Apologies in advance if this is the wrong place for this post but it feels more applicable to this subforum than the general one (should it go in store discussion?) My question/topic is two fold. First why do many stores buy list pricing not have different tiers for cards? i.e. We buy at 50% TCGP for standard/modern cards (as they have a lot more volatility and reprints)... 60% for legacy staples... and 70% for reserved list cards? Maybe it's limited to my area but the stores nearby seem to have just a flat margin for all cards (except bulk/dollar bin rares being separate categories) and all just seem to look up TCGP and don't have their own lists (I get this part since maintaining a buylist is a chore with all the volatility and only makes sense for big vendors like the online guys... and using TCGP protects you from big spikes/crashes better).
Second why are TCGP buylist prices so different than many stores? Case in point dual lands. For example a volcanic island is listed as $200 buylist in TCGP (I chose this example on purpose as it the TCGP buylist does seem high relative to TCGP low) but numerous local stores would only give me $120 to $130 and SCG says $150. Is it influenced by individuals trying to buy them cheaper (and not maintain margins but go for volume)? Or is it just some smaller shops are perfectly fine getting $20 or so per card to list them on TCGP and that is why they set their prices higher? The later makes some sense to me, especially for higher end reserved list cards. That's not a lot of effort to get some easy profit and cover rent etc.
Any shop owners care to enlighten me on what I am missing? I feel like my buy list policy would be one of the first things I'd nail down if I was opening a gaming store (knowing MTG and similar TCG are one of the main profit sources of those type of stores) so just curious what goes into it. I've seen/read plenty of interesting finance articles over the year but never anything on this topic. Thanks!
So I am a long time MTG player (and fairly active trader/poster here years back) who doesn't get to play as often since I had kids. I decided to sell of some revised duals and offered them to a few local stores for TCGP buy list pricing. Both offered me substantially less stating that have a policy to buy at X% of TCGP. Now as someone who followed the market heavily for years I totally understand this approach. You need a strict margin like that to protect yourself from the volatility of the market, reprints, and many other considerations. I just question why stores don't have separate margins for higher end stuff. I am talking reserve list, sealed product level stuff. Using the same percentages for standard/modern just makes no sense as there is a lot less risk... and the price differences are far larger when dealing with high end staples. Yes the margin is the same but the actual $$ differences becomes huge.
Without stating specific values I was offering them my cards for more than 25% off TCGP low (yet alone their actual market value as most were NM) and was matching TCGP buylist prices. They proceeded to offer me a price hundreds of dollars less. How does this make any sense? If they bought them off me at the offered TCGP buylist price and turned around and sold them on TCGP at TCGP low, then they would have made hundreds (even after fees). Instead they say no thanks I want a couple hundred dollars more out of this deal.
Any shop owners care to enlighten me on what I am missing? I do not mean for this to be salty. I am confident I can sell the cards and for more than I was asking at the stores. It will just take some time waiting for a buyer to come along. I have to assume I am missing something but just wanted to know what? This wouldn't be a question to me if the cards has reprint risk etc... but these are revised duals.
Apologies in advance if this is the wrong place for this post but it feels more applicable to this subforum than the general one (should it go in store discussion?) My question/topic is two fold. First why do many stores buy list pricing not have different tiers for cards? i.e. We buy at 50% TCGP for standard/modern cards (as they have a lot more volatility and reprints)... 60% for legacy staples... and 70% for reserved list cards? Maybe it's limited to my area but the stores nearby seem to have just a flat margin for all cards (except bulk/dollar bin rares being separate categories) and all just seem to look up TCGP and don't have their own lists (I get this part since maintaining a buylist is a chore with all the volatility and only makes sense for big vendors like the online guys... and using TCGP protects you from big spikes/crashes better).
Second why are TCGP buylist prices so different than many stores? Case in point dual lands. For example a volcanic island is listed as $200 buylist in TCGP (I chose this example on purpose as it the TCGP buylist does seem high relative to TCGP low) but numerous local stores would only give me $120 to $130 and SCG says $150. Is it influenced by individuals trying to buy them cheaper (and not maintain margins but go for volume)? Or is it just some smaller shops are perfectly fine getting $20 or so per card to list them on TCGP and that is why they set their prices higher? The later makes some sense to me, especially for higher end reserved list cards. That's not a lot of effort to get some easy profit and cover rent etc.
Any shop owners care to enlighten me on what I am missing? I feel like my buy list policy would be one of the first things I'd nail down if I was opening a gaming store (knowing MTG and similar TCG are one of the main profit sources of those type of stores) so just curious what goes into it. I've seen/read plenty of interesting finance articles over the year but never anything on this topic. Thanks!
So I am a long time MTG player (and fairly active trader/poster here years back) who doesn't get to play as often since I had kids. I decided to sell of some revised duals and offered them to a few local stores for TCGP buy list pricing. Both offered me substantially less stating that have a policy to buy at X% of TCGP. Now as someone who followed the market heavily for years I totally understand this approach. You need a strict margin like that to protect yourself from the volatility of the market, reprints, and many other considerations. I just question why stores don't have separate margins for higher end stuff. I am talking reserve list, sealed product level stuff. Using the same percentages for standard/modern just makes no sense as there is a lot less risk... and the price differences are far larger when dealing with high end staples. Yes the margin is the same but the actual $$ differences becomes huge.
