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As a buyer, the average person wants as many people selling LEGO in the after market as they can get. It helps keep costs down for a much longer time than they otherwise would be. If you see prices staying high, it's because there is demand for that particular set and the market will bear those prices. There is almost always someone willing to sell for less than the lowest priced set.
I've been an AFOL for going on 20 years and a fan of LEGO in general my whole life. I've been on eBay since 2008 and have been selling for fun and profit to support my "habit' almost as long. I can 100% tell you after market prices have dropped substantially in the last 4-5 years relative to what they were like before.
Now, for some on here, yes more resellers may suck because YOU aren't able to get there deals you want. I understand that completely. The average buyer out there however is mostly oblivious to LEGO marked down 50-75% off. That simply doesn't exist in their world. They are just happy that when little Timmy wants a set that they can't find at Walmart, toysrus or Target, they can go to Amazon or eBay and there it is.
Someone trying to buy up stock of a new, hard to find stock is a scalper. And that can be very annoying. But, unlike concert tickets, if you just wait a bit, 99.9% of the time the product will be available later for regular price. That's on the people that feed the scalpers in my opinion. As the old saying goes, a fool and his money are soon parted.
You can have what ever opinions you want, but experience and facts have shown me more resellers is good for basically everyone but resellers (and the"fan" population that makes up a miniscule portion of sales relatively speaking anyway).
Funny, as reality speaks a totally different story.
You have to be a first week economics student if you believe those formulae to be true in the real world. Markets in textbooks work that way, markets in reality often do not! That isn't even debatable.
By the way, I have been on ebay since late 1997 - basically from day one - and been buying LEGO there ever since. Actually, my very first ebay buy was a used LEGO set, 891.
And I can tell you that prices have not dropped in the last 4-5 years, but skyrocketed, at least over here.
I guess it's very different in the US, where competition is much fiercer, hence the oft-mentioned huge rebates/discounts from the likes of Target, Wal-Mart, TRU etc.
We simply don't get this over here to such an extent. For a start, we don't have such a lot of large chains (or as many competing stores) selling LEGO. Nationwide we have basically Kaufhof, TRU, real. That's more or less it. TRU is usually very expensive, with just a few good deals over the year. Kaufhof in general offers the best deals, and most often, whereas real is basically a chain selling everything, but mainly consumables, with toys being just a minor part in their portfolio. There's also lots of small and very small independent toy stores (some of them organized into "chains" like "idee+spiel"), which occasionally offer some good deals, but many of their stores are just local and their online outlets are small and hard to find, if they have one at all.
And of course there's Amazon, but even there you don't find 50-75% off very often over here either.
Come to think of it, 75% off would be a real find here, no matter at what store, can't even remember the last time I saw any such deal - at least on LEGO sets.
And stories like in the "Brag"-thread, where people from the US mention buying sets for less than a Dollar at some Wal-Mart or Target, forget it. Not a chance in hell something like this would ever happen here.
By the way, if you still don't believe me, just go to a set details page here on Brickset. Take a look at the Bricklink prices for different countries shown there. Most of the discontinued sets (as well as many current ones) are much cheaper from US sellers than from German ones, often drastically. That is no rounding error, or coincidence.
In Germany you say there are not many companies selling Lego, so you don't have access to low prices that competition brings. If you can't buy significantly less than RRP in Germany then any resellers will want a return more than 2x RRP as otherwise they'll have no margin.
Compare that with other countries where someone bought the same stuff on sale at 50% RRP (due to healthy competition between retailers clearing old stock). They can do a quick flip just above RRP and still make enough to make it worth their while. The aftermarket consumer has more choice in sellers if there are more of them, someone will be looking to be cheaper than the next guy to sell their stock quicker.
The adage of more sellers = more competition = lower prices does hold true when collusion/price fixing is not a factor. It just seems that in your case, Germany has a distinct lack of competition due to a distinct lack of sellers.
Way back in 97 ebay was an online car-boot/jumble sale/garage sale, it's a huge marketplace now for anything you could want. Back then people weren't buying Lego for resale, so there was no access to new/unopened sets post retirement unless someone was offloading an unwanted gift. No competition back then, but no healthy demand through Ebay for new Lego back then either.
Usually I would totally agree. But not when it comes to ebay, which is the main secondary market source over here. The number of sellers/offers is increasing, yet prices go up even faster.
Interesting to note that many of them don't sell the stuff at those prices, yet instead of lowering the prices when they reinstate the offers, they keep the insane prices up or even increase them again, perhaps on the slight hope that some poor fool will one day indeed pay such a price.
I wonder how these sellers manage to survive, if their sets with the highest margins don't sell.
