Arbitrage is the name given to the process wherein a person buys an item in one market and sells it in another to make a profit. This form of business has been happening since centuries when people used to sail overseas to places where a particular item was available for cheap and in plenty and later took them to another market where supply was scarce and demand was high. But then, with the coming of the internet revolution, everything has moved online and so has product arbitrage.

Product arbitrage on the internet gives us way too many advantages than its offline counterpart. You need not have any social skills to talk to people and make good deals when buying or selling goods, there is no travel involved no transportation of goods and no other inconveniences at all. You sit in front of your computer, identify online markets, buy for cheap and sell for more. Simple.

The online markets we are talking about here are 3 leading marketplaces on the internet: eBay, Amazon and Craigslist. eBay is an online auction website, Amazon is just an online store while Craigslist is the online home for classifieds ads. Just take a look at the various eBay auctions and you will see how little some things sell for there. For example, computer games sell at eBay at only a fraction of what they sell for at Amazon. This provides for excellent arbitrage opportunities. Similarly, craigslist too is an excellent seller's market since there are always people looking for a specific item there. The 'Want to Buy' section of craigslist is full of people looking to buy why you too are allowed to put up a 'for sale' listing there.

The key is to find auctions on eBay where you can buy stuff for cheap. There are many sellers who make basic mistakes when putting up an auction. A seller spells his product wrong which means nobody finds him through the search feature. Look out for such auctions as those are the ones that will sell for less. Many sellers also have a very poor sales copy due to which nobody gets interested in the auction. The idea is that you methodically rummage around eBay for such auctions, get a great deal for yourself, set right whatever the problem was with the listing and list it on Amazon or Craigslist for sale. Yet another strategy is to buy things for wholesale at eBay. There are a multitude of sellers selling, say, 20 jute bags at $20. You buy them, go to Amazon and advertise your jute bag at, say, 2 jute bags for $5. Sell them all and you have made a neat profit of $30. Not much but you can see how you could scale it up as it requires so less effort to be done.

In conclusion, as you have probably realized already, online product arbitrage can be a very profitable business with a little application. The simplicity of the whole thing is what stands out. With some shrewd buying and selling decisions and a few taps on your keyboard, you could on your way to making a steady income.