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Thread: How do the games stores deal with changing values?

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    Default How do the games stores deal with changing values?

    How do all the game stores that buy peoples used games deal with the constantly changing values? I'm talking more specifically about Xbox and PS2 and Cube games. These places give people store credit for their trade ins, and I know the values in their computer systems are constantly changing, but how do they keep up with it?

    I mean, a new game will come out, like Doom 3 for the XBOX, and it's $49.99 everywhere, and maybe they will give $25 store credit for one (when the game first released), and then you get other retailers that start selling the game for a less price not too long later, and then you see some store selling them for $19.99 brand new, I mean it must be a real pain in the ass to keep up with all the changing valuations of games for the current day systems.


    I haven't even mentioned all the budget titles, and the games that come out and are priced $29.99 or $19.99 from the beginning. That must make things even more complicated. I know for the major game retailers, it's probably not that big a deal, considering they give such a small amount anyways, but for the mom and pops and the independents, I have to imagine that they get burned quite a bit, unless they are constantly watching the price fluctuations. Do the big chains like GameStop and GameCrazy and EBgames have like a group of experts that are constantly watching pricing changes and constantly changing the prices for their computer systems? I would imagine so.


    But what about the mom and pop operations? What about the independents? How do they keep track of the constantly changing price fluctuations of all the XBOX and PS2 games that are constantly coming out and having their prices drop a mere month or two after release?

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    It's a necessary evil. The value of things (ALL things) changes on a regular basis. Corporations presumably take pride in their ability to keep up with this sort of thing, as do the more successful mom&pop stores. It's definitely a good question, Anthony, but I think you're looking a bit too far into it. :P

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    Quote Originally Posted by pacmanhat
    It's a necessary evil. The value of things (ALL things) changes on a regular basis. Corporations presumably take pride in their ability to keep up with this sort of thing, as do the more successful mom&pop stores. It's definitely a good question, Anthony, but I think you're looking a bit too far into it. :P


    All I can say is, that if I had my own gamestore, and I was buying peoples Xbox and PS2 and GameCube games, I would go absoltutely nuts trying to keep up with all the changing values. I would want to give the person a good amount for the game, but at the same time, I would be scared to death of way overpaying somebody for a game, when you hear about a certain game being available at Blockbuster for $9.99 brand new.


    HALO 2 anyone????


    I guess the good side for Game Stores, is that the casual fans don't keep up on prices that much either, so even if they pay somebody way too much money for a game being sold somewhere new for even less than the money they gave, they know that they can probably sell that game for the same price and at least break even. But still, it would drive me freaking bonkers. I've considered having my own gamestore, but this is one of the things that made me stick with my day job.

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    How do the games stores deal with changing values?
    Lately, they haven't in my area :/

    I've been seeing alot of overprice'd stuff as of late. The only time it's a positive, is when it soars upward in a hurry and their a little late to the party, thought that's pretty rare.

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    Well I would say that you have to think ahead a little when you buy something back. Most of the time you can tell if a title will stay at a high price for a while (First Party Nintendo, Final Fantasy, etc)...so maybe for those titles you would give a little extra plus you would reasonable assume you could resell said title in a quick enough time frame, way before a price drop.

    The other thing is looking at your buy back price as a long term investment. Some store at one time paid someone $10 for a N64, SNES, whatever game, and 5-10 years down the line, some of those games are worth double or triple that. So if someone buys back, for example, a copy of Sega Soccer Slam (first thing that came to mind) for $5...5 years down the line it could be desired by people and be worth $30.

    Now of course as a retailer, you don't want games sitting on the shelf for years and years, but I think for the most part things rotate pretty well. And of course people get burned now and again...thats going to happen anytime you buy and resell anything really.

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    I can see where that would be a pain. Most of my local indie stores that sell newer stuff have a tendency to overcharge for a bunch of stuff and undercharge a bunch of other stuff. Sometimes this is great for the consumer, other times it isn't. But that's exactly what matters most - the customer. The fears of lowering prices have to be relatively minute, so long as the customer gets the best deal in town, whatever that entails.

    Another thought occurs on this - consider the average used game that GameStop sees. When I worked at a GS, I was told the average used game goes through the GameStop system 5-10 times. That may seem like a lot, and it is - but what's even bigger is the amount of money involved:

    For example, say a store sells 50 copies of a $50 game. That's $2500 right there. Let's say 25 of those copies get traded in for $25 in store credit. That's $625 given out, leaving $1875 from the original sales. Then, when the copies all sell for $45 each, suddenly they're up to $3000. Repeat that another 4 times, and the number gets pretty big. Which brings me back to the price change thing - because of their used game model, profits might slow down but they'll never completely stop. In the end, I'm pretty sure that because of this, most game stores (chains and indies alike) aren't too concerned with price drops.

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    Also the used retail gaming place's have gott'n alot smarter over the last few years, a smart store really watches sports title trade-in's and the greatest hits games.

    It was really bad at one point when you bought a $50 game and target release'd the same game as a greatest hit a week before

    You don't wanna be sit'n on 20 copies madden 05, when you've been giving $25 credit and it's all over town @20 new.

