Comment by nomadomatic | Hacker News Reader

Comment by nomadomatic | Hacker News Reader

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It’s unlikely Priceonomics could build a massively successful business arbitraging used goods if we have to take possession of them.

Did you consider letting the buyers and sellers do the leg work?

Setup a distribution center. Sellers who want to offload stuff scan the items and their details to you and you give them instant, fair quotes. If they like your offer, they bring the items to your center, and you check to make sure everything is as it was stated.

You put the items, their details and their new prices (with your margin markup) online for buyers to peruse. If interested, they'll come by and pick up whatever they want.

Like an online pawn store w/ local centers, except there's no pawning, just selling & buying.

This sounds more or less like a consignment store and pretty much what the amazon marketplace does, but with the work done by a middle man instead. The question is, would people be willing to put up with the higher price or reduced profit required by adding a middleman, or would someone always undercut you because they were willing to go straight to the consumer? It reminds me of all those "ebay shops" that popped up 5 years ago and just as quickly disappeared, though this could be as much about ebay changing their focus as any business pressures, I don't know enough about it to say.

With a consignment store the model works because you are willing to take the reduced profit to not have to put in the actual leg work it would require. People are also willing to pay the slightly higher prices because consignment tends to be in things like clothes that are difficult to buy online.

Pawn shops make all their money on the interest on the loans. The buying and selling of goods is really the side line lower-profit leader to get people in the door. Most of the items for sale as just items that the owner failed to collect.

There is a world of difference between a straight 2nd hand goods dealer and a pawn shop. Most of that difference is in the profit margin.

There are people offering these services, for example Ebay has a Trading Assistant program.

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