First of all, to clarify - what do I consider speculation? Sometimes also called hoarding, the basic idea is this: I have a card for sale on my site that is cheaper than it should be listed at, or cheaper than it will soon be listed at. Most likely cause: a deck (or decks) has hit the scene that is winning tournaments, and a key card or cards in that deck, being a previous "unknown" as it were, suddenly sees a peak in popularity, and therefore price. Secondary possibility: some decision made by the DCI has caused some card to somehow become more desirable (as in the recent case where the banning of Mystical Tutor lead to a leap in price for a similar card, Personal Tutor). Someone then comes along to my site, and buys out every single copy of that card, with the intent of selling or trading that card for a profit - not for personal use in decks of their own.
As a store owner, I have a massive problem with this. And it's not completely the problem that you would automatically think it is. Yes, I will admit, it hurts to have 8 copies of a card sell for $0.75 when the prevailing market price is more like $2.00. And that is certainly a reason I don't like this practice. But there are other issues here that I think need to be discussed from the store owner's point of view that the speculators may not think of. So, in no particular order, I share some thoughts...
- The most common response when I gripe about this behavior is that I should just be better at keeping track of prices. I fully admit that this is my least favorite part of running a store, and I don't keep up as well as I should. In my case my store has a single employee: ME. My two sons sometimes help me with sorting cards, but that's about all they can handle (they're only 7 and 10 right now, after all - maybe when they're older I can hire them on with more responsibility). In addition to this store, I am essentially a full-time stay-at-home, homeschooling Dad. I have a part-time job that occupies me one day a week. In other words - I have a lot on my plate. Those who follow this blog or my Tweets on Twitter know that I rarely have time to sit and work on store stuff beyond pulling orders - and when I do, it's usually getting new inventory listed. It takes a long time to reprice inventory, and a great deal of time to try to follow the many blogs, tournament coverage, etc. that I would have to follow to stay up-to-date on what the hottest deck tech is, and therefore what the hot cards are. Time I usually don't have. Sometime this leads to kick-myself-in-the-pants moments (how many days did I hear about the freaking Pyromancer Ascension deck and not keep up on the price of that damned card?!?! ARGHHH!!!!!).
- My personal biggest grief (even more than loss of potential income) is loss of hits. What do I mean? The vast majority of the hits on my web site come from Google searches or something similar. People looking for the hot new card for their own personal deck will Google search for that card. But if I don't have a card in stock, I don't show up in that Google search. Which means a potential new customer (who would possibly have bought more than just the hot new card, and may have become a long-term return customer) never finds my site. All because one greedy bastard came by and bought every copy I had. THIS is the part that really steams me: when you come and buy me out of a card, you come to me only when it serves your wallet. Potentially, then, people who MIGHT come to me because I offer amazing service, reasonable prices, quick shipping, etc. may never even know my site exists because YOU bought every copy I had. it's not JUST the card in question that you burned me on - who knows what all business you may have robbed me of?
- Unlike some stores out there, I do not limit the number of copies of a card you can buy, nor do I (nor will I ever) cancel an order I deem to be "speculative". Sure, I'll whine about it on Twitter (and have), but I honor my commitments, even if it hurts and I'm ticked off at the speculator.
- I take it as a personal insult when someone only buys at my site for speculative purposes. We sellers can tell who these people are. A very famous speculator has bought from me several times - and only for these purposes. I'm good enough to make a quick buck off of, but not for anything else. That hurts.
- If you want companies like mine to stay in business, don't be greedy. If you find a cheap card that's hot or about to become hot, buy 8 or so (so you can make SOME profit) then be a nice guy and write to them to bring the low price to their attention. Everybody wins - you make some profit, and they get to adjust their price to make it reasonable and still potentially draw in traffic.
Comments welcome!
32 comments:
Very well said. I see both sides of the coin. Most shops rebuttals are not as well spoken as yours.
