There’s been a some talk amongst the toy community about a greedy aftermarket of speculators (a.k.a. scalpers) snatching up MOTUC figures from Mattycollector.com and re-selling them on eBay for high prices. Often the existence of this aftermarket is simply assumed in forum conversations, without the presentation of any sort of evidence. It is often used to justify asking Mattel to lower the 10-per-household limit on MOTUC orders to five figures or less.
Mattel has repeatedly stated their research shows “the vast majority (close to 90%) of orders are for 3 or less units.” Of course, it would be naive to take them at their word, but it’s just as close-minded to dismiss it out of hand as corporate bullshit. The real question is: what is the aftermarket for these figures really like, and is there evidence that collectors are paying scalpers huge prices for them?
Given the recent hooplah surrounding Mer-Man, I decided to do a quick, unscientific study of exactly how much MOTUC figures are going for on eBay. The following numbers are the average final sale cost of each character, based on fifteen auctions per figure from completed auctions within the last two weeks. (In general, I tried to go with the fifteen most recent auctions and excluded auctions with more than one figure or free shipping. I also didn’t include shipping, although it’s probably safe to assume an average of $8-$10, the same as if you ordered from Mattycollector.)
[table “” not found /]Final average prices for 5/4/09:
- He-Man: $78.08
- Beast-Man: $49.59
- Skeletor: $40.42
- Stratos: $25.24
- Faker: $35.28
- Mer-Man: $29.42
Now, let’s examine exactly how profitable reselling these figures could be, using Beast Man as our example (assuming the scalpers would want to maximize their profit by waiting a few months to sell, but not waiting too long and risking the fervor dying down). Let’s say you, a scalper (just in this example!) bought 10 Beast Mans at $20 each, plus approximately $20 for shipping. That’s $220 spent.
In late April, you sell all ten Beast Mans for an average of $50, making a total of $500 (you cover shipping costs and eBay fees in the shipping price of the auction). That’s a profit of $280. Not bad.
Now let’s try it again with Mer-Man. Obviously, right now we’re a lot closer to his sell date and more were produced, but also keep in mind a lot more people probably made sure to order Mer-Man at Mattycollector.com this time around. This analysis should be more indicative of what those people who miss out on the Mattycollector.com window are being forced to pay a week or two later.
So you, the scalper (again, only in the example!) spend the same $220 on 10 Mer-Mans, then sell them for an average of $30 for a total of $300. Your profit? $80. If you take into account the time spent putting up the auctions, packing the boxes and actually shipping them, you’re probably making maybe $40 an hour over two hours of work. It’s a profit, yes, but worth the effort? I’m not so sure. You’d probably have better luck using the figures as trading material.
More importantly, however, the evidence suggests that anyone who misses out on the Mattycollector.com sales window and is forced to hit up eBay a week or two later is paying an average of $10 more more during the “stabilization period” (when initial “gotta have it now!” demand dies down and before the increasing rarity drives prices up).
No one would call that fair, and it’s certainly Mattel’s responsibility (and in their own interest) to increase production until they’re at least getting through a day or two before selling out. However, I have a hard time viewing these eBay resales as successful scalper price-gouging either. Unless someone thought to buy 10 He-Man figures, no one’s getting remotely rich off this line (and of course, He-Man will be re-released eventually, possibly by the end of the year).
Newton Gimmick
I really wish I had thought of buying 10 He-Mans. And 4 King Greyskulls too.
I'd be filthy rich now. I'd dive into a big Scrooge McDuck money bin full of MOTUC profits.
Sadly, I did not have this forsight, or the cash at the time to buy all those extra dudes.
jestergoblin
“the vast majority (close to 90%) of orders are for 3 or less units.”
Based on the assumption that the figures have been produced in 12,000 quantities, we're still looking at a large amount of FIGURES being bought for resale (or hoarding). With 90% of orders being at 3 or less, that's still 10% ordering up to 10.
