Emergency Used Video Game FAQ



I suppose it’s some combination of election-season jitters, a lackluster Magic release, and normal October retail awfulness, but a bunch of my retailer friends are in distress, and well over a dozen of them have contacted me in the last two weeks about video games. I’ll be giving a presentation in March at the GAMA Trade Show about diversifying your game store into video games, but here’s a FAQ post containing the most common questions that I’m receiving. I’m still happy to answer your questions if this doesn’t cover them, so leave them in the comments.

Where do you get new games?

I don’t. I deal in used games, consoles, and accessories. I buy some new accessories from Hyperkin, who are awesome. New games and consoles are terrible, low-margin, high-risk sellers. A $60 video game typically wholesales for $52-$54, and if it’s a turd the market price can drop to $40 or $20 without warning. You will not be able to negotiate price guarantees or returnability for your independent game store. I have been selling used-only for five years. It’s possible and easy to do.

How much money can video games make me?

I’m more willing to discuss specific numbers privately than I am to post them on Al Gore’s Internet for everyone to see, but suffice to say that I could keep my doors open, pay a couple of part timers, keep the lights on, pay the rent in a very good location, and pay myself a very modest salary. I would not be in just the video game business, but in combination with tabletop games and electronics repair, I make an excellent living and provide for a bunch of people.

How do you price your games? How do you get this stuff into your Point of Sale?

PriceCharting provides an excellent price guide that you can look up game-by-game or download as a big spreadsheet. I have a subscription to the price guide and my point of sale downloads the new prices automagically every night. You may be able to import this price guide directly into your POS system. If you have CrystalCommerce, and your admin panel isn’t currently on fire, they have pricing data and covers and stuff. Nate Peterson’s IMP POS is an upstart alternative that shows potential and also takes care of pricing for you.

How much do you pay for games?

I started off paying 50%, cash or credit, for everything. This grew my inventory quickly but resulted in a lot of low-value junk. What if you gave a quarter for any Magic rare? Yeah, it’s like that. We ended up going with a variable trade value scheme that changes the percentage we pay for a game based on the sell price. This prevents the problem where you have to choose between paying a too-high rate on cheap bulk games and a too-low rate on valuable high-end games. My rates vary between 20% and 80%, but most games are under 50%.

Don’t people try to sell you stolen stuff?

Yes. Take ID and make a record of every trade-in. If your point of sale system doesn’t allow you to attach customers to transactions in order to track them, you’ll want to fix that. Don’t take trades from people who creep you out, and don’t hesitate to call your local constabulary if you feel that something fishy is going on. I deal with this perhaps three or four times a year.

Won’t it change the culture of my game store to have all these video gamers come in?

You are going to get a wider variety of customers than you are used to, but it’s an opportunity, not a liability. I thought you wanted muggles to come in to your store for conversion into meeples? I never thought that store owners would be concerned about lots of new customers, but I have gotten this several times.

For overall civility, I would say that your average video game customer rates with or just a hair below your nicest Magic players, and much higher than your average Yugioh player. (Haters gonna hate.)

How much space do I need? How do I display this stuff?

Figure on devoting 300-600 square feet of shoppable retail space to the category, in addition to two four-foot display counters and maybe a small closet’s worth of extra storage and supplies. More is better, but you don’t need much on the whole. Gridwall or slatwall displays will work. Bookshelves will not work.

How much do I need to invest up front?

Not counting fixtures? Figure on making a $500-$800 Hyperkin order first thing. You’ll also need to spend a couple hundred bucks on some solution for storing CD/DVD media behind the counter. You need a small TV to test systems. You need to be ready to spend several thousand dollars in cash buying games and systems off the street, and you need to spend some money advertising on Facebook that you’re the buyer with CASH IN HAND for their video games. When I open my second store next year I plan to spend five grand over three months getting the word out.

Can I get effective results on a near-zero budget?

No. I can only help you be a professional retailer. I don’t know how to help hobbyists.

How do I get into this category in time to be effective for Christmas?

You don’t. It’s October 27th at the time of this post, and it’s too late to bring in enough inventory from the street to be anything other than pathetic for the holidays. After the holidays is tax refund season, where sales continue to be strong and trade activity scarce. When everyone runs out of tax refund money in April or so, trade-in season starts. That’s when you want to strike.

Of course, it’s possible to either overpay for inventory on eBay or buy out a closing store. If you’re buying out a store, avoid the deal if the store has been running any kind of pre-close clearance sale. You can get started with garbage inventory, but you shouldn’t. You’ll regret it.

I can’t make my November rent payment and I need to make a change in the next six weeks, or else.

I can’t help you if it’s gotten this far. Go to a quiet place tonight after you close tonight, look at your store’s profitability over the last six months, and determine whether you’re collapsing or merely failing. If you don’t have a plan for making expenses other than hoping for a miracle, it’s time to be a grown-up and start moving toward responsible closure.

As a totally heartless aside, I buy out closing stores. Contact me, and maybe I can help you get out without losing your shirt.