Without stating specific values I was offering them my cards for more than 25% off TCGP low (yet alone their actual market value as most were NM) and was matching TCGP buylist prices. They proceeded to offer me a price hundreds of dollars less. How does this make any sense? If they bought them off me at the offered TCGP buylist price and turned around and sold them on TCGP at TCGP low, then they would have made hundreds (even after fees). Instead they say no thanks I want a couple hundred dollars more out of this deal.
Any shop owners care to enlighten me on what I am missing? I do not mean for this to be salty. I am confident I can sell the cards and for more than I was asking at the stores. It will just take some time waiting for a buyer to come along. I have to assume I am missing something but just wanted to know what? This wouldn't be a question to me if the cards has reprint risk etc... but these are revised duals.
Apologies for an extremely late post.
Most stores have a flat rate buylist price because it's much easier as an online system to upkeep and maintain. If you were to go to a GP or something and hand a vendor a stack of cards, they would probably price it out differently based on what you had. It also depends on store inventory. Some stores near me do offer better buy prices on cards that are moving especially quick.
As for your second question on differing buy prices... I'll use your example. Starcity can pay more for their cards because they price their cards higher than other places and also can maintain a very large inventory with a large consumer base constantly trading cards in for store credit etc. A couple thousand people might shop at starcity a day, but how many people walk through a small brick and mortar store or surf a small online website that most don't know about? A smaller store will usually have a much harder time moving things, especially if the local area around the store does not support said format. A store that I know of was that way. I remember talking to the owner once about some dual lands and he said while he'd buy them, he often bought them at an admitted very low buy price because they were so hard and slow to sell. He was better off buying standard and modern stuff, while at the mercy of a price spike or drop, could also sell in a few days or weeks.
Yeah the the flatrate buylist based off an online store makes perfect sense. Easier to maintain and avoid spikes etc. Just the time it would take to maintain one would could be painful with standards cards alone. I guess I just expected some tiers to it as well. The one added layer seems reasonable and simple enough... otherwise I don't see why anyone would sell higher end cards to them... and if I was an owner I'd want them to as it should be good easy money. I guess the flip side is if people will still sell them plenty at the one flat rate (or they have plenty of inventory as is) why over complicate it I guess. I never questioned it for standard and modern but this is the first time I went in selling something like duals.
On the second one, why does it seem the TCGP buylist price then is so much higher than what stores tend to give? TCGP claim it is from stores/vendors. Is it just a couple stores are savy enough/willing to get cards and then repost them on TCGP or other similar sites where as most others just cater to local demand? Or maybe even it's jsut a couple of people who mainly do online and are vendors not brick and mortar? Because I totally get you would not be able to move duals quickly in many local stores... but I would think most owners would be invested enough to know about TCGP and selling online. I have read so many articles about how local stores operate on a very thin edge (with MTG usually being what saves them) that I would think more would up to speed on the game and the various retail options (both to know their competition and methods for them to sell/succeed). In fact its part of why I decided I was okay selling to them on the low end as they supported me in playing the game years back and I'd still be turning a profit over what I got them for years back. It seem almost ironic though as the one site in question is the one they are using for their buylist price. I would hope they at least would be familiar with that one (but I respect if they just don't want to sell online). I guess that didn't seem the case to me though as I even offered said duals to a couple larger stores I used to frequent (one of which even goes to shows with their collection etc) and they too were only giving 60% of TCGP low for NM duals... and had a couple (only a couple) in their store already. Really not trying to sound like sour grapes (I'm not upset at all. I have no issue selling them online). I just find this fascinating and if I were in that position I feel like I would be using online a ton (especially for anything that sat on my shelves for a few months. Get it out of there before rotation hits etc). It seems like an important tool in their tool box to keep merchandise moving. Is it more about moving sealed products for those stores then and not a combination of sealed and singles? Is that the piece I was missing?
Thanks again! I've always found the financial side of this game fascinating.
This is really a question that I wish Jeff was still here to chime in on. Stores basically get paid to buy something at one price and sit on it until somebody will meet their selling price. Sometimes discounting it either directly or indirectly AKA TCG fees will generate enough interest to move the product. Maintaining an active buying and selling singles business is very labor intensive. If the store doesn't have a big tournament scene or their tournament seen as primarily in limited meaning they are making money on sealed product they're going to stick with that.
A store that is trying to move a lot of volume or has the market to move a lot of volume will pay more. That's why everybody raged against Star city a few years back because they were buy listing Legacy Staples above sell/ebay rates. They needed those cards to take the tournament so they were paying a premium and charging and premium because they had the market.
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Still here, just not as active on here as market street tends to be a lot quieter these days than it used to be and I don't really deal in standard singles anymore since I left the shop. Anyhow, onto the topic at hand...