Hey Don! Great blog post, and glad to see the other side of the fence. I actually posted over at that other blog, and had my post deleted- not everyone likes respectfully-phrased, dissenting opinions, but I enjoy a civil debate!
With regards to your post, I agree with some but not all of your points.
First off, I'm not entirely certain you should feel 'hurt' or personally slighted when someone shops you on price. The reality is, service tends to matter less than cost to most- look at Wal Mart's revenues, for example. I wouldn't take it personally, it's just the way of business.
Where I *am* far more sympathetic is in your concern about business. I know when I've shopped online before, if the place I've gone to is out of stock on a couple cards, I'll typically go somewhere else rather than split the order and double up on shipping. It is a PERFECTLY ACCEPTABLE business practice to limit order sizes so that you can fill the needs of a greater amount of customers. (It's just as acceptable for those individuals wanting to buy large quantities to avoid such merchants that risk throttling their ability to do so).
I've read of places that cancel orders of a playset just to try and milk a few bucks out of it. While I understand that a dealer reserves the right to do business with anyone, I find that abusing the concept and will avoid such places in the future.
But when a dealer such as "Cape Fear" has a STATED policy that this buyer runs afoul of, it's a little childish to make such a tantrum out of it when the store- get this- actually enforces stated policy.
I think the behaviour of some in the Twitterverse is shameful and deeply selfish, lambasting Cape Fear for actually enforcing their own policy (and taking the time to explain it to the embittered fellow). Such attitudes are a cancer on the community, a "me first" feeling of self-righteous entitlement.
By the same token, I absolutely endorse the desire of my speculative brothers and sisters to "vote with their feet" and patronise businesses that allow them to speculate on cards. As any read of a Quiet Speculation will tell you, it definitely takes some work to be on the bleeding edge of this stuff, and they should reasonably expect to make a profit at it if they put in that kind of time.
But they should not feel entitled to do that anywhere they wish, and take affront if a store has an upfront, stated policy which checks that sort of purchasing behaviour.
If a business cannot look after the means of business (Google availability, or keeping copies in stock for the player base at large), then they may not long be a business. And with the decline of competition comes... increased prices. Who'd be happy then?
@ertaislament - I know I SHOULDN'T take it personally - but it's a personality flaw of mine :-) When you ARE the store, anything that reflects on the store reflects on you.
I emphasize with your plight, but from the sound of it, you expect your customers to do elements of your job for you (or else they are greedy bastards). Your site offers to sell a commodity without limit or restriction at an advertised price. How can you be upset whatsoever when someone takes you up on your offer? Are they lying, cheating, or stealing from you?
The issue of not showing up as having an inventory in stock is easily remedied. Always show an inventory of at least one. You could have your bot written to never allow the last item to be sold, to notify you when someone buys all but one copy, and so on. There are countless solutions if you just take responsibility for your own store and set it up in a way that harmonizes with your business model.
As far as people that react quickly to information about bannings and restrictings, you are not entitled to "market price" so don't fool yourself. You are advertising a product at a price. If circumstances suddenly change making it much more desirable, you aught thank your lucky stars for the business boon soon to come. If you are concerned about selling your entire inventory for $0.75 when "market" is $2, perhaps it would serve you to pay attention to the exactly four times a year that there are changes to the banned and restricted list (which are not exactly dropped on us by surprise). You wouldn't even have to take your cart down, just pay attention for 5 minutes after midnight on each of the four days. Usually, there are no changes, but if there are, either adjust your prices immediately, or temporarily remove some percentage of the inventory to evaluate after you see what the "market" does the next day.
As far as keeping abreast of current trends such as the rise of pyromancer's ascension, that IS your job. You don't have to do it, but you can't be mad if you don't make the money you would if you did it. Besides, at the end of the day, you can set your prices to whatever you want. If you were willing to sell the card for $0.75 yesterday, why are you going to be mad if someone "takes it from you" for ONLY $0.75 tomorrow? Why? Because you COULD HAVE made $2 if you had been paying attention to your job? In my eyes the store owner that feels entitled to that $1.25 profit, without actually doing the very basic work of keeping up with the market is the greedy one.
