsing sales.

Amazon vs Walmart

• Amazon: brand + reviews + PPC sophistication.
• Walmart: can work extremely well, but often requires strong pricing + fast fulfillment (WFS) and clean catalog setup.

5) White label (generic product, your branding)

What it is: you buy an existing generic product and brand it.

Capital reality: $3k–$15k depending on MOQs and how competitive the niche is.

The truth
White label is faster than private label but easier to copy. You win by:

• packaging/content quality
• tighter pricing
• bundles/multipacks
• supply chain speed

Hard filters

• If you cannot explain your differentiation in one sentence, don’t launch it.
• If top listings are dominated by one brand with huge review moats, you’ll burn cash.

6) Dropshipping (supplier ships to customer)

What it is: sell without holding inventory.

Capital reality: low, but risk is high because your account health depends on a supplier you don’t control.

Where it goes wrong

• Late shipments → cancellations → metric hits → account action.
• Inconsistent packaging/quality → returns and negative reviews.

If you do this anyway, obey these rules

• Use suppliers with same-day or next-day handling.
• Tracking validity rate must be near-perfect.
• Choose products with low defect rates (avoid fragile, complex electronics, size/fit categories).

Better alternative for most people: hold limited inventory or use a 3PL so you control shipping speed and tracking quality.

7) Handmade / custom products

What it is: artisan or custom-made goods.

Capital reality: tools + materials; scalability depends on process.

Your edge

• Higher pricing power
• Lower direct competition (if your designs are truly unique)

Your risk

• Production time kills shipping metrics if you don’t set realistic handling times and automate updates.

Rule
If you can’t fulfill within the platform’s customer expectations consistently, keep it as a premium, limited-SKU play—not a giant catalog.

8) Bundles, multipacks, and kits (the “moat” model for resellers)

What it is: create unique bundles that reduce direct competition.

Capital reality: varies, usually $2k–$20k depending on components.

Why it’s powerful

• You’re not fighting 25 sellers on the same exact UPC.
• You can build your own listing (depending on platform rules/category policies).

Rules

• Bundle only items that are stable to source (avoid seasonal components unless that’s the whole strategy).
• Track bundle profitability at the component level so one price change doesn’t silently destroy margin.

Fulfillment: the decision that quietly controls your sales

You can run almost any model with either “platform fulfillment” or “merchant fulfillment,” but your sales velocity and headaches will change.

Amazon

• FBA: higher conversion, easier scaling, fees can be brutal on bulky/slow movers.
• FBM: more control, but you must be excellent operationally.

Walmart

• WFS: tends to boost conversion and competitiveness.
• Seller Fulfilled: workable, but your shipping speed + metrics must stay clean.

Fulfillment rule of thumb

• If the product is small/light + steady demand, platform fulfillment is usually worth it.
• If it’s oversize, fragile, or slow, seller fulfillment or 3PL often wins.

How to choose your model (fast, no fluff)

If you have $500–$2k

• Start: retail arbitrage or online arbitrage
• Goal: learn fees + listing + prep + what actually sells
• Win condition: consistent 30–60 day cash cycle

If you have $3k–$10k

• Start: online arbitrage + bundles, or small-scale wholesale
• Goal: reduce competition, increase repeatability
• Win condition: reorders based on proven velocity, not hope

If you have $10k–$50k+

• Start: wholesale (with real supplier strategy) or private label (with real differentiation)
• Goal: build something durable and scalable
• Win condition: stable margins even after price pressure + ad spend

The “don’t waste your time” checklist (use this before buying anything)

A product is only worth your time if you can answer yes to most of these:

1. Can I make ≥ 15% net margin (or ≥ 20% if private/white label)?
2. Can I be price-competitive without racing to the bottom?
3. Can I fulfill fast enough to avoid metric problems (especially on Walmart)?
4. If the buy box drops 5%, do I still make money?
5. Do I have a clear exit plan if it doesn’t sell in 45–90 days?
6. Am I protected from one platform risk (gating, restriction, account health hit) by selling on both?

If you want, paste one example product (sell price, landed cost, size/weight, expected fulfillment method, and the current competitive situation), and I’ll run it through this framework and tell you which model it fits—and whether it’s actually worth your cash.

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