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Wii The Almighty Buck

Retail Store Scalping Wii Consoles on eBay 236

Posted by Zonk
from the with-a-name-like-slackers-... dept.
C0rinthian writes "ArsTechnica reports that the games retailer Slackers has been keeping their stock of the Nintendo Wii off their store shelves, and is instead selling the system on eBay for $400-500. (A $150-$250 markup)" This follows their look at the other side of the coin: why some retailers insist on Wii Bundles.
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Retail Store Scalping Wii Consoles on eBay

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  • Re:So what (Score:3, Insightful)

    by Anonymous Coward on Friday December 21, 2007 @10:08PM (#21787216)
    Nintendo doesn't want them to, but they have to be very careful about cutting off shipments or Nintendo could get busted for price fixing.

    Ummm, price fixing is setting an artificially high price. If anything, Nintendo is dumping (selling below cost to gain market share).

    In this case, the MSRP is much lower than market price. So why not charge the market price? That's capitalism.
  • by Manip (656104) on Friday December 21, 2007 @10:11PM (#21787232)
    Honestly if they're only making just below $4 I can't blame them for requiring bundles. In the article it says they're losing money if a customer uses a credit card but even if they don't you have to wonder how they can keep the doors open.

    I kind of feel a little bit bad for small games stores right now even if I'm just a consumer with no real vested interest in making the prices higher.

  • Capitalism (Score:5, Insightful)

    by Anonymous Coward on Friday December 21, 2007 @10:11PM (#21787234)
    In a capatilist society it should be possible to buy any item, no matter how rare, with rarer items being more expensive. Should we blame retailers for doing what economic theory expects them to do? When supply is low and demand is high price should rise until supply = demand.
  • MSRP vs Wholesale (Score:3, Insightful)

    by TubeSteak (669689) on Friday December 21, 2007 @10:13PM (#21787250) Journal

    "My distributors tell us that Nintendo has an 'attach rate' and we are often forced to purchase four games with each console. We pay $246 per console. If we sell the console for $249.99 retail, it's a $3.99 markup. If a person pays by credit card we lose money."
    1. Why is the Manufacturer Suggested Retail Price (MSRP) so close to the wholesale price?
    2. Why doesn't the stores sell it for more than MSRP? The "S" does stand for "Suggested"
  • free market (Score:3, Insightful)

    by fermion (181285) on Friday December 21, 2007 @10:19PM (#21787286) Homepage Journal
    So what? Any retailer is free to get the best price it can for the product. And there is no price fixing. That is when any manufacturer set price is the 'suggested retail price'.

    The story here is that the Wii is worth so much money to some people. For that kind of money one could get a Playstation. But I have no idea how the world works. I still can't understand why some parent would spend $100+ to have their kids see some girl pretend to sing. At some pooint it seems that you tell the kids 'no', the market dries up, and the scalpers go away. But in reality there are enough compulsive people who will pay anything to be part of the in crowd so these scalpers will always have customers.

    In the free world we have the right to make choices, and as well as a basic education is offered, then I say let the adults make the choices(although it has been clear that when cash is too easy to get, the system tends to break down, and more responsible people end up picking up the pieces for the less responsible).

  • by truesaer (135079) on Friday December 21, 2007 @10:20PM (#21787290) Homepage
    1. Why is the Manufacturer Suggested Retail Price (MSRP) so close to the wholesale price?


    2. Why doesn't the stores sell it for more than MSRP? The "S" does stand for "Suggested"


    1) Because it makes MSRP effectively a price floor. Stores have little incentive to undercut each other if they're already making zero profit or a loss on the sale (still beneficial to sell em to get people through the door where they'll buy games and accessories).


    2) Thats exactly what they're doing...selling em on eBay above MSRP.

  • Re:free market (Score:3, Insightful)

    by Rakishi (759894) on Friday December 21, 2007 @10:32PM (#21787368)
    But in a free world Nintendo is also free to never sell any more Wiis or games for them to stores which sell above it's "suggested price."
  • Re:So what (Score:2, Insightful)

    by orkysoft (93727) <orkysoft AT myrealbox DOT com> on Friday December 21, 2007 @10:44PM (#21787446) Journal
    That is exactly what the AC was saying...
  • The bigger problem (Score:3, Insightful)

    by sunking2 (521698) on Friday December 21, 2007 @10:45PM (#21787452)

    I think much more frequent is the case where store employees are buying wiis before they ever reach the floor and selling them either on ebay or other places. I know of at least one person who does this. They buy them for their discounted value and then sell it for a $100 msrp markup. I really don't know why Games...errr...said company doesn't put a stop to it. They are losing a lot of money by letting them go at employee discount. I'm sure these places have rules to try to stop this, but they obviously aren't enforced or the people who have the ability to cover turn the other cheek are part of it (ie store managers don't stop it, and for whatever reason the regional/corporate isn't looking close enough at the numbers).