Please understand, this is not meant to be offensive, I am merely trying to shed some light from another perspective.
@Anonymous: I understand completely what you are saying. And, in fact, I have told myself this exact thing: "if I was willing to sell it for $0.75 last week, why not today" when I felt particularly stung. I have considered making cards available in my inventory even when I am out of stock (like some stores do) - there are reasons for and against this, and that is a whole 'nother blog entry :-) Perhaps if I were to do that my major concern about loss of business would go away. But right now there are valid reasons I keep out-of-stock items unlisted.
I really enjoyed your article, it justifies policies that prevent individuals from buying in bulk.
But my frustration isn't with their policy, its from their inability to enforce it properly and simply let me know about it from the get go. I received an email stating that they weren't going to be sent out to me because they "would like to be able to hold cards for local players" with zero mention of their policy. I had to email them back to be properly informed about what was going on. They apologized and made me an offer, I was a bit heated but I knew that was just the way things were. I had no intention of making any of this public until they felt the need to let me know about a previous bulk order to prove some kind of point, but in my eyes I see it as a bit hypocritical. I later received another email stating that the first order was okay because it was the first time, like I committed some kind of infraction and that was just warning.
I 100% agree with Anonymous (above). There are measures you can take to prevent this from happening, including actually setting a limit of 8 (which is the number you yourself suggest); never letting your inventory go below 1 (so it shows in Google searches); and watching the market, or simply following people like Kelly Reid or Jon Medina on Twitter. That's where most people are getting their information anyway, so you wouldn't necessarily need to keep up with all the tournament results.
As Anonymous said, it's not like people are stealing from you; they are taking you up on your stated offer of Card X at Price Y. How can you be angry at that?
@MtgVeteran: I understand your frustration, and I hope you weren't insulted at my linking to your post about the incident. I had seriously been thinking of writing on this for months (ever since the first time a certain someone cleaned me out), but tonight I finally felt inspired to actually do it thanks to reading yours. I thought "the other side needs to get shown here..." But I agree with you on the cancellation - I'd never do that. I'll gripe and moan [and have] but I'll honor the deal.
@Affinity For: I need to look into setting limits (I'm not sure if it's something ProStores allows - I need to check) but that wouldn't help in all cases. For example a speculator who shall remain nameless bought me out of Polymorph a while back - no more than 8 copies from any given set, but since there were so many editions it was in, it was still 19 copies when all was said and done.
Personally, I do not like when online stores choose to randomly enforce policies such as this. If they simply said "I will not accept orders for more than x of any card" find, that is their choice. I get upset when stores allow the order to go through then cancel it after.
Think of it this way, if you bought something in a regular store (Target, Walmart etc) and were stopped at the door after you had paid and were told you could not have the items, here is your money back how would you feel? What if you found an old Duel Decks or some such at MSRP that you were planning on reselling in your own store and bought them out, would that be ok? That is the same thing ANY store owner who is pulling this is doing. I barely speculate at all and I will not buy from Cape Fear or any store that does this because I do not trust them.
@pureval I agree 100% that canceling an order like that is dirty pool (although in the case cited the store DID have a statement regarding their policy on this, so it became a case of buyer beware). And, yes, I have felt hypocritical before when finding a "gem" on eBay that was going for less than I knew it to be worth, and buying it for my stores' stock. I will admit that.
My problem with their policy is the clearly did not always enforce it, and it was unclear at best. If it was straight forward I would agree with them 100%, but this "any order when we feel like it" makes me uneasy.
@pureval An excellent point. If you're going to have the policy, you need to enforce it 100% of the time, not whenever you feel like it.
