Arbitrage Calculator

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Arbitrage Calculator
Retail / E-commerce ArbitrageSimple Price Difference
Results:
Net Profit:$ 0.00
Return on Investment (ROI):0.00%
Profit Margin:0.00%
Enter values and click Calculate to see results
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";stepText+="1. Gross Revenue: $"+sell.toFixed(2)+"
";stepText+="2. Cost of Goods: -$"+buy.toFixed(2)+"
";if(type==='retail'){stepText+="3. Marketplace Fees ("+feeP+"%): -$"+feeVal.toFixed(2)+"
";stepText+="4. Shipping/Misc: -$"+ship.toFixed(2)+"
";}stepText+="Net Profit: $"+netProfit.toFixed(2)+"";bDiv.innerHTML=stepText;bDiv.style.display='block';}else{bDiv.style.display='none';}document.getElementById('placeholder').style.display='none';document.getElementById('answer').style.display='block';}

Arbitrage Calculator Use

An arbitrage calculator is an essential tool for resellers, investors, and traders looking to capitalize on price discrepancies between different marketplaces. Whether you are performing retail arbitrage (buying from local stores to sell on Amazon) or online arbitrage (buying from one website to sell on another), knowing your exact net profit after all expenses is critical to your success.

This calculator allows you to quickly determine if a potential flip is worth your time and capital. By factoring in marketplace fees and shipping costs, you avoid the common trap of seeing a "gross profit" that evaporates once the platform takes its cut.

Buy Price (Cost)
The amount you paid for the item, including any sales tax or sourcing costs.
Sell Price (Revenue)
The final price the customer pays on the destination marketplace.
Marketplace Fees
The percentage taken by platforms like Amazon (usually 15%), eBay, or Poshmark.
Shipping & Misc
Packaging materials, labels, and the actual postage cost to send the item.

How It Works

The arbitrage calculator uses standard accounting principles to find your bottom line. To find the net profit, the calculator subtracts all variable and fixed costs from the total revenue. The formula for retail arbitrage is:

Net Profit = Sell Price – Buy Price – (Sell Price × Fee %) – Shipping Costs

  • ROI (Return on Investment): Calculated as (Net Profit ÷ Buy Price) × 100. This tells you how efficiently your capital is working.
  • Profit Margin: Calculated as (Net Profit ÷ Sell Price) × 100. This tells you what percentage of your total sales is actual profit.
  • Break-even Point: The price at which you must sell the item to recover all costs without making a profit or loss.

Arbitrage Calculation Example

Scenario: You find a popular toy at a local retail store on clearance for $12.00. You check Amazon and see the current "Buy Box" price is $35.00.

Step-by-step solution:

  1. Buy Price: $12.00
  2. Sell Price: $35.00
  3. Fees (15%): $35.00 × 0.15 = $5.25
  4. Shipping: $4.50 (estimated shipping to customer or FBA warehouse)
  5. Calculation: $35.00 – $12.00 – $5.25 – $4.50 = $13.25
  6. Result: Net Profit = $13.25, ROI = 110.4%, Margin = 37.8%

Common Questions

What is a good ROI for arbitrage?

Most professional resellers aim for a minimum of 30% to 50% ROI. However, for fast-turning items that sell within days, a lower ROI might be acceptable. For slower-moving items, you generally want a higher ROI (100%+) to compensate for the time your capital is tied up.

Do I need to include sales tax?

Yes. If you do not have a resale certificate and you pay sales tax at the retail store, that tax must be added to your Buy Price. Even a 7-8% tax rate can significantly eat into your arbitrage margins if not accounted for in your arbitrage calculator inputs.

Difference between Retail and Online Arbitrage?

Retail arbitrage involves visiting physical stores (like Walmart or Target) to find deals. Online arbitrage involves sourcing from websites. The math remains the same, but online arbitrage often involves higher shipping costs (to you) or shipping lead times that can affect price volatility.

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