What do you think about "service arbitrage"

8 replies
I've bought a couple of WSO's within the last few months that essentially talk about "Service Arbitrage" deals... where you go to sites like Fiverr and buy gigs for $5, then re-sell them on other sites for a higher price.

For example I list a job on Elance.com for a well written article on any topic of your choice for $10... then when I make the sale, I go to Fiverr.com and find somebody to write it for me, then I make $5 in the process.

Doesn't seem like a "long term" business idea, but it could possibly work to make some quick cash. Just wondering if anyone has tried this... and also wondering if it's really ethical or not?
#service arbitrage
  • Profile picture of the author niffybranco
    Why don't you see it as a long term business ? Is that not what most companies do , hire staff , pay them peanuts and charge clients a premium service ?
    {{ DiscussionBoard.errors[9486496].message }}
  • Profile picture of the author CAmarketing
    Because I think it borders on the line between being ethical & unethical... not sure I'd WANT to make this a long term business practice.

    Re-selling others hard work at a premium price... seems a little "shady" to me. But Idk I was curious to know what you guys thought about it!
    {{ DiscussionBoard.errors[9486503].message }}
  • Profile picture of the author niffybranco
    Well, you are not forcing them to sell their services for a fiverr so i do not see what is unethical about it , It is called business , buy low sell high .
    {{ DiscussionBoard.errors[9486506].message }}
  • Profile picture of the author CAmarketing
    What do you think about building a "portfolio" website... to "show off" your services. (That aren't yours though... they are your outsourcers...)
    {{ DiscussionBoard.errors[9486553].message }}
    • Profile picture of the author davidmac00
      CA,

      Good questions. For over a year I have been doing this.

      I started by making websites (Customised WP) for a few local businesses which I attracted offline. I then used images/ screenshots of these sites to promote my business.
      When orders came in I had already sourced some designers on PPH who would then go on to complete the orders. I would check and deliver.

      Basically I now have an agency using staff who are paid per job rather than hourly, which offers me the chance to profit from finding the customers. I add the screenshots of new designs as I go. This could be done for most jobs posted on fiverr or other service site.

      My "staff" are happy as they are getting paid work from my clients and I'm happy as I concentrate on selling which ends in payments for us all.

      Hope that helps to put your mind at ease.
      {{ DiscussionBoard.errors[9486638].message }}
    • Profile picture of the author Alexa Smith
      Banned
      Originally Posted by CAmarketing View Post

      What do you think about building a "portfolio" website... to "show off" your services. (That aren't yours though... they are your outsourcers...)
      Please understand clearly that I mean none of what follows as criticism/complaint or blame, in any way: it's intended only helpfully.

      I think it's probably the ninth or tenth completely new, different "business idea" you've come up with in the last month, and that whatever anyone here thinks about it, and whatever advice you receive about it, and whatever the realities of it, there isn't going to be a way for anything to prevent your coming up with an eleventh and a twelfth and a thirteenth completely new, different "business idea", none of which will or can be helpful to you until you're both willing and able to select one and reject/exclude all the others.

      When you look through those books of interviews with successful people, one of the very, very few striking things that all of them seem to have in common, whatever their background, whatever their business, is that they were all people who (for whatever reasons) were both willing and able to do something and "exclude other things".

      Concentrating on one thing really does involve "excluding other things".

      Achieving success is partly about one's ability to say "no".

      .
      {{ DiscussionBoard.errors[9486751].message }}
      • Profile picture of the author davidmac00
        Great advice from Alexa there^^^

        *awaits falling on deaf ears! *
        {{ DiscussionBoard.errors[9486767].message }}
  • Profile picture of the author M3C
    If services arbitrage is unethical a very significant portion of industries are hugely unethical for doing no more than adding value to a service.

    If a design company hires a freelancer to do some work on a project for a client and charges the client a fee over and above what they paid the freelancer, is that unethical?

    When somebody fits windows in your house and pays his workers less than he charges you - is it unethical?

    If you have built up a solid knowledge of great fiver gigs and can transfer those services to those looking for them on another website - that is not unethical.

    There's so much in the world of IM and out of it, that is unethical.

    Service arbitrage, is not one of them.

    Contrary to your stated position, services arbitrage is hugely scalable.
    {{ DiscussionBoard.errors[9486849].message }}

Trending Topics