Christmas is next week. Are you done with your shopping, particularly you parents/guardians shopping for your kids’ toys? I don’t know if you’d want to use Amazon or their independent sellers. That’s because Amazon pumps Christmas toy prices.
Well, at least they give independent sellers the okay to do so. Take a man named Jim Sheppard from the greater Cincinnati/Northern Kentucky area. He bought the Disney Frozen Castle & Ice Palace Playset. It’s one of the most popular toys from one of the most popular movie franchises of all time. He bought it from a store for $119. He sold it through Amazon for $250. The official name of this tactic is called retail arbitrage: buying a product from a physical store and selling it at a much higher price. Mr. Sheppard isn’t alone. Around 40% of all Amazon deals are made by independent sellers. Many of these sellers practice retail arbitrage. This practice is especially popular around the holiday season, as the more popular toys get sparer and sparer. Remember the 1990s, when Tickle Me Elmo sold for over $1,500?
Does retail arbitrage work? You bet it does. Is it ethical? To each his own. But you must admit, it’s a profitable business tactic, and this is the right time to do so. Be honest. If your kid wanted that special toy, wouldn’t you pay extra for it? Or if you bought a present that nobody wanted, and you sold it online. Would you be tempted to pump up the price some, especially if that present is in high demand? But if you’re going to buy, let it be your last resort. This is why I like to check small businesses first to see if they have the present. And check many stores before going to Amazon for a better price. And if you have to use a certain chain store that I loathe, then, well, it’s Christmas, right?