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I beg to disagree, and here's why: (Not saying the guy isn't scum, but I think his statement is plausible...) He didn't just start doing this last week. This s

I beg to disagree, and here's why: (Not saying the guy isn't scum, but I think his statement is plausible...) He didn't just start doing this last week. This so-called "retail arbitrage" is a normal thing throughout online marketplaces, and has been for years. Sometimes, someone (like me, as a consumer) won't feel like going to the store, and will happily pay ten bucks for what's usually a three-dollar item, because it's shipped to my door. FedEx is the real winner, but guys like this are making a living enabling my laziness. In other situations, a product will be weirdly short in one part of the country, but available elsewhere. For instance, in a hurricane, a bunch of unprepared people suddenly decide they want some product, but the local stores are sold out. There's lots of that product _already sitting on shelves_ elsewhere in the country. Those retailers aren't going to pull it themselves and shove it backwards up the distribution chain to be redistributed to storm country -- that's just not how distribution works. So, folks like this will go buy it, off the shelf, and offer it online. Where again, someone decides it's a better option than going to the store. And the guy doing the shipping is doing real work, I don't see anything wrong with him putting food on his table with it. In all these cases, the retail-arbitrage folks aren't depriving anyone of anything. They're not clearing out the last of anything, and the stores they shop usually do restock the next day, because their local distributor has plenty of product. This time was different, and that's obvious to everyone now. But I do find it at least half-plausible that this guy might not have been thinking of it as different. It looked, from his view, just like every other opportunity where he's been making money the last several years, and which hurt nobody.

smnrchrds 7y ago
This is the answer. NPR Planet Money did an episode on this a while ago, long before there were any real or perceived shortages of any goods. Even in good times, this strategy tends to work: > Sam Cohen's business works like this: He walks into a big retail store and buys a bunch of stuff. Then he sells it on Amazon for more. It's straightforward and surprisingly lucrative. > This is a multimillion-dollar business for Sam — and for lots of other people who do the same thing. It's called retail arbitrage... https://www.npr.org/sections/money/2017/07/26/539552579/episode-629-buy-low-sell-prime https://www.npr.org/sections/money/2017/07/26/539552579/epis...
- tartoran 7y ago
  Why not buy it directly from the supplier? Why pay tax and a mark-up when it can be obtained for a similar price the department store got it for??
  - danhak 7y ago
    Small-time individuals don’t get the same sorts of deals as major retailers.
    - refurb 7y ago
      Exactly. And many manufacturers will have minimum purchases, i.e. you need to buy a pallet of these, we won't sell them individually.
  - smnrchrds 7y ago
    I am not sure if manufacturers will be open to selling directly to someone who is not buying a large enough quantities. But even if they are, they probably won't sell them to retail arbitragers. I cannot remember if it was from the same episode or another Planet Money episode, but I remember them talking to manufacturers who were unhappy with their products being sold online for prices much different than they intended to. The gist of it is that, if you are for example Coca Cola, you want people to think of your products as an everyday item they can drink anytime, not a luxury to be saved for special occasions. And if you are Apple, you won't want your product to end up in the bargain bin. Pricing is part of a brand's marketing strategy and identity. People who price products way out of the range the manufacturer envisioned are detrimental to their brand image and long-term market share.
    - mooreds 7y ago
      It wasn't until the 1970s (in the USA) that retailers could determine the price of goods in their store. Before then manufacturers could dictate the price of their goods (laws protected that). So retailers competed on other dimensions (service, location) rather than price. I learned this (and a lot more) from "Goliath": https://www.simonandschuster.com/books/Goliath/Matt-Stoller/9781501183089 https://www.simonandschuster.com/books/Goliath/Matt-Stoller/...
inferiorhuman 7y ago
He didn't just start doing this last week. ' Yes, he did. Previously he had been reselling non-essential things that weren't in particularly high demand. Selling something that people are panicked about is new. Hell, in one breath he talks about the insane prices he was getting for hand sanitizer and in the next he talks about how his markup is justified. He knew exactly what he was doing.
- randallsquared 7y ago
  > > He didn't just start doing this last week. ' > Yes, he did. Previously he had been reselling non-essential things that weren't in particularly high demand. Selling something that people are panicked about is new. That was a neat switch you did there. I started to write an elaborate analogy about someone running through an in-use batting cage, but you get the idea.
mulmen 7y ago
> Those retailers aren't going to pull it themselves and shove it backwards up the distribution chain to be redistributed to storm country -- that's just not how distribution works. Cross docking is exactly this and is common in supply-chain logistics, most famously at WalMart. https://en.wikipedia.org/wiki/Cross-docking https://en.wikipedia.org/wiki/Cross-docking
ajross 7y ago
The practice has existed forever. But the quantity and the product rule out "this is just what he does" as an explanation. He bought tens of thousands of sanitation items from states across the midwest in one road trip! He knew what he was doing, and why.
brown9-2 7y ago
I suggest reading the original article: > But what about the morality of hoarding products that can prevent the spread of the virus, just to turn a profit? > Mr. Colvin said he was simply fixing “inefficiencies in the marketplace.” Some areas of the country need these products more than others, and he’s helping send the supply toward the demand. > “There’s a crushing overwhelming demand in certain cities right now,” he said. “The Dollar General in the middle of nowhere outside of Lexington, Ky., doesn’t have that.” > He thought about it more. “I honestly feel like it’s a public service,” he added. “I’m being paid for my public service.”
- austhrow743 7y ago
  Your quoted information supports that comment not refutes it.
dillonmckay 7y ago
See how much Excedrin Migraine is going for on eBay now?
baddox 7y ago
> Those retailers aren't going to pull it themselves and shove it backwards up the distribution chain to be redistributed to storm country -- that's just not how distribution works. Why isn’t that exactly how FEMA or similar agencies work?
deleted 7y ago
[deleted]