EDIT: Took the example of the Volcanic Island and checked out the buylist prices and which sellers were offering and how many of them were actually selling revised duals (let alone the duals with buylist offers) on tcgplayer itself. For volcanic island I found the following: buylist for NM copies 2 @ $184, and 10 @ 168 (neither selling revised duals on tcgplayer), Buylist for LP copies had more not selling duals on tcgplayer, but one buyer was, offering to buy 5 @ $170, while selling LP ones for $270 (offering more, but selling for higher than other sellers). And for MP, the same thing, a bunch of buyers not selling revised duals on tcgplayer, but one offering to buy 7 at $155 buy selling for $243, once again offering more but also selling for more than other sellers.) Looks like most are using it for local store inventories moreso than tcgplayer inventory and probably marking up the price appropriately to warrant the offered prices in similar comparison to the store that is selling on tcgplayer (and all of the buylist buyers for volcanic island were high volume sellers, confirming what tcgplayer would seem to have said about who is involved with being able to post a buylist on there.)
Summary of below for those that don't want to read the massive post I ended up with: Shops have high overhead costs between rent/bills that can easily exceed $2k/month which requires a lot of sales with normal selling margins to be able to even break even let alone make a profit. Shops (even those that do sell excess inventory online on ebay for example) still have to deal with things like ebay/paypal fees and shipping related costs there, and otherwise have to deal with the sunk cost of inventory that can potentially sit there for a while before it may eventually sell. Then there is the largest issue and that is the fluctuation in value of magic singles over time. Standard singles rotate and become worth a fraction of the previous value, modern/legacy cards not on the reserved list can ebb and flow in popularity and the biggest thing, is reprinting, which can demolish the value of certain cards and with that, the lower cash buy rates help to balance all of that out in order to make it viable for a shop to keep a decent inventory of cards without the potential for it to break the shop financially if things don't go well with the value of their singles inventory over time. Even things on the reserved list can fluctuate in price, but generally are safer though can be harder to move at the same time depending upon the shop's customer base. Online stores tend to have more flexibility there and while I'm not much familiar with some of the new tcgplayer features, generally yes, online stores will tend to offer more for certain more popular/in demand cards due to the nature of their business and greater ease of liquidity.
Below is the long and more personalized version from my experiences for those interested:
Firstly let me explain how I did things at the shop I owned/ran the magic singles collection for. I would sell my cards at the same price I would sell them for on ebay (typically matching or slightly lower than the lowest NM playset price with a reasonable shipping cost)/4 for singles. I tried to keep my prices as low as possible both to benefit the players as well as the shop (The shop got 15% off the top of my sales, so selling in volume benefitted them significantly) which was also essentially the cost it was for me to sell on ebay when you factored in all of the ebay/paypal fees and other related shipping/packaging costs at the time.
That setup as well as a massive stock for a normal local brick and mortar store (I kept 100% separate inventory between my ebay and shop stock), helped lead to sales of between $100k and $150k per year at the shop alone for the last few years I was there (not counting ebay sales which were also up there but which was 100% separate from the shop). Most of my sales were standard/modern/extended stuff, though I did sell some legacy cards from time to time, and of course casual/commander were also quite huge (nothing like having to dig out an entire commander deck worth of singles on a busy day :p).
Part of how I kept such a large and consistent inventory (at least a playset of everything modern/extended legal and multiple playsets of everything standard legal) and typically for revised-current at the time at least a playset of everything legacy related as well, was with my buy/trade rates and the fact that I was willing to take anything at all times regardless of inventory based on what I would be selling the card for.
The standard cash buy rate I put at 50%, and the standard trade rate I put at 67% (1/2 cash, 2/3rds trade), both of which the vast majority of my customers were more than happy to accept, and was higher than really any of the other shops in the area, and even then most of them restricted what they were willing to take in.) I felt the free flow of cards through the magic community was important for the general community confidence in the game and the purchase/resell value of their cards, and it really seemed to work out well there.
As mentioned by others above, it is true that you can certainly find higher buy rates on certain cards from online sellers and otherwise, and though I was fairly firm on my percentages in order to keep my reasonable (but low) margins intact, I would occasionally be willing to offer a little more for higher end harder to find things that I could use more of that had higher demand. The sheer amount of volume in buying/trading I did at the shop was already almost too much to keep up with so I decided to stick with that buy/trade rate and continued with it until I left the shop the end of 2012 (for health reasons). Typically with higher end older cards like NM duals or power or anything that I figured I would have a lot of difficulty selling at the shop, I would suggest the person sell them online as they would be able to get more than I would be able to reasonably offer for them and really without that much overall effort, I even helped a number of people get set up on ebay to do so as time allowed, or at least offered some advice on how to do so.
Now, for the more detailed reason for the 50% cash and 2/3rds trade. One of the biggest issues with magic cards is that of the fluctuation in the value of cards (especially standard rotating stock). I tended to buy and hold an awfully large inventory, so a lot of the cards would just sit there when there wasn't much demand at times. Buying at 50% cash meant that buying a $20 card cost me $10. If the card stayed at $20, and I sold it later, I would sell for $20, the shop would get $3, and I would make a $7 profit on that $20 card. However, as often was the case with magic cards, many of those $20 cards could drop down to $15 fairly easily as popularity of decks and cards would ebb and flow. Suddenly selling that card at $15, meant $2.25 for the shop and only a $2.75 profit for me, not terrible but not exactly a lot on the overall. And then, should the card drop to say $12, that would mean the shop gets $1.80 and I get a whopping .20 out of that card. There is also the long-term sunk cost of inventory and the value of having cash on hand. The 50% rate offer kept me at a reasonable balance of cards coming in (and cash going out) versus sales of cards and cash coming back in, If I offered more, I would have potentially been causing myself other issues.
