Advantages and Disadvantages of Retail and Online Arbitrage
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Advantages of Retail and Online Arbitrage:
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Better profit margins than the other models
because we get products at exceptional rates.
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Low risk:
Getting the things at low rates, that can be sold anywhere if they didn’t sell according to the seller's plan.
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Easy to start:
No permissions or authorizations required in most cases!
Disadvantages of Retail and Online Arbitrage:
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Not a solid business:
There’s no consistency in this business, as we get products for the first time, we might not find that product again!
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No reputation
If a customer buys a product from our store, customers consider it just buying it from any random brand!
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No goodwill of the brand:
When we sell other brand products, we don’t make any goodwill, goodwill is just for the brand in this model.
What is meant by goodwill?
An intangible asset, which is a customer's confidence in any brand or personality, that is also a trust badge for the customer.
Goodwill helps in brand marketing, it also helps the brands in selling their new products, recurring sales, no objection to higher price, and much more.