Just saying, if 90% ordered 1 figure and 10% ordered 10 figures, that would mean more than half the figures would be going to bulk buyers (52%). Which could be around 6240 figures.
Or try this one out, if 30% buy 1, 30% buy 2, 30% buy 3 and 10% buy 10, that 10% still accounts for 35.7% of all the figures sold, which is still equal to around 4284 figures.
Now I know my numbers take a worst case scenario but that's a lot of potential figures that are just going into the resale market.
It would probably make sense to do a bell curve distribution to create a better model, but I've got an exam in an hour to go to!
izdawiz
Thanks for doing this Poe.
Just for completeness' sake POE may be you could do a similar analysis on The King Greyskull and the KIng Greyskull Bronze variant.
Jim
@Poe:"I have a hard time viewing these eBay resales as successful scalper price-gouging either. Unless someone thought to buy 10 He-Man figures, no one’s getting remotely rich off this line (and of course, He-Man will be re-released eventually, possibly by the end of the year)."
Exactly what I've been saying. He man and Beast can get you somewhat of a profit but not anyother characters (at least not now).
Second, I don't believe 90% of the orders have been small orders. Do you know how many online sellers, comic shops owners, etc etc. people I know that have bought 40 and up of each character?
Third, there are all types of scalpers. Unless your selling multiples of heman, grayskull or beastman, it's not worth it. Ebay sellers strain just to make $10 a figure. Being unemployed has its perks and i've calculated and logged all this. lol With ebay charges, the cut ebay makes, the paypal cut, s/h…all plays a factor.
So since it's not really worth it to go the ebay route. A LOT of ppl sell locally. I know a TON of ppl buying locally and on their own website to stamp out ebay charges and what not. There are also online retailers that scalp these and regular people that think they'll get rich off of reselling these.
Here's what I think:
1)Don't blame the scalpers because scalpers are a part of the action figure community. Its a part of life. Especially times are tough, people will always want to make a quick buck. Not saying its right but the world isn't a charity foundation.
2)Scalpers come in all forms and types…not just ebay scalpers.
3)Scalping will always exist because ppl will always be willing to spend secondary market prices.
4)I'll play devil advocate and say that I'd rather have Mattel do sell outs from scalpers to increase hype then Mattel relying on PURE fan base. Why? because again, MOTU isn't marketed like GIJOE or Transformers. Mattel has to rely on high base price points for their units and intense hype for these sell outs.
I believe the scalpers are the life line of MOTU. If they're gone, who knows if Mattel will ask, "What's in it for us? Our sales have dropped considerably, We have all this extra stock from increasing prod runs and the hype is gone."
Now that's what I'm afraid of. Once scalpers (cause of sell outs and hype) are gone, you will have a domino effect that will cause changes to the line.
griffin
I think one way to keep track of how many scalpers there are is to keep track of how many listings there are on ebay. For example, Mer-Man currently has 82 listings, some of which have multiple units available. I'm not sure at what rate these listings are bought and put up but it does seem much better than the worst case scenario presented by Jester, closer to 1000 at worst would be my guess but who knows.
Also, if the point is simply to make a profit, not to become independently wealthy, then $40/h is pretty good, espcially if you do this for cash on the side. $40/h is higher than most people make at their day jobs.
Jim
@griffin: ebay scalpers are only a portion of scalpers. Again, there are a ton of local scalper, online store scalpers and regular people that scalp.
As for profit….it's actually only a little more or less $10 profit for all the figures except heman, beastman and grayskull. So I dont think it's really profitable. Ebay take a pretty big cut and considering each figure is $20…not making much profit at the end of the day.
Jim
A lot of people think that if you buy a figure for 20 and you sell it on ebay for 30…you get 10 profit. After ebay's cut, ebay insertion fee, paypal charge and shipping materials….you'll need to sell the figure for a bit more just to REALLY reach your 10 bucks.