To compare, most other shops in the area were only willing to offer 33% cash or 50% trade (for the cards they were specifically looking for) so my offer while not as good as online store offers perhaps, was still higher than most other shops locally by a decent margin especially factoring in my willingness to take anything at all times, and trade value being able to be used for anything at all times. Most local brick and mortar stores tend not to do anything close to the volume of buying/selling/trading I did at the shop while I was there, and most will look to price their singles higher than the lower end of ebay buy it now prices and will often use sales to try to move excess inventory (which I avoided with my selling method) or have a separate setup for ebay selling (As I also did) to move excess inventory as it came in. Admittedly though our shop was unique in that I was a separate entity within the shop owning/running the magic singles and non-standard pack/box sales to make it easier for the shop owner to focus on the standard sealed product and recent supplementary products (that would sell quicker and easier) as well as all of the other games the shop carried, while getting the 15% back from me for the space I was provided.
The other thing to keep in mind with brick and mortar stores in general is the overhead it costs to run a store. For example, these days, the rent alone for a decent sized shop in a decent location can easily cost $2k+ per month for rent, and probably another $500 per month for utilities and other overhead costs. Given normal margins for products at a shop, that is a lot in potential sales that would have to be done with normal reasonable margins to be able to get enough just to break even each month, let alone pull in a profit.
In the end, what I will get out of my 6 years at the shop and many years buying/selling otherwise to build the collection I had to start at the shop with is the massive inventory I still am working on liquidating to this day to get as much money back out of it as I can, which looks to net me a reasonable return on the overall for all those years and all of the money that got put into the collection to begin with (though a large amount of that as well is the increase in value of the cards that occurred post 2009 when the player base exploded upward as much as it did and has over the years.) These days though that growth has slowed significantly and with the mass amount of risks with reprinting from wizards in the great variety of products they come out with each year, holding an inventory of older cards is as risky now as it has ever been, which is the other reason for such a buy/cash rate is due to that risk (obviously not the case for things on the reserved list, but for many shops those are cards that simply don't move quickly so that is a lot of money sitting in a case/binder/box collecting dust as it were rather than being able to be moved quickly to keep the cash flow moving (a very important thing for a shop).
Thanks for the very long reply. It was really insightful to see how the little individual stores operate and just how risky of a business venture it is to run a store. I think my biggest take away from this is that the local stores (communities) where people play aren't really doing all that well and are probably struggling just to make ends meet. Add to that Wizards' reprinting policies make it even more difficult for the stores to make money and I really wonder why and how people are legitimately making a business venture succeed.
Thanks for the very long reply. It was really insightful to see how the little individual stores operate and just how risky of a business venture it is to run a store. I think my biggest take away from this is that the local stores (communities) where people play aren't really doing all that well and are probably struggling just to make ends meet. Add to that Wizards' reprinting policies make it even more difficult for the stores to make money and I really wonder why and how people are legitimately making a business venture succeed.
Thanks again!
It can certainly be difficult, but if people are smart with how the business is built from the ground up, they can certainly succeed. Shop owners aren't going to get rich doing it, but they can eventually build up the business enough with enough hard work and good customer service and customer oriented business model to bring in the playerbases for the various games the shop supports and in general bring in enough customers from all around to get their sales an incremental profits up high enough to get past the overhead costs and be able to bring in an okay income that can potentially expand over time if kept up with well.
Location is certainly important, as is knowing what the local community of gamers is looking for to make sure the shop's inventory is set up to as perfectly address the local demand as it possibly can to hopefully not leave the shop with a bunch of dead hard to move inventory. Having enough money on hand to cover a solid amount of initial inventory, as well as all of the startup costs of tables/chairs/product space equipment/cases/shelving/display cooler/register/alarm system/safe/etc.
Many shops tend to rely more on their sealed product sales than their singles sales to keep the lights on and the rent paid as it were. The shops that do end up with a successful singles business often have to be very careful to not let their inventory get too out of hand, which is why its so very important these days to have an online presence for the shop, whether its just using something like ebay to offload excess inventory that isn't moving to keep that cash flow going, or to be able to use it as an additional outlet for sales (at lower margins to be sure, but every little bit helps and volume can certainly make up for the very low online margins a lot of the time).
Its also important not to grow the business too quickly, which is something that can often be the beginning of the end for many business when they try to expand or take on too much too soon before the business is really 100% financially or otherwise ready for it. All businesses have growing pains though, and being able to learn from the experience of others who have been there and done that can be invaluable to being able to avoid so many of those as you go along. Often its better to try not to be a one-size-fits-all shop, but rather focus significantly on those product lines/games that there is the most demand for, while offering custom orders, or having smaller portions of inventory for the other games that one can be fairly certain can be moved to those few who are looking for them.
Personally I am an expert when it comes to the business of magic the gathering. My knowledge of the singles and sealed product aspects of the game were always my greatest asset in addition to the massive collection I built before getting involved in the shop when the opportunity arose there. I could run a magic the gathering only shop without any significantly difficultly therein, however realistically speaking, one game, even one as popular and huge in sales as magic, isn't really enough these days to be able to support an entire decent sized shop, one needs the other games to make the whole thing work, which my knowledge was generally minimal for outside of magic (hence having someone who knows games in general can make for a great partner to work with in running such a business, where magic may be a primary focus, but the other games help make the whole thing financially viable in the end.
