RA – Retail Arbitrage

Definition updated on November 2023

What is RA (Retail Arbitrage) and how does it play a role in e-commerce strategies?

Retail Arbitrage (RA) is a business strategy where an individual or company buys products from physical retail stores and then sells them at a higher price, usually on online marketplaces. In the sneaker resell world, this would involve purchasing sneakers from brick-and-mortar stores (like clearance sales, outlet stores, or even regular retail stores) and then selling them on platforms like eBay, StockX, or GOAT. The profit comes from the difference between the discounted in-store price and the higher online resale value. The process often involves scouting multiple stores, hunting for deals, and having a deep understanding of the sneaker market to identify shoes that will yield a good profit margin. Factors like brand, rarity, demand, and condition play significant roles in determining the resale value of a sneaker. Successful retail arbitrage in the sneaker industry requires a combination of market knowledge, research, and sometimes a bit of luck in finding those hidden gems in retail stores. While this method can be lucrative, it's also time-consuming and requires an initial investment in inventory, with no guaranteed returns. As such, it's essential for those engaging in RA to stay updated on sneaker trends and demand.

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