@don I also found this post to be excellent. there is no point in saying what others already have in the areas I disagree with, they are all mentioned and addressed in here so far. Being a speculator myself, I understand that shops will probably disagree with my practices; buying low and selling high, and if I'm limited to the number of cards I buy upfront, that's fine. If you have cheaper prices for those 8 cards than someone else does for their 12 or 13, I'll probably take the 8 and be happy. (obviously there are exceptions) If it comes with great service, I'll happily return to that store when I need something non-speculative. It may not be a huge order, and will most likely just be the one or two things I need that I cant find in my area, but I'm also going to recommend that my friends go to the store I'm happy with if they ask where to get cards from.
The other thing I think should be said is that many of us speculators see it as a challenge to be ahead of the curve. I think of online speculative buying almost like "little wall street", only this one isn't regulated and insider trading is much easier, and doesn't earn you jail time.
Speculators, were like stock brokers for your past time/hobby :D
Ack! I inadvertently deleted a comment from Leo - sorry Leo! Here's his comment, in its entirety:
--------------------------------
Hey there,
First off I'd like to introduce myself, My name is Leo and I'm a graduate student from UCLA with a degree in sociology and a minor in economics.
Secondly, good to see you have a reasonable and logical argument, a lot of blogs are just rants and irrational claims with circumstantial evidence.
My take; I recognize you have a right to concerned with your establishments reputation, and revenue. Small business is INCREDIBLY hard to maintain with capitalism in the 21st century, and you have a right to be angry if someone is "cheating" you out of either. And i commend you for being able to survive it.
However, you have to protect yourself from these situations. Realize you are in a capitalist economy which promotes competitive pricing, with little to no moral boundaries, and the all mighty dollar takes president.
Setting the limit of 8 a lot of people have recommended is a great idea to prevent the loss of "stock" which is your lifeblood in the economy. Without stock you're no longer a merchant.
One point I think a lot of people might have missed is the revolution of internet markets. By having a online store, you not only have access to the entire online community, or basically everyone in the world, but the criticism and responsibility that comes with that type of cliental.
Also keep in mind, that because of internet markets, consumers are anonymous and can be whoever they want to be, so even if you set a limit of 8, and someone really wants to buy 40, he's going to make 5 accounts and buy 40 off you anyway.
You obviously have the right to refuse service to anyone but then you are subject to that decision. In the example of Cape Fear, they Do indeed have a policy that states this. However with all the negative publicity they're getting with these blog posts does that policy have merit? Only time will tell, perhaps that policy has saved him many dollars, but it definitely deters customers.
So, to sum, the market dictates the demand of a product and you having part of the supply are able to adjust the price. You have to protect yourself from these forces in order to maintain a supply that the market deems worthy of you having a competitive stake in it. In other words, people are going to keep buying from you as long as you have product they want, afterwards it doesn't matter if you have great service, as a merchant you're powerless w/out product. So restock faster! Put a limit on how many items they can purchase, and if you're still being bought out, working at 100% then my friend you are doing a lot better than a lot of other magic stores and should be proud your business is doing well.
-Leo
@Leo: [First and foremost I offer apologies for deleting your post - Blogger was showing two copies, and I thought I would be deleting a duplicate, just to keep things cleaner]. Food for thought - thank you. I do need to investigate placing limits on sales (as you say it won't 100% solve the problem, but it's a step in the right direction).
oh ya i double posted like a noob so no worries and good luck :D
@Leo - thanks for being understanding. Wouldn't want anyone to think I was censoring :-)
Thanks to all who have commented so far - my blog has NEVER seen this many comments! I appreciate everyone who has taken the time to type their thoughts.
The problem with the incredibly whiny blog post and the people agreeing with it is that he was not doing speculating of any kind. Speculation is buying a card whose true value has not been recognized. True speculation requires a very thorough and deep understanding of the game at a competitive level of play.