Maintaining Adequacy and Suffering Surprises Only Once

This is a quick, lazy post, but I wanted to share something that seems obvious to me but would help a lot of store owners that struggle in two areas: The amount of time spent scrambling to restock supplies when they run out, and the difficulty in doing the cleaning that needs to be done less frequently than every day.

It’s lists. Sorry, that’s boring, but it’s just lists. What’s important is that the staff knows that we go through these lists EVERY WEEK, without fail.

We call ours the “Sunday Supply Checklist” and the “Wednesday Cleaning Checklist”.

The Supply Checklist tells the user where to find the items that need to be counted, and how low to let the supply dwindle before contacting the appropriate person for reorder or addition to the shopping list. The idea is that, any time we run out of something and it becomes a phone call to the owner at home during dinner, that will be the LAST time we are surprised by that particular item. Nobody is angry or scared when this happens, because they know what happens next: It goes on the list, and it’s never an emergency again.

Similarly, the Cleaning Checklist means I never have to hound my employees about occasionally checking the air freshener refills or wiping down door trim. The first time I get annoyed that nobody else has noticed the smudges on the fronts of the supply cabinets, I add that as a thing to be checked, and it’s the last time I have to worry about it. What’s fun about this list is that, as my managers have taken more control of the day-to-day operations of the store, the list has been mysteriously growing with items that I hadn’t thought of. It’s a great feeling.

The result ends up being that many issues are magically solved in our store. There are always more rolls of receipt paper. The drawer under the register is always neat and orderly. This process does what all good processes do: It accepts the fallible, imperfect nature of human attention, and makes the result perfect or near-perfect anyway.

Here’s the lists. Maybe reading them will inspire you.

Sunday Supply Checklist

Toilet paper at least 20 rolls, men’s/women’s room
Paper towels at least 15 rolls, men’s/women’s room
Toilet cleaner At least two full spare bottles, men’s room shelf
Mop cleaner At least one full bottle, under mop sink
Bleach At least one full refill bottle, located under mop sink
Windex At least one full refill bottle, located under mop sink
Clorox wipes At least two full containers, on men’s room shelf
Q-tips At least half a box, located in large front cabinet
Alcohol At least half a bottle, located in large front cabinet
Swiffer wipes At least 24 wipes, located on men’s room shelves
Gloves at least one full box, men’s room shelf (Paul)
Large black trash bags, at least one full roll, men’s room shelf
Small white trash bags, at least one full roll, men’s room shelf
CD sleeves at least 4 bundles, bottom CD cabinet drawer (Paul)
Price gun labels, at least six rolls, bottom CD cabinet drawer (Paul)
Price gun ink, at least two refills, bottom CD cabinet drawer (Paul)
Disc buffer replacement jugs (Paul)
Receipt paper, at least 15 rolls, bottom CD cabinet drawer, extras in office supplies cabinet in back (Paul)
Post it notes, at least 6 pads, bottom CD cabinet drawer
Label printer rolls, at least 6 rolls, in the bottom CD cabinet drawer (Paul)
At least two refills of GOJO hand soap, men’s room shelf
Sharpies, at least 6, front/back pen holders
Pens, at least one spare box of pens, office shelf
Gift cards, at least 15, in the point of sale drawer (Paul)
Microfiber towels
Denture brushes
Free FNM Entry cards, at least 10, in the point of sale drawer
Rubber bands, at least one full bag, in the large front cabinet or a CD cabinet drawer (Paul)
Penny Sleeves, at least 20 packs, in the large front cabinet
“Grocery bag” bags, at least one full box, in the large front cabinet and/or back closet.
Copier/Printer Paper, at least 3 full reams, office supplies cabinet
Small number labels for game cases

Wednesday Cleaning Checklist

– Wipe down everything on the cash register cabinet with a damp towel. Look for dirt in crevices. Make sure you examine it from the customer side of the counter to see what looks dirty.
– Spend 10 minutes dusting. Try to find new cobwebs and dust to destroy.
– Clean the inside front glass everywhere you can reach. Squeegie the glass outside.
– Wipe down the aluminum trim outside and inside. Clean the door handles.
– Pick up the trash in the parking lot.
– Check around the dumpster. Clean up any trash that could belong to us, (neighbor), or (neighbor). Report spilled (restaurant neighbor) trash to Paul.
– Empty the cigarette bin.
– Sweep cigarette butts out of the sidewalk cracks.
– Make sure the supply shelves in the bathrooms are orderly.
– Re-stock bathrooms with paper goods.
– Tidy up the back closet. Try to get everything into boxes and on shelves.
– Tidy the office. Use the air duster everywhere. Clean the glass desk top.
– Look through all the food in the office. Throw out anything that is expired or gross.
– Clean the inside of office fridge and microwave as needed.
– Wipe the office chair down with a wet towel. Sweep the floor. Try to get into corners.
– Replace the four air freshener bottles as needed.
– Clean out Disc buffer machine. Clean anywhere the buffer machine splatters (surrounding consoles, fan, counter, etc.)
– Wipe down all cabinet fronts with Clorox wipe.
– Wipe down all trash cans with a Clorox wipe.
– Wipe down any footprints/scuffs on inside of bathroom doors.