The same applies to trying to be everything for all people when it comes to magic singles. My setup at the shop I was at wasn't really viable for the long term, I eventually got overwhelmed and didn't bring on help with my part of the business until I was already growing so fast in sales that it was getting away from me and I had to spend more and more time at the shop to the point of working 100+ hours weeks 52 weeks per year for several years straight and the health impact was so bad I finally had to make the choice I did to leave for the sake of my health and stress level accordingly. Knowing what I know now, I could very well make such a setup work in the future, however the environment now with all the reprinting happening at a much faster and consistent rate than in previous years makes it a lot harder to keep as wide-ranging of an inventory as I would want to be able to support everyone as I was able to do before.
Which harkens back once again to why shops don't offer more for cards. Basically from a financial viability standpoint shops have to be careful with their cash flow. Offer too much for cards that don't move quickly enough and you hamper your ability to keep up with the bills and purchase of new products as they come out, and of course, offer too little and you will inevitably have difficulty bringing in new singles inventory to replace what is sold off to be able to make things work. So a number like 50% cash, and 2/3rds trade like I employed ended up being in that sweet spot that made things work, even if I did let my inventory get a bit out of hand by not getting help sooner as mentioned above. Shops with good legacy or higher end EDH groups have a much greater ability to offer more for higher end old cards like duals that they would have a much easier time being able to move, but a shop that doesn't have a good base like that, will have a harder time being able to offer more for such cards accordingly knowing they may very well sit for a while and having too much value in inventory that doesn't move is bad for the cash flow and thusly bad for the business.
I've had to reality check more than a few people over the years to how difficult it can be to run a shop and all that goes into it, but for those dedicated enough with a smart enough plan, it can and certainly does work, in fact I continue to offer advice to people to this day in regards to such areas, and I only hope that what advice I have been able to offer has helped them to either make a successful shop work, or to decide it perhaps would be better to rethink their plans so as not to jump into something they may not be ready for.
Thanks Jeff! That was very insightful and exactly what I was looking for. I always knew standard cards needed such margins for the reasons you outlined but didn't realize it extended as far into legacy/reserved list cards as well. Makes sense!
Based on your thoughts... it also seems to me that the TCGP buylist price is just not an accurate/realistic measure then for most stores. Definitely good to know.
Second why are TCGP buylist prices so different than many stores? Case in point dual lands. For example a volcanic island is listed as $200 buylist in TCGP (I chose this example on purpose as it the TCGP buylist does seem high relative to TCGP low) but numerous local stores would only give me $120 to $130 and SCG says $150. Is it influenced by individuals trying to buy them cheaper (and not maintain margins but go for volume)? Or is it just some smaller shops are perfectly fine getting $20 or so per card to list them on TCGP and that is why they set their prices higher? The later makes some sense to me, especially for higher end reserved list cards. That's not a lot of effort to get some easy profit and cover rent etc.
Any shop owners care to enlighten me on what I am missing? I feel like my buy list policy would be one of the first things I'd nail down if I was opening a gaming store (knowing MTG and similar TCG are one of the main profit sources of those type of stores) so just curious what goes into it. I've seen/read plenty of interesting finance articles over the year but never anything on this topic. Thanks!
So I am a long time MTG player (and fairly active trader/poster here years back) who doesn't get to play as often since I had kids. I decided to sell of some revised duals and offered them to a few local stores for TCGP buy list pricing. Both offered me substantially less stating that have a policy to buy at X% of TCGP. Now as someone who followed the market heavily for years I totally understand this approach. You need a strict margin like that to protect yourself from the volatility of the market, reprints, and many other considerations. I just question why stores don't have separate margins for higher end stuff. I am talking reserve list, sealed product level stuff. Using the same percentages for standard/modern just makes no sense as there is a lot less risk... and the price differences are far larger when dealing with high end staples. Yes the margin is the same but the actual $$ differences becomes huge.
Without stating specific values I was offering them my cards for more than 25% off TCGP low (yet alone their actual market value as most were NM) and was matching TCGP buylist prices. They proceeded to offer me a price hundreds of dollars less. How does this make any sense? If they bought them off me at the offered TCGP buylist price and turned around and sold them on TCGP at TCGP low, then they would have made hundreds (even after fees). Instead they say no thanks I want a couple hundred dollars more out of this deal.
Any shop owners care to enlighten me on what I am missing? I do not mean for this to be salty. I am confident I can sell the cards and for more than I was asking at the stores. It will just take some time waiting for a buyer to come along. I have to assume I am missing something but just wanted to know what? This wouldn't be a question to me if the cards has reprint risk etc... but these are revised duals.
Apologies for an extremely late post.
Most stores have a flat rate buylist price because it's much easier as an online system to upkeep and maintain. If you were to go to a GP or something and hand a vendor a stack of cards, they would probably price it out differently based on what you had. It also depends on store inventory. Some stores near me do offer better buy prices on cards that are moving especially quick.
