Updated: Mar 10, 2021
Globalization has provided a myriad of ways to profit and make consistent money. The most obvious ways are by importing/exporting goods and of course, dropshipping. In fact, we earlier wrote how you can create a passive income stream by dropshipping vastly cheaper Chinese products from Alibaba to American consumers at higher prices. However, what if you could "dropship" more than just physical goods on the international stage? With Fiverr, you can easily hire skilled designers, writers, developers, etc. from around the world at steep discounts, then sell what they've made for profit to American consumers. I like to call this "Sweat Equity Arbitrage." Read on to understand this opportunity better.
Fiverr is the Alibaba of Freelance Services
Alibaba became a beast of a company by tapping into the global market. Due to less expensive labor, electricity and overhead, China produces goods at vastly cheaper prices than American manufacturers. Because of this, many American merchandisers have their products and parts made in China. Alibaba and Aliexpress act as a gateway between buyers and Chinese manufacturers.
Fiverr acts in much the same way as Alibaba, except instead of physical goods, they sell freelance services for anything that requires a computer. This includes anything you can think of, such as logo designers, animators, app developers and much more. In addition, they are completely international. Their freelancers are located anywhere from Houston to Sri Lanka to Bangladesh to the United Kingdom and more. Where they reside has nearly everything to do with how much they price their services. But since I started using Fiverr, I've managed to get a logo done for $20, a book cover for $17.50 and even SEO work to attract readers for just $10.
How Fiverr Works
Fiverr is by far the world’s largest marketplace for digital services. Their platform streamlines transactions between buyers and the talented sellers offering their services- often called 'Gigs'. When creating their Gigs, sellers can choose their starting price, and even offer 'Gig packages.' With these packages, sellers can offer customers a myriad of tailored services at varying prices. This enables extra options for buyers when trying to figure out how to fulfill their needs. Signing up with Fiverr is quite simple and free. You must register if you'd like to use their services. When you do sign up, it will default to a buyer's account. If you do want to become a freelancer and sell your services, you'd have to follow an extra set of instructions.
Sweat Equity Arbitrage
For those of you not in the know, an arbitrage is the simultaneous buying and selling of assets in generally any market. When an arbitrage opportunity presents itself, one can take advantage of differing prices for the same asset. Why not do that for freelance services?
For instance, about a year ago, I started a website that offered services in AI development. This included Python coding and robotics programming. I would charge American customers hundreds if not thousands of dollars to manage their projects. This included outsourcing most of the coding tasks to coders I'd find on Fiverr. In turn, they would charge me only a fraction of what an American coder would.
So the customer pays me $500 for a project. I outsource to Fiverr, where a freelancer charges me $50. I pocket $450.
Not bad! Of course, it helped that I was a certified data scientist, which made it easier for me to 'quarterback' these projects and make sure these coders did their work as customers requested.
Freelance Services Available on Fiverr
To list all the freelance services available on Fiverr would be beyond the scope of this article. Instead, I've listed five of the best ideas for arbitrage. These are highly coveted gigs, in which a treasure trove of talent exists on Fiverr capable of doing them.
1) E-Commerce. Entails the activity of buying or selling products over the Internet. Gigs offered on Fiverr include e-commerce marketing, development and more.
2) Short Video Ads. Entails online display advertisements that include video content. Gigs offered on Fiverr include making youtube videos, animated videos, instagram and more.
3) Website Development. Entails developing simple websites, web-based Internet applications, electronic businesses, and social network services. Gigs offered on Fiverr include design customization, content uploading, using Squarespace and much more.
4) SEO Services. SEO refers to search engine optimization, which is the process of improving traffic to a website from search engines like google. SEO targets unpaid traffic rather than direct traffic or paid traffic. Gigs offered on Fiverr include improving SEO in technology websites, health and wellness, business and much more.
5) Website Design. Includes many different skills and disciplines in the production and maintenance of websites. Fiverr's gigs include many different areas of web design including web graphic design, user interface design, authoring, email templates, landing pages and mobile apps.
Why are the Services so Cheap?
I often get asked this question. However, the truth is more complicated. It's not just that overseas products and services are cheaper. It's also the fact that goods are just that expensive. We have been conditioned to accept the prices we pay here in the U.S. But those prices include much more than manufacturing costs. It also includes advertising and marketing to create that “I gotta have that!” American culture that enables coveted products to go viral.
For instance, most of us have no quibble about walking into our favorite department store to purchase a designer watch for over $250, though it was made in China for the wholesale price of $15. Same thing goes for Victoria Secret bras, dress shirts, designer shoes and especially electronics like our iPhones.
So perhaps the more appropriate question is why are cheaply made products from overseas so expensive in the United States? Perhaps this might explain why so many Americans are rich in material goods, but are actually cash poor.