The owner of MTGWar is not a speculator. He's an opportunist. Jumping on a card the night tournament results are released in hopes to grab them and resell them the next day when everyone's prices go up requires no foresight or thought. It's something any smart person would do, just as any smart business owner would prevent people from trying to do this and it's pretty ridiculous that he thinks he should just be able to bend this smallo business over for his own benefit and get uppity when they actually retaliate.
True speculators buy 100 copies of a card six months before it's ever even hinted at in a tournament deck. I'm sure if he was buying fifty copies of a junk rare, they'd be perfectly fine, because then he's actually banking on something and investing, rather than trying to snatch an opportunity that he really has no specific right to or special skill which allowed him to attain it.
Hello,
Interesting read and perspective, but how about this for an option, one i'm surprised has not been mentioned in all of this drama.
Most bulk or low end cards that suddenly spike are usually not in limited supplies. I'm sure you had more than 1 pyromancer ascension, maybe more than 4, maybe even more than 8 depending on the size of your shop.
So if i'm correct in this assumption, would it be possible to not list every copy in your store software? Say you have 32 copies of Pyromancer's Ascension. Why not list only 20 of them in the store? The speculator comes in and buys them all out of you, but at least you have another 12 which you can put back into the inventory software at a newly adjusted price instead of getting burned.
If the speculator is buying to get a quick buck, they do so, and you still have plenty of copies for people who google for the card or are willing to buy it for the going rate for their decks. Both sides win and you make more money in the end.
So you may think about this, it's good to know your inventory and this means copies might go missing? Your stock should be organized and when you're fulfilling the orders you'll notice a surplus from the amount available. If a stock gets low, you can put more in as a restock. This works when suddenly someone buys a ton, or if you get low you can add more. A retail shop may order 50 of the same TV's, but they aren't going to put more than a couple out on the shelf at a time. They'll have overnight workers restock the shelves as necessary with their bulk.
If you're running a store, time shouldn't be an issue on this part either, even if it's a single person running it. You're running a business and expected to spend enough time on it as needed, and i'm sure the time it would take to monitor inventory for anything getting low is not much more than it would take to make this blog post, much less the other blog posts and tweets you claim to do complaining about these issues.
Do not take this as an attack on you or your business, but constructive suggestions to be able to reap the rewards of a dynamic secondary market in this hobby as well as provide customer satisfaction to all customers regardless of your personal feelings towards them. As a business these are key things to keep in mind because customer base provide your incentive for the business, regardless how you feel about them.
@karl: Thank you for your thoughts. ProStores does allow me to set a "threshold" at which, if an item's inventory drops below, I am notified that it's time to restock. So that could be an option. Alternately, I could just set my own cap of 8 copies in (posted) inventory at any given time. It would add additional processing time when I pull orders to keep up with bumping the # back up to 8 (or whatever the proper amount is) but this is definitely a potential solution to give more thought to!
Hello,
I came across this blog posting and have come to make a suggestion to your business in regards to this issue that would benefit both you and the speculators without getting burned.
Perhaps instead of listing all of your stock into the inventory software for your online store, put only some of the stock into the system. For example if you have 32 pyromancer ascensions, why not only list having 20 in stock.
This practice allows the speculator to buy the 20 if they feel so inclined, but you can then relist the other 12 with the newly adjusted going rate, allowing the people who are searching for it to put in their deck to have their own copies.
This requires minimal time or effort, and if you already organize your inventory you can check to see how many are online, and add the remaining ones or some of them when you notice it is low in stock. This works both when the hot new tech is being sold out at all vendors, or when the occasional people who buy 1 or 2 has caused you to run low of certain cards.
If time is an issue consider your own time management. If you have time to blog and tweet expressing your concerns over this issue, then you can also apply the time to monitoring your own inventory in the extent I have explained. Not to mention if you don't have time for a business, then maybe it's not the right time to have the business.
continued from previous post...