In the US otoh, sellers seem to adjust their prices to the demand far more reasonably, and faster. Perhaps German resellers are just too stupid ;-P
Some 2013 SW sets:
EV £200 retail, ~£220 ave on BL
Red5 £170, ~£200
Battle packs £12, ~£15
A-wing £25, ~£28
Z95 £40, ~£50
Rancor £60, ~£75
Planets £12, £10-15
Battle of Hoth £40, ~£70
Duel on Geonosis £40, £45
Jabba £100, ~£110-120
Republic Gunship £110, ~£180
I've not done country specific prices, as it is difficult to get past data that way especially for so few sales. UK prices are likely to be slightly higher than those BL ones. I wouldn't say any of them have skyrocketed, they've held value but not increased that much. Two have done reasonably well, but not doubled.
Big LOTR flagship set like Orthanc, US buyers can get one for $240 on BL (retail $200), Europeans about 300 Eur (retail 200 Eur).
Plus they are easy to remove by eye for a set that has been sold more than a few times - I didn't actually use the average calculation in the price guide, I looked at the distribution of sold prices.
Interesting tidbit: 119 copies of Ewok Village was sold on BL in the last 6 months. In the same period, the 4 sellers with the highest number of feedback has sold 674 copies of the Lepin copy of this set... (Tried to get some eBay figures, but it's not straightforward.)
My initial point was that big box stores like Target/Walmart etc. aren't inherently more valuable to Lego then resellers, if hupothetically resellers all way upped their purchases from Lego and the big box chains all stopped ordering, fundamentally it'd be the same.
Obviously Lego wants these stores to sell their stock so they make more orders, but at its most base level Lego's already been paid. My main point was that in theory resellers arent any more or less valuable to Lego than Target.
And more resellers in general means us as consumers will be able to acquire cheaper, older, sets.
And already are important/good for consumers!
Of course they wouldn't. If 20% higher was the market rate that buyers were willing to pay then they should increase their prices. Of course, savvy buyers would have bought from the guy that had cheaper prices, if he was advertising them.
Most resellers I know don't wait until the market can't go higher. For sure, I don't when I resell. I wait until I feel it has appreciated enough, and that something else will appreciate faster. If resellers waited until the market can't go higher, they wouldn't sell anything.
The more resellers, the more stock is saved for later sale. However, resellers cannot control the number of buyers in future. Large amounts of stock and a low trickle of buyers means a slow increase in price if buyers continually buy from the cheapest resellers. Small amounts of stock and a low trickle of buyers means a faster increase in prices, as the number of sets on the market diminishes.
Yes, resellers can set their own prices. However, buyers ultimately determine prices in a healthy market with plenty of competition. Whatever is going on in Germany is more likely indicative of the downstream forces at work. The entire population of Germany is 1/4 that of the United States. Just by demographic information alone there are going to be less resellers in Germany. This is compounded by less substantial sales at the local level. Also, it is entirely possible maybe even probable that the average citizen has greater wealth in Germany than the average American. Thus they tolerate higher aftermarket prices. I don't know.
Just a quick search on eBay Germany shows 29 sellers for LEGO set #75902. In the us there are 167 listings on eBay. There are 17 on amazon.de and 89 on amazon.com. The lowest buy it now prices on each reflect this disparity. They are more expensive in Germany than in the USA. I GUARANTEE if you increased the number of sellers of that set in Germany you would see the price drop. At least until the numbers of sellers dropped and the market rebalanced.
There is a reason why things that are nearly universally accepted as true are referred to as "Textbook". That doesn't change whether you are a first week student or PhD student in your field. The fundamentals are the same. The differences between Germany and the USA can easily be explained, but they are not because Germany exists in some sort of alternate economic reality.
Also anecdotally, I used to regularly buy sets from amazon.de, amazon.fr and amazon.uk and import them to the USA because they were cheaper than anything I could find here. Amazon nuked that a few years ago so now I don't even look at prices in Europe.
Right now on eBay, looking at Wall-E sets. There are currently 3 auctions around $50 (with a lot of time left), a couple of auctions around $75 (with time left), and a bunch over $100 (most at Buy it Now). Looking at the history of that set, there are around 11 Buy it Now auctions that sold at over $100, a couple around $80, and a couple around $60. Both of those are a mixture of used/new, most new. edit - This is just from the last week or so.
Why the heck are people buying sets at the $110 price if they can have one for less? Time. They can't be bothered with looking around for cheaper sets. They pay whatever to get the set and move on with their lives.
So if I had a Wall-E set to sell, even if it was used, I would set the price at what the other sellers are putting for Buy it Now, I would choose like $105 or so. From what I have seen, the lower priced sets sell quickly and are gone, leaving a ton of higher priced sets that WILL eventually sell, thus driving the price UP even though a bunch of people have these sets for sale and have more put away to sell.
You can see the same trend with any other set.
Also not all sets will eventually sell (for current rate or more than what the last buyer paid). If there is no longer a steady stream of buyers wanting something, even at the current price, then sellers will have to reduce to sell. This can happen if something becomes less popular or something similar but better is made. Taj Mahal sales were very low volume at the prices offered before the release and look what happened to those. The same thing happens for a system X-wing or landspeeder - the higher priced don't necessarily sell and then if something else comes along, they become unsellable at the price that the seller wanted.
