Making the Most Out of Being a Middleman
There are several different ways to approach business success these days. One of the more intriguing ones is to find out how to be the best middle management you convey. In other words, you’re finding a way to match a consumer with his producer. If it seems like this is a service that wouldn’t be needed these days because of how information flows, then you just have to think about how creativity can give you a leg up.
Consider three cases where being a middleman can be particularly profitable. What if you own a pawn shop? You are a middleman between certain goods and certain people. There is an obvious connection between the need and a thing. You can fill that gap.
Or, you can find a way to sell advertising. Particularly when it comes to online versions of this system, you can automate the entire process. And third, every intermediary has to understand what transaction costs are. If you make it your function to reduce transaction costs between people, you get to take a good cut of that savings.
Pawn Shop Businesses
An intriguing example of this phenomenon would be with supply and demand concerning pawn shops or thrift stores. If you work with a pawnshops supplier, then you know that you’ll always have the stock that you need to provide your customers with the best variety of items that they need. If you know what your customers are into at your particular location, you simply figure out how to order the things that they want, and then you can upsell them and create profit for yourself in the middle with minimal effort.
Selling advertising is another way to be a middleman. For example, if you use Google AdWords, as long as you have great content on your website, advertisers will use you to their advantage if you automate analytics, and you can start seeing profits immediately. After a bit of time gaining an audience, your earnings will steadily increase as long as you maintain the value of all of your posts. Lots of people do this very effectively without putting a lot of energy into it – it’s more a matter of organization.
Recognizing Transaction Costs
Do you know what transaction costs are? The entire point of being a middleman is that you are reducing the energy that one person requires to get something that they want, and you are reducing the energy of another person who wants to get someone something. It is not a theoretical construct. It is a hard reality. If you have resources, experience, or creativity, you can be an incredibly profitable middleman by merely knowing how to connect the right people at the right time.