Hagop
Poe-
Great write-up. I really enjoy these "Poe's Points"; always sober and insightful.
Motorthing
ebay has never been the path to easy riches for small scale reselling of a handful of toys. Unless you were lucky enough to score 100 King Grayskulls right at the sell-out point and get them on ebay right at that point then you wont be sending your kids to a better college off the back of MOTUCs.
Where it does make sense is for medium scale shops to get hold of 10/20 and mark them up $15 a pop like BBTS does as it's simply another easy money draw to get traffic to their site at minimal effort and outlay. And a painless profit – for them.
But for all those that failed to get even 1 Mer-man it's a kick in the knickers to have to contend with even the idea that some other bastard got hold of the toy they wanted and dont give a shit about except as a commodity.
That's where the outrage comes from. And it's perfectly natural.
griffin
@Jim, if you look at the numbers Poe gave, you are right, you make less than 10 a figure, but if it only takes like 2 hours to do it, then you make $40/h. It's not enough to live off of on its own, but its not a waste of time either, especially since you aren't adding any value to the item. Which goes to Motorthing's point, another reason people are upset is that they know the scalper did nothing to add value to the item and that they are just selling it higher to make a profit. Its all the more frustrating when you know what the actual retail price is.
Jim
@griffin: To each his own I suppose, I sell on ebay and unless I get profit like that of selling heman or beastman, it's really not worth it to me. In other words, I wouldn't want to charge my credit card for 40 mermans with less than 10 of profit per figure and waste all that time packing those figures. I'm with Poe, that it does seem better off as trade bait but thats me.
As for the scalping issue, I agree everyoneone has a right to be upset but everyone should realize that it won't go away and if scalping does go away…I believe a lot of the things i mentioned above will be the domino effect from the absences of bulk buyers (ebay, online store, local scalpers).
The ONLY way I see selling MOTUC NOT a waste of time is if you get a straight up 10 profit without packing or shipping or having all the ebay/paypal charges. How? By selling locally. If u know people who will buy it for 30 after the guys sell out…then cool! Order 10 and that's a 10 profit per figure minus the cost u paid Mattel for shipping them to you.
(PrfktTear)
This is a well thought out post, and granted its all loosely based on your "unscientific" findings, its still a decent compass to see how this line is going.
I agree with your point about taking Mattel at their word, it'd be naive to do so, but to assume everything they say is bullshit is also being pretty close minded.
Action figure collectors love to blame scalpers for all their woes. I've seen guys walk out of a store with eight or nine of the same figure, you know they're not all for birthday presents.
Also, is scalping necessarily a *bad* thing? It is for those who are unable to order the figures, yes. But what about independently owned comic/toy shops that are ordereing them? They're doing the line a service by a.) helping ensure the line sells well, and b.) getting the knowledge of the line out there and getting the figures out into stores and help raise awareness of the line. Say I owned Joe's Comics & Mor, I see these and figure they look cool and want to buy up a dozen or so to put on my shelves. Customers come in, see the figures buy them, at a mark-up that makes it profitable and worth the time for me, and the customer has a new MOTUC figure in his hand.
Another point, people forget about the greedy collectors who buy up multiples for themselves. One to open, one to display MOC, one to customize, one to keep in a box in the attic, etc. Many brag about how many they ordered… "I ordered my six" so I think that takes a lot into account. Lets be conservative, lets say you have a hundred collectors ordering two for themselves one to open and one MOC, thats 200 units right there.
Regardless, looking at the big picture, the line is selling extremely well. Mattel is trying to meet the demand (so they say, take that as you will) and they're making plans for the line well into the next year or two, and as they've stated they'll do re-releases, so just because you didn't get Mer-Man today doesn't mean you won't have a chance at one in nine months or whatever, and if you can't wait… ebay.