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    Quote Originally Posted by KingCobra
    Also the used retail gaming place's have gott'n alot smarter over the last few years, a smart store really watches sports title trade-in's and the greatest hits games.

    It was really bad at one point when you bought a $50 game and target release'd the same game as a greatest hit a week before

    You don't wanna be sit'n on 20 copies madden 05, when you've been giving $25 credit and it's all over town @20 new.
    I hadn't thought of this...I would imagine that game retailers probably even get inside info on when these sort of things happen (hell, with the analysts they have, they might not even need inside info). First they sloooowly bring down the trade-in price, then when the retail price comes down, no one's the wiser.

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    I would say that the mom&pop stores out there really have their work cut out for theim, as a nationwide chain can just track what's hot and what's not almost daily through sales? and adjust asap.

    As where if your working 10-12 hours a day? it'd be pretty tuff to track whats hot on ebay and run around all the time to retailers tracking markdowns, greastest hits and blowouts :/

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    Quote Originally Posted by Drexel923
    Well I would say that you have to think ahead a little when you buy something back. Most of the time you can tell if a title will stay at a high price for a while (First Party Nintendo, Final Fantasy, etc)...so maybe for those titles you would give a little extra plus you would reasonable assume you could resell said title in a quick enough time frame, way before a price drop.

    ...
    Yeah I agree with this. The thing about Mom and Pop stores (which there aren't any left here that I know of) is that the staff *tends* to be a bit more knowledgeable. For the most part, price drops happen when a game isn't in as high a demand. So if you're a day or three late, it isn't going to kill your store. And obviously you should keep up with what is making greatest hits list and when.

    I mean if you are that worried about it, just say "Let me look this up in my database", meanwhile goto bestbuy.com or whatever.

    ---
    Now what really baffles me is independent music stores knowing which CDs are out of print and such. There's a whole hell of alot more albums out there than current gen games. Manifest here in Charlotte is real good like that, the staff just *knows*. It's insane.

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    Default Re: How do the games stores deal with changing values?

    Buy low, sell high. You couldn't waltz into GameStop and buy Dracula X SNES for $10 More relevantly today, you can't walk into one and buy these rereleased copies of Persona 2 (or whatever it is) or Breath of Fire IV for less than $36.

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    Default Re: How do the games stores deal with changing values?

    Quote Originally Posted by Ed Oscuro
    Buy low, sell high. You couldn't waltz into GameStop and buy Dracula X SNES for $10 More relevantly today, you can't walk into one and buy these rereleased copies of Persona 2 (or whatever it is) or Breath of Fire IV for less than $36.
    ! True though

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    Default Re: How do the games stores deal with changing values?

    Uh uh, gremlins disabled your BBCode

    Seriously though, there's no mystery to what used game stores like GameStop do. IT'S JUST COMMON SENSE

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    Ofcourse, it's why mom&pop are pretty much dust in the overall sheme, it's a nasty Biss.

    Plus, there's other perks once you get as big as they are, like sending overage to other places that are deprived of such games. ect..

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    I'm sure that all of the chain stores know about impending price drops from the manufacturer, and adjust their prices accordingly. Isolated incidents of games selling well below the typical retail price(like the Circuit City or TRU sales) shouldn't affect other store's selling prices, but might be taken into consideration for buyback prices.

    As you deduced, these companies have (somewhat) intelligent individuals that handle this sort of thing. They look at trade in numbers and sales across the board for the company, plus info about other companies' sales, and adjust as necessary. Usually, when one of the big chains permenently drops their price, the others follow suit.

    Mom & Pop stores have to go by on-site recon, word of mouth, or the internets. That's why you usually see overpriced or underpriced games, but not many average prices. Especially if they're using Game Dude or eBay as a reference.

    When your store is solely videogames, you either know a lot about the industry and it's trends or you hire someone who does. If it's only a small part of your business plan, you can afford to not be very knowledgable other than basic information to sell your product.
    RIP bargora, you will be greatly missed.That is how we do things on Giedion Prime.

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    i think for the most part, there is probably a mathamatical formula used based on sales of new copies of said game and number of used copies traded in, sold, and currently in stock. Prices are probably updated weekly.

    im more intrested in how they come up with numbers for older games. how long will fifa 97 for saturn sit on the shelf at gamecrazy at 4.99 vs any other saturn sports game that is 99 cents? that seems like a bit of micromanaging on their part.

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    For large chains they are often notified by their suppliers or head office of a price drop. Sometimes if they have a regular relationship with the supplier they are partially re-imbursed for stock already on the shelf they have to drop.
    Independent stores get no such notification or protection on their investments. They can stay competitive but must always be vigilant and up to date with price drops. If game X which your selling for $40used suddenly drops to $19.99 new over night that can hurt pretty bad if you have 15 copies in the back that you paid $20-$25 each on. At that point you either charge more for it than other stores to try and recoup your losses, or you drop them down to $14.99, eat the loss and remember this lesson for next time. That's why at a lot of independent stores you'll sometimes see old games for inflated prices. It's usually smarter to just take the loss though, even if you sell a few copies at the inflated price it reflects poorly on the store's image.

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