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Comment by crazygringo | Hacker News Reader

Ebay commissions are not that high, 13.25% for most items.

The barrier to listing huge amounts of merchandise is not the commission, but rather the amount of labor it takes to list and price everything and pack and ship it and deal with refunds and returns for items that turn out to have problems. And how a lot of items are only economical to sell locally, because when you add in shipping costs it approaches the value of buying something new.

Buying eBay doesn't provide any kind of easy way to help offload inventory at all. The way inventory is offloaded in bulk is in bulk pallets sold at auction, where people bid on them and then do all of the grunt work involved in photographing and listing and packing and shipping. Which is a significant proportion of sales on eBay today. GameStop can easily auction off pallets of their merchandise if they want, today. In fact, there's a good chance they already do.

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> Ebay commissions are not that high, 13.25% for most items.

13.25% isn't zero.

> The barrier to listing [is] the amount of labor it takes to list and price everything

GameStop has a surprising amount of technology around their pawnshop activities. My son traded in his laptop last month and they had him wipe it, enable developer mode, and plug it in to do automated tests and make sure they knew what they were getting. They're already doing the labor to price everything. They're not going to have people type up listings, they'll just automate posting off of their inventory system.

> when you add in shipping costs it approaches the value of buying something new.

They get to skip the shipping costs. You could choose to have them ship the item to a GameStop near you which would cost them pennies. This is an advantage of having stores in every city with a population over 50,000 in the US.

And a huge amount of the stuff that GameStop buys and sells is out of print. Buying new is simply not an option when you're talking about a game that was released 6 years ago only on physical media.

> The way inventory is offloaded in bulk is in bulk pallets sold at auction, where people bid on them and then do all of the grunt work involved in photographing and listing and packing and shipping.

There must be money in the margins here. Otherwise people wouldn't do it. GameStop has all the technological ability to cut out this grunt work.

I'm just saying, 13.25% isn't the barrier here to making this work.

And shipping things to a "GameStop near you" does not cost pennies, and most people hate having to pick up packages. The reason that can be cheaper for regular stores is because they're distributing from central warehouses to those stores anyways. If GameStop is holding inventory trapped in all these physical stores, shipping an item from one store to another is no cheaper than shipping it directly to the customer -- e.g. it's edge node to edge node, not central node to edge node.

Oh yeah, not a barrier, but for the volume they'd want to enable it's not a complete loss.

Remember who uses GameStop. It's certainly not me, and it's probably not you. I'd guess that their core demographic is 14-25 year olds that are cash-strapped. You don't go to a GameStop for the experience, and their prices aren't any better than any other retailer. You go there because you don't have options or for their secondary market. And at that point, $5 in shipping fees matters.

Why would it be edge --> edge and not edge --> central --> edge? For common stuff keep half of it at the edge for local sales. For uncommon stuff or the other half ship it back to central so they can re-ship it quickly and easily. Including something in a shipment is orders of magnitude cheaper than shipping a single item, just in packaging costs and time alone.

They must have items going both directions (to handle overstock, returns, defectives, etc.). I assume those all go in a large box and are shipped together. At that point I'd need to see some actual numbers to agree that it's not pennies.

Interesting discussion. Something it made me think about is trading cards or other items you typically might want to sell as graded items. If you’ve got a physical GameStop with the digital eBay footprint maybe you’ve got the makings of a nice little ecosystem for selling Pokémon cards, video games, antiques, and other items in an inspected condition.

Ebay commissions are higher than that.

13.25% on the entire deposit to your bank account (price + tax + shipping), not just the item price.

Plus an extra tax of around 5% if you are selling from your country to another.

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