  • Re:So what (Score:4, Insightful)

    by Kadin2048 (468275) * <slashdot DOT kadin AT xoxy DOT net> on Friday December 21, 2007 @10:47PM (#21787456) Homepage Journal
    Huh? You can go to any Best Buy or WalMart and buy a Wii that's not in a bundle. Or at least you could until they ran out of stock for the Christmas rush, but I'm sure if you stand around on the day they get their resupply that they'll sell you one in the regular retail box, which is nothing but the the console, one Wiimote, and Wii Sports, just fine.

    Gamestop seem to be notorious for its bundling policies, but then again I think Gamestop is one notch up from a guy selling electronics and Persian rugs out of the back of a van.
  • Re:wrong much? (Score:4, Insightful)

    by Waffle Iron (339739) on Friday December 21, 2007 @11:04PM (#21787558)

    I just searched, there's at least 10 brand new consoles, perfectly functional with at least one controller on ebay BUY IT NOW for under $325.

    My guess is that the going eBay price has just drastically dropped because right now chances slim that it's going to make it to your doorstep by Xmas morning.

  • Re:So what (Score:5, Insightful)

    by Maxo-Texas (864189) on Friday December 21, 2007 @11:04PM (#21787560)
    It's not dumping. It's well known that Nintendo makes a profit on every Wii sold at the MSRP.

    Raw capitalism yes-- but not friendly capitalism. Raw capitalism will maximize profits but might cost nintendo a lot of good will.

    For example- Sony pissed me off in 2001 and I have not bought another product from them since. So their short term gain resulted in probably $20,000 to $30,000 in lost sales.

    Nintendo has been managing their market for a looooong time.
  • Re:So what (Score:2, Insightful)

    by Barraketh (630764) on Friday December 21, 2007 @11:27PM (#21787682)
    The ability to set a *minimum price* has nothing to do with this particular case, as the retailers are selling at above MSRP. At no point was the manufacturer allowed to set the maximum price for the product, so if Nintendo stopped shipping to the retailers that do so they'd have a price fixing suit on their hands.
  • by MobileTatsu-NJG (946591) on Friday December 21, 2007 @11:28PM (#21787686)

    Does anyone have the inside scoop on why -- over a year after introducing this product -- Nintendo has not been able to ramp production up to meet demand? It wasn't a surprise that they couldn't meet demand last Christmas. But, this time around they've had a full year to get the production line up to speed.

    What's up? Is their a particular component that is hard to come by or has a real low yield?
    To date, Nintendo's sold 12 million Wii's. That's a pretty strong demand for consoles. I'm not saying it's neverhappened, but I've never heard of a console selling over 10 million in its first year. Heck, the XBOX 360 has been out for two years and the Wii surpassed it in half hte time. If I'm right about the history of console sales, then the question I'd ask is: "What reason would Nintendo have to think they needed say.. double the amount of Wii consoles available?"
  • Re:Bundles (Score:5, Insightful)

    by MobileTatsu-NJG (946591) on Friday December 21, 2007 @11:32PM (#21787708)
    "I have to buy a console and games? Boo hoo!"

    Wow. Way to miss the point. Okay, here's a metaphor to help you comprehend the idea: Let's say you want to purchase an HD-DVD player. They sell for $200, but demand is high, so you cannot find them. Suddenly, you find one but it's $400 and comes with Gigli, Eps. 1-3, TMNT 3, King Kong, White Noise, and Deuce Bigalow.