I think MOTUC is better than no-MOTUC at all. As fans we got the 2002 toy line, but that was gone in the blink of an eye, and then we went several years with no MOTU news or releases (except for the ministatues) and then we were given this line, which I think is one of hte best lines out there right now.
I would have been disappointed if I didn't get Mer-Man or if I don't get a Hordak or MAA, but I'll be able to live with myself. Afterall, these are just toys, life will go on. Just like if you're a Sox fan and they lose a game, life goes on, there's always tomorrow.
Poe
Come on, let's be honest with ourselves here…we've only had that attitude since 2004.
Before that, the world ended day after day after day, for 86 years…
Jim
@pfktear: WELL SAID!!! Totally agree.
(PrfktTear)
Haha… bad choice of sports team then… Celtics… oh, wait… Bruins? that won't work… I'd say Patriots, but when you only have 16 or so games, every one DOES matter…
griffin
oh you poor championship winning Boston fans. Try being a Cleveland fan. Oh dear God it's painful.
Also scalping can only be good for a line if it brings in new customers, like those who wouldn't buy off a website because they want to check the individual figure for paint and the like, or in a similar scenario to what PrfktTear described. Otherwise a scalper is only buying a figure that someone else would have bought, and in fact is going to buy from the scalper, and charging more for it.
Unless online scalpers are buying more figures than there is an actual demand for, and how could they be if they can still charge higher than the original price, they are not adding to the line.
Michael Lovrine
Also have to wonder about the online shops like BBTS. How do they get their supply of figures to sell? Is it a preset allotment/supply or are they forced to instead buy right when the figures go on sale at the site?
Mark
Ebay take a good of money so in some ways it isn't worth it. A UK seller still has some Skeletors but he is asking £55 including postage…and thats just to the UK. Makeing a profit is one thing but being greedy and trying to make massive profits is another.
Esbat
From my own perusing my local market here in Laredo, Tx which is a literally sitting on the US-mexico border. We have shops in town that buy exclusives and what not from walmart/target etc and online and sell them in brick and mortar shops to, lets face it, rich foreigners. A DCUC Series 1 Batman sells, for 30 bucks in store, and I've seen the foreign collector happy as a clam paying that much. For the He-man figures, about 50 to 70 a pop. These collectors don't use the internet or don't bother with it at all.
But lets not assume all the scalpers/resellers are throwing them on eBay.
Jim
From Matty Collector Facebook for any JLU fans:
JLU update
Today at 12:38pm
Hey DCU fans,
It is no secret that their has been a delay in getting new JLU figures into Target stores. This is entirely do to our factor shutting down last December. We have already found a new factory and we have new packs ready to ship, the problem is, while we waited for the new factory to produce the new 2009 figures, we had to continue and ship 2008 product to Target to hold the place in the toy aisle.
So right now Target is full of 2008 packs. We need to get all of these sold before Target will take orders for new 2009 packs. So, to help, Mattel is funding a month long price reduction on 3 packs. So tell your friends and allies, swing by a Target and grab some JLU packs this month on sale. Once we move all of the older product, we have fresh new figures ready to ship and get into your hands!
That is the latest! We are doing everything we can to get to fresh figures. All we have to do now is clear out the 2008 inventory. 🙂
doctorkent
I posit this theory: it does not matter to Mattel how many figures they sell to scalpers, as long as each release sells out.
I believe this because we are seeing a sales strategy that other companies have tried, but not succeeded to this level with – direct-to-consumer sales.
Regardless if anyone believes Rob's numbers or not, the fact remains that the figures are selling out and allowing more figures to be made…so the minimum benchmark to continue the line has been established.
All of the profits go to Mattel (and Digital River, possibly) for this line – no Walmart taking a bite out of every figure. For a character like Faker, every figure was probably incredibly profitable – no new molds, etc.
Mattel is trying to correct the problem with fans not being able to get the figures via the subscription idea. I'll be curious to see how many take Mattel up on the idea, and how many long complaint posts we see about "I'm not giving them money in advance for stuff I don't know about!" It will also be interesting to see if there are still sell-outs once this occurs.
