How the Retail Arbitrage Calculator works
Retail arbitrage is buying discounted items in physical stores and reselling them on Amazon. The store price is only the start: sales tax, prep supplies, shipping the item to an Amazon warehouse and Amazon's own fees all come out before you see profit.
RA sellers live on ROI because cash turns over quickly. A 30% ROI on items that sell within weeks beats a 60% ROI on something that sits for months.
Formula
- Buy cost with tax = Store price × (1 + Sales tax %)
- Net profit = Selling price − Buy cost with tax − Prep − Inbound shipping − Referral − FBA − Storage − Returns − Misc
- ROI = Net profit ÷ (Buy cost with tax + Prep + Inbound shipping) × 100
- Max store price = Max buy cost for 30% ROI ÷ (1 + Sales tax %)
Example
A $12.99 clearance toy reselling at $34.99 nets about $9.50, roughly 63% ROI.
Frequently asked questions
Should I include sales tax?
Yes unless you have a resale certificate accepted by the store. Tax is a real part of your cost basis.
What ROI do RA sellers target?
Most look for at least 30–50% ROI and a minimum of $3–5 profit per unit so that small errors do not erase the gain.
Does the calculator include the Amazon storage fee?
Yes if you enter it or give dimensions; RA items usually sell fast so it is small.