    Boo hoo.
  • by AbsoluteXyro (1048620) on Friday December 21, 2007 @11:43PM (#21787780)
    I walked into a local independent game shop the other day, just as they unboxed 6 new Wii consoles that had arrived that day. I asked "Do you have any Wiis in stock?" and an employee stepped in front of the stack of Wiis and said "Nnnnnnooooo.... th..these aren't for sale. I mean they are, but we sell them online. No one wants to pay the $450 we are asking in the store." Frickin' jerkwads.
  • by alanshot (541117) <rurick@@@techondemand...net> on Friday December 21, 2007 @11:58PM (#21787878)
    Yes, the "S" does stand for "suggested". It stands for suggested the same way cousin vinny "Suggests" you pay him back in a timely manner, or the way a mugger "suggests" you hand him your wallet.

    I am all for Slackers selling them for the max profit. Price controls dont work. They hinder the market and cause problems. Just ask those in the south that needed their roofs fixed or needed generators after a hurricane.

    Since price controls went into effect, it did two things. First it forced retailers to maintain artificially low prices for items such as batteries so that they ran out too quick. Instead of the price of a D cell jumping to say $6 each that would make a person say "hey, maybe I only need enough to get me through this by conserving my light" instead the first few bought all they could carry, forcing others to go without even if they had enough in thier hands to run thier light constantly for 3 months. So instead of alot of people getting what they NEEDED, you had a few greedy bastards that bought extra leaving others without. Generators? cant charge extra even if they had to be shipped in special(which costs more $$), so vendors didnt go through the hassle of getting the extra units down there. Why sell at a loss? They maintained the normal (inadequate) flow of materials because there was no monetary incetive to do otherwise. Once again, people went without.

    Second, out of state contractors didnt have an incentive to travel to work, leaving the locals under-covered for construction workers. Instead of companies packing up and coming down with a "hey, due to teh demand, this is what it costs because of the demand, my travel expenses, etc." they were told by the gubment "you cant charge any more than the regular rate." so they said "psssh... screw that, I'll stay here instead of travelling down there to help and lose money." years later many roofs still had blue tarps because of the backlog. Even if somebody WANTED to pay more to get it done sooner, they couldnt (in theory).

    They need to GTF outta da way and let the market decide. They'll make thier cash either way.

      Retailers will charge no more than the market will bear. Nintendo wont see any less sales even if this is allowed. If the retailers cant move the units at $500, they'll drop the prices down until they DO move. Eventually the pricing will settle out and they'll sell briskly and at a reasonable amount. Eventually once production increases to match demand, or demand drops, they will be back to where the vendor wants them to be.

  • by Prof.Phreak (584152) on Saturday December 22, 2007 @12:56AM (#21788156) Homepage
    Personally, I'm waiting for the Christmas rush to pass so I can get the console without a forced bundle.

    Yes, you and about a million others!
  • Re:Capitalism (Score:3, Insightful)

    by Anonymous Coward on Saturday December 22, 2007 @06:54AM (#21789442)
    yes, we all know how a "perfect" free market works. the issue is in whether we actually agree with the tenants of true free market capitalism. I'm sure there are plenty here who, like me, think that there should be some regulations on the market.
  • by Richard W.M. Jones (591125) <<rich> <at> <annexia.org>> on Saturday December 22, 2007 @07:17AM (#21789502) Homepage

    No, write down [investopedia.com] is the correct term.

    If you thought you had $billion worth of widgets in the warehouse, but now you don't expect to sell as many, or expect them to sell at a lower price, then in your end of year accounts you'll write down the value of this asset.

    Now you might try to sell the widgets at a marked down (ie. lower) price and thus just take a small loss (a small write down). But you might also just not be able to sell them at all in which case they'll end up in a landfill [snopes.com] somewhere.

    Rich.

  • by Anonymous Coward on Saturday December 22, 2007 @10:44AM (#21790520)
    Maybe in the USA but in Europe, there are plenty of Wii's to go around in France and Germany.
    ...
    So yes, there is the issue of supply and demand - but in Europe Nintendo have got it significantly wrong.

    Lemme see, the US retail price is $249, the European retail price Euro 249 (including sales tax), abour Euro 209, excluding sales tax. In todays yen, that would mean a Wii sells for just over 28,000 yen in the US, while that same Wii sells for just over 34.000 yen in Europe. Silly Nintendo, making sure all demand is met in the highest paying market, they have it significantly wrong indeed :P.
  • by noshellswill (598066) on Saturday December 22, 2007 @11:09AM (#21790678)
    If the price is "too" high, then don't buy the product. A 'toy' should have an infinite price-elasticity ... you are NOT entitled to be amuzed.

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