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MineralMan

(146,321 posts)
Sun Feb 17, 2019, 04:40 PM Feb 2019

While I'm talking about Amazon, here's another story.

A few years ago, I installed a chain link fence around my back yard. It was hard work. I didn't enjoy it, but doing the installation myself saved over $1000, and that made it worthwhile.

I created a complete parts list for that fence so I could buy everything I needed for the installation. To my surprise, I had to visit two separate Home Depots to fill that list. I never did figure out how they could sell all the stuff for chain link fences, but be out of stock of some essential components. Somewhere, there is an inventory system that just doesn't work properly. But that's another story.

Anyhow, my fence design required one unusual part. I needed a gate latch that attached to an existing wall, rather than to an end post. I was putting in a gate at the corner of the garage, and it had a concrete apron that kept me from digging a post hole there. I knew that such a part existed, because I had seen it listed among chain link components.

Nobody had one. Not in the entire Twin Cities Metro Area. I know, because I called every hardware store, home supply business and even all of the fence companies. The fence companies knew what I was talking about, but nobody had one.

So, I went on Amazon, typed in the description of the part, and sure enough, there it was. Some Amazon third-party seller in Kansas had it listed and showed it in stock, so I ordered it. It was twice the price I though it would be. But at $10, I didn't care. I also paid for FedEx overnight shipping, which was more than the cost of the part. An hour later, I got an email showing that it had been shipped, and it arrived the next day, just in time to finish up the installation.

Out of curiosity, I called the seller on the phone. I gave him the short story of my search for that part and asked him why he, a small town fence company in Kansas had the part, when nobody else did. Here's what he told me.

He said that he stocked every obscure chain link fence part he could find. Then, he listed them all on Amazon, as a third party vendor. He said that he had every conceivable part anyone would ever need, in all sizes and kept at least six of them on hand at all times. He told me that it was tough making a living building fences in Kansas, and that he had started selling unusual parts on Amazon as a way to make extra money. He explained that he shipped dozens of parts a day, all over the country, most of them overnight shipments on FedEx.

He said, and I paraphrase, "I charge a 100% premium for keeping all that odd stuff around, and everyone who looks on Amazon or Google for something hard to find, I have it, so everyone orders from me. I'm just about out of the business of building fences now. I make more selling junk that nobody can find than I was making building fences, and all I have to do is put the thing in a box and ship it. You might be surprised to know that there are several hundred items like that. Odd sizes, specialized latches, brackets, braces, and other weird hardware pieces that aren't needed on most fence jobs. I have them all, and Amazon lets me reach everyone who knows what to search for."

Amazon's huge reach and audience gives this guy a new way to make a living. People don't even have to search on Amazon, either. Specific Google searches will find his stuff and lead people to Amazon. This guy in Kansas found a way to make Amazon work for him, rather than the other way around. I learned something from that guy. I suspect there are others like him out there, making Amazon work for them.

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Demovictory9

(32,467 posts)
1. i'm glad a small business person is able to make a living through amazon. ebay is similar by the way
Sun Feb 17, 2019, 04:46 PM
Feb 2019

you can find obscure stuff on ebay too

MineralMan

(146,321 posts)
3. That's true. And I've used ebay like that a lot.
Sun Feb 17, 2019, 04:54 PM
Feb 2019

I just found it interesting that some guy in Kansas found a new way to do business because of Amazon. If I were a younger guy, I think I'd probably be looking for just such an opportunity in some obscure area. It might be fun way to be a solopreneur, something I've always done anyhow.

The cool thing is that the guy doubles the price and nobody cares. They need the piece. That more than covers the cost of doing business on Amazon. But it takes something really obscure to make that business model work.

MineralMan

(146,321 posts)
5. My pleasure. I'm always interesting in ways people find
Sun Feb 17, 2019, 05:06 PM
Feb 2019

to make a living that aren't ordinary. For about 6 months, I had a business that made custom doghouses for people who lived in expensive houses. It was pretty cool. I built them to match the style of their house, and could build in all sorts of features, like automatic heaters and water dispensers, if the buyer wanted to spend the money. I stopped doing it because I found another business that wasn't so much work.