Jim
@doctorkent: I agree doctorkent. It seems a lot more people on poe are more realistic than the guys at facebook.
Granted….it is frustrating but bottomline is MOTU isn't (at least right now) able to compete with GIJOE/Transformers.
So MOTUC is limited and limited stuff will always have scalpers and hype. That's the trade off.
You want MOTU figures, then Mattels going to play it safe to the point where scalpers will run amok and the 2ndary market will be it's lifeline.
After the motu live action movie, maybe motu can compete with the rest of the guys at the toy aisle but till then I welcome all the hype and frenzy that goes with this line. Mattel sees a reason to keep making these guys…cuz even if they're fans working for mattel, at the end of the day its about making money.
Mattel wants ultra fast sellouts regardless of who's buying (scalpers, etc. etc.) to keep a line (that's not able to compete with gijoe) going for years to come.
Imagine a MOTUC Two Bad, Panthor, Stinkor, Battle Cat, FISTO, MOSS MAN in motuc form and maybe BAF or a Castle Grayskull backdrop! We can have it ALL as long as Mattel sees the line is selling out fast and they'll crank out more and more motuc figures.
From my observations, dcuc, Jlu, cars and the rest of their lines aren't doing as well. They're still selling and are till popular but I think dcuc is near the end of it's course.
Hell, as much demand there is for Ghostbusters, I doubt it'll be as popular as MOTUC so MOTUC is currently their most POPULAR SELL OUT LINE!
Jim
and about the subscription….I will say that i'm against that. That MAY take the scalper issue out, take hype out, and the line may rely soley on motu's true fan base.
That may decrease mattels bulk orders AND it would be during a time when they've increased production runs.
Personally, the subscription makes me a bit nervous. I'd rather pay a scalper an extra 10-15 bucks for a SINGLE figure that comes out ONCE a month than mess with the current success/hype of motu.
(PrfktTear)
@Dr. Kent: it does not matter to Mattel how many figures they sell to scalpers, as long as each release sells out
They are in this business to make money after all. 😉
@Jim: It seems a lot more people on poe are more realistic than the guys at facebook.
Thats an understatment if I've ever heard one. Occasionally I peruse the comments on Facebook, but it seems like mostly raving fanboys, and an occasional fangirl.
I think the subscripton is a good thing. Once people have subscribed, Mattel will know how many they HAVE to produce in order to fill out those orders, and then can produce an amount over for those new to the line or unwilling to subscribe, and of course scalpers. If people are going to buy them, they'll by them, so why not cut out the scalping and get them straight from Mattel? Its not just about the "sell out". Granted its great for the ego, but whats the difference between getting 15,000 units into the hands of people who want them by locking them in ahead of time, or selling 15,000 units and having everyone scramble ahead of time?
Mark
I want an Extendar and Spikor.
Jim
@pfktear: "Its not just about the “sell out”. Granted its great for the ego, but whats the difference between getting 15,000 units into the hands of people who want them by locking them in ahead of time, or selling 15,000 units and having everyone scramble ahead of time?"
I see what your saying. But when it comes to motu (again…a line that can't currently compete against transformers or gijoe..at least for now) I see Mattel trying to walk on egg shells (which they are doing considering production runs). Especially after the 2002 failure.
I see Mattel as being interested in this toy line if supported by fans BUT also backed by hype and quick sellouts.
A PURE Motu fan base hasn't been successfull in the past since the beginning 80's run of MOTU.
Also, I wonder if you can order multiples for that subscription deal? Personally, I've decided to collect 3 of each. One MOC, a second for display and a third as a back up for my display piece in case it breaks for whatever reason.
In any case, whoever is for or against the subscription, it will be interesting to see the effect it will have on the line…if any.
Jim
@Mark: SPIKOR ….man do i want a figure of him!