smnrchrds 7y ago

This is the answer. NPR Planet Money did an episode on this a while ago, long before there were any real or perceived shortages of any goods. Even in good times, this strategy tends to work: > Sam Cohen's business works like this: He walks into a big retail store and buys a bunch of stuff. Then he sells it on Amazon for more. It's straightforward and surprisingly lucrative. > This is a multimillion-dollar business for Sam — and for lots of other people who do the same thing. It's called retail arbitrage... https://www.npr.org/sections/money/2017/07/26/539552579/episode-629-buy-low-sell-prime https://www.npr.org/sections/money/2017/07/26/539552579/epis...

tartoran 7y ago
Why not buy it directly from the supplier? Why pay tax and a mark-up when it can be obtained for a similar price the department store got it for??
- danhak 7y ago
  Small-time individuals don’t get the same sorts of deals as major retailers.
  - refurb 7y ago
    Exactly. And many manufacturers will have minimum purchases, i.e. you need to buy a pallet of these, we won't sell them individually.
- smnrchrds 7y ago
  I am not sure if manufacturers will be open to selling directly to someone who is not buying a large enough quantities. But even if they are, they probably won't sell them to retail arbitragers. I cannot remember if it was from the same episode or another Planet Money episode, but I remember them talking to manufacturers who were unhappy with their products being sold online for prices much different than they intended to. The gist of it is that, if you are for example Coca Cola, you want people to think of your products as an everyday item they can drink anytime, not a luxury to be saved for special occasions. And if you are Apple, you won't want your product to end up in the bargain bin. Pricing is part of a brand's marketing strategy and identity. People who price products way out of the range the manufacturer envisioned are detrimental to their brand image and long-term market share.
  - mooreds 7y ago
    It wasn't until the 1970s (in the USA) that retailers could determine the price of goods in their store. Before then manufacturers could dictate the price of their goods (laws protected that). So retailers competed on other dimensions (service, location) rather than price. I learned this (and a lot more) from "Goliath": https://www.simonandschuster.com/books/Goliath/Matt-Stoller/9781501183089 https://www.simonandschuster.com/books/Goliath/Matt-Stoller/...

inferiorhuman 7y ago

He didn't just start doing this last week. ' Yes, he did. Previously he had been reselling non-essential things that weren't in particularly high demand. Selling something that people are panicked about is new. Hell, in one breath he talks about the insane prices he was getting for hand sanitizer and in the next he talks about how his markup is justified. He knew exactly what he was doing.

randallsquared 7y ago
> > He didn't just start doing this last week. ' > Yes, he did. Previously he had been reselling non-essential things that weren't in particularly high demand. Selling something that people are panicked about is new. That was a neat switch you did there. I started to write an elaborate analogy about someone running through an in-use batting cage, but you get the idea.

mulmen 7y ago

> Those retailers aren't going to pull it themselves and shove it backwards up the distribution chain to be redistributed to storm country -- that's just not how distribution works. Cross docking is exactly this and is common in supply-chain logistics, most famously at WalMart. https://en.wikipedia.org/wiki/Cross-docking https://en.wikipedia.org/wiki/Cross-docking

ajross 7y ago

The practice has existed forever. But the quantity and the product rule out "this is just what he does" as an explanation. He bought tens of thousands of sanitation items from states across the midwest in one road trip! He knew what he was doing, and why.

brown9-2 7y ago

I suggest reading the original article: > But what about the morality of hoarding products that can prevent the spread of the virus, just to turn a profit? > Mr. Colvin said he was simply fixing “inefficiencies in the marketplace.” Some areas of the country need these products more than others, and he’s helping send the supply toward the demand. > “There’s a crushing overwhelming demand in certain cities right now,” he said. “The Dollar General in the middle of nowhere outside of Lexington, Ky., doesn’t have that.” > He thought about it more. “I honestly feel like it’s a public service,” he added. “I’m being paid for my public service.”

austhrow743 7y ago
Your quoted information supports that comment not refutes it.

dillonmckay 7y ago

See how much Excedrin Migraine is going for on eBay now?

baddox 7y ago

deleted 7y ago

[deleted]