Many major retail outlets and businesses don't put their entire stock on the shelf. Even on the local game shop level, my store may have a sealed box and open box for booster sales, but then pull out 2-3 boxes during the draft events. They obviously have the excess boxes stored in the back because having a case or two of product sitting on a shelf takes up more store real estate than necessary and doesn't look as good to the display.
I've seen bigger brick and mortar game shops do the same with singles. Putting 1-4 in the display case then leaving the rest stashed in boxes behind the counter. If a store had Birds of Paradise in stock what looks better in a case: Having 3 or having 40?
Please take this simply as constructive suggestions. I don't claim to be an expert at business, marketing, or economics, but I take an approach i've learned from my experiences with jobs, the business owners that I am friends with, and the experience I have had with an ebay business and small time mailorder work i have done on my own. I wish the best for you and your business, and hope this may help you benefit in the future.
I had a dream last night that Archmage Ascension is going to be the centerpiece of the next top Standard deck. I'd like to buy all twenty copies you have in stock.
I don't think you care so much about your policy in this situation, right? But that's the risk speculators face. It's easy in hindsight to say, "Doppelgangers just went up $0.45, that guy screwed me!" But what about when we speculated on Mind Over Matter and it turned out to be a dud? You have no problem taking our money in those situations.
Sure, in this case, it was pretty obvious that Doppelganger would spike in price after Nationals. But what if it's never used in a competitive deck again? What if it drops back down to its original price? Now we speculators just helped you out by taking some bulk rares off your hands.
I guess I don't understand how "speculator" came to be translated as "enemy of small business." I always thought it meant "customer who pays good money."
As for the argument that buying you out of stock reduces hits on your page: what if you only have 3 of an item in stock, can I buy them all then?
And really, if you have the foresight to mark up Doppelganger to $1.00 before the speculators get there, you probably aren't going to sell many Doppelgangers, as other dealers (and those speculators that found them cheaper elsewhere) are going to undercut you.
@Brad: I'm glad to see from your second comment that you actually read my full post (it was unclear whether you had from your first one).
You are absolutely right that if I have only 3, then no matter how I try to limit purchases (if I do indeed decide to do so) it will not prevent this. This happened to me with Eye of Ugin, I believe. When it peaked overnight after the spoiling of Kozilek, the 5 copies I had were snatched up by a single buyer.
I am gravitating towards a need to get my entire inventory listed with Google, even if I'm out of stock. I am nearly 100% sure it can be done - there are just some logistics questions to work out. That should eliminate my primary concern.
As for loss of "potential income" (to coin a phrase describing the money that could have been gotten selling the items at a higher price), I accept that this is just part of the risk of doing business. I certainly don't like it, but it's a risk I take.
My reason for the post was really to just open your eyes to the other side of things. But some, it seems, would rather keep their eyes closed.
Very good post.
Hey Don. I really enjoyed this post. Regarding your concern about losing business due to not having a card in stock, i am personally a speculator, and when a store doesn't cancel my order, i take note and use that store for personal purchases as well, because i am happy giving my money to a store that honors their agreements with customer
@Noah Thanks for your comment. This is one of the reasons that I honor such purchases, even if it may irk me to do so. It is my hope that (especially given the number of online stores that seem to cancel orders, as has recently happened with Time Spiral) my doing so will encourage people to come back and place non-speculative orders with me as well.
you have opened an online store. it is your responsibility to price your cards accordingly.
also, you FAIL to mention the fact that speculators are speculating. cards that they believe WILL rise in price often do not, or do not move significantly enough to warrant the effort/time that they put into their speculation.
if a card moves 10%, but i can't move any of those cards because demand is still low, where does that leave my speculation? who gained? only the store, because it has moved product that nobody wanted, and nobody still wants, at a reasonable price.
to complain about anything else is just immature.
i do understand loss of future business, if that is the case, you can simply list all cards as available, and then keep ONE in stock.
there are easy solutions if you spent the time to find them.
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