Now for what you have been waiting for. This is part 2 of a series on successful techniques used to make quick money. There are many ways to get rich very rapidly but I offer you an example below and some insights about what the wealthy know and have known for centuries.
We ended part one noting that anyone can have a great idea that could really be successful. The challenge is taking right action. Before you can act, you must know how to make your idea work. In this article, we discuss an actual working concept for recognizing profitable opportunities that has existed since humans began to use money.
What do wealthy people know about getting rich quick?
Arbitrage is a concept that you should learn more about. It is a word that circulates in financial circles and is therefore obscured to the average person as just some odd french word that stock market people use.
The truth is that arbitrage is the single biggest idea about wealth that you should understand. Doing an arbitrage deal is literally this: If I offered you 70 cents for your crisp clean dollar note would you take the deal? What if you had $100,000 and I had $75,000 and I said look, let me deposit this money into your account in exchange for your money? How would you feel about that?
Not very good at all, and I wouldn’t blame you. It isn’t a fair deal. Yet wealthy people do this every day, all day long.
The Secret of Arbitrage, and How it Works
How? Arbitrage, which deals with value and perceptions, bulk vs. unit sales, and wholesale over retail, vs. value based on straight pricing above cost. Arbitrage is the act of buying low and selling high in two different markets, exploiting the price difference between the two markets. Auctions exploit this pricing reality all the time. You might have also heard of the term “chatteling,” buying one person’s junk to sell to another for treasure. When you focus on arbitrage, you realize there are hundreds of ways that you can swap 70 cents for someone else’s dollar.
The wealthy have practiced arbitrage for as long as currency existed because arbitrage is the secret road to wealth. This secret is never openly talked about because it is so valuable. My little contribution here will do nothing to change that balance, but consider yourself fortunate to learn about this and maybe it will spur you on to take action for a new life.
Check out this real-world example
Here is a real world example of arbitrage I came across, as practiced many years ago by a wealthy man just when he was starting out broke, dejected, but hopeful.
One form of arbitrage is the concept of economies of scale. This arbitrage strategy relies on a single fact, when you buy something in bulk, you are entitled to and more often then not get a very large discount on your purchase. When this bulk amount is “split up” and re-sold in more popularly-sized units, your investment will return a decent profit.
So here is a get rich quick idea. One you can use right now to establish an income stream to replace your daily job. It can be reproduced and systematized to manufacture a very healthy income.
When you look at newspapers and other sources of local price lists, you will notice they follow this concept of economies of scale. Simply a small ad may cost $140 for example. But buy a full page and you only pay say $900. Why? because it’s less work for the publication to sell to one versus many so more profitable for them.
How to create your own marketplace
One entrepreneur used this strategy to start a weekly ad page, labeling it his marketplace. He approached 200 businesses face to face and told them they could get a small ad in his one page spread for just $90, which happened to be a full $50 cheaper then if they bought their ad directly from the paper. Do you think this offer interested a good percentage of the entrepreneurs he approached? Absolutely! Not only that, but they got a further discount if they paid for 6 months in advance.
He could fit 40 ads of that size onto his page. Being filled up,he made $3600 every week for an outlay of $900 for the page. He added value with nice graphics and the page was well-received as his clients reported good returns from their ads. This was reproduced 20 times around the country, with 2 sales staff for every full page marketplace ad. Within months, he was netting close to $20,000 per week for a fairly lengthy period.
You would need a few dollars to try this, but it is inevitable that if you do your research properly you could make this work and get exactly the same results.
To Your Success!