Why Scalping Is A Profitable Business For Some Malaysians

RM700 for concert tickets? More like RM129,000! What about a pair of limited edition sneakers that retail for RM 1000? Gone within seconds, only to magically reappear online at twice the price. Welcome to the land of scalping, where hype is currency and scarcity is opportunity. 

In this gold-mine of an industry, your regular everyday Malaysians are turning into overnight successes raking in thousands in profit while only relying on fast internet connectivity and a nose for what’s hot. 

Rise of the scalper economy

Whether it’s tickets to the Era’s tour, a pair of vintage Jordan’s or even a toy that comes with your Happy Meal, nothing is safe from scalpers. As long as there is a demand for it, someone is out there flipping it for profit. 

From the moment anything limited edition drops, scalpers are already lurking. Armed with extra dextrous fingers, bots or maybe even insider info —scalpers seem to always beat everyone to the next ‘it’ thing.

Coldplay ticketing fiasco

Take the Coldplay debacle that happened back in 2023. Fans across Malaysia were left in tears as ticketing sites crashed within minutes after the online purchase queues opened. If this was just a case of one diehard fan losing out to another diehard fan, this would have been a non issue. However, what started the fire was the fact that fans started spotting resellers popping up online offering seats at what they thought was a fully sold-out show.  

This is definitely not an isolated incident but as this was set to be Coldplay’s first ever concert in Malaysia, the hype reached a different altitude altogether. Sensing all this, scalpers swooped in snatching up the tickets in bulk to resell them at twice their value (some even went as far as to sell tickets ten times the original price). This sparked public outrage, frontpage headlines and even calls for tighter regulation around scalping. Though so, the damage had already been done.  

The scalpers business model 

Let’s be honest, are scalpers really to be blamed? To many people in the flipping and reselling industry, scalping is all about making the right investment (no matter how unusual they may be) and seizing an opportunity in a highly competitive marketplace. 

Basic supply and demand

At its core it’s just based on supply and demand, much like any business in the world. When there is a limited supply of something (say concert tickets, shoes or collectibles) there is an equally eager and desperate audience of people willing to pay a lot more than the actual price just to get their hand on it. 

Scalpers, realising the opportunity here, step in to bridge the gap. In fact, it’s the exact same principle in real estate: buy cheap, wait for high-demand then sell high. When you look at it this way, it’s just smart business no?

Capitalising on limited supply plus high demand

Buying something and reselling it for double or triple (or even ten times!) it’s original price creates a profit margin that would make any investor jealous. Scalpers aren’t manufacturing the hype, nor are they forcing people to buy from them —they’re simply opportunists who are capitalising on the limited supply and high demand. If people are willing to pay such an exorbitant price for something, then why not sell it to them at that price?  

Scalper business model

If you’ve been picturing scalpers as this lone stranger in the dark, rapidly clicking ‘buy now’on whatever they could get their hands on, you’ve got it all wrong. Sure it may have started that way, but scalping has evolved into a full fledged operation. Some even work in teams and operate on a much larger scale than you would have anticipated. 

Bots and personal connections

Behind the scenes, scalpers use a variety of tools and strategies to maximise their profit. Some use bots to bypass online queues, while others take a more traditional approach and build relationships with store employees so they are privy to insider information on when limited edition items drop.  

‘Personal shoppers’ 

Despite what many would think, scalping is not all hush hush. A quick search on social platforms like TikTok or Instagram will show you resellers who are sometimes referred to as ‘personal shoppers’ market their business showing off their resale hauls. A lot of them also go live while purchasing limited edition items in bulk to showcase their hustle. 

This not only builds their brand identity but also creates a sense of trust, proving these items are indeed authentic and also creates a community of like minded people who are interested in the same product. 

These live sessions also generate buzz, excitement and a sense of urgency for their audiences to put in their orders as well for these exclusive items. If you ask us, this is marketing done right. (Note to any scalper who may be reading this: conduct a masterclass on the art of marketing your business). 

Ethical grey zone

At the heart of it, scalping exists in an ethically grey zone. While it may not (yet) be illegal in Malaysia, it definitely is very controversial.  After all, when resellers clear out tickets or collectibles within seconds only to resell them for so much more than the actual price, are they helping consumers —or exploiting them during a time of vulnerability? On one side of the argument, scalping is just capitalism doing what it does best. Scalpers, after all, aren’t forcing anyone to spend inflated amounts of money for anything. If someone is willing to pay RM5000 on a pair of shoes, why not let them decide what the value of these limited items should be?

On the other hand, critics argue that scalping turns moments that would otherwise be joyous, (like securing a ticket to your favourite band’s concert or finally getting your hands on an elusive pair of shoes) into a competition of who’s willing to pay more. The bigger question is, is it wrong to profit off of scarcity or is that just reality in today’s ruthless world. 

Read more: 5 Tips When Buying Concert Tickets Online