The Great Glut of Gaming Guides at "Go away" prices...

[Crothian]

That's another reason to eventually mark something down. Maybe the original MSRP was too high for the market. I know there's many times I look at an item and think "hey - I'd buy that if it were $X cheaper."

It's also about finding new customers. I never would have gone there if they didn't agree to host the gameday. I was planing on spending about $40 there as a way to show that hosting a gameday does bring money to the store. But when I saw what they have I spent about three times that and could have spent more if I would have had more time to browse.

 

[Ulrick]

Interesting.

Putting aside the discussion of economics and business, it sounds like this sort of thing happening almost everywhere.

 

[Vocenoctum]

Your example works...just remember though that when the retailer ordered the original stock he/she thought that would sell as well. Being able to identify the stuff that 'will actually sell' is the hard part, not the decision to flog the dead stuff at below what you paid for it...at least it was for me.

Thanks,
Rich

A guy I used to know that sold cars called it "the first loss". You're better off taking that 10% hit after a month, rather than the 40% hit after a year. Worse of course is just never selling it.

Most game shops consider only the "profit" and not the "cash flow", but at the same time I think gameshops SHOULD have a couple "eternal products", even if it's only one copy of some ancient book. You can never tell when something like that might be needed.

Other thing I see is a lot of them not buying enough of something first time, then reordering way too many times. The new WotC book might sell 5 copies in the first month, but they'll order 2, then 2, then 2... Half the time losing some of those "5 sales" because don't have it, then wondering why the books are sitting on the shelf. They have no clue how much they should be ordering for what they sell.

 

[Fifth Element]

A guy I used to know that sold cars called it "the first loss". You're better off taking that 10% hit after a month, rather than the 40% hit after a year. Worse of course is just never selling it.

That's a good way of putting it.

 

[SPoD]

It's also about finding new customers. I never would have gone there if they didn't agree to host the gameday. I was planing on spending about $40 there as a way to show that hosting a gameday does bring money to the store. But when I saw what they have I spent about three times that and could have spent more if I would have had more time to browse.

This is a really, really good point. Deciding to slash prices on dead stock isn't just about profit or cashflow--it's about PR. When word gets around the local gaming cliques that the FLGS just put all 3.5 books on discount, it will drive traffic to the store. And once customers are picking up that 3.5 book on 50% off, they might pick up a few packs of Magic or some other current product at the same time because hey, it's right there. (Never underestimate the laziness of gamers; I used to know a game store that sold candy and soda at the cashier, and they sold tons even though they were across the street from a 7-11, which had a much wider selection.) So now your dead stock has turned into an attraction that helps move current stock.

I know this is basic retail--the point of a sale is to get people to come in--but it's pretty rare in the game store business. I can't remember ever seeing a sale on non-obsolete product, and even a lot of outdated stuff does indeed sit at full MSRP for years.