The more people there are holding stock, the more likely someone else will undercut the bottom price to get rid of stock.
Take a look at the Ninjago Movie polybag for example. You could get these for about £2 in the UK a few weeks ago.
One seller wants £9.98 for this. He is going to have a long wait. 8 have sold in the past six months. There is about 11 years worth in the queue before him, if demand holds up. If I had bought that many, I'd be thinking that I might as well cash in now. I'd list them at probably £4.75 and hope the few at £3.99 go quite quick then I'm next cheapest. Or just try to dump them now at £3.95 each. Althoguh even at that price there might not be demand. It might need to be dropped to £3 to really start shifting them. Whereas the Belgian seller might be more comfortable as he is the only seller in his country with them that cheap, so he might well get his asking price.
Whereas if there were just two or three people with stock, the one wanting the higher price would be much more comfortable with his price, knowing that once the other sellers have sold out, he controls the market.
But actually, I think your data is even proving my point now that I think about it.
That is an undesirable poly that was around £2 if not actually free (two sellers have 50+ of them, a number of sellers have around 20 of them). But look at those prices. You even say yourself that you would price it at £4.75, but where did you get that number? I'm guessing based on what other sellers are pricing it at. For a free/£2 poly. Why on earth do so many of those sellers have the price set close to £10? Because their prices are influenced by all of the other prices that are out there! In this case, more resellers = sky high prices (which some people WILL pay).
Thanks to scalpers, there are people who were unable to buy #75192 while the VIP promo was going on. There are several posts from members here that were hot to buy on day one and reconsidered due to lack of availability. Meanwhile, LEGO was shown that they could have priced it even higher, because people were buying them from scalpers for higher than MSRP. Somebody at LEGO has surely seen that over 700 #75192s have sold on eBAY for over $1000, so they might as well raise the bar again for the next huge UCS set.
Competition in the aftermarket is a good thing, but "more sellers = lower prices" ignores the reality that for every middleman there is an added cost. When the manufacturer see their product selling for much higher than retail, it lets the manufacturer know they can probably increase prices and keep making sales.
(And 'scalper' is just a pejorative term for a reseller. One scalper with one ticket will be able to demand more value than one hundred scalpers with one hundred tickets... thus market.)
I have a set of German Football CMFs that someone should buy from me for $300,000,000.00. I will take payment in Bitcoin, only. And I'll throw in a chrome Stormtrooper.
But there are people currently in the market that are setting their prices artificially high and that is affecting the market. And historically that has happened in other markets as well.
I remember when The Phantom Menace came out. There were tons of people buying action figures thinking that the prices were going to skyrocket due to how expensive certain figures from the 80's were to collect. There are still shops where I've seen those action figures for $30 but I've also seen people clearing out their buy in stock at garage sales for $1 a figure. So that market mostly sorted itself out. Took quite a while though.
I could list a ton of other markets that have been affected buy new seller expectations. My point is that right now, this market is being affected by the expectations of new sellers. It won't last forever, and is most likely on the decline, but it is happening. I'm sure you can find examples that show the opposite but for those of us on the buying end of things the trend is more sellers with higher prices.
Like you said about artificially high prices - that worsens with less sellers. With more you have people trying to undercut one another to get the sales.
Yes, I do, with new, in-demand sets that are not available on the primary market because they have all stock moved to the secondary market. #75192 is the perfect current example of this.
"Of course after market prices will be higher than RRP"
So the prices DO go up when more sellers are involved.
"but with more resellers that level of highness is brought down.Like you said about artificially high prices - that worsens with less sellers. With more you have people trying to undercut one another to get the sales."
More resellers certainly means they have incentive to compete - but most won't get all the way back down to MSRP for items like #75192, because they paid MSRP to get the product. But a few primary market vendors, like Toys R US, Walmart, and Target, each with thousands of units to sell, will drive prices lower than having 1000 individual resellers with one each to sell. Absent a primary market, having a lot of resellers in the secondary market is a very good thing.
And that is just one way the market can be affected. Again, my entire point is that you cannot definitively say that more sellers = better prices.
More supply will ultimately yield better prices. Less supply simply cannot result in better prices. It's basic economics. Using the new UCS MF example - that is an instance where demand exceeds supply.
If you have a seller not actually selling, or a buyer not actually buying - then (by definition) you don't have a market.
More sellers means more competition, someone will always be willing to undercut the herd, no matter the advertised selling price. Same in all markets, otherwise we'd all be paying RRP for everything, whether it be a car, an expensive watch, groceries. These rules apply in primary and secondary market. Demand and supply find their equilibrium for everything on sale that isn't fixed in price due to cartel or legislation (e.g. cigarette prices through official channels).