3 ms·
Reselling at higher price is only profitable if the original seller are selling at a price that is too low because they failed to raise the price properly, and
by devit 6y ago
Reselling at higher price is only profitable if the original seller are selling at a price that is too low because they failed to raise the price properly, and in that case the resellers are correcting the prices.
The advantage of having higher prices is that only people who REALLY need an article will buy it, so limited supplies will go to them.
For instance, if FFP2 masks are in a limited supply and cost $0.01 each, then everyone is going to try to buy in lots of 1000, and they will run out immediately, with the supply going to random people who probably will not even use most of them.
But if FFP2 masks cost $100 each, then people will buy and use them only when strictly needed, and they will be available for those who absolutely need them and are thus willing to pay any amount of money.
The only problems are:
- People who irrationally try to price gouge when the price is already correct, costing themselves money and making the article unavailable
- The potential inability of people who are highly needy to obtain loans or have sufficient basic income to purchase high-priced supplies
The former is fixed by providing the forecasts that are used to set prices, thus providing a credible insight that there will be no shortage at current prices, while the latter by having better ways of ensuring that loans are repaid and generally making it easier to give out loans.