Ethics in Arbitrage
Ran across this article about a person bragging on social media (TT) with a video of them buying all of the stock on hand for a cookware set that Walmart had on clearance.
Is what this person did/does (aka “arbitrage”) ethical?
When you think about it, how is that any different than what Meh/Mercatalyst does?
I honestly didn’t get the shade thrown towards the person. It wasn’t like they were buying all of Walmart’s clearance stock nationwide and that others couldn’t do the same in their local stores. Which is pretty much what Meh does every day.
If your WM was the same as the person in the article, then yeah, I can see the shade as really just entitled jealousy because they found the deal before you did and you’re not entitled to jack squat. (I’m using the generic “you”, not the specific “you”, dear gentle reader).
Also, the haters don’t mention carrying costs now that this person has all of this clearanced inventory in their stock instead of Walmart’s. There’s a reason WM had it on clearance. It wasn’t selling and they weren’t going to sink any more costs, including shelf space, on an item that isn’t selling through enough to keep it in stock (and therefore keep generating positive cash flow for WM).
Arbitrage is not a risk-free profitable business, no matter what @snapster says…
Just some food for thought and discussion.
We’re all here because we’re mostly receiving the benefits from Meh’s arbitrage at scale. It occurred to me that the ethics of the industry at the large scale operations Meh, Woot, resale stores, etc. seem to be comfortable to people, but at the individual proprietor or “side hustle” scale, it turns into something capricious and taking advantage of people. That just seemed like a dissonance to explore why that is.
It’s OK for a company to do it, but not a person? But aren’t companies people? According to the Supreme Court the people we elected to Congress said so.
Discuss. Or brag about your latest successful arbitrage hustle. I hear some people are parting out IRKs for resale, and IMO, good on them! Not mad because I didn’t think of it first. Why would I?
- 13 comments, 56 replies