As for your second question on differing buy prices... I'll use your example. Starcity can pay more for their cards because they price their cards higher than other places and also can maintain a very large inventory with a large consumer base constantly trading cards in for store credit etc. A couple thousand people might shop at starcity a day, but how many people walk through a small brick and mortar store or surf a small online website that most don't know about? A smaller store will usually have a much harder time moving things, especially if the local area around the store does not support said format. A store that I know of was that way. I remember talking to the owner once about some dual lands and he said while he'd buy them, he often bought them at an admitted very low buy price because they were so hard and slow to sell. He was better off buying standard and modern stuff, while at the mercy of a price spike or drop, could also sell in a few days or weeks.
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Yeah the the flatrate buylist based off an online store makes perfect sense. Easier to maintain and avoid spikes etc. Just the time it would take to maintain one would could be painful with standards cards alone. I guess I just expected some tiers to it as well. The one added layer seems reasonable and simple enough... otherwise I don't see why anyone would sell higher end cards to them... and if I was an owner I'd want them to as it should be good easy money. I guess the flip side is if people will still sell them plenty at the one flat rate (or they have plenty of inventory as is) why over complicate it I guess. I never questioned it for standard and modern but this is the first time I went in selling something like duals.
On the second one, why does it seem the TCGP buylist price then is so much higher than what stores tend to give? TCGP claim it is from stores/vendors. Is it just a couple stores are savy enough/willing to get cards and then repost them on TCGP or other similar sites where as most others just cater to local demand? Or maybe even it's jsut a couple of people who mainly do online and are vendors not brick and mortar? Because I totally get you would not be able to move duals quickly in many local stores... but I would think most owners would be invested enough to know about TCGP and selling online. I have read so many articles about how local stores operate on a very thin edge (with MTG usually being what saves them) that I would think more would up to speed on the game and the various retail options (both to know their competition and methods for them to sell/succeed). In fact its part of why I decided I was okay selling to them on the low end as they supported me in playing the game years back and I'd still be turning a profit over what I got them for years back. It seem almost ironic though as the one site in question is the one they are using for their buylist price. I would hope they at least would be familiar with that one (but I respect if they just don't want to sell online). I guess that didn't seem the case to me though as I even offered said duals to a couple larger stores I used to frequent (one of which even goes to shows with their collection etc) and they too were only giving 60% of TCGP low for NM duals... and had a couple (only a couple) in their store already. Really not trying to sound like sour grapes (I'm not upset at all. I have no issue selling them online). I just find this fascinating and if I were in that position I feel like I would be using online a ton (especially for anything that sat on my shelves for a few months. Get it out of there before rotation hits etc). It seems like an important tool in their tool box to keep merchandise moving. Is it more about moving sealed products for those stores then and not a combination of sealed and singles? Is that the piece I was missing?
Thanks again! I've always found the financial side of this game fascinating.
A store that is trying to move a lot of volume or has the market to move a lot of volume will pay more. That's why everybody raged against Star city a few years back because they were buy listing Legacy Staples above sell/ebay rates. They needed those cards to take the tournament so they were paying a premium and charging and premium because they had the market.
EDIT: Took the example of the Volcanic Island and checked out the buylist prices and which sellers were offering and how many of them were actually selling revised duals (let alone the duals with buylist offers) on tcgplayer itself. For volcanic island I found the following: buylist for NM copies 2 @ $184, and 10 @ 168 (neither selling revised duals on tcgplayer), Buylist for LP copies had more not selling duals on tcgplayer, but one buyer was, offering to buy 5 @ $170, while selling LP ones for $270 (offering more, but selling for higher than other sellers). And for MP, the same thing, a bunch of buyers not selling revised duals on tcgplayer, but one offering to buy 7 at $155 buy selling for $243, once again offering more but also selling for more than other sellers.) Looks like most are using it for local store inventories moreso than tcgplayer inventory and probably marking up the price appropriately to warrant the offered prices in similar comparison to the store that is selling on tcgplayer (and all of the buylist buyers for volcanic island were high volume sellers, confirming what tcgplayer would seem to have said about who is involved with being able to post a buylist on there.)
Summary of below for those that don't want to read the massive post I ended up with: Shops have high overhead costs between rent/bills that can easily exceed $2k/month which requires a lot of sales with normal selling margins to be able to even break even let alone make a profit. Shops (even those that do sell excess inventory online on ebay for example) still have to deal with things like ebay/paypal fees and shipping related costs there, and otherwise have to deal with the sunk cost of inventory that can potentially sit there for a while before it may eventually sell. Then there is the largest issue and that is the fluctuation in value of magic singles over time. Standard singles rotate and become worth a fraction of the previous value, modern/legacy cards not on the reserved list can ebb and flow in popularity and the biggest thing, is reprinting, which can demolish the value of certain cards and with that, the lower cash buy rates help to balance all of that out in order to make it viable for a shop to keep a decent inventory of cards without the potential for it to break the shop financially if things don't go well with the value of their singles inventory over time. Even things on the reserved list can fluctuate in price, but generally are safer though can be harder to move at the same time depending upon the shop's customer base. Online stores tend to have more flexibility there and while I'm not much familiar with some of the new tcgplayer features, generally yes, online stores will tend to offer more for certain more popular/in demand cards due to the nature of their business and greater ease of liquidity.
