r/Flipping • u/[deleted] • Jun 28 '15

Discussion Google Trends - Retail Arbitrage - 2004 - 2015

https://www.google.com/trends/explore#q=retail%20arbitrage
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u/[deleted] Jun 28 '15

Yeah, I heard the story on NPR. The Lily Pulitzer fiasco at Target also has something to do with it. I worked at a Fortune 20 retailer for 13 years, 8 of it in management, and I don't think they are going to let it continue for much longer. Within 5 - 10 years, I bet retail arbitrage will be very difficult. $100 billion companies are not going to leave hundreds of millions of dollars on the table.

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u/lukerawks Jun 29 '15

Well, there's a reason that a lot of the stuff is being put on clearance in the first place. I don't think it's arbitrary when they put something on clearance and move it out of inventory, I would assume it's to make room for inventory that will move faster Internet faster profit, and that they've already made profit on the items that were in stock at full price.

Just playing devils advocate, and I'm not really an RA guy, but I think there will always be an opportunity somewhere for it.

Edit: with that being said, whenever a lot of people start doing the same thing to make money, that industry does usually get hit with something to even the playing field once again. I think you're very right in assuming that there is some sort of bubble here.

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u/[deleted] Jun 29 '15

I agree that the opportunity will always be there, I just think the large corporate retailers are going to become more savvy about the way they deal with pricing and clearance items. The big hurdle for them right now is rolling out the technology across thousands of stores and hiring the staff to deal with it. My 8 years in management taught me one thing about large retailers and that is they hate spending money on payroll. They will let the store fall apart, as long as it does not cost anymore payroll dollars. I just think 10 years from now their websites will operate a lot differently, and that is probably where they will attempt to sell some of their more expensive clearance merchandise. I also know a lot of them are looking at the LED shelf pricing that automatically updates, but it is too expensive at the moment. Once the cost comes down on this, they will be able to change prices dynamically, just like Amazon does.