Online classifieds website Gumtree says that arbitrage activity is gaining traction in South Africa, with some individuals, or ‘Super Users’, making a living entirely through this channel.<\/p>\n
Arbitrage is the practice of buying an asset a low price and then selling it for a higher price to a different market.<\/p>\n
Gumtree noted that the so-called eBay arbitrage phenomenon has been the subject of forums, economic articles and even academic papers for years – with individuals making a living by \u201cflipping\u201d goods they\u2019ve bought by using online classifieds and auction sites.<\/p>\n
And although it\u2019s a new phenomenon in South Africa, “there are a few individuals who are making a living entirely through online arbitrage,\u201d said Claire Cobbledick, head of marketing at Gumtree South Africa.<\/p>\n
\u201cThe majority of users are finding it an easy way to supplement their existing income, but we are becoming aware of increasing numbers of ‘Super Users’ that are buying and reselling large quantities of goods with increasing success.\u201d<\/p>\n
Gumtree cautions against some of the pitfalls of making arbitrage a full-time business. “It\u2019s not, however, a given that an item will be sold for profit. It takes practise and a good eye,”\u00a0Cobbledick said.<\/p>\n
\u201cYou don\u2019t find valuable items just lying around every day \u2013 you have to look for them. Secondly, you have to spend learning what the values really are. Just because something sold well once, doesn\u2019t mean it will sell well again.”<\/p>\n
Gumtree forms part of the eBay classifieds group. According to Alexa, <\/span>Gumtree is the 6th largest site in South Africa, reaching 18% of the population each month.<\/p>\n Over 600,000 live ads and 30,000 new ads are posted on the site each day.<\/p>\n The most common online scams on Gumtree<\/strong><\/a><\/p>\n Gumtree unclassified: 3 to 5 million monthly users strong<\/strong><\/a><\/p>\nMore on Gumtree<\/h3>\n