Below is the long and more personalized version from my experiences for those interested:
Firstly let me explain how I did things at the shop I owned/ran the magic singles collection for. I would sell my cards at the same price I would sell them for on ebay (typically matching or slightly lower than the lowest NM playset price with a reasonable shipping cost)/4 for singles. I tried to keep my prices as low as possible both to benefit the players as well as the shop (The shop got 15% off the top of my sales, so selling in volume benefitted them significantly) which was also essentially the cost it was for me to sell on ebay when you factored in all of the ebay/paypal fees and other related shipping/packaging costs at the time.
That setup as well as a massive stock for a normal local brick and mortar store (I kept 100% separate inventory between my ebay and shop stock), helped lead to sales of between $100k and $150k per year at the shop alone for the last few years I was there (not counting ebay sales which were also up there but which was 100% separate from the shop). Most of my sales were standard/modern/extended stuff, though I did sell some legacy cards from time to time, and of course casual/commander were also quite huge (nothing like having to dig out an entire commander deck worth of singles on a busy day :p).
Part of how I kept such a large and consistent inventory (at least a playset of everything modern/extended legal and multiple playsets of everything standard legal) and typically for revised-current at the time at least a playset of everything legacy related as well, was with my buy/trade rates and the fact that I was willing to take anything at all times regardless of inventory based on what I would be selling the card for.
The standard cash buy rate I put at 50%, and the standard trade rate I put at 67% (1/2 cash, 2/3rds trade), both of which the vast majority of my customers were more than happy to accept, and was higher than really any of the other shops in the area, and even then most of them restricted what they were willing to take in.) I felt the free flow of cards through the magic community was important for the general community confidence in the game and the purchase/resell value of their cards, and it really seemed to work out well there.
As mentioned by others above, it is true that you can certainly find higher buy rates on certain cards from online sellers and otherwise, and though I was fairly firm on my percentages in order to keep my reasonable (but low) margins intact, I would occasionally be willing to offer a little more for higher end harder to find things that I could use more of that had higher demand. The sheer amount of volume in buying/trading I did at the shop was already almost too much to keep up with so I decided to stick with that buy/trade rate and continued with it until I left the shop the end of 2012 (for health reasons). Typically with higher end older cards like NM duals or power or anything that I figured I would have a lot of difficulty selling at the shop, I would suggest the person sell them online as they would be able to get more than I would be able to reasonably offer for them and really without that much overall effort, I even helped a number of people get set up on ebay to do so as time allowed, or at least offered some advice on how to do so.
Now, for the more detailed reason for the 50% cash and 2/3rds trade. One of the biggest issues with magic cards is that of the fluctuation in the value of cards (especially standard rotating stock). I tended to buy and hold an awfully large inventory, so a lot of the cards would just sit there when there wasn't much demand at times. Buying at 50% cash meant that buying a $20 card cost me $10. If the card stayed at $20, and I sold it later, I would sell for $20, the shop would get $3, and I would make a $7 profit on that $20 card. However, as often was the case with magic cards, many of those $20 cards could drop down to $15 fairly easily as popularity of decks and cards would ebb and flow. Suddenly selling that card at $15, meant $2.25 for the shop and only a $2.75 profit for me, not terrible but not exactly a lot on the overall. And then, should the card drop to say $12, that would mean the shop gets $1.80 and I get a whopping .20 out of that card. There is also the long-term sunk cost of inventory and the value of having cash on hand. The 50% rate offer kept me at a reasonable balance of cards coming in (and cash going out) versus sales of cards and cash coming back in, If I offered more, I would have potentially been causing myself other issues.
To compare, most other shops in the area were only willing to offer 33% cash or 50% trade (for the cards they were specifically looking for) so my offer while not as good as online store offers perhaps, was still higher than most other shops locally by a decent margin especially factoring in my willingness to take anything at all times, and trade value being able to be used for anything at all times. Most local brick and mortar stores tend not to do anything close to the volume of buying/selling/trading I did at the shop while I was there, and most will look to price their singles higher than the lower end of ebay buy it now prices and will often use sales to try to move excess inventory (which I avoided with my selling method) or have a separate setup for ebay selling (As I also did) to move excess inventory as it came in. Admittedly though our shop was unique in that I was a separate entity within the shop owning/running the magic singles and non-standard pack/box sales to make it easier for the shop owner to focus on the standard sealed product and recent supplementary products (that would sell quicker and easier) as well as all of the other games the shop carried, while getting the 15% back from me for the space I was provided.
The other thing to keep in mind with brick and mortar stores in general is the overhead it costs to run a store. For example, these days, the rent alone for a decent sized shop in a decent location can easily cost $2k+ per month for rent, and probably another $500 per month for utilities and other overhead costs. Given normal margins for products at a shop, that is a lot in potential sales that would have to be done with normal reasonable margins to be able to get enough just to break even each month, let alone pull in a profit.
In the end, what I will get out of my 6 years at the shop and many years buying/selling otherwise to build the collection I had to start at the shop with is the massive inventory I still am working on liquidating to this day to get as much money back out of it as I can, which looks to net me a reasonable return on the overall for all those years and all of the money that got put into the collection to begin with (though a large amount of that as well is the increase in value of the cards that occurred post 2009 when the player base exploded upward as much as it did and has over the years.) These days though that growth has slowed significantly and with the mass amount of risks with reprinting from wizards in the great variety of products they come out with each year, holding an inventory of older cards is as risky now as it has ever been, which is the other reason for such a buy/cash rate is due to that risk (obviously not the case for things on the reserved list, but for many shops those are cards that simply don't move quickly so that is a lot of money sitting in a case/binder/box collecting dust as it were rather than being able to be moved quickly to keep the cash flow moving (a very important thing for a shop).