There are a million things people can do for a living.

OnDoutside

(19,964 posts)
6. My brother uses Amazon as his first port of call for purchasing materials for the house he is
Sun Feb 17, 2019, 05:09 PM
Feb 2019

renovating for sale. He can get a lot of stuff that is fine but was returned for various reasons, and so is heavily discounted. He was adding a deck at the back of the house and one of the items he got a few reels of steel cable which was 20% of the price you would pay in Home Depot etc.

guillaumeb

(42,641 posts)
7. And on the other side,
Sun Feb 17, 2019, 05:29 PM
Feb 2019

we have a greedy billionaire demanding corporate welfare before he locates in an area.

And the taxes that billionaire Bezos does not pay will be paid by American working families. It is called externalizing the costs of doing business. I suggest that you Google that phrase.

Here, allow me to do it for you:

Cost externalizing is a socioeconomic term describing how a business maximizes its profits by off-loading indirect costs and forcing negative effects to a third party. An externalized cost is known to economists as a negative externality.


https://en.wikipedia.org/wiki/Cost_externalizing

And we have the many thousands of low wage, part time workers who often qualify for State and Federal benefits as a result of the low pay and part time hours that [plantation owner Bezos gives to them.

More externalizing of costs. And informed progressives should be aware of these tendencies by capitalists to push their own costs to the workers.

So in balance, these tiny supposed benefits come at a very high cost.

Nice little story though.

MineralMan

(146,321 posts)
9. Yes, and so, the guy in Kansas shouldn't do what he does?
Sun Feb 17, 2019, 05:32 PM
Feb 2019

I fail to see the relevance of your post to mine. You appear to be conversing with yourself.

guillaumeb

(42,641 posts)
10. You almost appear to be trying to promote a predatory model of capitalism.
Sun Feb 17, 2019, 05:34 PM
Feb 2019

If you fail to see the relevance, I suggest that you read my entire post, and Google the term.

guillaumeb

(42,641 posts)
12. Sometimes people make up their minds based on incomplete information.
Sun Feb 17, 2019, 05:44 PM
Feb 2019

And relying on that technique can lead to a failure to see the entire picture.

If you do not care about Bezos externalizing his costs onto US working families, that is your affair.

guillaumeb

(42,641 posts)
8. More:
Sun Feb 17, 2019, 05:32 PM
Feb 2019
Externalized costs are costs generated by producers but carried by society as a whole. For example, a factory may pollute water by dumping waste in the river without paying for it. Fifty kilometers downstream, the local government has to clean the water to use it as drinking water. Those costs are caused by the factory, but the factory does not pay them; the local government does. That's what we call externalized costs. Externalizing costs means companies show higher profits, but society is paying for them. Underpaying employees, leading to poverty and associated problems, is another example. The current shareholder and finance models reward companies for externalizing costs.




https://www.natureandmore.com/en/true-cost-of-food/what-are-externalized-costs

"Externalized costs are costs of production that someone else pays. For example, one reason vegetables from California's Central Valley are cheaper to buy in Pennsylvania than local produce is that they don't reflect their full cost. Since producers are not liable to pay the current and future costs of aquifer depletion, pesticide poisoning, soil salinization, and other effects of their farming methods, these costs do not contribute to the price of a head of lettuce. Moreover, the cost of trucking produce across the continent is also highly subsidized. The price of a tank of fuel doesn't include the cost of the pollution it generates, nor the cost of the wars fought to secure it, nor the cost of oil spills. Transport costs don't reflect the construction and maintenance of highways. If all these costs were embodied in a head of lettuce, California lettuce would be prohibitively expensive in Pennsylvania. We would buy only very special things from faraway places.


http://wiki.p2pfoundation.net/Externalization_of_Costs
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