Amazon.com (AMZN) Sees Boom in Sellers as Wal-mart (WMT) Streamlines Operations

Amazon.com (Nasdaq: AMZN) slumped late last week following its recent earnings release, though the company could see benefit in subsequent quarters as one retail giant consolidates.

The WSJ noted late last Friday that Wal-mart (NYSE: WMT) closed around 150 U.S. locations last month as online competition increases. Coincidentally, Amazon is seeing an influx of sellers looking to capitalize on retail arbitrage.

Retail arbitrage happens when one retailer is selling goods for a discount due to something like a store closing, then enterprising shoppers scoop-up the discounted goods to sell on another platform. In this case, that platform is Amazon.

Wal-mart has offered discounts as much as 50 to 75 percent as it moved to close certain locations.

Sellers can send goods to Amazon, which offers warehousing and shipping for a fee and percentage of each sale.

While retail arbitrage isn't limited to store closings, it is an example of how competition can be both good and bad. Wal-mart wants to sell goods cheaper than competitors to lure in crowds, but items that sell for a certain price in one market, might be a bargain to someone in another market that has a higher cost of living.

Shares of Amazon are down 2 percent.

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