Thanks for the very long reply. It was really insightful to see how the little individual stores operate and just how risky of a business venture it is to run a store. I think my biggest take away from this is that the local stores (communities) where people play aren't really doing all that well and are probably struggling just to make ends meet. Add to that Wizards' reprinting policies make it even more difficult for the stores to make money and I really wonder why and how people are legitimately making a business venture succeed.
Thanks again!
It can certainly be difficult, but if people are smart with how the business is built from the ground up, they can certainly succeed. Shop owners aren't going to get rich doing it, but they can eventually build up the business enough with enough hard work and good customer service and customer oriented business model to bring in the playerbases for the various games the shop supports and in general bring in enough customers from all around to get their sales an incremental profits up high enough to get past the overhead costs and be able to bring in an okay income that can potentially expand over time if kept up with well.
Location is certainly important, as is knowing what the local community of gamers is looking for to make sure the shop's inventory is set up to as perfectly address the local demand as it possibly can to hopefully not leave the shop with a bunch of dead hard to move inventory. Having enough money on hand to cover a solid amount of initial inventory, as well as all of the startup costs of tables/chairs/product space equipment/cases/shelving/display cooler/register/alarm system/safe/etc.
Many shops tend to rely more on their sealed product sales than their singles sales to keep the lights on and the rent paid as it were. The shops that do end up with a successful singles business often have to be very careful to not let their inventory get too out of hand, which is why its so very important these days to have an online presence for the shop, whether its just using something like ebay to offload excess inventory that isn't moving to keep that cash flow going, or to be able to use it as an additional outlet for sales (at lower margins to be sure, but every little bit helps and volume can certainly make up for the very low online margins a lot of the time).
Its also important not to grow the business too quickly, which is something that can often be the beginning of the end for many business when they try to expand or take on too much too soon before the business is really 100% financially or otherwise ready for it. All businesses have growing pains though, and being able to learn from the experience of others who have been there and done that can be invaluable to being able to avoid so many of those as you go along. Often its better to try not to be a one-size-fits-all shop, but rather focus significantly on those product lines/games that there is the most demand for, while offering custom orders, or having smaller portions of inventory for the other games that one can be fairly certain can be moved to those few who are looking for them.
Personally I am an expert when it comes to the business of magic the gathering. My knowledge of the singles and sealed product aspects of the game were always my greatest asset in addition to the massive collection I built before getting involved in the shop when the opportunity arose there. I could run a magic the gathering only shop without any significantly difficultly therein, however realistically speaking, one game, even one as popular and huge in sales as magic, isn't really enough these days to be able to support an entire decent sized shop, one needs the other games to make the whole thing work, which my knowledge was generally minimal for outside of magic (hence having someone who knows games in general can make for a great partner to work with in running such a business, where magic may be a primary focus, but the other games help make the whole thing financially viable in the end.
The same applies to trying to be everything for all people when it comes to magic singles. My setup at the shop I was at wasn't really viable for the long term, I eventually got overwhelmed and didn't bring on help with my part of the business until I was already growing so fast in sales that it was getting away from me and I had to spend more and more time at the shop to the point of working 100+ hours weeks 52 weeks per year for several years straight and the health impact was so bad I finally had to make the choice I did to leave for the sake of my health and stress level accordingly. Knowing what I know now, I could very well make such a setup work in the future, however the environment now with all the reprinting happening at a much faster and consistent rate than in previous years makes it a lot harder to keep as wide-ranging of an inventory as I would want to be able to support everyone as I was able to do before.
Which harkens back once again to why shops don't offer more for cards. Basically from a financial viability standpoint shops have to be careful with their cash flow. Offer too much for cards that don't move quickly enough and you hamper your ability to keep up with the bills and purchase of new products as they come out, and of course, offer too little and you will inevitably have difficulty bringing in new singles inventory to replace what is sold off to be able to make things work. So a number like 50% cash, and 2/3rds trade like I employed ended up being in that sweet spot that made things work, even if I did let my inventory get a bit out of hand by not getting help sooner as mentioned above. Shops with good legacy or higher end EDH groups have a much greater ability to offer more for higher end old cards like duals that they would have a much easier time being able to move, but a shop that doesn't have a good base like that, will have a harder time being able to offer more for such cards accordingly knowing they may very well sit for a while and having too much value in inventory that doesn't move is bad for the cash flow and thusly bad for the business.
I've had to reality check more than a few people over the years to how difficult it can be to run a shop and all that goes into it, but for those dedicated enough with a smart enough plan, it can and certainly does work, in fact I continue to offer advice to people to this day in regards to such areas, and I only hope that what advice I have been able to offer has helped them to either make a successful shop work, or to decide it perhaps would be better to rethink their plans so as not to jump into something they may not be ready for.
Based on your thoughts... it also seems to me that the TCGP buylist price is just not an accurate/realistic measure then for most stores. Definitely good to know.