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A Sex Shop

Babeland

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How It Works: The high-end sex shop buys from tiny artisan-type vendors, making for an upscale clientele and an average 63 percent markup.

Annual Revenue: $1.75 million from its Mercer Street store ($192,000 is profit).

New Yorkonomics: Adam Smith wrote that “the division of labor is limited by the extent of the market,” and nothing shows that better than Babeland. New York’s vast scale makes it possible for even a shop this specialized to thrive.


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